PDUFA IV Five-Year Financial Plan - 2009 Update: Information Technology, Rent and Central Accounts
Information Technology, Rent and Central Accounts
The funds in three important areas are centrally managed in PDUFA IV. These areas are Information Technology, Rent, and Central Accounts. This section provides a summary of each one, and ends with a chart summarizing the year by year planned spending in each area.
The complete PDUFA IV Five Year Information Technology Plan has been separately made available.
The PDUFA IV agreement builds upon the progress made in PDUFA III and will commit the FDA to develop, implement, and maintain new information systems consistently across all organizational divisions participating in the process for human drug review throughout the product lifecycle. To help meet this goal, there is an ongoing effort to document the business processes in CBER and CDER, building upon the FDA Business Process Framework developed in 2004 and updated in 2006.
The FDA considers the first year of the PDUFA IV timeframe to be a period of considerable transition. The Agency must resolve many near-term planning activities and strategic investment decisions prior to committing resources to future, long-range systems development plans for the out years of PDUFA IV. For example, due to a variety of external pressures, the FDA is conducting studies to determine a strategy for modernizing IT infrastructure and services. Similarly, the FDA is working to shift its IT decision-making and governance to an Agency-wide, less de-centralized model. Further, FDA must resolve security issues with standard, Agency-wide solutions for secure submissions, secure e-mail, and electronic signatures. In the first 12 to 24 months of PDUFA IV, the FDA will focus on completing these plans to ensure that they are developed, published, and widely understood. Once these foundational plans are implemented, the FDA will be in a position to expand planning of specific systems development and infrastructure projects into the PDUFA IV out-years.
This plan represents only a portion of the overall IT work to be accomplished at FDA, but it is imperative that these PDUFA activities map clearly to overall Agency business and IT strategic planning. Several of the strategies must be accomplished not only to meet PDUFA IV IT goals, but also Agency and DHHS goals. The strategies outlined in the plan are presented to show their alignment with overall Department, Agency, and Program goals and objectives. Therefore, the strategies presented here must be applied consistently across the Agency to achieve the maximum benefit of the efforts.
The plan also provides a future-state vision for the FDA standards and technical infrastructure supporting the process for the review of human drugs throughout the product lifecycle. Specifically, this plan details how the FDA intends to:
- strengthen and improve information management within the new drug and biologic products review processes;
- strengthen the IT infrastructure to improve capacity for post market safety data management and analysis;
- improve the FDA's ability to communicate, share, and disseminate information more clearly within the Agency and with other government organizations, the regulated industry, and the American Public; and
- seek more efficient and effective means for supplying technology tools and services to the FDA user community.
The plan will help guide the direction and implementation of IT projects initiated to meet Agency program objectives and specific PDUFA IV IT goals. Among the principal IT planning documents to be developed by the Agency during the PDUFA IV timeframe, the plan will be the mechanism to communicate the steps the FDA plans to take to achieve its objectives to stakeholders, both internal and external to the Agency.
The summary IT/Rent/Central Plan Summary Tables reflect the five-year IT costs in three places. The first is in the top portion of the chart that reflects the PDUFA IV Additive Base Costs starting with $33.145million in FY 2008. The second place is the Information Technology line, which reflects anticipated expenditures on IT enhancements each year. The last place is near the bottom of the chart where two IT subtotals are given. The IT subtotal for FY 2008 is $40.625 million, increasing to $50.517 million by FY 2012.
Rent and Rent Related Costs
The General Services Administration charges rent to FDA for the Federal buildings that FDA occupies. This rent is charged at different rates depending on the type and location of the space provided. Since rent is an essential support cost for the process for human drug review, part of those charges are paid from appropriations and part from PDUFA fees. Also included in this account are recurring costs that FDA pays directly to non-Federal sources under the delegation of direct lease and service authority. These services include rental of space, and all recurring services for building operations such as overtime utilities, janitorial, guard, and ground maintenance. The amount of rent and rent related costs FDA pays is directly related to the number of employees that must be housed. Under PDUFA III the funds available did not keep pace with the increasing costs of space particularly with the transition of much of FDA to the new White Oak campus, and with the substantial increases in facility security costs in the aftermath of September 11, 2001. An adjustment was made in the PDUFA IV Fee Base for rent and rent related costs to address these higher costs in PDUFA IV. In addition, the agency will be hiring additional employees, and the cost of acquiring and maintaining space for those additional employees is reflected in the rent and rent related estimates.
The summary IT/Rent/Central Plan Summary Tables reflect the five year Rent estimates in three places. The first is in the top portion of the chart that reflects the PDUFA IV Fee Base Costs starting with $12.850 million for rent and $15.799 million for rent related costs in FY 2008. The second place is a separate rent line in each of the enhancement areas. In each enhancement area, the first line shows the cumulative additional staff years associated with the goal area for each year additional staff years to be hired during PDUFA IV. The number of additional staff years that must be housed each year drives the amount of increased rent each year. The last place is near the bottom of the chart where rent and rent related subtotals are given. The rent subtotal for FY 2008 is $15.252 million, increasing to $22.596 million by FY 2012. The rent related total for FY 2008 is $16.515 million, increasing to $21.536 million by FY 2012. For purposes of this plan, amounts are shown increasing at a steady rate over 5 years. In fact actual amounts spent may be lower in earlier years, but may have spiked cost increases in later years as FDA moves components of the Center for Biologics Evaluation and Research to new facilities on the White Oak Campus.
The Central Account pays for shared agency-wide services such as telecommunications, training, printing, mail and document management, IT systems including maintenance, employee health units, and other support and miscellaneous services. Like rent, the amount of central account support FDA pays is directly related to the number of employees that must be serviced. PDUFA provides the increased resources for these costs for the additional staff associated with the implementation of PDUFA.
The summary IT/Rent/Central Plan Summary Tables reflect the five-year Central Account estimates in three places. The first is in the top portion of the chart that reflects the PDUFA IV Fee Base Costs starting with $27.372 million in FY 2008. The second place is a separate central account line in each of the enhancement areas. In each enhancement area, the first line shows the cumulative additional staff years associated with the enhancement area for each year additional staff years hired during PDUFA IV. The number of additional staff years that must be supported each year drives the amount of increased central account costs each year. The last place is near the bottom of the chart where two central account subtotals are given. The central account subtotal for FY 2008 is $30.475 million, increasing to $41.897 million in FY 2012.
Workload Adjustment Increases
The September 2008 PDUFA 5-Year Financial Plan reflected a workload adjustment that was made in 2009 (3 percent) and then increased only for inflation each subsequent year. That adjustment funded a total of 62 FTE for all of FDA in FY 2009, and maintained that same FTE level for the remaining 3 years. This FY 2009 Update to the plan reflects the increase of 6.82 percent in FY 2010, and annual increases at the rate of 3.41 percent for each subsequent year. With these revised assumptions, the workload adjustment funds an additional 82 FTE in FY 2010, for a total of 144 FTE that year. It funds an additional 76 FTE in FY 2011, for an FDA total of 220 FTE in FY 2011. It funds an additional 80 FTE in FY 2012 for an FDA total of 300 FTE in FY 2012 funded from the workload adjustment increases. These additional FTE requires significant increases in centrally funded amounts that FDA will have to pay for rent, rent related, and central account costs for these additional FTE, which are reflected in the following table.