Document ID: FDA-2023-N-2850-0001
Agency: fda
Document Type: Notice
Title: Prescription Drug User Fee Rates for Fiscal Year 2024
Posted Date: 2023-07-28T04:00Z

[Federal Register Volume 88, Number 144 (Friday, July 28, 2023)]
[Notices]
[Pages 48881-48888]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-15911]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2023-N-2850]

Prescription Drug User Fee Rates for Fiscal Year 2024

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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SUMMARY: The Food and Drug Administration (FDA, Agency, or we) is 
announcing the rates for prescription drug user fees for fiscal year 
(FY) 2024. The Federal Food, Drug, and Cosmetic Act (FD&C Act), as 
amended by the Prescription Drug User Fee Amendments of 2022 (PDUFA 
VII), authorizes FDA to collect application fees for certain 
applications for the review of human drug and biological products and 
prescription drug program fees for certain approved products. This 
notice establishes the fee rates for FY 2024.

DATES: These fees apply to the period from October 1, 2023, through 
September 30, 2024.

FOR FURTHER INFORMATION CONTACT: Olufunmilayo Ariyo, Office of 
Financial Management, Food and Drug Administration, 4041 Powder Mill 
Rd., 6th Floor, Beltsville, MD 20705, 240-402-4989; and the User Fee 
Support Staff at [email protected].

SUPPLEMENTARY INFORMATION: 

I. Background

    Sections 735 and 736 of the FD&C Act (21 U.S.C. 379g and 379h, 
respectively)

[[Page 48882]]

establish two different kinds of user fees. Fees are assessed as 
follows: (1) application fees are assessed on certain types of 
applications for the review of human drug and biological products and 
(2) prescription drug program fees are assessed on certain approved 
products (section 736(a) of the FD&C Act). The statute also includes 
conditions under which such fees may be waived or reduced (section 
736(d) of the FD&C Act), or under which fee exceptions, refunds, or 
exemptions apply (sections 736(a)(1)(C) through (H), 736(a)(2)(B) 
through (C), and 736(k) of the FD&C Act).
    For FY 2023 through FY 2027, the base revenue amounts for the total 
revenues from all PDUFA fees are established by PDUFA VII. The base 
revenue amount for FY 2024 is $1,256,844,387. The FY 2024 base revenue 
amount is adjusted for inflation, strategic hiring and retention, and 
for the resource capacity needs for the process for the review of human 
drug applications (the capacity planning adjustment (CPA)). This amount 
is further adjusted to include the additional dollar amount as 
specified in the statute (see section 736(b)(1)(F) of the FD&C Act) to 
provide for additional full-time equivalent (FTE) positions to support 
PDUFA VII initiatives. If applicable, an operating reserve adjustment 
is added to provide sufficient operating reserves of carryover user 
fees. The amount from the preceding adjustments is then adjusted to 
provide for additional direct costs to fund PDUFA VII initiatives. Fee 
amounts are to be established each year so that revenues from 
application fees provide 20 percent of the total revenue, and 
prescription drug program fees provide 80 percent of the total revenue 
(see section 736(b)(2) of the FD&C Act).
    This document provides fee rates for FY 2024 for an application 
requiring covered clinical data \1\ ($4,048,695), for an application 
not requiring covered clinical data ($2,024,348), and for the 
prescription drug program fee ($416,429). These fees are effective on 
October 1, 2023, and will remain in effect through September 30, 2024. 
For applications that are submitted on or after October 1, 2023, the 
new fee schedule must be used.
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    \1\ As used herein, ``covered clinical data'' is ``clinical data 
(other than bioavailability or bioequivalence studies) with respect 
to safety or effectiveness [that] are required for approval'' (see 
section 736(a)(1)(A) of the FD&C Act).
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II. Fee Revenue Amount for FY 2024

    The base revenue amount for FY 2024 is $1,256,844,387 (see section 
736(b)(1)(A) and (b)(3) of the FD&C Act). This amount is prior to any 
adjustments made for inflation, the strategic hiring and retention 
adjustment, CPA, additional dollar amount, operating reserve adjustment 
(if applicable), and additional direct costs (see section 736(b)(1) of 
the FD&C Act).

A. FY 2024 Statutory Fee Revenue Adjustments for Inflation

    PDUFA VII specifies that the $1,256,844,387 is to be adjusted for 
inflation increases for FY 2024 using two separate adjustments: one for 
personnel compensation and benefits (PC&B) and one for non-PC&B costs 
(see section 736(c)(1) of the FD&C Act).
    The component of the inflation adjustment for payroll costs is the 
average annual percent change in the cost of all PC&B paid per FTE 
positions at FDA for the first 3 of the preceding 4 fiscal years, 
multiplied by the proportion of PC&B costs to total FDA costs of the 
process for the review of human drug applications for the first 3 of 
the preceding 4 fiscal years (see section 736(c)(1)(A) and (B)(i) of 
the FD&C Act).
    Table 1 summarizes the actual cost and FTE data for the specified 
fiscal years, provides the percent changes from the previous fiscal 
years, and provides the average percent changes over the first 3 of the 
4 fiscal years preceding FY 2024. The 3-year average is 3.9280 percent.

              Table 1--FDA Personnel Compensation and Benefits (PC&B) Each Year and Percent Changes
----------------------------------------------------------------------------------------------------------------
                                               FY 2020           FY 2021           FY 2022       3-Year average
----------------------------------------------------------------------------------------------------------------
Total PC&B..............................    $2,875,592,000    $3,039,513,000    $3,165,477,000  ................
Total FTE...............................           $17,535           $18,501           $18,474  ................
PC&B per FTE............................          $163,992          $164,289          $171,348  ................
Percent Change from Previous Year.......           7.3063%           0.1811%           4.2967%           3.9280%
----------------------------------------------------------------------------------------------------------------

    The statute specifies that this 3.9280 percent be multiplied by the 
proportion of PC&B costs to the total FDA costs of the process for the 
review of human drug applications. Table 2 shows the PC&B and the total 
obligations for the process for the review of human drug applications 
for the first 3 of the preceding 4 fiscal years.

        Table 2--PC&B as a Percent of Total Cost of the Process for the Review of Human Drug Applications
----------------------------------------------------------------------------------------------------------------
                                               FY 2020           FY 2021           FY 2022       3-Year average
----------------------------------------------------------------------------------------------------------------
Total PC&B..............................      $891,395,106      $959,387,333      $931,302,114  ................
Total Costs.............................    $1,471,144,928    $1,499,064,056    $1,480,601,875  ................
PC&B Percent............................          60.5919%          63.9991%          62.9002%          62.4971%
----------------------------------------------------------------------------------------------------------------

    The payroll adjustment is 3.9280 percent from table 1 multiplied by 
62.4971 percent resulting in 2.4549 percent.
    The statute specifies that the portion of the inflation adjustment 
for non-payroll costs is the average annual percent change that 
occurred in the Consumer Price Index for urban consumers (Washington-
Arlington-Alexandria, DC-VA-MD-WV; Not Seasonally Adjusted; All items; 
Annual Index) for the first 3 years of the preceding 4 years of 
available data multiplied by the proportion of all costs other than 
personnel compensation and benefits costs to total costs of the process 
for the review of human drug applications (as defined in section 
735(6)) for the first 3 years of the preceding 4 fiscal years (see 
section 736(c)(1)(A) and (B)(ii)). Table 3 provides the summary data 
for the percent changes in the specified CPI for

[[Page 48883]]

the Washington-Arlington-Alexandria area.\2\
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    \2\ The data are published by the Bureau of Labor Statistics and 
can be found on its website at: https://data.bls.gov/pdq/SurveyOutputServlet?data_tool=dropmap&series_id=CUURS35ASA0,CUUSS35ASA0.

        Table 3--Annual and 3-Year Average Percent Change in CPI for Washington-Arlington-Alexandria Area
----------------------------------------------------------------------------------------------------------------
                                               FY 2020           FY 2021           FY 2022       3-Year average
----------------------------------------------------------------------------------------------------------------
Annual CPI..............................            267.16            277.73            296.12  ................
Annual Percent Change...................           0.8989%           3.9568%           6.6212%           3.8256%
----------------------------------------------------------------------------------------------------------------

    The statute specifies that this 3.8256 percent be multiplied by the 
proportion of all costs other than PC&B to total costs of the process 
for the review of human drug applications obligated. Because 62.4971 
percent was obligated for PC&B (as shown in table 2), 37.5029 percent 
is the portion of costs other than PC&B (100 percent minus 62.4971 
percent equals 37.5029 percent). The non-payroll adjustment is 3.8256 
percent times 37.5029 percent, or 1.4347 percent.
    Next, we add the payroll adjustment (2.4549 percent) to the non-
payroll adjustment (1.4347 percent), for a total inflation adjustment 
of 3.8896 percent (rounded) for FY 2024.
    We then multiply the base revenue amount for FY 2024 
($1,256,844,387) by 3.8896 percent, which produces an inflation 
adjustment amount of $48,886,219. Adding this amount to the base 
revenue amount yields an inflation-adjusted base revenue amount of 
$1,305,730,606.

B. FY 2024 Strategic Hiring and Retention Adjustment

    For each fiscal year, after the annual base revenue established in 
section II is adjusted for inflation in accordance with section II.A 
above, the statute directs FDA to further increase the fee revenue and 
fees to support strategic hiring and retention. For FY 2024, this 
amount is $4,000,000 (see section 736(c)(2)(A) of the FD&C Act).

C. FY 2024 Statutory Fee Revenue Adjustments for Capacity Planning

    The statute specifies that after the base revenue amount for FY 
2024 of $1,256,844,387 has been adjusted as described in sections II.A 
and II.B above, this amount shall be further adjusted to reflect 
changes in the resource capacity needs for the process of human drug 
application reviews (see section 736(c)(3) of the FD&C Act). Following 
a process required in statute, FDA established a new CPA methodology 
and first applied it in the setting of FY 2021 fees. The establishment 
of this methodology is described in the Federal Register of August 3, 
2020 (85 FR 46651). This methodology includes a continuous, iterative 
improvement approach, under which the Agency intends to refine its data 
and estimates for the core review activities to improve their accuracy 
over time.
    In FY 2023, updates were made to refine the time reporting 
categories included within the CPA to reflect program changes in the 
current authorization period. As such, the time reporting data and 
baseline capacity were revised to match the refinements. For FY 2024 
fees, additional updates were made to account for additional activities 
that are also directly related to the direct review of applications and 
supplements as provided for in the statute. The updates include 
additional formal meeting types and the direct review of postmarketing 
commitments (PMC) and requirements (PMR) (see tables 4 and 7), the 
direct review of risk evaluation and mitigation strategies, and the 
direct review of annual reports for approved prescription drug 
products. The Center for Biologics Evaluation and Research (CBER) CPA 
was also updated to reflect the PDUFA VII revision of the definition of 
``human drug application'' and ``prescription drug product'' to include 
allergenic products licensed on or after October 1, 2022. These 
additions necessitated an additional re-baselining of capacity.
    The CPA methodology includes four steps:
    1. Forecast workload volumes: predictive models estimate the volume 
of workload for the upcoming FY.
    2. Forecast the resource needs: forecast algorithms are generated 
utilizing time reporting data. These algorithms estimate the required 
demand in FTEs \3\ for direct review-related effort. This is then 
compared to current available resources for the direct review-related 
workload.
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    \3\ Full-time equivalents refer to a paid staff year, rather 
than a count of individual employees.
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    3. Assess the resource forecast in the context of additional 
internal factors: program leadership examines operational, financial, 
and resourcing data to assess whether FDA will be able to utilize 
additional funds during the FY, and the funds are required to support 
additional review capacity. FTE amounts are adjusted, if needed.
    4. Convert the FTE need to dollars: utilizing FDA's fully loaded 
FTE cost model, the final feasible FTEs are converted to an equivalent 
dollar amount.
    To determine the FY 2024 CPA, FDA calculated a CPA for the Center 
for Drug Evaluation and Research (CDER) and CBER individually. The 
final Center-level results were then combined to determine the total FY 
2024 PDUFA CPA. The following section outlines the major components of 
each Center's FY 2024 PDUFA CPA.
    Table 4 summarizes the forecasted workload volumes for CDER in FY 
2024 based on predictive models, as well as historical actuals from FY 
2022 for comparison.

              Table 4--CDER Actual FY 2022 Workload Volumes and Predicted FY 2024 Workload Volumes
----------------------------------------------------------------------------------------------------------------
                          Workload category                              FY 2022 actuals     FY 2024 predictions
----------------------------------------------------------------------------------------------------------------
Efficacy Supplements................................................                   236                   203
Labeling Supplements................................................                   902                   714
Manufacturing Supplements...........................................                 2,084                 2,174
NDA/BLA \1\ Original................................................                   128                 1,136
PDUFA Industry Meetings (including WROs \2\)........................                 3,647                 3,504

[[Page 48884]]

 
Active Commercial INDs \3\..........................................                 9,535                10,632
Annual Reports \4\..................................................                 3,394                 3,504
PMR/PMC-Related Documents \4\.......................................                 1,567                 1,631
Active REMS Programs \4\ \5\........................................                    21                    20
----------------------------------------------------------------------------------------------------------------
\1\ New drug applications (NDA)/biological license applications (BLA).
\2\ Written responses only (WROs).
\3\ For purpose of the CPA, this is defined as an active commercial investigational new drug (IND) for which a
  document has been received in the past 18 months.
\4\ Represents activities related to the review of materials submitted to the application file after approval.
\5\ Represents the percentage of active risk evaluation and management strategy (REMS) programs proportional to
  Center and User Fee by total number of qualifying products with the exclusion of the Opioid Shared System.

    Utilizing the resource forecast algorithms, the forecasted workload 
volumes for FY 2024 were then converted into estimated FTE needs for 
CDER's PDUFA direct review-related work. The resulting expected FY 2024 
FTE need for CDER was compared to current resource capacity for direct 
review related work to determine the FY 2024 resource delta, as 
summarized in table 5. Hiring and re-baselining of current resource 
capacity resulted in an increase of both the resource capacity and 
resource forecast relative to prior years.

                                     Table 5--CDER FY24 PDUFA Resource Delta
----------------------------------------------------------------------------------------------------------------
                                               Current  resource      FY 2024  resource      Predicted  FY 2024
                   Center                           capacity               forecast              FTE delta
----------------------------------------------------------------------------------------------------------------
CDER.......................................                 1,931                  2,001                     70
----------------------------------------------------------------------------------------------------------------

    The projected 70 FTE delta was then assessed by FDA in the context 
of additional operational and internal factors to ensure that a fee 
adjustment is only made for resources that can be utilized in the 
fiscal year and for which funds are required to support additional 
review capacity. After accounting for funded vacancies that are 
intended to address direct review workload that is within scope of the 
workload accounted for by the capacity planning adjustment, CDER's 
delta was adjusted to 38 FTE. The FY 2024 PDUFA CPA for CDER is 
therefore $12,778,222, as summarized in table 6.

                                         Table 6--CDER FY 2024 PDUFA CPA
----------------------------------------------------------------------------------------------------------------
                                              Additional FTEs  for      Cost for each       CDER FY 2024  PDUFA
                   Center                           FY 2024             additional FTE              CPA
----------------------------------------------------------------------------------------------------------------
CDER.......................................                    38               $336,269            $12,778,222
----------------------------------------------------------------------------------------------------------------

    To calculate the FY 2024 PDUFA CPA for CBER, FDA followed the 
approach outlined above. Table 7 summarizes the forecasted workload 
volumes for CBER in FY 2024 as well as the corresponding historical 
actuals from FY 2022 for comparison.

              Table 7--CBER Actual FY 2022 Workload Volumes and Predicted FY 2024 Workload Volumes
----------------------------------------------------------------------------------------------------------------
                          Workload category                              FY 2022 actuals     FY 2024 predictions
----------------------------------------------------------------------------------------------------------------
Efficacy Supplements................................................                    22                    23
Labeling Supplements................................................                    52                    45
Manufacturing Supplements...........................................                   684                   692
NDA/BLA \1\ Original................................................                    13                    11
PDUFA Industry Meetings (including WROs \2\)........................                   635                   715
Active Commercial INDs \3\..........................................                 1,694                 1,974
Annual Reports \4\..................................................                   292                   304
PMR/PMC-Related Documents \4\.......................................                   140                   151
Active REMS Programs \4\ \5\........................................                     2                     2
----------------------------------------------------------------------------------------------------------------
\1\ New drug applications (NDA)/biological license applications (BLA).
\2\ Written responses only (WROs).
\3\ For purpose of the CPA, this is defined as an active commercial investigational new drug (IND) for which a
  document has been received in the past 18 months.
\4\ Represents activities related to the review of materials submitted to the application file after approval.
\5\ Represents the percentage of active REMS programs proportional to Center and User Fee by total number of
  qualifying products with the exclusion of the Opioid Shared System.

[[Page 48885]]

    The forecasted CBER PDUFA workload for FY 2024 was then converted 
into expected FTE resources and compared to current resource capacity 
for PDUFA direct review work, as summarized in table 8. Hiring and re-
baselining of current resource capacity resulted in an increase of both 
the resource capacity and resource forecast relative to prior years.

                                   Table 8--CBER FY 2024 PDUFA Resource Delta
----------------------------------------------------------------------------------------------------------------
                                                Current resource       FY 2024 resource    Predicted FY 2024 FTE
                   Center                           capacity               forecast                delta
----------------------------------------------------------------------------------------------------------------
CBER.......................................                   408                    452                     44
----------------------------------------------------------------------------------------------------------------

    The projected 44 FTE delta for CBER was also assessed in the 
context of other operational and financial factors that may impact the 
need and/or feasibility of obtaining the additional resources. After 
considering subject matter expert input on industry trends and 
workload, reviewing the historical accuracy of workload forecasts, 
accounting for historical net FTE gains within CBER and the hiring 
necessary to meet the hiring commitments set forth for FY 2024 in the 
PDUFA VII commitment letter, and subtracting previously funded PDUFA 
vacancies aligned with CPA-covered activities, CBER determined that an 
adjustment of 34 additional FTEs for FY 2024 is needed. The FY 2024 CPA 
for CBER is therefore $11,157,847, as summarized in table 9.

                                         Table 9--CBER FY 2024 PDUFA CPA
----------------------------------------------------------------------------------------------------------------
                                              Additional FTEs for       Cost for each
                   Center                           FY 2024             additional FTE        CBER FY 2024 CPA
----------------------------------------------------------------------------------------------------------------
CBER.......................................                    34               $328,172            $11,157,847
----------------------------------------------------------------------------------------------------------------

    The CDER and CBER CPA amounts were then added together to determine 
the PDUFA CPA for FY 2024 of $23,936,069, as outlined in table 10. FDA 
will track the utilization of the CPA funds to ensure they are 
supporting the organizational components engaged in PDUFA direct review 
work to enhance resources and expand staff capacity and capability. 
Should FDA be unable to utilize any amounts of the CPA funds during the 
fiscal year, it will not spend those funds and the unspent funds will 
be transferred to the carryover balance at the end of the fiscal year.

                       Table 10--FY 2024 PDUFA CPA
------------------------------------------------------------------------
                      Center                          FY 2024 PDUFA CPA
------------------------------------------------------------------------
CDER..............................................           $12,778,222
CBER..............................................            11,157,847
                                                   ---------------------
    Total.........................................            23,936,069
------------------------------------------------------------------------

D. FY 2024 Statutory Fee Revenue Adjustments for Additional Dollar 
Amounts

    PDUFA VII provides an additional dollar amount for each of the 5 
fiscal years covered by PDUFA VII for additional FTE to support 
enhancements outlined in the PDUFA VII commitment letter. The 
additional dollar amount for FY 2024 as outlined in statute is 
$25,097,671 (see section 736(b)(1)(F) of the FD&C Act). This amount 
will be added to the total FY 2024 PDUFA VII revenue amount.

     Table 11--Base Revenue Amount and Section 736(c)(1) Through (3)
                           Adjustment Amounts
------------------------------------------------------------------------
                          Fee                                Amount
------------------------------------------------------------------------
Statutory Fee Revenue Base Amount (section 736(b)(3)      $1,256,844,387
 of the FD&C Act).....................................
Statutory Fee Revenue Adjustments for Inflation               48,886,219
 (section 736(c)(1) of the FD&C Act)..................
Strategic Hiring and Retention Adjustment (section             4,000,000
 736(c)(2)(A) of the FD&C Act)........................
Statutory Fee Revenue Adjustments for Capacity                23,936,069
 Planning (section 736(c)(3) of the FD&C Act).........
Statutory Fee Revenue Adjustments for Additional              25,097,671
 Dollar Amounts (section 736(b)(1)(F) of the FD&C Act)
                                                       -----------------
    Cumulative Revenue Amount after Adjustments in         1,358,764,346
     sections 736(c)(1), (2), (3), and (4) of the FD&C
     Act..............................................
------------------------------------------------------------------------

E. FY 2024 Statutory Fee Revenue Adjustments for Operating Reserve

    PDUFA VII provides for an operating reserve adjustment that may 
result in an increase or decrease in fee revenue and fees for a given 
FY (see section 736(c)(4) of the FD&C Act). For FY 2024, FDA is 
required to further increase fee revenue and fees if an adjustment is 
necessary to provide for at least 9 weeks of operating reserves of 
carryover user fees (see section 736(c)(4)(A)(i) of the FD&C Act). If 
FDA has carryover balances of user fees in excess of 14 weeks of 
operating reserves, FDA is required to decrease fee

[[Page 48886]]

revenue and fees to provide for not more than 14 weeks of operating 
reserves of carryover user fees (see section 736(c)(4)(B) of the FD&C 
Act).
    To determine the dollar amounts for the 9-week and 14-week 
operating reserve thresholds, the adjustments (inflation, strategic 
hiring and retention, capacity planning, and additional dollar amount) 
discussed in sections II.A, II.B, II.C, and II.D are applied to the FY 
2024 base revenue (see section 736(c)(4)(A) of the FD&C Act), resulting 
in $1,358,764,346. This amount is then divided by 52 to generate the 1-
week operating amount of $26,130,084. The 1-week operating amount is 
then multiplied by 9 and 14. This results in a 9-week threshold amount 
of $235,170,752 and a 14-week threshold amount of $365,821,170.
    To determine the FY 2023 end-of-year operating reserves of 
carryover user fees, the Agency assessed the operating reserve of 
carryover fees at the end of June 2023 and forecast collections and 
obligations in the fourth quarter of FY 2023 combined. This provides an 
estimated end-of-year FY 2023 operating reserve of carryover user fees 
of $321,648,510, which equates to 12.3 weeks of operations.\4\
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    \4\ For purposes of the operating reserve adjustment under PDUFA 
VII, the operating reserve of carryover user fees includes only user 
fee funds that are available for obligation. FDA excludes from the 
operating reserve of carryover user fee funds that were collected 
prior to 2010 and that are held by FDA, but which are considered 
unavailable for obligation due to lack of an appropriation 
($78,850,995).
---------------------------------------------------------------------------

    Because the estimated FY 2023 end-of-year operating reserves of 
carryover user fees are within the 9-week and 14-week thresholds, FDA 
will not increase or reduce the FY 2024 fees or fee revenue under the 
statutory provision for operating reserve adjustments.

     Table 12--Base Revenue Amount and Section 736(c)(1) Through (4)
                           Adjustment Amounts
------------------------------------------------------------------------
                          Fee                                Amount
------------------------------------------------------------------------
Statutory Fee Revenue Base Amount (section 736(b)(3)      $1,256,844,387
 of the FD&C Act).....................................
Statutory Fee Revenue Adjustments for Inflation               48,886,219
 (section 736(c)(1) of the FD&C Act)..................
Strategic Hiring and Retention Adjustment (section             4,000,000
 736(c)(2)(A) of the FD&C Act)........................
Statutory Fee Revenue Adjustments for Capacity                23,936,069
 Planning (section 736(c)(3) of the FD&C Act).........
Statutory Fee Revenue Adjustments for Additional              25,097,671
 Dollar Amounts (section 736(b)(1)(F) of the FD&C Act)
Operating Reserve Adjustment (section 736(c)(4) of the  ................
 FD&C Act)............................................
                                                       -----------------
    Cumulative Revenue after Adjustments in sections       1,358,764,346
     736(c)(1), (2), (3), and (4) of the FD&C Act.....
------------------------------------------------------------------------

F. FY 2024 Statutory Fee Revenue Adjustments for Additional Direct Cost

    PDUFA VII specifies that an additional direct cost of $63,339,404 
is to be added to the total FY 2024 PDUFA revenue amount (see section 
736(c)(5) of the FD&C Act). With respect to target revenue for FY 2024, 
adding the additional direct cost amount of $63,339,404 to the 
inflation, strategic hiring and retention, CPA, additional dollar 
amount, and operating reserve adjustment of $1,358,764,346 results in 
the total revenue amount of $1,422,104,000 (rounded to the nearest 
thousand dollars).

            Table 13--Total Estimated Adjusted Revenue Amount
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Statutory Fee Revenue Base Amount (section 736(b)(3)      $1,256,844,387
 of the FD&C Act).....................................
Statutory Fee Revenue Adjustments for Inflation               48,886,219
 (section 736(c)(1) of the FD&C Act)..................
Strategic Hiring and Retention Adjustment (section             4,000,000
 736(c)(2)(A) of the FD&C Act)........................
Statutory Fee Revenue Adjustments for Capacity                23,936,069
 Planning (section 736(c)(3) of the FD&C Act).........
Statutory Fee Revenue Adjustments for Additional              25,097,671
 Dollar Amounts (section 736(b)(1)(F) of the FD&C Act)
Operating Reserve Adjustment (section 736(c)(4) of the  ................
 FD&C Act)............................................
Additional Direct Cost (section 736(c)(5) of the FD&C         63,339,404
 Act).................................................
                                                       -----------------
    Cumulative Revenue Amount after Adjustments in         1,422,104,000
     sections 736(c)(1), (2), (3), and (4) of the FD&C
     Act..............................................
------------------------------------------------------------------------

III. Application Fee Calculations

A. Application Fee Revenues and Application Fees

    Application fees will be set to generate 20 percent of the total 
revenue amount, amounting to $284,420,800 in FY 2024.

B. Estimate of the Number of Fee-Paying Applications and Setting the 
Application Fees

    Historically, FDA has estimated the total number of fee-paying full 
application equivalents (FAEs) it expects to receive during the next 
fiscal year by averaging the number of fee-paying FAEs received in the 
three most recently completed fiscal years. For FY 2024 fee setting, 
the 3 relevant fiscal years are FYs 2020,\5\ 2021, and 2022. Prior year 
FAE totals are updated annually to reflect refunds and waivers 
processed after the close of the fiscal year.
---------------------------------------------------------------------------

    \5\ FY 2020 data was omitted in FY 2022 methodology as FDA took 
into account the global COVID-19 pandemic situation at the time. 
However, after reviewing the data trend, FY 2020 data is included in 
this year's methodology given the higher FAE count for FY 2021. See 
table 14.
---------------------------------------------------------------------------

    In estimating the number of fee-paying FAEs, an application 
requiring covered clinical data \6\ counts as one FAE. An application 
not requiring covered clinical data counts as one-half of an FAE. An 
application that is withdrawn before filing, or refused for filing, 
counts as one-fourth of an FAE if the applicant initially paid a full 
application fee, or one-eighth of an FAE if the applicant initially 
paid one-half of the full application fee amount.
---------------------------------------------------------------------------

    \6\ As defined in section 736(a)(1)(A)(i) of the FD&C Act.
---------------------------------------------------------------------------

    As table 14 shows, the average number of fee-paying FAEs received 
annually in FY 2020 through FY 2022 is 70.25. FDA will set fees for FY 
2024 based on this estimate as the number of full application 
equivalents that will be subject to fees.

[[Page 48887]]

                                            Table 14--Fee-Paying FAEs
----------------------------------------------------------------------------------------------------------------
                                           FY 2020            FY 2021            FY 2022         3-Year average
----------------------------------------------------------------------------------------------------------------
Fee-Paying FAEs.....................             65.25              90.50              55.00              70.25
----------------------------------------------------------------------------------------------------------------
Note: Prior year FAE totals are updated annually to reflect refunds and waivers processed after the close of the
  fiscal year.

    The FY 2024 application fee is estimated by dividing the average 
number of full applications that paid fees from FY 2020 through FY 
2022, 70.25, into the fee revenue amount to be derived from application 
fees in FY 2024, $284,420,800. The result is a fee of $4,048,695 per 
full application requiring clinical data, and $2,024,348 per 
application not requiring clinical data.

IV. Fee Calculation for Prescription Drug Fees

    PDUFA VII assesses prescription drug program fees for certain 
prescription drug products. Program fees will be set to generate 80 
percent of the total target revenue amounting to $1,137,683,200 in FY 
2024.
    An applicant will not be assessed more than five program fees for a 
FY for prescription drug products identified in a single approved NDA 
or BLA (see section 736(a)(2)(C) of the FD&C Act). Applicants are 
assessed a program fee for a fiscal year for user fee eligible 
prescription drug products identified in a human drug application 
approved as of October 1 of such fiscal year. Additionally, applicants 
are assessed a program fee for a product that is not a prescription 
drug product on October 1 because it is included in the discontinued 
section of the Orange Book or the CDER/CBER Billable Biologics List on 
that date, if the product becomes a fee-eligible prescription drug 
product during the fiscal year.
    FDA estimates 2,928 program fees will be invoiced in FY 2024 before 
factoring in waivers, refunds, exceptions, and exemptions. FDA 
approximates that there will be 55 waivers and refunds granted. In 
addition, FDA approximates that another 41 program fees will be 
exempted in FY 2024 based on the orphan drug exemption in section 
736(k) of the FD&C Act.
    PDUFA VII changed the definition of the same product exception for 
program fees. FDA determined that 102 products may be eligible for the 
pharmaceutical equivalence same product exception. An additional 
exception for program fees for skin-test diagnostic products is 
included in the PDUFA VII. FDA has determined that there are nine skin-
test diagnostic application products that may be eligible for the 
exception for skin diagnostic tests. FDA estimates 2,730 program fees 
in FY 2024, after allowing for an estimated 198 waivers and reductions, 
including the orphan drug exemptions, excepted and exempted fee-liable 
products. The FY 2024 prescription drug program fee rate is calculated 
by dividing the adjusted total revenue from program fees 
($1,137,683,200) by the estimated 2,730 program fees, resulting in a FY 
2024 program fee of $416,734 (rounded to the nearest dollar).

V. Fee Schedule for FY 2024

    The fee rates for FY 2024 are displayed in table 15.

                   Table 15--Fee Schedule for FY 2024
------------------------------------------------------------------------
                                                              Fee rates
                        Fee category                         for FY 2024
------------------------------------------------------------------------
Application:
    Requiring clinical data................................   $4,048,695
    Not requiring clinical data............................    2,024,348
Program....................................................      416,734
------------------------------------------------------------------------

VI. Fee Payment Options and Procedures

A. Application Fees

    The appropriate application fee established in the new fee schedule 
must be paid for any application subject to fees under PDUFA VII that 
is submitted on or after October 1, 2023. Payment must be made in U.S. 
currency by electronic check, check, bank draft, wire transfer, or U.S. 
postal money order payable to the order of the Food and Drug 
Administration. The preferred payment method is online using electronic 
check (Automated Clearing House (ACH) also known as eCheck) or credit 
card (Discover, VISA, MasterCard, American Express).
    FDA has partnered with the U.S. Department of the Treasury to use 
Pay.gov, a web-based payment application, for online electronic 
payment. The Pay.gov feature is available on the FDA website after 
completing the Prescription Drug User Fee Cover Sheet and generating 
the user fee ID number. Secure electronic payments can be submitted 
using the User Fees Payment Portal at https://userfees.fda.gov/pay 
(Note: only full payments are accepted. No partial payments can be made 
online). Once an invoice is located, ``Pay Now'' should be selected to 
be redirected to Pay.gov. Electronic payment options are based on the 
balance due. Payment by credit card is available for balances that are 
less than $25,000. If the balance exceeds this amount, only the ACH 
option is available. Payments must be made using U.S. bank accounts as 
well as U.S. credit cards.
    If a check, bank draft, or postal money order is submitted, make it 
payable to the order of the Food and Drug Administration and include 
the user fee ID number to ensure that the payment is applied to the 
correct fee(s). Payments can be mailed to: Food and Drug 
Administration, P.O. Box 979107, St. Louis, MO 63197-9000. If a check, 
bank draft, or money order is to be sent by a courier that requests a 
street address, the courier should deliver your payment 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. 
If you have any questions concerning courier delivery, contact the U.S. 
Bank at 314-418-4013. This telephone number is only for questions about 
courier delivery.) Please make sure that the FDA post office box number 
(P.O. Box 979107) is written on the check, bank draft, or postal money 
order.
    For payments made by wire transfer, include the unique user fee ID 
number to ensure that the payment is applied to the correct fee(s). 
Without the unique user fee ID number, the payment may not be applied, 
which could result in FDA not filing an application and other 
penalties. Note: the originating financial institution may charge a 
wire transfer fee, especially for international wire transfers. 
Applicable wire transfer fees must be included with payment to ensure 
fees are paid in full. Questions about wire transfer fees should be 
addressed to the financial institution. The account information for 
wire transfers is as follows: U.S. Department of the Treasury, TREAS 
NYC, 33 Liberty St., New York, NY 10045, Acct. No.: 75060099, Routing 
No.: 021030004, SWIFT: FRNYUS33. If needed, FDA's tax identification 
number is 53-0196965.

[[Page 48888]]

B. Prescription Drug Program Fees

    FDA will issue invoices and payment instructions for FY 2024 
program fees under the new fee schedule in August 2023. Under section 
736(a)(2)(A)(i) of the FD&C Act, prescription drug program fees are due 
on October 2, 2023.
    FDA will issue invoices in December 2024 for products that qualify 
for FY 2024 program fee assessments after the October 2023 billing.

C. Fee Waivers and Refunds

    To qualify for consideration for a waiver or reduction under 
section 736(d) of the FD&C Act, an exemption under section 736(k) of 
the FD&C Act, or the return of an application or program fee paid under 
section 736 of the FD&C Act, including if the fee is claimed to have 
been paid in error, a person must submit to FDA a written request 
justifying such waiver, reduction, exemption or return not later than 
180 days after such fee is due (section 736(i) of the FD&C Act). A 
request submitted under this paragraph must include any legal 
authorities under which the request is made.

    Dated: July 24, 2023.
Lauren K. Roth,
Associate Commissioner for Policy.
[FR Doc. 2023-15911 Filed 7-27-23; 8:45 am]
BILLING CODE 4164-01-P