Regulatory Focus™ > News Articles > Understaffed and Underfunded: FDA Begins to Hear Opinions on Crafting an OTC Drug User Fee Program

Understaffed and Underfunded: FDA Begins to Hear Opinions on Crafting an OTC Drug User Fee Program

Posted 10 June 2016 | By Zachary Brennan 

Understaffed and Underfunded: FDA Begins to Hear Opinions on Crafting an OTC Drug User Fee Program

With only 18 full-time employees working to oversee an over-the-counter (OTC) drug monograph program covering hundreds of thousands of products, the US Food and Drug Administration (FDA) is beginning to evaluate different perspectives on creating a new user fee program to help, particularly as congressional appropriations have remained stagnant over the past few years.

On Friday, FDA held a public meeting on the idea of creating this user fee program for OTC drugs, with many experts supporting such a new program, though some questioned why reforms discussed in 2014 haven’t moved forward and whether the cost of such a program would inevitably fall into the laps of consumers.

Much of the meeting focused on background information about what a user fee program is and why it may or may not be necessary from economic and public health perspectives.

Janet Woodcock, director of FDA’s Center for Drug Evaluation and Research, explained (as she did for the Health Affairs blog on Thursday) not only how FDA can currently only use congressional appropriations to regulate OTC drugs, but “would like to be able to do more than merely maintain a system that originated a half-century ago. Science by its very nature cannot be static, and we want to be able to usher advances in drug formulation and emerging safety data into the OTC product arena promptly.”

As FDA explained in May, because of this lack of resources, the finalization of some OTC monographs has been slow in many therapeutic areas, with the result that there are OTC drugs on the market with still-pending monographs and for which the FDA has not made a final determination on safety and effectiveness.

“The lack of resources has also slowed FDA’s ability to accommodate potential innovation, and has presented challenges to the timely addition of new safety information to monographs,” the agency said.

“Our current system of OTC review is simply too sluggish to promote OTC modernization. If we count only those monograph drugs that are currently in non-final status, it will take many decades, under current conditions, to produce finalized monographs. In addition, this hopelessly slow time frame will be possible only if we ignore opportunities for improving the effectiveness, safety, and quality of existing OTC drugs that are on the market,” Woodcock wrote.


Details of what such a user fee system would look like were few and far between at Friday’s meeting, particularly as the OTC monograph system is unique, the OTC drug market is a fraction of what the brand name, generic, biosimilar and medical device industries are, and OTC drug companies may not see expedited FDA reviews of particular products or financial benefits from a new system.

Dr. Diana Zuckerman, president of the National Center for Health Research, suggested that the user fee program should be structured as a sliding scale with product fees based on the amount of resources needed for FDA’s review.

Similarly, Diane McEnroe of the law firm Sidley Austin said her clients would favor a system where innovation is prioritized and that user fees should not be used to finalize pending monographs.

Johnson and Johnson’s Jethro Ekuta (who’s also a RAPS board member) offered support for the user fees but also said FDA should explore other sources of revenue.

Cornell Stamoran of the Pharma and Biopharma Outsourcing Association recommended one-time licensing fees, small annual product fees for the monographs to be maintained, but no facility fees for the manufacturers.

Steven Woolf, CFO of Humco, however, stressed that the economic impact of a user fee system for OTC products will ultimately be passed down to the consumer “and this should be at the top of our mind.”

And despite general support from almost all of the speakers, no clear consensus how such a user fee system would work or a timeline for when it might be created has emerged. The docket for public comments will remain open for 30 days after Friday’s meeting.

Public Meeting: Over-the-Counter Monograph User Fees


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