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‘‘(B) The issuance of action letters which 
approve animal drug applications or supple-
mental animal drug applications or which set 
forth in detail the specific deficiencies in animal
drug applications, supplemental animal drug 
applications, or investigational animal drug sub-
missions and, where appropriate, the actions 
necessary to place such applications, supple-
ments or submissions in condition for approval. 
‘‘(C) The inspection of animal drug estab-
lishments and other facilities undertaken as 
part of the Secretary’s review of pending animal 
drug applications, supplemental animal drug 
applications, and investigational animal drug 
submissions. 
‘‘(D) Monitoring of research conducted in 
connection with the review of animal drug ap-
plications, supplemental animal drug applica-
tions, and investigational animal drug submis-
sions. 
‘‘(E) The development of regulations and 
policy related to the review of animal drug ap-
plications, supplemental animal drug applica-
tions, and investigational animal drug submis-
sions.
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‘‘(F) Development of standards for prod-
ucts subject to review. 
‘‘(G) Meetings between the agency and the 
animal drug sponsor. 
‘‘(H) Review of advertising and labeling 
prior to approval of an animal drug application 
or supplemental animal drug application, but 
not such activities after an animal drug has 
been approved. 
‘‘(9) The term ‘costs of resources allocated for 
the process for the review of animal drug applica-
tions’ means the expenses incurred in connection 
with the process for the review of animal drug appli-
cations for—
‘‘(A) officers and employees of the Food 
and Drug Administration, contractors of the 
Food and Drug Administration, advisory com-
mittees consulted with respect to the review of 
specific animal drug applications, supplemental 
animal drug applications, or investigational ani-
mal drug submissions, and costs related to such 
officers, employees, committees, and contrac-
tors, including costs for travel, education, and 
recruitment and other personnel activities,
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‘‘(B) management of information, and the 
acquisition, maintenance, and repair of com-
puter resources, 
‘‘(C) leasing, maintenance, renovation, and 
repair of facilities and acquisition, maintenance, 
and repair of fixtures, furniture, scientific 
equipment, and other necessary materials and 
supplies, and 
‘‘(D) collecting fees under section 740 and 
accounting for resources allocated for the re-
view of animal drug applications, supplemental 
animal drug applications, and investigational 
animal drug submissions. 
‘‘(10) The term ‘adjustment factor’ applicable 
to a fiscal year refers to the formula set forth in sec-
tion 735(8) with the base or comparator year being 
2003. 
‘‘(11) The term ‘affiliate’ refers to the defini-
tion set forth in section 735(9). 
‘‘SEC. 740. AUTHORITY TO ASSESS AND USE ANIMAL DRUG 
FEES. 
‘‘(a) TYPES
OF FEES.—Beginning in fiscal year 
2004, the Secretary shall assess and collect fees in accord-
ance with this section as follows:
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‘‘(1) ANIMAL DRUG APPLICATION AND SUPPLE-
MENT FEE.—
‘‘(A) IN GENERAL.—Each person that sub-
mits, on or after September 1, 2003, an animal 
drug application or a supplemental animal drug 
application shall be subject to a fee as follows: 
‘‘(i) A fee established in subsection 
(b) for an animal drug application; and 
‘‘(ii) A fee established in subsection 
(b) for a supplemental animal drug appli-
cation for which safety or effectiveness 
data are required, in an amount that is 
equal to 50 percent of the amount of the 
fee under clause (i). 
‘‘(B) PAYMENT.—The fee required by sub-
paragraph (A) shall be due upon submission of 
the animal drug application or supplemental 
animal drug application. 
‘‘(C) EXCEPTION FOR PREVIOUSLY FILED 
APPLICATION OR SUPPLEMENT.—If an animal 
drug application or a supplemental animal drug 
application was submitted by a person that paid 
the fee for such application or supplement, was 
accepted for filing, and was not approved or 
was withdrawn (without a waiver or refund),
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the submission of an animal drug application or 
a supplemental animal drug application for the 
same product by the same person (or the per-
son’s licensee, assignee, or successor) shall not 
be subject to a fee under subparagraph (A). 
‘‘(D) REFUND OF FEE IF APPLICATION RE-
FUSED FOR FILING.—The Secretary shall re-
fund 75 percent of the fee paid under subpara-
graph (B) for any animal drug application or 
supplemental animal drug application which is 
refused for filing. 
‘‘(E) REFUND
OF
FEE
IF
APPLICATION 
WITHDRAWN.—If an animal drug application or 
a supplemental animal drug application is with-
drawn after the application or supplement was 
filed, the Secretary may refund the fee or por-
tion of the fee paid under subparagraph B if no 
substantial work was performed on the applica-
tion or supplement after the application or sup-
plement was filed. The Secretary shall have the 
sole discretion to refund the fee under this 
paragraph. A determination by the Secretary 
concerning a refund under this paragraph shall 
not be reviewable.
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‘‘(2) ANIMAL DRUG PRODUCT FEE.—Each per-
son—
‘‘(A) who is named as the applicant in an 
animal drug application or supplemental animal 
drug application for an animal drug product
which has been submitted for listing under sec-
tion 510, and 
‘‘(B) who, after September 1, 2003, had 
pending before the Secretary an animal drug 
application or supplemental animal drug appli-
cation; 
shall pay for each such animal drug product the an-
nual fee established in subsection (b). Such fee shall 
be payable for the fiscal year in which the animal 
drug product is first submitted for listing under sec-
tion 510, or is submitted for relisting under section 
510 if the animal drug product has been withdrawn 
from listing and relisted. After such fee is paid for 
that fiscal year, such fee shall be payable on or be-
fore January 31 of each year. Such fee shall be paid 
only once for each animal drug product for a fiscal 
year in which the fee is payable. 
‘‘(3) ANIMAL
DRUG
ESTABLISHMENT
FEE.—
Each person—
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‘‘(A) who owns or operates, directly or 
through an affiliate, an animal drug establish-
ment, and 
‘‘(B) who is named as the applicant in an 
animal drug application or supplemental animal 
drug application for an animal drug product 
which has been submitted for listing under sec-
tion 510, and 
‘‘(C) who, after September 1, 2003, had 
pending before the Secretary an animal drug 
application or supplemental animal drug appli-
cation, 
shall be assessed an annual fee established in sub-
section (b) for each animal drug establishment listed 
in its approved animal drug application as an estab-
lishment that manufactures the animal drug product 
named in the application. The annual establishment 
fee shall be assessed in each fiscal year in which the 
animal drug product named in the application is as-
sessed a fee under paragraph (2) unless the animal 
drug establishment listed in the application does not 
engage in the manufacture of the animal drug prod-
uct during the fiscal year. The fee shall be paid on 
or before January 31 of each year. The establish-
ment shall be assessed only one fee per fiscal year
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under this section, provided, however, that where a 
single establishment manufactures both animal drug 
products and prescription drug products, as defined 
in section 735(3), such establishment shall be as-
sessed both the animal drug establishment fee and 
the prescription drug establishment fee, as set forth 
in section 736(a)(2), within a single fiscal year. 
‘‘(4) ANIMAL DRUG SPONSOR FEE.—Each per-
son—
‘‘(A) who meets the definition of an animal 
drug sponsor within a fiscal year; and 
‘‘(B) who, after September 1, 2003, had 
pending before the Secretary an animal drug 
application, a supplemental animal drug appli-
cation, or an investigational animal drug sub-
mission, 
shall be assessed an annual fee established under 
subsection (b). The fee shall be paid on or before 
January 31 of each year. Each animal drug sponsor 
shall pay only one such fee each fiscal year. 
‘‘(b) FEE AMOUNTS.—Except as provided in sub-
section (a)(1) and subsections (c), (d), (f), and (g), the 
fees required under subsection (a) shall be established to 
generate fee revenue amounts as follows:
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‘‘(1) TOTAL FEE REVENUES FOR APPLICATION 
AND SUPPLEMENT FEES.—The total fee revenues to 
be collected in animal drug application fees under 
subsection (a)(1)(A)(i) and supplemental animal 
drug application fees under subsection (a)(1)(A)(ii) 
shall be $1,250,000 in fiscal year 2004, $2,000,000 
in fiscal year 2005, and $2,500,000 in fiscal years 
2006, 2007, and 2008. 
‘‘(2) TOTAL
FEE
REVENUES
FOR
PRODUCT 
FEES.—The total fee revenues to be collected in 
product fees under subsection (a)(2) shall be 
$1,250,000 in fiscal year 2004, $2,000,000 in fiscal 
year 2005, and $2,500,000 in fiscal years 2006, 
2007, and 2008. 
‘‘(3) TOTAL FEE REVENUES FOR ESTABLISH-
MENT FEES.—The total fee revenues to be collected 
in establishment fees under subsection (a)(3) shall 
be $1,250,000 in fiscal year 2004, $2,000,000 in fis-
cal year 2005, and $2,500,000 in fiscal years 2006, 
2007, and 2008. 
‘‘(4) TOTAL
FEE
REVENUES
FOR
SPONSOR 
FEES.—The total fee revenues to be collected in 
sponsor fees under subsection (a)(4) shall be 
$1,250,000 in fiscal year 2004, $2,000,000 in fiscal
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year 2005, and $2,500,000 in fiscal years 2006, 
2007, and 2008. 
‘‘(c) ADJUSTMENTS.—
‘‘(1) INFLATION ADJUSTMENT.—The revenues 
established in subsection (b) shall be adjusted by the 
Secretary by notice, published in the Federal Reg-
ister, for a fiscal year to reflect the greater of—
‘‘(A) the total percentage change that oc-
curred in the Consumer Price Index for all 
urban consumers (all items; United States city 
average) for the 12-month period ending June 
30 preceding the fiscal year for which fees are 
being established; or 
‘‘(B) the total percentage change for the 
previous fiscal year in basic pay under the Gen-
eral Schedule in accordance with section 5332 
of title 5, United States Code, as adjusted by 
any locality-based comparability payment pur-
suant to section 5304 of such title for Federal 
employees stationed in the District of Columbia. 
The adjustment made each fiscal year by this sub-
section will be added on a compounded basis to the 
sum of all adjustments made each fiscal year after 
fiscal year 2004 under this subsection.
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‘‘(2) WORKLOAD ADJUSTMENT.—After the fee 
revenues are adjusted for inflation in accordance 
with subparagraph (1), the fee revenues shall be fur-
ther adjusted each fiscal year after fiscal year 2004 
to reflect changes in review workload. With respect 
to such adjustment: 
‘‘(A) This adjustment shall be determined 
by the Secretary based on a weighted average
of the change in the total number of animal 
drug applications, supplemental animal drug 
applications for which data with respect to safe-
ty or effectiveness are required, manufacturing 
supplemental animal drug applications, inves-
tigational animal drug study submissions, and 
investigational animal drug protocol submis-
sions submitted to the Secretary. The Secretary 
shall publish in the Federal Register the fees 
resulting from this adjustment and the sup-
porting methodologies. 
‘‘(B) Under no circumstances shall this 
workload adjustment result in fee revenues for 
a fiscal year that are less than the fee revenues 
for that fiscal year established in subsection 
(b), as adjusted for inflation under subpara-
graph (c)(1).
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‘‘(3) FINAL
YEAR
ADJUSTMENT.—For fiscal 
year 2008, the Secretary may further increase the 
fees to provide for up to 3 months of operating re-
serves of carryover user fees for the process for the 
review of animal drug applications for the first 3 
months of fiscal year 2009. If the Food and Drug 
Administration has carryover balances for the proc-
ess for the review of animal drug applications in ex-
cess of 3 months of such operating reserves, then 
this adjustment will not be made. If this adjustment 
is necessary, then the rationale for the amount of 
the increase shall be contained in the annual notice 
setting fees for fiscal year 2008. 
‘‘(4) ANNUAL
FEE
SETTING.—The Secretary 
shall establish, 60 days before the start of each fis-
cal year beginning after September 30, 2003, for 
that fiscal year, animal drug application fees, sup-
plemental animal drug application fees, animal drug 
sponsor fees, animal drug establishment fees, and 
animal drug product fees based on the revenue 
amounts established under subsection (b) and the 
adjustments provided under this subsection. 
‘‘(5) LIMIT.—The total amount of fees charged, 
as adjusted under this subsection, for a fiscal year 
may not exceed the total costs for such fiscal year
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for the resources allocated for the process for the re-
view of animal drug applications. 
‘‘(d) FEE WAIVER OR REDUCTION.—
‘‘(1) IN GENERAL.—The Secretary shall grant a 
waiver from or a reduction of 1 or more fees as-
sessed under subsection (a) where the Secretary 
finds that—
‘‘(A) the assessment of the fee would 
present a significant barrier to innovation be-
cause of limited resources available to such per-
son or other circumstances, 
‘‘(B) the fees to be paid by such person 
will exceed the anticipated present and future 
costs incurred by the Secretary in conducting 
the process for the review of animal drug appli-
cations for such person, 
‘‘(C) the animal drug application or sup-
plemental animal drug application is intended 
solely to provide for use of the animal drug 
in—
‘‘(i) a Type B medicated feed (as de-
fined in section 558.3(b)(3) of title 21, 
Code of Federal Regulations (or any suc-
cessor regulation)) intended for use in the
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manufacture of Type C free-choice medi-
cated feeds, or 
‘‘(ii) a Type C free-choice medicated 
feed (as defined in section 558.3(b)(4) of 
title 21, Code of Federal Regulations (or 
any successor regulation)), 
‘‘(D) the animal drug application or sup-
plemental animal drug application is intended 
solely to provide for a minor use or minor spe-
cies indication, or 
‘‘(E) the sponsor involved is a small busi-
ness submitting its first animal drug applica-
tion to the Secretary for review. 
‘‘(2) USE OF STANDARD COSTS.—In making the 
finding in paragraph (1)(B), the Secretary may use 
standard costs. 
‘‘(3) RULES FOR SMALL BUSINESSES.—
‘‘(A) DEFINITION.—In paragraph (1)(E), 
the term ‘small business’ means an entity that 
has fewer than 500 employees, including em-
ployees of affiliates. 
‘‘(B) WAIVER OF APPLICATION FEE.—The 
Secretary shall waive under paragraph (1)(E) 
the application fee for the first animal drug ap-
plication that a small business or its affiliate
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submits to the Secretary for review. After a 
small business or its affiliate is granted such a 
waiver, the small business or its affiliate shall 
pay application fees for all subsequent animal 
drug applications and supplemental animal 
drug applications for which safety or effective-
ness data are required in the same manner as 
an entity that does not qualify as a small busi-
ness. 
‘‘(C) CERTIFICATION.—The Secretary shall 
require any person who applies for a waiver 
under paragraph (1)(E) to certify their quali-
fication for the waiver. The Secretary shall peri-
odically publish in the Federal Register a list of 
persons making such certifications. 
‘‘(e) EFFECT OF FAILURE TO PAY FEES.—An ani-
mal drug application or supplemental animal drug applica-
tion submitted by a person subject to fees under sub-
section (a) shall be considered incomplete and shall not 
be accepted for filing by the Secretary until all fees owed 
by such person have been paid. An investigational animal 
drug submission under section 739(5)(B) that is sub-
mitted by a person subject to fees under subsection (a) 
shall be considered incomplete and shall not be accepted 
for review by the Secretary until all fees owed by such
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person have been paid. The Secretary may discontinue re-
view of any animal drug application, supplemental animal 
drug application or investigational animal drug submission 
from a person if such person has not submitted for pay-
ment all fees owed under this section by 30 days after 
the date upon which they are due. 
‘‘(f) ASSESSMENT OF FEES.—
‘‘(1) LIMITATION.—Fees may not be assessed 
under subsection (a) for a fiscal year beginning after 
fiscal year 2003 unless appropriations for salaries 
and expenses of the Food and Drug Administration 
for such fiscal year (excluding the amount of fees 
appropriated for such fiscal year) are equal to or 
greater than the amount of appropriations for the 
salaries and expenses of the Food and Drug Admin-
istration for the fiscal year 2003 (excluding the 
amount of fees appropriated for such fiscal year) 
multiplied by the adjustment factor applicable to the 
fiscal year involved. 
‘‘(2) AUTHORITY.—If the Secretary does not 
assess fees under subsection (a) during any portion 
of a fiscal year because of paragraph (1) and if at 
a later date in such fiscal year the Secretary may as-
sess such fees, the Secretary may assess and collect 
such fees, without any modification in the rate, for
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animal drug applications, supplemental animal drug 
applications, investigational animal drug submis-
sions, sponsors, animal drug establishments and ani-
mal drug products at any time in such fiscal year 
notwithstanding the provisions of subsection (a) re-
lating to the date fees are to be paid. 
‘‘(g) CREDITING AND AVAILABILITY OF FEES.—
‘‘(1) IN GENERAL.—Fees authorized under sub-
section (a) shall be collected and available for obliga-
tion only to the extent and in the amount provided 
in advance in appropriations Acts. Such fees are au-
thorized to be appropriated to remain available until 
expended. Such sums as may be necessary may be 
transferred from the Food and Drug Administration 
salaries and expenses appropriation account without 
fiscal year limitation to such appropriation account 
for salary and expenses with such fiscal year limita-
tion. The sums transferred shall be available solely 
for the process for the review of animal drug appli-
cations. 
‘‘(2) 
COLLECTIONS
AND
APPROPRIATION 
ACTS.—
‘‘(A) IN
GENERAL.—The fees authorized 
by this section—