Regulatory Focus™ > News Articles > Generic Drug Companies Call for Fixes to GDUFA, Citing Few Returns on Investment

Generic Drug Companies Call for Fixes to GDUFA, Citing Few Returns on Investment

Posted 15 June 2015 | By Alexander Gaffney, RAC

Generic Drug Companies Call for Fixes to GDUFA, Citing Few Returns on Investment

Several of the generic drug industry's most prominent groups are calling on the US Food and Drug Administration (FDA) to make major changes to the program supporting one of its marquee funding sources, the Generic Drug User Fee Act (GDUFA).


GDUFA is modeled off several other conceptually similar user fee programs, including the Prescription Drug User Fee Act (PDUFA) and the Medical Device User Fee Act (MDUFA).

The concept behind the programs is relatively straightforward: Companies prefer to have their products reviewed quickly, as it allows their products to potentially reach consumers more quickly, thereby allowing them to make a return on their investment into researching and developing the product. FDA, however, has resource limitations which limit its ability to hire a sufficient number of staff to expedite the review process.

That's where the user fee programs come into play. In the same way you probably pay a fee to the Department of Motor Vehicles (DMV) when you renew your car title or apply for a new license, FDA charges fees to drug manufacturers for most activities.

For example, a company submitting an abbreviated new drug application (ANDA), the form through which nearly all generic drugs are approved, must pay FDA $58,730. A company must pay even more—between $247,717 and $262,717—to have a facility inspected by FDA.

Fees Payable to FDA Under the Generic Drug User Fee Act (GDUFA)
Abbreviated New Drug Application$58,730$63,860$51,520
Prior Approval Supplement$29,370$31,930$25,760
Drug Master File$26,720$31,460$21,340
Finished Dosage Form Facility (Domestic)$247,717$220,152$175,389
Finished Dosage Form Facility (Foreign)$262,717$235,152$190,389
Active Pharmaceutical Ingredient Facility (Domestic)$41,926$34,515$26,458
Active Pharmaceutical Ingredient Facility (Foreign)$56,926$49,515$41,458



Now, almost three years after GDUFA first came into effect under the 2012 Food and Drug Administration Safety and Innovation Act (FDASIA), FDA is asking for feedback on the program and how it might be improved, and the generic drug industry is answering.

                To read more about the GDUFA reauthorization process, click here.

In comments released on 15 June 2015, the Society of Chemical Manufacturers and Affiliates (SOCMA), which represents some of the worlds' largest bulk pharmaceutical manufacturers, said GDUFA is in need of some major changes.

In its assessment, SOCMA's Bulk Pharmaceuticals Task Force (BPTF) highlighted two concerns: The characteristics of facility inspections, and the high cost of GDUFA compliance on small manufacturers.

To the former, SOCMA said it "is concerned the increase in foreign inspections has been at the expense of domestic inspections," which the group said could result in some US manufacturers not being inspected "within a three-year cycle." Many foreign countries require frequent inspections in order to allow a drug to be exported from the US and into the foreign country, the group explained.

Money Concerns: Small Business

But for SOCMA and the Generic Pharmaceutical Association (GPhA), the generic drug industry's top lobbying group, one concern about GDUFA so far reigns supreme: money and how it's spent.

One of those concerns relates to the burden GDUFA places on small manufacturers. Unlike MDUFA, GDUFA has no statutory provisions guaranteeing reduced fees for small manufacturers or first-time filers. That means small, start-up generic drug manufacturers would bear the same financial burden as large, established generic drug manufacturers.

"To help level the playing field, BPTF asked that FDA consider a fee reduction for small businesses during GDUFA II negotiations," SOCMA wrote. "Because of higher-than-expected facility fees, absence of a waiver or discount for small business has resulted in an unintended barrier to business entry and to the competitiveness of small business entities."

Money Concerns: Lack of Spending

GPhA's comments to FDA, also submitted on 15 June 2015, also critiqued FDA for how the agency has spent the money it's collected thus far. "FDA still has $277 million in unused funds from the generic industry that could be applied to site inspections or approvals," it observed.

The high carry-over amount is especially "confounding," GPhA continued, given FDA's ongoing struggles to improve its regulatory review times.

"In 2011 when GDUFA began, median review time to approval was at 30 months," the group explained. "Since then, median review times increased to 31 months in FY2012, 36 months in FY2013 and an estimated 42 months in FY2014. At the industry's best estimate, current fiscal year median approval times will be 48 months — the slowest it has ever been."

Both groups' comments are likely to be central in the coming months as industry groups sit down with FDA in an attempt to negotiate a new version of GDUFA before its authorization expires on 30 September 2017. And based on the comments submitted thus far, resource requirements and regulatory performance are likely to live atop the GDUFA II agenda.





© 2021 Regulatory Affairs Professionals Society.

Regulatory Focus newsletters

All the biggest regulatory news and happenings.