Document ID: FDA-2014-N-0007-0009
Agency: fda
Document Type: Notice
Title: Fee for Using a Rare Pediatric Disease Priority Review Voucher in Fiscal Year
2015
Posted Date: 2014-10-01T04:00Z

[Federal Register Volume 79, Number 190 (Wednesday, October 1, 2014)]
[Notices]
[Pages 59275-59276]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-23320]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2014-N-0007]

Fee for Using a Rare Pediatric Disease Priority Review Voucher in 
Fiscal Year 2015

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) 2015. 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 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 certain 
rare pediatric disease product applications, submitted 90 days or more 
after July 9, 2012, 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 fiscal year, and the average cost 
incurred in the review of an application that is not subject to 
priority review in the previous fiscal year. This notice establishes 
the rare pediatric disease priority review fee rate for FY 2015 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, 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, 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) of the FD&C Act) 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 that may then use it for a human drug application. 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 the 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 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 2015 at $2,562,000 and outlines FDA's procedures for 
payment of rare pediatric disease priority review user fees. This rate 
is effective on October 1, 2014, and will remain in effect through 
September 30, 2015.

II. Priority Review User Fee for FY 2015

    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. The rare pediatric disease priority 
review voucher fee is intended to cover the incremental costs for FDA 
to do a priority review on a human drug application that would 
otherwise get a standard review. The formula provides the Agency with 
the added resources to conduct a priority review while still ensuring a 
robust rare pediatric disease priority review voucher program that is 
consistent with the Agency's public health goal of encouraging the 
development of new human drugs and biological products for rare 
pediatric diseases.
    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

[[Page 59276]]

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 2015, which is 
to be based on standard cost data from the previous fiscal year, FY 
2014. However, the FY 2014 submission cohort has not been closed out 
yet, thus the cost data for FY 2014 are not complete. The latest year 
for which FDA has complete cost data is FY 2013. 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 2013 show standard costs 
(rounded to the nearest thousand dollars) of $5,122,000 for a NME NDA, 
and $4,090,000 for a BLA. Based on these standard costs, the total cost 
to review the 53 applications in these two categories in FY 2013 (31 
NME NDAs and 22 BLAs with clinical data) was $248,762,000. (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 of these applications (12 NDAs and 8 BLAs) received 
priority review, which would mean that the remaining 33 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 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 comparison of historical 
average review times 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 2013 figures, the costs of a priority and 
standard review are estimated using the following formula:

(20 [alpha] x 1.67) + (33 [alpha]) = $248,762,000

    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 
$3,746,000 (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 
$6,256,000 (rounded to the nearest thousand dollars). The difference 
between these two cost estimates, or $2,510,000, represents the 
incremental cost of conducting a priority review rather than a standard 
review.
    For the FY 2015 fee, FDA will need to adjust the FY 2013 
incremental cost by the average amount by which FDA's average costs 
increased in the 3 years prior to FY 2014, to adjust the FY 2013 amount 
for cost increases in FY 2014. That adjustment, published in the 
Federal Register on August 1, 2014 (see 79 FR 44807 at 44809), is 
2.0813 percent for the most recent year, not compounded. Increasing the 
FY 2013 incremental priority review cost of $2,510,000 by 2.0813 
percent results in an estimated cost of $2,562,000 (rounded to the 
nearest thousand dollars). This is the rare pediatric disease priority 
review user fee amount for FY 2015 that must be submitted with a 
priority review voucher for a human drug application in FY 2015, in 
addition to any PDUFA fee that is required for such an application.

III. Fee Schedule for FY 2015

    The fee rate for FY 2015 is set out in Table 1 of this document:

  Table 1--Rare Pediatric Disease Priority Review Schedule for FY 2015
------------------------------------------------------------------------
                                                           Fee rate for
                      Fee category                            FY 2015
------------------------------------------------------------------------
Applications Submitted With a Rare Pediatric Disease          $2,562,000
 Priority Review Voucher in Addition to the Normal PDUFA
 Fee....................................................
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IV. Payment Procedures for Rare Pediatric Disease Priority Review 
Voucher Fees Incurred in FY 2015

    Under section 529(c)(4)(A) of the FD&C Act, the priority review 
voucher 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. 
In order to comply with this section the sponsor must contact FDA 
before providing official notification of its intent to use the 
voucher.
    Rare pediatric disease priority review voucher fees incurred for FY 
2015 will be payable after Congress provides an appropriation of these 
fees. Accordingly, FDA will issue an invoice to the sponsor who has 
incurred a rare pediatric disease priority review voucher fee when it 
receives the sponsor's notification of intent to use the voucher or, if 
an appropriation of rare pediatric disease priority review voucher fees 
has not been enacted at that time, after the appropriation has been 
enacted. The invoice will include instructions on how to pay the fee 
via wire transfer or check.
    As noted above, 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.

    Dated: September 26, 2014.
Peter Lurie,
Associate Commissioner for Policy and Planning.
[FR Doc. 2014-23320 Filed 9-30-14; 8:45 am]
BILLING CODE 4164-01-P