Generic drug user fee negotiations began with a reminder that components of the program will not apply to other regulated drug sectors.

Industry opened the negotiations with its proposal, which did not appear to include any surprises, calling for inspection, establishment and application fees, as well as performance measures for FDA, according to minutes of a March 18 session.

As negotiators laid out their ideas for how the fees can improve the Office of Generic Drugs and other FDA divisions dealing with generic applications, the agency reminded everyone that the user fee proposal would not apply to other programs, such as the brand industry. The agency also said the program scope had to be specific to the generic industry.

The possibility of facility inspection fees remains limited to the generic sector.

FDA said generic drug user fee talks could not undermine other FDA user fee negotiations, according to minutes of the Feb. 28 opening session. Any final agreement also could not make changes to FDA’s generic drug policies, the agency said.

In the lead-up to generic drug user fee negotiations, the idea of an inspection fee has gained support. Now questions are being asked about whether the idea of charging a fee for facility inspections would eventually filter to the brand industry.

Gordon Johnston, an industry negotiator and former vice president of regulatory sciences at the Generic Pharmaceutical Association, said the program would not affect other drug sectors. Brand company trade associations are not talking about the idea (Also see "Is Silence Golden For Brand Companies On Inspection Fees?" - Pink Sheet, 4 April, 2011.).

Proposal Would Bring In Substantial Dollars

While not including specific numbers, it appears the industry proposal would generate a substantial revenue increase for the generic drug program. A lack of manpower and resources has been cited as a primary reason for approval delays and a lack of timely facility inspections.

“FDA considered that the size of the total program funding proposed by industry and the proposed structure of fees demonstrated the seriousness of industry’s efforts to reach agreement,” the agency said in the minutes.

Mylan Pharmaceuticals President Heather Bresch estimated the establishment fee program she proposed could result in $225 million per year and an inspection fee could generate $30 million per year. That total would dwarf the current OGD budget (Also see "GDUFA Timetable Unclear, But Negotiations Will Begin With Lots Of Agreement - Except For Mylan" - Pink Sheet, 17 September, 2010.).

FDA was expected to reveal its proposal March 31 as part of an aggressive negotiating schedule to reach an agreement by the end of June, but minutes of that meeting have not been released. Negotiating sessions were expected to be scheduled about every two weeks, according to minutes of a Feb. 28 session.

FDA’s goal is to include the generic user fee agreement in an omnibus user fee bill that also will include reauthorization of the Prescription Drug User Fee Act and the Medical Device User Fee and Modernization Act.

Negotiations for the other user fee agreements, some of which are behind schedule, also would have to be completed in the next few months to make a combined bill possible (Also see ""Mega-UFA" Is Behind Schedule; Combined User Fee Bill Will Be Difficult, But Still Expected" - Pink Sheet, 14 February, 2011.).

GPhA Wants Performance Goals With Fees

Three groups are negotiating on behalf of the generic industry: GPhA, the Society of Chemical Manufacturers and Affiliates and the European Fine Chemicals Group. Their goal is to establish a fee program “that can be reliable and sustainable,” according to the March 18 minutes.

The minutes did not provide specifics, but indicated the industry proposal included establishment registration fees, inspection fees and application fees. There was discussion of the types of establishments that would be registered and the types of inspections that would warrant fees.

Industry also called for additional fees and projected review timelines for applications already awaiting review.

The application backlog, which has been estimated at about 2,000, has been a primary driver behind the push for generic drug user fees. Some backlog-specific fee ideas have been proposed, but FDA was worried about the potential administrative problems they could create (Also see "Tiered And Backlog Generic User Fees Are Possible But Create Challenges For FDA" - Pink Sheet, 3 January, 2011.).

Other performance goals in the industry proposal include timeframes for completing foreign and domestic inspections and review goals for abbreviated new drug applications, amendments and prior approval supplements.

Industry also asked for formal meeting and controlled correspondence timeframes for industry and FDA interactions during application reviews. Both elements are a staple of the PDUFA regime and are the subject of reauthorization talks (Also see "PDUFA V: FDA Relaxes Pre-Submission Meeting Requirement" - Pink Sheet, 28 March, 2011.).

SOCMA and EFCG, which are representing active pharmaceutical ingredient manufacturers, want FDA to use an electronic database of all qualified API sites or join the EudraGMP database, which the European Medicines Agency administers.

The groups also requested the agency work with other regulators to conduct international inspections and Good Manufacturing Practices compliance.

All three generic industry groups said FDA should focus inspections on “global facilities” rather than domestic counterparts, according to the Feb. 28 minutes.

FDA already has indicated it eventually wants to expand its reliance on fellow regulators, and potentially private third parties, to share information and handle some of the inspection burden so it can better target its resources (Also see "FDA-EMA-TGA Joint Inspection Program To Be Permanent; Other Collaborations Expand" - Pink Sheet, 21 March, 2011.).

Company CEOs Help Start Talks

Several heads of generic manufacturers attended the first GDUFA negotiation, likely an indication of the importance they place on the program.

Watson Pharmaceuticals Inc. CEO Paul Bisaro, chairman of the GPhA board of directors; Sandoz Inc. U.S. operations President Don DeGolyer; Zydus Pharmaceuticals USA Inc. CEO Joe Renner; and Bresch were among the negotiators for GPhA.

Bresch returned for the March 18 session, but Bisaro, Renner and DeGolyer did not.

Mylan and Watson also have sent multiple employees to the negotiating table at both meetings as part of the GPhA team, according to the minutes. Mylan had two people, including Bresch, at the Feb. 28 meeting, and three at the March 18 session. Watson sent two people to each meeting.

The two companies have numbered about half of the entire nine-member GPhA team at each session.

By Derrick Gingery

GDUFA Talks: FDA Reminds Industry The Program Is Generic-Only

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