REQUIRED BY THE
PRESCRIPTION DRUG USER FEE ACT OF 1992
AS AMENDED BY THE
FOOD AND DRUG ADMINISTRATION MODERNIZATION ACT OF 1997
February 21, 2002
The Honorable Richard Cheney
President of the Senate
Washington, D.C. 20510
Dear Mr. President:
Enclosed for your consideration is the annual financial report to the Congress required by the Prescription Drug User Fee Act of 1992 (PDUFA) as amended (section 104(b) of the Food and Drug Administration Modernization Act of 1997 (FDAMA)). This report covers fiscal year FY 2001, documenting how each of the conditions specified in PDUFA for continued collection of prescription drug user fees was met.
The report also presents the user fee revenues and related expenses for FY 2001, comparative data for earlier periods, and details the amounts carried over at the end of each year that remain available. In FY 2001, FDA collected $132 million in user fees, and spent $161 million, including balances collected in earlier periods that remained available. About 67 percent of the fees were spent for salaries and benefits. This infusion of human resources is the single most critical factor enabling FDA to meet the performance goals associated with PDUFA-goals that become increasingly more stringent each year.
In FY 2001 FDA experienced a sharp and unanticipated shortfall in revenues, due to an abrupt drop in the number of fee-paying applications submitted, even though industry submissions that do not pay fees and other aspects of FDA's review workload are steadily increasing. That requires FDA to also reduce fee revenue forecasts for FY 2002. The result is that the drug review program will have to use all of its reserve funds to meet operating costs in FY 2002. Reserves will be depleted when FY 2003 begins.
Challenges facing FDA in FY 2002 include carefully monitoring fee receipts and, if necessary, curtailing operations to manage within available resources-even if that means some goals may not be met. And because PDUFA expires at the end of FY 2002, and there will be no carryover balances, it is also imperative that PDUFA be reauthorized well in advance of September 30, 2002, to prevent serious disruption of FDA's drug review program.
Tommy G. Thompson
Identical letters to
Speaker of the House of Representatives
Chairman and Ranking Minority Member, Committee on Health, Education, Labor, and Pensions, United States Senate
Chairman and Ranking Minority Member, Committee on Energy and Commerce, House of
Appendix A: Conditions for Assessment and Use of Fees
Appendix B: Exemptions and Waivers
Appendix C: Allowable and Excluded Costs for the Process for the Review of Human Drug Applications
Appendix D: Development of Costs for the Process for The Review of Human Drug Applications