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Carryover Balances (FY 2010 PDUFA Financial Report)

 
Back to Table of Contents: FY 2010 PDUFA Financial Report

Under PDUFA, fees collected and appropriated but not obligated by the end of a fiscal year continue to remain available to FDA in future fiscal years. These revenues are referred to as carryover balances. The net result of operations in FY 2010 decreased the carryover balances by $21,524,140.  This decrease was largely the result of receiving about 17 fewer full-fee-paying applications in FY 2010 than anticipated when fees were set before the beginning of the year (118 received, compared with 135 expected). Additional FY 2009 fees for products and establishments collected in the first quarter of FY 2010 reduced the impact of this application fee shortfall.

 
Table 3 captures the changes in carryover balances from FY 1993.
 
Table 3
Statement of Collections, Obligations, and Carryover Balances by Fiscal Year
As of the end of each fiscal year shown and not including payments for next fiscal year
 

Fiscal
Year
Beginning
Carryover
Net
Collections
Fee Revenue
Obligations
Year-End
Carryover
1993
-
$28,531,996
$8,949,000
$19,582,996
1994
$19,582,996
$53,730,244
$39,951,020
$33,362,220
1995
$33,362,220
$70,953,500
$74,064,015
$30,251,705
1996
$30,251,705
$82,318,400
$85,053,030
$27,517,075
1997
$27,517,075
$93,234,125
$84,289,046
$36,462,154
1998
$36,462,154
$132,671,143
$101,615,000
$67,518,297
1999
$67,518,297
$126,580,456
$122,515,000
$71,583,753
2000
$71,583,753
$133,060,339
$147,276,000
$57,368,092
2001
$57,368,092
$138,761,294
$160,713,000
$35,416,386
2002
$35,416,386
$149,078,939
$161,812,100
$22,683,225
2003
$22,683,224
$209,667,051
$200,154,500
$32,159,776
2004
$32,195,776
$251,617,821
$232,081,500
$51,732,097
2005
$51,732,097
$283,491,495
$269,433,800
$65,789,792
2006
$65,789,792
$315,502,786
$305,644,137
$75,648,440
2007
$75,648,440
$375,597,273
$320,429,620
$130,816,093
2008
$130,816,093
$485,165,229
$450,786,835
$165,194,487
2009
$165,194,487
$518,992,651
$512,051,400
$172,135,738
2010
$172,135,738
$551,734,260
$573,258,400
$150,611,598
2011
$150,611,598
 
 
 

 
The balances above reflect cumulative cash at the beginning/end of each fiscal year, and the net cash collected during each fiscal year. The figures do not include accounts receivable. The net collections balance shown above for FY 2010 of $551,734,260 is greater than the FY 2010 cohort year collections balance in Table 1 on page 3 ($529,276,543) because the FY 2010 net collections figure above also includes some FY 2009 product and establishment fees that were counted in the FY 2009 cohort year revenue in the chart on page 3, but are reflected in Table 3 as part of the total collections that occurred in FY 2010. There are also a number of restrictions on the use of these carryover funds, as explained below.
 
Collection Ceilings, Potential Refunds and Offsets
 
PDUFA I prohibited FDA from keeping fees in excess of the amount specified in appropriations (collection ceiling) each fiscal year through FY 1997. Amounts collected that exceeded collection ceilings through FY 1997 were required to be refunded.  A total of $6.3 million surplus collections from this period were refunded in FY 2000 and FY 2001.  Under PDUFA II and III, collections in excess of fee amounts appropriated after FY 1997 may be kept and used to reduce fees that would otherwise be assessed in a later fiscal year.  The first such offset (for excess collections in 1998 and 2004) was made when fees were set for FY 2007, as reflected in the table below.  At the time fees were set for FY 2007 (August 2006), there were no excess collections for other years. Collections since then have resulted in additional excess collections. Under the provisions of PDUFA IV, if cumulative collections from FY 2008 through FY 2010 and estimated for FY 2011 exceed cumulative fee appropriations for the same period, FDA will reduce fees when fees are set for FY 2012 by the cumulative amount by which fees collected over this period exceed fees appropriated over the same period. The table below depicts the net collections, the collection amounts specified in appropriations, and the amounts that FDA may have to use to offset future collections.
 
Table 4
Statement of Fees Collected, Collection Ceilings, and Potential Offsets
 As of September 30, 2010

Fiscal Year
Collections
 Realized
Collection
Ceiling
Potential Offset to Future Collections
1998
$117,849,016
$117,122,000
$727,016
1999
$125,729,367
$132,273,000
-
2000
$141,134,682
$145,434,000
-
2001
$138,421,429
$149,273,000
-
2002
$141,408,975
$161,716,000
-
2003
$218,302,684
$222,900,000
-
2004
$258,333,700
$249,825,000
$8,508,700
2005
$287,178,231
$284,394,000
$2,784,231
2006
$313,541,278
$305,332,000
$8,209,278
2007
$370,903,656
$352,200,000
$18,703,656
Collections Exceeding Appropriations through 2007
$38,932,881
Excess Collections Offset under 736(g)(4) when fees for FY 2007 were set
$7,957,922
Remaining Excess Collections to be Offset
$30,974,959
2008
$479,582,086
$459,412,000
$20,170,086
2009
$533,605,375
$510,665,000
$22,940,375
2010
$529,276,573
$578,162,000
($48,885,457)
2008-2010
$1,542,463,896
$1,548,239,000
($5,774,997)
 Collections FY 2008-2010 Compared to Appropriations
($5,774,997)
Net Balance to be Offset in a Subsequent Year
$30,974,959

 
Other Reserves and Balance Available for Allocation
 
Table 5 provides a summary of reserves of carryover balances for potential claims on those balances. The first line sets forth the amount collected in excess of appropriations through PDUFA III, which FDA will offset against fees collected when fees are set in a subsequent fiscal year. The second line shows a reserve of $2,500,000 for refunds of fees paid. The third line sets aside funds to be paid from PDUFA fees for the move of CBER components to White Oak in the future. The fourth line shows the cost through 2012 of additional FTEs allocated in 2009 to address increased PDUFA workload. The fifth line shows the amount of all claims/reserved amounts.
 
Table 5
Summary Statement on Carryover Balance
As of September 30, 2010

Limitations/Claims on Carryover Funds
Amount
Reserve for Future Offset
$30,974,959
Reserve for Refunds
$2,500,000
Reserve for CBER move to White Oak
$37,896,000
Allocation of Additional 53 FTE, FY 2011-2012
$29,771,000
TOTAL of all Claims on Carryover Balances
$101,141,959
TOTAL Carryover Balance
$150,611,598
Amount of Balances Available for Allocation
$49,469,639

Total carryover balances exceed limitations and claims by a total of $49,469,639. This amount is available for allocation, or for holding in reserve in FY 2011 against any revenue shortfalls in FY 2011 and FY 2012, or towards operating costs in FY 2013. 
 
PDUFA IV authorizes FDA to have up to 3 months of available carryover balance at the end of FY 2012. FDA currently estimates that it will need a total of $184.3 million in fee revenues ($61.4 million per month) to cover PDUFA operations in the first 3 months of FY 2013. How much of that will have to be added to 2012 fee collections will be determined when fees are set for 2012 in August of 2011. 
 
Next Section: Total Costs of the process for the review of Human Drug Applications