Document ID: FDA-2016-N-0007-0009
Agency: fda
Document Type: Notice
Title: Fee for Using a Rare Pediatric Disease Priority Review Voucher in Fiscal Year 2017
Posted Date: 2016-09-30T04:00Z

[Federal Register Volume 81, Number 190 (Friday, September 30, 2016)]
[Notices]
[Pages 67360-67362]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-23624]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2016-N-0007]

Fee for Using a Rare Pediatric Disease Priority Review Voucher in 
Fiscal Year 2017

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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SUMMARY: The Food and Drug Administration (FDA or the Agency) is 
announcing the fee rate for using a rare pediatric disease priority 
review voucher for fiscal year (FY) 2017. The Federal Food, Drug, and 
Cosmetic Act (the FD&C Act), as amended by the Food and Drug 
Administration Safety and Innovation Act (FDASIA), authorizes FDA to 
determine and collect rare pediatric disease priority review user

[[Page 67361]]

fees for certain applications for review of human drug or biological 
products when those applications use a rare pediatric disease priority 
review voucher. These vouchers are awarded to the sponsors of rare 
pediatric disease product applications that meet all of the 
requirements of this program, are submitted 90 days or more after July 
9, 2012, and upon FDA approval of such applications. The amount of the 
fee for using a rare pediatric disease priority review voucher is 
determined each FY based on the difference between the average cost 
incurred by FDA in the review of a human drug application subject to 
priority review in the previous FY, and the average cost incurred in 
the review of an application that is not subject to priority review in 
the previous FY. This notice establishes the rare pediatric disease 
priority review fee rate for FY 2017 and outlines the payment 
procedures for such fees.

FOR FURTHER INFORMATION CONTACT: Robert J. Marcarelli, Office of 
Financial Management, Food and Drug Administration, 8455 Colesville 
Rd., COLE-14202F, Silver Spring, MD 20993-0002, 301-796-7223.

SUPPLEMENTARY INFORMATION:

I. Background

    Section 908 of FDASIA (Pub. L. 112-144) added section 529 to the 
FD&C Act (21 U.S.C. 360ff). In section 529 of the FD&C Act, Congress 
encouraged development of new human drugs and biological products for 
prevention and treatment of certain rare pediatric diseases by offering 
additional incentives for obtaining FDA approval of such products. 
Under section 529 of the FD&C Act, the sponsor of an eligible human 
drug application submitted 90 days or more after July 9, 2012, for a 
rare pediatric disease (as defined in section 529(a)(3)) shall receive 
a priority review voucher upon approval of the rare pediatric disease 
product application. The recipient of a rare pediatric disease priority 
review voucher may either use the voucher for a future human drug 
application submitted to FDA under section 505(b)(1) of the FD&C Act 
(21 U.S.C. 355(b)(1)) or section 351(a) of the Public Health Service 
Act (42 U.S.C. 262(a)), or transfer (including by sale) the voucher to 
another party. The voucher may be transferred (including by sale) 
repeatedly until it ultimately is used for a human drug application 
submitted to FDA under section 505(b)(1) of the FD&C Act or section 
351(a) of the Public Health Service Act. A priority review is a review 
conducted with a Prescription Drug User Fee Act (PDUFA) goal date of 6 
months after the receipt or filing date, depending on the type of 
application. Information regarding PDUFA goals is available at http://www.fda.gov/downloads/forindustry/userfees/prescriptiondruguserfee/ucm270412.pdf.
    The applicant that uses a rare pediatric disease priority review 
voucher is entitled to a priority review of its eligible human drug 
application, but must pay FDA a rare pediatric disease priority review 
user fee in addition to any user fee required by PDUFA for the 
application. Information regarding the rare pediatric disease priority 
review voucher program is available at: http://www.fda.gov/Drugs/DevelopmentApprovalProcess/DevelopmentResources/ucm375479.htm.
    This notice establishes the rare pediatric disease priority review 
fee rate for FY 2017 at $2,706,000 and outlines FDA's procedures for 
payment of rare pediatric disease priority review user fees. This rate 
is effective on October 1, 2016, and will remain in effect through 
September 30, 2017.

II. Rare Pediatric Priority Review User Fee for FY 2017

    Under section 529(c)(2) of the FD&C Act, the amount of the rare 
pediatric disease priority review user fee is determined each fiscal 
year based on the difference between the average cost incurred by FDA 
in the review of a human drug application subject to priority review in 
the previous fiscal year, and the average cost incurred by FDA in the 
review of a human drug application that is not subject to priority 
review in the previous fiscal year.
    A priority review is a review conducted with a PDUFA goal date of 6 
months after the receipt or filing date, depending on the type of 
application. Under the PDUFA goals letter, FDA has committed to 
reviewing and acting on 90 percent of the applications granted priority 
review status within this expedited timeframe. Normally, an application 
for a human drug or biological product will qualify for priority review 
if the product is intended to treat a serious condition and, if 
approved, would provide a significant improvement in safety or 
effectiveness. An application that does not receive a priority 
designation will receive a standard review. Under the PDUFA goals 
letter, FDA has committed to reviewing and acting on 90 percent of 
standard applications within 10 months of the receipt or filing date 
depending on the type of application. A priority review involves a more 
intensive level of effort and a higher level of resources than a 
standard review.
    Section 529 of the FD&C Act specifies that the rare pediatric 
disease priority review voucher fee amount must be based on the 
difference between the average cost incurred by the Agency in the 
review of a human drug application subject to a priority review in the 
previous fiscal year, and the average cost incurred by the Agency in 
the review of a human drug application not subject to a priority review 
in the previous fiscal year. FDA is setting a fee for FY 2017, which is 
to be based on standard cost data from the previous fiscal year, FY 
2016. However, the FY 2016 submission cohort has not been closed out 
yet, thus the cost data for FY 2016 are not complete. The latest year 
for which FDA has complete cost data is FY 2015. Furthermore, because 
FDA has never tracked the cost of reviewing applications that get 
priority review as a separate cost subset, FDA estimated this cost 
based on other data that the Agency has tracked. FDA uses data that the 
Agency estimates and publishes on its Web site each year--standard 
costs for review. FDA does not publish a standard cost for ``the review 
of a human drug application subject to priority review in the previous 
fiscal year.'' However, we expect all such applications would contain 
clinical data. The standard cost application categories with clinical 
data that FDA publishes each year are: (1) New drug applications (NDAs) 
for a new molecular entity (NME) with clinical data and (2) biologics 
license applications (BLAs) with clinical data.
    The standard cost worksheets for FY 2015 show standard costs 
(rounded to the nearest thousand dollars) of $5,251,000 for an NME NDA, 
and $5,055,000 for a BLA. Based on these standard costs, the total cost 
to review the 56 applications in these two categories in FY 2015 (32 
NME NDAs and 24 BLAs with clinical data) was $289,352,000. (Note: These 
numbers exclude the President's Emergency Plan for AIDS Relief NDAs; no 
investigational new drug (IND) review costs are included in this 
amount.) Twenty-five of these applications (18 NDAs and 7 BLAs) 
received priority review, which would mean that the remaining 31 
received standard reviews. Because a priority review compresses a 
review schedule that ordinarily takes 10 months into 6 months, FDA 
estimates that a multiplier of 1.67 (10 months divided by 6 months) 
should be applied to non-priority review costs in estimating the effort 
and cost of a priority review as compared to a standard review. This 
multiplier is

[[Page 67362]]

consistent with published research on this subject which supports a 
priority review multiplier in the range of 1.48 to 2.35 (Ref. 1). Using 
FY 2015 figures, the costs of a priority and standard review are 
estimated using the following formula:

(25 [alpha] x 1.67) + (31 [alpha]) = $289,352,000

    Where ``[alpha]'' is the cost of a standard review and ``[alpha] 
times 1.67'' is the cost of a priority review. Using this formula, the 
cost of a standard review for NME NDAs and BLAs is calculated to be 
$3,977,000 (rounded to the nearest thousand dollars) and the cost of a 
priority review for NME NDAs and BLAs is 1.67 times that amount, or 
$6,642,000 (rounded to the nearest thousand dollars). The difference 
between these two cost estimates, or $2,665,000, represents the 
incremental cost of conducting a priority review rather than a standard 
review.
    For the FY 2017 fee, FDA will need to adjust the FY 2015 
incremental cost by the average amount by which FDA's average costs 
increased in the 3 years prior to FY 2016, to adjust the FY 2015 amount 
for cost increases in FY 2016. That adjustment, published in the 
Federal Register on July 28, 2016 (see 81 FR 49674 at 49676), setting 
the FY 2017 PDUFA fee, is 1.5468 percent for the most recent year, not 
compounded. Increasing the FY 2015 incremental priority review cost of 
$2,665,000 by 1.5468 percent results in an estimated cost of $2,706,000 
(rounded to the nearest thousand dollars). This is the rare pediatric 
disease priority review user fee amount for FY 2017 that must be 
submitted with a priority review voucher for a human drug application 
in FY 2017, in addition to any PDUFA fee that is required for such an 
application.

III. Fee Schedule for FY 2017

    The fee rate for FY 2017 is set out in table 1:

  Table 1--Rare Pediatric Disease Priority Review Schedule for FY 2017
------------------------------------------------------------------------
                                                         Fee rate for FY
                      Fee category                             2017
------------------------------------------------------------------------
Application submitted with a rare pediatric disease          $2,706,000
 priority review voucher in addition to the normal
 PDUFA fee.............................................
------------------------------------------------------------------------

IV. Implementation of Rare Pediatric Disease Priority Review User Fee

    Under section 529(c)(4)(A) of the FD&C Act, the priority review 
user fee is due (i.e. the obligation to pay the fee is incurred) when a 
sponsor notifies FDA of its intent to use the voucher. Section 
529(c)(4)(B) of the FD&C Act specifies that the application will be 
considered incomplete if the priority review user fee and all other 
applicable user fees are not paid in accordance with FDA payment 
procedures. In addition, section 529(c)(4)(C) specifies that FDA may 
not grant a waiver, exemption, reduction, or refund of any fees due and 
payable under this section of the FD&C Act. Beginning with FDA's 
appropriation for FY 2015, the annual appropriation language states 
specifically that ``priority review user fees authorized by 21 U.S.C. 
360n and 360ff (section 529 of the FD&C Act) shall be credited to this 
account, to remain available until expended.'' (Pub. L. 113-235, 
Section 5, Division A, Title VI).
    The rare pediatric disease priority review fee established in the 
new fee schedule must be paid for any application that is received on 
or after October 1, 2016. In order to comply with this requirement, the 
sponsor must notify FDA 90 days prior to submission of the human drug 
application that is the subject of a priority review voucher of an 
intent to submit the human drug application, including the date on 
which the sponsor intends to submit the application.
    Upon receipt of this notification, FDA will issue an invoice to the 
sponsor who has incurred a rare pediatric disease priority review 
voucher fee. The invoice will include instructions on how to pay the 
fee via wire transfer or check.
    As noted in section II, if a sponsor uses a rare pediatric disease 
priority review voucher for a human drug application, the sponsor would 
incur the rare pediatric disease priority review voucher fee in 
addition to any PDUFA fee that is required for the application. The 
sponsor would need to follow FDA's normal procedures for timely payment 
of the PDUFA fee for the human drug application.

V. Reference

    The following reference is on display in the Division of Dockets 
Management (HFA-305), Food and Drug Administration, 5630 Fishers Lane, 
Rm. 1061, Rockville, MD 20852, and is available for viewing by 
interested persons between 9 a.m. and 4 p.m., Monday through Friday.

1. Ridley, D.B., H.G. Grabowski, and J.L. Moe, ``Developing Drugs 
for Developing Countries,'' Health Affairs, vol. 25, no. 2, pp. 313-
324, 2006.

    Dated: September 26, 2016.
Leslie Kux,
Associate Commissioner for Policy.
[FR Doc. 2016-23624 Filed 9-29-16; 8:45 am]
 BILLING CODE 4164-01-P