Document ID: FDA-2011-N-0594-0001
Agency: fda
Document Type: Notice
Title: Fee for Using a Priority Review Voucher in Fiscal Year 2012
Posted Date: 2011-08-30T04:00Z

[Federal Register Volume 76, Number 168 (Tuesday, August 30, 2011)]
[Notices]
[Pages 53910-53912]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-22062]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2011-N-0594]

Fee for Using a Priority Review Voucher in Fiscal Year 2012

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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SUMMARY: The Food and Drug Administration (FDA) is announcing the fee 
rates for using a tropical disease priority review voucher for fiscal 
year (FY) 2012. The Federal Food, Drug, and Cosmetic Act (the FD&C 
Act), as amended by the Food and Drug Administration Amendments Act of 
2007 (FDAAA), authorizes FDA to determine and collect priority review 
user fees for certain applications for approval of drug or biological 
products when those applications use a priority review voucher awarded 
by the Secretary of Health and Human Services. These vouchers are 
awarded to the sponsors of certain tropical disease product 
applications, submitted after September 27, 2007, upon FDA approval of 
such applications. The amount of the fee to be submitted to FDA with 
applications using a priority review voucher is determined each FY 
based on the average cost incurred by FDA in the review of a human drug 
application subject to priority review in the previous FY. This notice 
establishes the priority review fee rate for FY 2012.

FOR FURTHER INFORMATION CONTACT: David Miller, Office of Financial 
Management (HFA-100), Food and Drug Administration, 1350 Picard Dr., 
Rockville, MD 20850, 301-796-7103.

SUPPLEMENTARY INFORMATION:

I. Background

    Section 1102 (under title XI) of FDAAA (Pub. L. 110-85) added new 
section 524 to the FD&C Act (21 U.S.C. 360n). In section 524, Congress 
encouraged development of new drug and biological products for 
prevention and treatment of certain tropical diseases by offering 
additional incentives for obtaining FDA approval of such products. 
Under section 524, the sponsor of an eligible human drug application 
submitted after September 27, 2007, for a qualified tropical disease 
(as defined in section 524(a)(3)), shall receive a priority review 
voucher upon approval of the tropical disease product application. The 
recipient of a priority review voucher may either use the voucher with 
a future submission to FDA under section 505(b)(1) of the FD&C Act (21 
U.S.C. 355(b)(1)) or section 351 of the Public Health Service Act (21 
U.S.C. 262), or transfer (including by sale) the voucher to another 
party that may then use it. A priority review is a review conducted 
with a Prescription Drug User Fee Act (PDUFA) goal date of 6 months.
    The applicant that uses a priority review voucher is entitled to a 
priority review but must pay FDA a priority review user fee in addition 
to any other fee required by PDUFA. FDA has published a draft guidance 
on its Web site about how this priority review voucher program will 
operate (available at: http://www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/ucm080599.pdf).
    This notice establishes the priority review fee rate for FY 2012 of 
$5,280,000 and outlines FDA's process for implementing the collection 
of the priority review user fees. This rate is effective on October 1, 
2011, and will remain in effect through September 30, 2012, for 
applications submitted with a priority review voucher. The payment of

[[Page 53911]]

this priority review user fee is required in addition to the payment of 
any other fee that would normally apply to such an application under 
PDUFA before FDA will consider the application complete and acceptable 
for filing.

II. Priority Review User Fee for FY 2012

    Under section 524(c)(2) of the FD&C Act, the amount of the priority 
review user fee is to be determined each FY based on the average cost 
incurred by FDA in the review of a human drug application subject to 
priority review in the previous FY.
    A priority review is a review conducted with a PDUFA goal date of 6 
months. Normally, an application for a Center for Drug Evaluation and 
Research (CDER) product will qualify for a priority review if FDA 
determines that the product, if approved, would provide safe and 
effective therapy where no satisfactory alternative therapy exists or 
would be a significant improvement compared to marketed products, 
including non-drug products and/or therapies, in the treatment, 
diagnosis, or prevention of a disease. A Center for Biologics 
Evaluation and Research (CBER) product will qualify for a priority 
review if FDA determines that the product, if approved, would be a 
significant improvement in the safety or effectiveness of the 
treatment, diagnosis, or prevention of a serious or life-threatening 
disease. FDA has committed to a goal to review and act on 90 percent of 
the applications that have been granted priority review status no later 
than 6 months after receipt. An application that does not receive a 
priority designation will receive a standard review. Under the goals 
identified in the letters referenced in section 101(c) of FDAAA, FDA 
commits to a goal to review and act on 90 percent of standard 
applications within 10 months of the date of receipt. A priority review 
involves a more intensive level of effort and a higher level of 
resources than a standard review.
    Section 524 of the FD&C Act specifies that the fee amount should be 
based on the average cost incurred by the Agency for a priority review 
in the previous FY. 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 and 
kept. FDA started by using 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 does publish 
each year are: (1) New drug applications (NDAs) for a new molecular 
entity (NME) with clinical data, and (2) biologic license applications 
(BLAs).
    The worksheets for standard costs for FY 2010, the latest year for 
which standard cost data are available, show a standard cost of 
$4,316,567 for an NDA with clinical data and $6,081,461 for a BLA. 
Based on these standard costs, the total cost to review the 33 
applications in these two categories in FY 2010 (9 BLAs and 24 NDAs 
with clinical data) was $158,331,000, rounded to the nearest thousand 
dollars. (Note: No investigational new drug (IND) review costs are 
included in this amount; they will be calculated separately and added 
in the next paragraph.) Records acquired from CDER and CBER by the 
Office of Policy and Planning (OPP), Economics Staff, indicate that a 
total of 13 of these applications (8 NDAs [excluding the President's 
Emergency Plan for Aids Relief NDAs] and 5 BLAs) received priority 
review, which would mean that the remaining 20 received standard 
reviews. Because a priority review compresses a review that ordinarily 
takes 10 months into 6 months, OPP 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 consistent with 
published research on this subject. In the article ``Developing Drugs 
for Developing Countries,'' published in Health Affairs, Volume 25, 
Number 2, in 2006, the analysis by David B. Ridley, Henry G. Grabowski, 
and Jeffrey L. Moe supports a priority review multiplier in the range 
of 1.48 to 2.35. The multiplier derived by FDA falls well below the 
mid-point of this range. Using FY 2010 figures, the costs of a priority 
and standard review are estimated using the following formula:

(13 [alpha] * 1.67) + (20 [alpha]) = $158,331,000

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 NMEs is calculated to be $3,796,000 (rounded 
to the nearest thousand dollars) and the cost of a priority review for 
NMEs is 1.67 times that amount, or $6,339,000 (rounded to the nearest 
thousand dollars).
    Next, the cost of the IND review phase for these applications is 
calculated. The standard lifetime cost of reviewing a drug IND in FY 
2010 was $362,102. The standard lifetime cost of a biologic IND review 
in FY 2010 was $791,916. Because there were 8 priority NDAs and 5 
priority BLAs received in FY 2010, the following formula below 
estimates the average cost of the IND review phase of an application:

(8 NDA * $362,102) + (5 BLAs * $791,916) = $6,856,396

This is the full cost of the IND review associated with the 13 priority 
review applications received in FY 2010. Dividing $6,856,000 (rounded 
to the nearest thousand dollars) by 13 (the total number of priority 
review applications received in FY 2010), yields an average IND review 
phase cost of $527,000 (rounded to the nearest thousand dollars) per 
priority review application.
    Adding the cost of the NDA/BLA priority review calculated above, 
$6,339,000, to the cost of the IND review phase of $527,000, results in 
an estimated average cost for priority review for an application 
received in FY 2010 of $6,866,000.
    Section 524 of the FD&C Act specifies that the fee amount should be 
based on the average cost incurred by the Agency for a priority review 
in the previous FY. FDA is setting fees for FY 2012, and the previous 
FY is FY 2011. However, the FY 2011 submission cohort has not been 
closed out yet, and the cost data for FY 2011 are not complete. The 
latest year for which FDA has data is FY 2010. Accordingly FDA will 
adjust the FY 2010 cost figure above by the average amount by which 
FDA's average salary and benefit costs increased in the 5 years prior 
to FY 2011, to adjust the FY 2010 amount for cost increases in FY 2011. 
That figure, also published in the Federal Register of August 1, 2011 
(76 FR 45831), setting PDUFA fees for FY 2012, is 3.72 percent. 
Increasing the FY 2010 average priority review cost figure of 
$6,866,000 by 3.72 percent results in an estimated cost of $7,121,000 
(rounded to the nearest thousand dollars).
    FDA will deduct from this amount the PDUFA fee that must also be 
paid (in addition to the priority review fee) when an NDA or BLA with 
clinical data is submitted in FY 2012. That amount, also published in 
the Federal Register of August 1, 2011, is $1,841,500. The difference, 
rounded to the nearest thousand dollars, is $5,280,000. This is the 
priority review user fee amount for FY 2012 that must be submitted with 
a priority review voucher in FY 2012, in addition to any PDUFA fee that 
is required for such an application.

[[Page 53912]]

III. Priority Review Fee Schedule for FY 2012

    The fee rate for FY 2012 is set out in table 1 of this document:

              Table 1--Priority Review Schedule for FY 2012
------------------------------------------------------------------------
                                                               Fee rate
                        Fee category                         for FY 2012
------------------------------------------------------------------------
Applications Submitted With a Priority Review Voucher in      $5,280,000
 Addition to the Normal PDUFA Fee..........................
------------------------------------------------------------------------

IV. Implementation of Priority Review Fee

    Under section 524(c)(4)(A) of the FD&C Act, the priority review 
user fee is due upon submission of the application for which the 
priority review voucher is used. Section 524(c)(4)(B) 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. FDA may not grant a waiver, exemption, 
reduction, or refund of any fees due and payable under this section of 
the FD&C Act, and FDA may not collect priority review voucher fees 
prior to a relevant appropriation for fees for that FY. Beginning with 
FDA's appropriation for FY 2009, the annual appropriation language 
states specifically that ``priority review user fees authorized by 21 
U.S.C. 360n (section 524 of the FD&C Act) may be credited to this 
account, to remain available until expended.'' (Pub. L. 111-8, Section 
5, Division A, Title VI).
    The priority review fee established in the new fee schedule must be 
paid for any application that is received after September 30, 2011, and 
submitted with a priority review voucher. This fee must be paid in 
addition to any other fee due under PDUFA. Payment must be made in U.S. 
currency by check, bank draft, or U.S. postal money order payable to 
the order of the Food and Drug Administration. The user fee 
identification (ID) number should be included on the check, followed by 
the words ``Priority Review.'' Payments can be mailed to: Food and Drug 
Administration, P.O. Box 979107, St. Louis, MO 63197-9000.
    If checks are sent by a courier that requests a street address, the 
courier can deliver the checks to: U.S. Bank, Attention: Government 
Lockbox 979107, 1005 Convention Plaza, St. Louis, MO 63101. (Note: This 
U.S. Bank address is for courier delivery only.) The FDA post office 
box number (P.O. Box 979107) must be written on the check. The tax 
identification number of the Food and Drug Administration is 53-
0196965.
    Wire transfer payments may also be used. Please reference your 
unique user fee ID number when completing your transfer. The 
originating financial institution may charge a wire transfer fee. 
Please ask your financial institution about the fee and include it with 
your payment to ensure that your fee is fully paid. The account 
information is as follows: New York Federal Reserve Bank, U.S. Dept. of 
Treasury, TREAS NYC, 33 Liberty St., New York, NY 10045, Acct. No.: 
75060099, Routing No.: 021030004, Swift: FRNYUS33, Beneficiary: FDA, 
1350 Piccard Dr., Rockville, MD 20850.

    Dated: August 24, 2011.
Leslie Kux,
Acting Assistant Commissioner for Policy.
[FR Doc. 2011-22062 Filed 8-29-11; 8:45 am]
BILLING CODE 4160-01-P