New Tobacco Products: FDA Needs to Set Time Frames for Its Review Process
Published: 2013-09-06T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: In 2009, the Family Smoking Prevention and Tobacco Control Act granted FDA, an agency within the Department of Health and Human Services (HHS), authority to regulate tobacco products such as cigarettes. The act requires that tobacco manufacturers submit information to be reviewed by FDA in order to market new tobacco products and established tobacco user fees to fund FDA's tobacco-related activities. The act represents the first time that FDA has had the authority to regulate tobacco products.
Manufacturers have raised concerns about the progress of CTP, the FDA center established by the act to implement its provisions. GAO was asked to examine CTP's review of new tobacco product submissions, responses to meeting requests, and use of funds. This report examines (1) the status of CTP's reviews of new tobacco product submissions; (2) how CTP responded to manufacturers' and other entities' meeting requests, and the length of time CTP took to hold the meetings; and (3) the extent to which FDA has spent its tobacco user fee funds. GAO analyzed data regarding submissions received by FDA as of January 7, 2013; reviewed data on meeting requests, spending plans, and amounts obligated; and interviewed CTP and tobacco industry officials.
section_title: What GAO Found
paragraphs: As of January 7, 2013, the Food and Drug Administration's (FDA) Center for Tobacco Products (CTP) had finished initial, but not final, review steps for most of about 3,800 submissions for new tobacco products (those not on the market on February 15, 2007). Ninety-nine percent of the submissions received by FDA were made under the substantial equivalence (SE) pathway. CTP determines whether the new tobacco product in an SE submission has the same characteristics as a predicate tobacco product (a product commercially marketed in the United States on February 15, 2007, or previously found by FDA to be substantially equivalent) or has different characteristics that do not raise different questions of public health. Initial review steps include CTP's determination of whether the new product is a type regulated by FDA and whether the submission is missing information. For most SE submissions, CTP took more than a year and a half from the date a submission was received to the date these initial steps were completed. Of the 3,788 SE submissions, 3,165 were received by FDA prior to a statutory deadline (March 22, 2011) allowing the product to be marketed unless CTP finds that they are not substantially equivalent. SE submissions received after that date cannot be marketed until CTP determines they are substantially equivalent. In late June 2013, CTP made a final decision on 6 of the 3,788 SE submissions, finding that 2 of the products were substantially equivalent and that 4 were not; the remaining submissions were still undergoing CTP review. CTP officials and manufacturers told GAO that several factors (such as CTP requests for additional information from manufacturers for submissions and having to hire and train new staff) impacted the time it took CTP to review SE submissions. While CTP is working to address these factors by, for example, disseminating information to manufacturers to improve submission quality and developing training for staff, CTP does not have performance measures that include time frames for making final decisions on submissions by which to assess its progress. Without time frames, CTP is limited in its ability to evaluate policies, procedures, and staffing resources in relation to its review process and, in turn, is limited in its ability to reasonably assure efficiency and effectiveness.
A variety of outside entities (such as manufacturers) have requested meetings with CTP to discuss new tobacco product submissions, public health activities, and other issues, and four CTP offices have received meeting requests. Those offices granted more meetings (72) than they denied (22) of all the meeting requests they received through January 7, 2013. The number of calendar days from the date a meeting was requested to the date it was held ranged from 1 to 262 days, and the averages among the four offices ranged from 51 to 97 days.
FDA spent (obligated) less than half of the nearly $1.1 billion in tobacco user fees it collected from manufacturers and others through the end of fiscal year 2012; $603 million of these user fees remained unspent and, thus, remained available to CTP. CTP spent substantially less than planned in fiscal years 2011 and 2012. CTP had planned on spending a total of $611 million for fiscal year 2012; instead, the center spent $272 million for that year. CTP officials told GAO that the time it took to award contracts contributed to the center spending less than planned. For example, CTP planned to award a $145 million contract in fiscal year 2012 for a public health education campaign, but most of that amount was not awarded until the first quarter of fiscal year 2013.
section_title: What GAO Recommends
paragraphs: GAO recommends that FDA establish performance measures that include time frames for making decisions on new tobacco product submissions and that the agency monitor performance relative to those time frames. HHS agreed with GAO's recommendations.

section_title: Letter
paragraphs: Tobacco use is the leading cause of preventable death, disease, and  disability, and it is a significant contributor to health care costs in the  United States. The Centers for Disease Control and Prevention reports  that smoking and exposure to secondhand smoke account for over  440,000 premature deaths per year. In June 2009, the Family Smoking  Prevention and Tobacco Control Act (Tobacco Control Act) granted the  Food and Drug Administration (FDA), an agency within the Department of  Health and Human Services (HHS), authority to address the concern of  tobacco use by young people and to regulate the manufacturing,  marketing, and distribution of tobacco products using a public health  standard. Under this standard, FDA regulates tobacco products as  appropriate for the protection of public health while taking into account the  risks and benefits of tobacco products on the population as a whole,  including users and nonusers. The Tobacco Control Act requires that  manufacturers of tobacco products submit information—for example, a  statement of the product’s ingredients and a description of the methods  used for manufacturing the product—to be reviewed by FDA using this  public health standard in order to introduce new tobacco products into the  market after February 15, 2007.first time that FDA has had the authority to regulate tobacco products.
The Tobacco Control Act represents the  The Tobacco Control Act also established the Center for Tobacco  Products (CTP) within FDA to be responsible for implementing the act.   CTP was formed in 2009—the first new center within FDA in 21 years— and it implements the act by reviewing submissions for marketing new  tobacco products, enforcing prohibitions on the sale of certain tobacco  products, developing and issuing regulations and guidance, engaging in  public education about the risks associated with tobacco product use, and  performing other activities. The act also authorizes FDA to assess and  collect user fees from each tobacco manufacturer and importer to be  spent on only FDA’s tobacco regulation activities. All of CTP’s activities  are funded exclusively through tobacco user fees.
Tobacco manufacturers have raised concerns about CTP’s progress in  implementing the provisions of the Tobacco Control Act. You asked us to  look at CTP’s review of new tobacco product submissions, responses to  meeting requests, and use of resources. This report examines (1) the  status of CTP’s reviews of new tobacco product submissions; (2) how  CTP has responded to requests for meetings from manufacturers and  other entities, and the length of time CTP has taken to hold the meetings;  and (3) the extent to which FDA has spent its tobacco user fee funds. We  also provide information on staffing resources for conducting reviews of  new tobacco product submissions. (See app. I.)
To examine the status of CTP’s review of new tobacco product  submissions, we analyzed data maintained by CTP’s Office of Science  (OS)—the CTP office primarily responsible for conducting reviews of new  tobacco product submissions—regarding all submissions received by  FDA as of January 7, 2013. This included data on whether specific steps  of the review process were completed for each submission, and key  dates for each submission. We calculated the number of calendar days to  complete key steps in the review process and the number of days a  submission was pending in a particular step in the process. In addition,  we reviewed relevant laws, regulations, and agency documents (such as  guidance documents and draft standard operating procedures) and we  viewed CTP webinars on new tobacco product submissions. We also  interviewed OS officials to learn about the process for tracking and  reviewing submissions, and to identify factors that contributed to the time  CTP took to review new tobacco product submissions. We compared  CTP’s review processes against internal control standards, which specify  that performance measures such as time frames and the monitoring of  actual performance against measures are an integral part of operating  efficiently, achieving effective results, and planning appropriately. Finally,  we interviewed industry representatives from manufacturers and tobacco  trade associations to learn about factors that may have contributed to the  time taken by CTP to review submissions.
To examine on how CTP responded to requests for meetings and the  length of time CTP has taken to hold the meetings, we reviewed and  analyzed data from the four CTP offices that received meeting requests  from manufacturers and other entities: OS, the Office of the Center  Director (OCD), the Office of Compliance and Enforcement (OCE), and  the Office of Policy (OP). For each of the four offices, we analyzed data  provided by officials from the office on meeting requests received as of  January 7, 2013, including the date requests were received and the date  meetings were held. We analyzed the data from each of the four offices  separately because the data maintained by each office varied. For  example, OS officials only maintain data on the date the meeting request  was received by FDA while OP officials maintain data on the date the  meeting request was received by FDA and by OP. We analyzed the  number of meeting requests granted, denied, transferred, withdrawn, and  pending. We also analyzed the number of calendar days from the date  the request was received by FDA or a specific CTP office, depending on  available data, to the date the meeting was held. Finally, we reviewed a  relevant FDA guidance document, and interviewed officials from each of  the four CTP offices to learn about the processes for scheduling and  holding meetings.
To examine on the extent to which FDA has spent its tobacco user fee  funds, we reviewed FDA’s data, including information from CTP on  tobacco user fees from the fourth quarter of fiscal year 2009 through the  fourth quarter of fiscal year 2012, such as the amounts collected by FDA  and the amounts spent by all seven CTP offices: Office of Management, Office of Regulations, and Office of Health  Communication and Education. We analyzed these data to determine  how collection related to spending over time. Further, we reviewed FDA  and CTP documents, such as FDA budget justification documents, CTP’s  spend plan (which is used by CTP to identify its plans for spending user  fee funds on staffing, acquisitions, and operational needs), and CTP  quarterly reports to Congress (which describe CTP’s implementation of  the Tobacco Control Act provisions).
OS, OCD, OCE, OP,  We assessed the reliability of FDA data we received by reviewing related  documentation, performing data reliability checks (such as examining the  data for missing values), and interviewing CTP officials. After taking these  steps, we determined that the data we used were sufficiently reliable for  our purposes.
For the purposes of this report, spending means obligations, including those for which  expenditures have been made. The term obligation refers to a definite commitment by a  federal agency that creates a legal liability to make payments immediately or in the future. that the evidence obtained provides a reasonable basis for our findings  and conclusions based on our audit objectives.
subsections: section_title: Background
paragraphs: FDA’s authority to regulate tobacco products under a public health  standard is unique among its regulatory responsibilities. CTP is the FDA  center with primary responsibility for executing this regulatory  responsibility, and its offices conduct work in several areas, including  reviewing submissions for new tobacco products to determine if such  products can be legally marketed in the United States, and responding to  meeting requests from manufacturers and other entities. All of CTP’s  activities are funded through tobacco manufacturer user fees, as required  by the Tobacco Control Act.
subsections: section_title: FDA Oversight of Tobacco Products
paragraphs: FDA—primarily through CTP—undertakes four broad categories of  activities in carrying out its responsibilities and authorities under the   (1) reviewing submissions for marketing new  Tobacco Control Act:tobacco products and setting scientific standards for tobacco products;   (2) enforcing statutory and regulatory requirements prohibiting the sale,  marketing, and distribution of certain tobacco products; (3) developing  and issuing regulations and guidance, conducting compliance checks,  and removing violative products from the market pursuant to the Tobacco  Control Act; and (4) engaging in public education and outreach activities  about the risks associated with tobacco product use, and promoting  awareness of and compliance with the Tobacco Control Act. CTP is  organized into seven offices. (See table 1.) Within CTP, OS is the office  primarily responsible for conducting reviews of new tobacco product  submissions; however, OS staff duties are not limited to reviewing new  tobacco product submissions.
Under the Tobacco Control Act, a manufacturer may make a submission  to FDA for CTP’s determination of whether the manufacturer may  introduce a new tobacco product to the market in the United States. CTP  reviews submissions made by manufacturers through one of three  pathways:
Substantial Equivalence (SE) pathway: Manufacturers make a  submission under the SE pathway if either (1) a new tobacco product  has the same characteristics as a predicate tobacco product—that is,  a product commercially marketed in the United States on February 15,  2007, or a product previously found by CTP to be substantially  equivalent; or (2) the new tobacco product has different  characteristics from a predicate tobacco product, but does not raise  different questions of public health. There are two types of  submissions made under the SE pathway—provisional and regular— that are defined by the date that the product came on the market and  when the manufacturer made the submission. For provisional SE  submissions, a manufacturer may market the new product that is the  subject of the submission while CTP conducts its review of the  submission, but for regular SE submissions, a manufacturer may not  market the new product until CTP completes its review and  determines that the product meets the SE requirements. (See   table 2.)
Exemption from SE pathway: Manufacturers make a submission  under the Exemption from SE pathway if (1) the new product is a  minor modification (adding, deleting, or changing the quantity of an  additive) of another tobacco product marketed by the same  manufacturer; (2) an SE submission is not necessary to ensure that  permitting the tobacco product to be marketed would be appropriate  for the protection of public health; and (3) an Exemption from SE is  otherwise appropriate.
Premarket Tobacco Product Application (PMTA) pathway:  Manufacturers make a submission under the PMTA pathway if the  new tobacco product does not meet the criteria of the SE or  Exemption from SE pathways—that is, the new tobacco product is not  substantially equivalent to a predicate product or is not a minor  modification of an appropriate product for modification. The PMTA  submission must include, among other things, full reports of  investigations of health risks, and must meet the public health  standard described under the Tobacco Control Act (that is, would be  appropriate for the protection of public health).
The Tobacco Control Act does not mandate a time frame for CTP’s  review of new tobacco product submissions with the exception of PMTA  submissions. For PMTA submissions, the act requires CTP to issue an  order stating whether the product may be marketed as promptly as  possible, but not later than 180 days after FDA’s receipt of a  submission.
CTP reviews of SE submissions—primarily conducted by OS—include  three key steps: (1) jurisdiction review to determine if the product is  regulated by FDA, (2) completeness review to determine if the  submission is missing information, and (3) scientific review to determine if  the product is substantially equivalent or not (see fig.1).
According to CTP officials, project managers determine whether the product (including  any component, part, or accessory of the product) is made or derived from tobacco;  whether it is a drug or medical device; and whether it meets established definitions for any  type of FDA-regulated tobacco product. respond to administrative AI letters, but in April 2012, CTP began giving  manufacturers 30 days to respond to an administrative AI letter.
After OS finishes these initial two steps in the SE review process, the next  step is a scientific review, which involves an assessment of the product  by scientists in different disciplines (such as chemistry and toxicology).  These scientists work to determine whether the product is substantially  equivalent to a product already on the market—that is, has the same  characteristics as a predicate tobacco product, or has different  characteristics but does not raise different questions of public health.  During scientific review, OS may issue scientific AI letters to request  additional information that the scientists determine is needed to make a  final determination (such as clarification of ingredients and additional  testing results). In these letters, CTP officials told us that OS requests  that manufacturers respond within 60 days. If OS determines that the SE  criteria have been met, then CTP will issue an SE order, and the product  may continue being marketed by the manufacturer (if it was a provisional  SE submission) or may be legally introduced into the U.S. market (if it  was a regular SE submission). If neither of these criteria is met, then CTP  will issue an order that the product is not substantially equivalent and the  manufacturer must remove the product from the market (if it was a  provisional SE submission) or cannot introduce the product into the  market under the SE pathway (if it was a regular SE submission).
According to CTP officials, reviews of Exemption from SE and PMTA  submissions also include jurisdiction, completeness, and scientific review  steps. However, the specific activities within each review step for those  pathways may differ from the specific activities involved in review steps  for SE submissions.
section_title: Requests for Meetings with CTP Offices
paragraphs: The Tobacco Control Act does not require CTP to conduct meetings with  outside entities, but CTP officials reported that they are valuable because  they increase knowledge of tobacco regulation among public health  groups, promote compliance among manufacturers, and clarify  information needed for new tobacco product submissions. However, each  CTP office follows different processes for receiving and processing  meeting requests. In the event that an outside entity—for instance, a  manufacturer or a public health advocacy organization—wants to meet  with CTP officials, it can request a meeting in various ways. For example,  manufacturers can submit written requests to the Director of OS by mail,  courier, or electronically to FDA’s document center. Manufacturers have  requested meetings with OS to discuss their new tobacco product  submissions, as well as study protocols and other scientific issues.  Manufacturers, tobacco trade associations, and other entities have also  proposed meetings with OS, OCD, OCE, and OP to educate CTP on  tobacco industry operations (for example, current practices in tobacco  product manufacturing), and to discuss industry’s views on FDA’s  approaches to tobacco regulation (for example, industry feedback on  published guidance documents). State, local, and tribal governments, as  well as academic and scientific organizations, have requested meetings  in order to coordinate public health efforts or share relevant knowledge.  CTP officials told us that CTP follows FDA’s practice not to grant  meetings for which the topic of discussion is in draft guidance.  Additionally, according to officials, one office within CTP may transfer a  meeting request to another office within CTP in order to provide the most  knowledgeable and appropriate agency officials at the meeting. However,  a request may not result in a scheduled meeting.
section_title: Tobacco User Fees
paragraphs: The Tobacco Control Act requires FDA to assess user fees on  manufacturers of FDA-regulated tobacco products based on their market  share and specifies that the tobacco user fees can only be applied toward  FDA activities that relate to the regulation of tobacco products. FDA bills  and collects tobacco user fees from manufacturers on a quarterly basis  and fees are generally collected the quarter after they are billed. For  example, fees billed in the fourth quarter of fiscal year 2011 were  collected in the first quarter of fiscal year 2012. The Tobacco Control Act  specified the total amount of user fees authorized to be collected for each  fiscal year beginning with fiscal year 2009, and authorized user fees to  remain available until expended (which means that FDA may carry over  user fees to subsequent fiscal years if they are not obligated by the end of  the fiscal year in which they were collected). (See table 3.)
section_title: CTP Finished Initial, but Not Final, Review Steps for Most Submissions, and Lacks Time Frames for its Review Process
paragraphs: As of January 7, 2013, the vast majority of new tobacco product  submissions FDA received from manufacturers were made under the SE  pathway. CTP has finished initial review steps (jurisdiction and  completeness reviews) for most SE submissions, but CTP has not made  final decisions for most submissions. For the majority of provisional SE  submissions, CTP took over a year and a half to complete these initial  review steps. In late June 2013, CTP made a final decision on 6 of the  3,788 SE submissions, finding that 2 of the products were substantially  equivalent and that 4 were not; the remaining submissions were still  undergoing CTP review. Several factors contributed to the significant  amount of time it took for review of new tobacco product submissions,  according to officials from CTP and tobacco manufacturers. CTP officials  reported taking steps to address factors that contributed to the length of  time the center has taken to review submissions, but the center has not  established review time frames by which to assess progress.
subsections: section_title: Almost All New Tobacco Product Submissions Have Been under the SE Pathway
paragraphs: As of January 7, 2013, nearly all new tobacco product submissions FDA  received from manufacturers (99 percent) were SE submissions, most of  which were provisional SE submissions. FDA received a total of 3,788 SE  submissions and 23 Exemption from SE submissions from  manufacturers. FDA did not receive any PMTA submissions. (See fig. 2.)
As shown in figure 2, of the 3,788 SE submissions received by FDA as of  January 7, 2013, 3,165 (84 percent) were provisional SE submissions   Almost all of the  and 623 (16 percent) were regular SE submissions.provisional SE submissions were received in the second quarter of fiscal  year 2011—3,115 of the provisional SE submissions were received within  the 3 weeks prior to the statutory deadline of March 22, 2011. The  number of regular SE submissions received in a quarter ranged from 19  (in the third quarter of fiscal year 2011) to 192 (in the third quarter of fiscal  year 2012). (See fig. 3.)
In addition to the 3,788 SE submissions, FDA received 23 Exemption  from SE submissions from manufacturers as of January 7, 2013.  Eligibility for the Exemption from SE pathway is limited to new tobacco  products that are minor modifications of an existing tobacco product  (adding, deleting, or changing the quantity of an additive) already  marketed by the same manufacturer. According to CTP officials, a key  factor contributing to the relatively small number of submissions is that it  is not common for a manufacturer to change only additives when making  a change to an existing tobacco product. According to industry  representatives, a key reason for the relatively small number of  submissions under this pathway is insufficient guidance from CTP about  what exactly constitutes a minor modification of another commercially  marketed tobacco product. FDA did not include a definition of the term  “minor modification” in its final rule to establish procedures for the  Exemption from SE pathway because the agency did not have the   In the rule, FDA stated  experience needed to provide a useful definition.that as it gains experience in evaluating Exemption from SE submissions,  it will consider establishing a definition for minor modifications.
CTP officials also reported that no submissions were received by FDA from January 8,  2013, through June 25, 2013. that current tobacco users will stop using tobacco products. According to  industry representatives, meeting the standards under the PMTA pathway  may not be feasible for some manufacturers—in particular, for small  manufacturers (which are manufacturers that have fewer than 350  employees). Industry representatives reported that small manufacturers  do not have the research and development resources to design or initiate  clinical trials that would be needed to support a PMTA submission.
section_title: CTP Finished Initial Review Steps for Most SE Submissions
paragraphs: As of January 7, 2013, CTP finished jurisdiction and completeness  reviews for over two thirds of the provisional and regular SE submissions  received since June 2010, but had not made a final decision on any of the  3,788 SE submissions. CTP finished both jurisdiction and completeness  reviews for about 69 percent of provisional SE submissions (2,191 out of  3,165), and about 67 percent of regular SE submissions (415 out of 623).  Almost all of the remaining 974 provisional SE submissions and about  half of the remaining 208 regular SE submissions were through  jurisdiction review but not completeness review. (See fig. 4.) Provisional  SE submissions and regular SE submissions were pending in  completeness review for as long about 1.5 years and 1 year,  respectively.review for any of the SE submissions.
As of January 7, 2013, CTP had not finished scientific   According to CTP officials, prioritization of provisional SE  On June 25, 2013—about 3 years after FDA’s receipt of the first SE  submission—CTP made a final decision on 6 of the 3,788 SE  submissions. CTP concluded that the new tobacco products in two of the  submissions were substantially equivalent and that the products in the  four other submissions were not. These six submissions were regular SE  submissions received by FDA in fall 2011 (about 1 year and 8 months  prior to CTP’s final decisions). For each of the two substantially  equivalent products, CTP found that the new product had different  characteristics than the predicate tobacco product but did not raise  different questions of public health. CTP found that four new tobacco  products were not substantially equivalent to predicate tobacco products  due to factors such as inadequate evidence that the products to which the  new products were being compared were valid predicate products and  lack of complete information on tobacco product characteristics.
section_title: CTP Took Over a Year and Half for Initial Review Steps for the Majority of Provisional SE Submissions
paragraphs: CTP took over a year and a half from FDA’s receipt of a submission  through the end of initial review steps for more than half of provisional SE  submissions, and 6 months for more than half of the regular SE  submissions. As of January 7, 2013, the median length of time to finish  initial review steps—from FDA’s receipt of a submission through the end  of completeness review—for provisional SE submissions was about   1 year and 9 months, and the length of time ranged from about 9 months  to about 2.5 years (see fig.5). The median length of time to finish initial  review steps for regular SE submissions was about 6 months, ranging  from about 1 month to about 2 years (see fig. 6).
Several factors have contributed to the significant amount of time it took  for review of SE submissions, according to CTP officials and industry  representatives. These officials identified factors such as insufficient  information provided by manufacturers in submissions; the prioritization of  regular SE submission reviews over provisional SE submissions; and  other factors.
CTP officials told us that insufficient information from manufacturers in SE  submissions has had the most significant impact on review times for  those submissions. According to CTP officials, the majority of SE  submissions were incomplete and required follow-up with manufacturers  to obtain additional information, such as a full description of both the new  tobacco product and the predicate tobacco product. CTP officials reported  that they spent significant time sending out AI letters requesting missing  information from manufacturers and awaiting the manufacturers’  responses. Our analysis found that administrative AI letters were  associated with 2,559 SE submissions, and CTP officials told us that  some submissions had more than one administrative AI letter. In these  letters, CTP officials requested that manufacturers respond to requests  within 60 days or 30 days. In addition, our analysis found that scientific AI  letters were associated with 81 SE submissions. In these letters, CTP  requested that manufacturers respond to requests within 60 days, but  CTP officials reported that it had granted extensions of up to 4 months.
Industry representatives agreed that the lack of completeness of  submissions had an impact on reviews, but they told us that guidance  provided by CTP was neither timely nor adequate for manufacturers to  provide what CTP would consider SE submissions with sufficient  information. Manufacturers we interviewed said they were not able to  include all information indicated in CTP guidance that was issued on  January 5, 2011, for provisional SE submissions, which needed to be  submitted by March 22, 2011, in order for those products to remain on the   Some industry representatives indicated that the  market provisionally.time it took to prepare a submission was more than CTP estimated, and  that the deadline for provisional SE submissions was not enough time to  incorporate all of the requirements in the guidance in their submissions.  Additionally, industry representatives we interviewed reported that the  January 2011 guidance did not direct manufacturers to include some  information by the March 22, 2011, submission deadline that CTP later  requested in its September 2011 draft guidance or AI letters, such as an  environmental assessment.
CTP placed a higher priority on its review of regular SE submissions than  on its review of provisional SE submissions, which contributed to longer  review times for provisional SE submissions when compared to regular  SE submissions. Specifically, according to OS officials, in the summer of  2011 CTP prioritized completeness reviews for regular SE submissions  over provisional SE submissions, so resources were shifted away from  provisional SE submissions. As a result of this decision—coupled with the  fact that provisional SE submissions were received earlier than regular  SE submissions—completeness review times for provisional SE  submissions were longer than for regular SE submissions. CTP officials  said that there were three reasons for placing a higher priority on its  review of regular SE submissions over provisional SE submissions:   (1) tobacco products in provisional SE submissions could remain on the  market legally (unless and until CTP issued an order of not substantially  equivalent), (2) FDA received a large number of provisional SE  submissions on March 21, 2011 (the day before the statutory deadline for  submitting provisional SE submissions), making it impractical to prioritize  reviews by the date the submission was received, and (3) CTP required  time to assess which approach to reviewing provisional submissions  would be the most effective at addressing the public health burden of  tobacco use.
Two more factors that had a significant impact on review times were a  shortage of experienced tobacco product review staff and slow IT  systems, according to CTP officials. These officials reported that when  they started reviews of SE submissions the center had a shortage of  experienced staff and that finding qualified staff was challenging.  Additionally, CTP officials said that initial training of review staff  contributed to review times as new staff were unable to review  submissions until receiving the necessary training. CTP officials also told  us that a slow IT system impacted the rate at which project managers  could enter data during jurisdiction and completeness reviews of SE  submissions, which slowed down those review times.
section_title: CTP Has Worked to Address Factors That Contributed to Review Times, but Has Not Established Time Frames by Which to Assess Progress
paragraphs: CTP has taken action to address the factors CTP officials identified as  contributing to the significant amount of time the center has taken to  review submissions. CTP has provided additional direction to  manufacturers in an attempt to decrease delays due to agency requests  for more information through AI letters. Specifically, it has held webinars  and published frequently asked questions to provide more guidance to  manufacturers that prepare submissions. Additionally, CTP officials told  us that in November 2012 CTP began alerting manufacturers of  upcoming scientific review of their submissions by issuing a notification to  manufacturers 45 days prior to starting scientific review. According to  CTP officials, this notification reminds manufacturers of the option to  amend their submissions as needed prior to the start of scientific review,  to facilitate higher quality submissions, and potentially avoid delays in  scientific review due to the issuance of scientific AI letters. CTP also  noted that it is working on a standardized form for manufacturers to use  when submitting new tobacco product information for review. According  to CTP officials, this form may take time to develop as it will require FDA  to issue regulations, but CTP officials anticipate that, when implemented,  a standardized form should improve review times. To address the  shortage of staff available for reviews, CTP officials told us they have  increased OS staff from 12 staff in June 2010 to more than 100 staff in  January 2013, including scientists and project managers involved in  submission reviews. Also in 2012, CTP drafted a reviewers’ guide to help  train staff on aspects of the SE review process. According to CTP  officials, the center plans to continue to revise its draft reviewer’s guide as  it further refines its new tobacco product review process. CTP officials  also reported that CTP had upgraded its IT system as of early 2013,  which has improved the time taken for data entry on SE submissions.  They also reported that CTP plans to transition to a new IT system in late  2013.
Our analysis of data provided by CTP found that for regular SE  submissions the length of time from the end of jurisdiction review through  the end of completeness review improved over time. Among regular SE  submissions received by FDA in fiscal year 2011 and for which CTP had  finished completeness review as of January 7, 2013, the length of time  from the end of jurisdiction review to the end of completeness review  ranged from about 3 months to 1.5 years, with a median length of time of  about 8 months. In contrast, the length of time for these steps for regular  SE submissions received in fiscal year 2012 ranged from less than 1 day  to 11 months, with a median of about 2 months. CTP officials reported  that actions such as hiring review staff and providing training for review  staff have resulted in improved review times.
While CTP is moving forward with its reviews of SE submissions and  efforts to improve review times, CTP does not have time frames for  reaching a final decision on submissions. Time frames would allow CTP  to evaluate its efficiency and effectiveness and help it make appropriate  adjustments. Under federal standards for internal control, control activities  that establish performance measures, such as time frames, and the  monitoring of actual performance against measures are an integral part of  operating efficiently, achieving effective results, and planning  appropriately. There are no time frames set by statute for the SE  pathway, and CTP has not established performance measures that  include time frames for making final decisions on the review of SE  submissions. Although CTP officials agreed that establishing time frames  would be useful for performance evaluation, CTP has not identified  specific plans to establish such time frames. According to CTP officials,  they have not yet established time frames because they first need to  collect and analyze information about how long each review step should  take. Yet without time frames, CTP is limited in its ability to evaluate  policies, procedures, and staffing resources in relation to its review  process and this, in turn, limits CTP’s ability to reasonably assure  efficiency and effectiveness. As a result, CTP is limited in its ability to  determine the adjustments needed to make improvements. For example,  CTP is limited in its ability to evaluate whether OS staff are performing  efficiently and effectively in relation to specific review steps, and as a  result, CTP may not appropriately make adjustments such as changing  an individual staff member’s responsibilities or increasing the number of  available staff.
section_title: CTP Granted Most Meeting Requests, but the Time from Request to Date Held Varied Widely
paragraphs: As of January 7, 2013, CTP granted more meetings than it denied. The  number of calendar days from the date a meeting request was received to  the date a meeting was held varied widely, and CTP officials reported that  logistics and subject matter contributed to these variations.
subsections: section_title: CTP Granted More Meetings Than It Denied
paragraphs: As of January 7, 2013, CTP’s offices had responded—granted, denied, or  transferred—to over 93 percent of the meeting requests they received  through January 7, 2013. Based on the data provided by CTP officials  from the four offices that received meeting requests from outside entities,  CTP’s offices responded to 108 of the 116 meeting requests received as  of January 7, 2013 (see table 4). Of these 108 responses, 72 of the  meeting requests were granted, 22 were denied, and 14 were transferred   According to CTP officials, in some cases,  to another office within CTP.the CTP office denied a meeting request because the office was able to  address the entity’s questions by telephone and a formal meeting was   no longer necessary. The remaining eight meeting requests were pending  or withdrawn as of January 7, 2013. CTP officials told us that since   January 7, 2013, they responded to three of the five pending meetings by  granting two meetings and denying one. According to CTP officials, as of  July 2013, the other two meetings were still pending because the meeting  requester had not responded to CTP.
Of the 116 meeting requests from outside entities, most (74) were  requested by tobacco manufacturers. Public health advocacy  organizations had the second highest number with 19 meeting requests  (see fig. 7).
The data compiled by the CTP offices did not include data on whether the transferred  meeting requests were either granted or denied by the office receiving the transferred  request. As a result, a transferred meeting request may also be counted as granted or  denied in the office that received the transferred request. requested meetings in order to provide information to CTP that may be  useful for CTP’s work.
section_title: The Time Taken from Meeting Request to Date Held Varied Widely; CTP Reported That Logistics and Subject Matter Contributed to Variations
paragraphs: The number of calendar days taken from the date a CTP office received a  meeting request to the date the meeting was held varied widely. For  example, in OP, the number of days from the date a meeting request was  received to the date a meeting was held ranged from 3 days to almost  five months, with half of the responses to meeting requests taking more  than about 1.5 months. Further, for OCD, the number of days from the  date a meeting request was received to the date a meeting was held  ranged from 9 days to more than 8 months with at least half of the  responses to meeting requests taking over 2.5 months. (See table 5.)
For tobacco manufacturers, the type of entity with the most meeting  requests, the amount of time taken from the date the meeting request  was received to the date the meeting was held also varied by office. For  example, the minimum number of days from a meeting request to the  date the meeting was held for OS was about a month, and the maximum  was about 5 months, with half of the responses to meeting requests  taking more than about 3 months. The minimum number of days from a  meeting request to the date the meeting was held for OP was 3 days, and  the maximum was almost 4 months, with half of the responses to meeting  requests taking more than about 1.5 months.
According to CTP officials, logistics for scheduling meetings and the  subject of the request contributed to the wide variation in time taken from  the date of the request to the date the meeting was held. For example,  OP officials said that the entity requesting the meeting may have to  coordinate travel for several people across many locations in order to  schedule a meeting and this coordination may contribute to a longer  period of time before the meeting will take place. In addition, the subject  matter of the request was another factor that CTP officials reported as  contributing to the time taken by CTP offices to hold a meeting. For  example, officials from OS said that CTP is a new regulatory agency and,  as a result, it sometimes receives meeting requests on subject matters  with which the center is unfamiliar and officials must involve many entities  within both CTP and FDA to determine several things, including which  office within CTP should host the meeting and what information the  requested entity should prepare.
section_title: FDA Spent Less than Half of the $1.1 Billion in User Fees Collected
paragraphs: As of the end of fiscal year 2012, FDA had spent less than half of the  tobacco user fees collected and CTP had spent less than planned. CTP  officials reported that issues related to contracting contributed to lower  than expected spending.
subsections: section_title: FDA Spent Less than Half of the User Fees Collected and CTP Spent Less than Planned
paragraphs: As of the end of fiscal year 2012, FDA had spent less than half of the   $1.1 billion in tobacco user fee funds collected (46 percent) from fiscal  year 2009 through fiscal year 2012, leaving more than $603 million   (54 percent) unspent. (See fig. 8.) Of the almost $513 million spent  during this time, CTP spent almost $468 million. The remaining funds  were spent by other FDA entities, such as the Office of Regulatory Affairs.
In fiscal years 2011 and 2012, CTP spent less than the amounts it  identified in its spend plan—that is, spent less than planned. According to  CTP officials, the center’s spend plan identifies plans for spending CTP’s  user fee funds on staffing, acquisitions, and operational needs. The  spend plan is based on user fee funds anticipated to be collected by FDA  and user fee funds that CTP did not spend in the previous fiscal year.  Based on the spend plan for fiscal year 2011, all seven CTP offices had  planned on spending a total of $225.4 million for fiscal year 2011, and  these offices spent $106.4 million for that year. CTP continued to spend  less than planned for fiscal year 2012. (See table 6.) CTP officials  reported that based on spending through the third quarter of fiscal year  2013, the difference between the amount of planned spending and the  amount of actual spending in fiscal year 2013 will be less than the  differences between planned and actual spending in previous years.   CTP planned to spend more than $810 million in fiscal year 2013, and as  of June 30, 2013, CTP has spent or is committed to spend over   $712 million.
Specifically, six of the seven CTP offices spent less user fee funding than  CTP planned for fiscal years 2011 and 2012. For example, for fiscal year  2011, CTP’s Office of Health Communication and Education, OCE, and  OS planned to spend about $30 million more than they actually spent;  and the Office of Management was the only CTP office that planned to  spend less than it actually spent—it planned to spend about $1 million  less than it spent. (See fig. 9.)
CTP officials told us that issues related to contracting accounted for most  of the difference between the amounts spent and planned spending.  Specifically, they reported that the time it took to award contracts resulted  in CTP not spending the funds that the center planned to spend for a  given fiscal year. For example, according to CTP officials, CTP’s Office of  Health Communication and Education had planned to award a $55 million  contract for communications support services for part of its public  education campaign for fiscal year 2011. This office also planned to  award a related $145 million contract in fiscal year 2012 for a public  health education campaign. However, most of the planned $200 million  total was not awarded until the first quarter of fiscal year 2013.officials told us that both contracts were not awarded at these amounts in  fiscal year 2011 or 2012 as planned because CTP and FDA spent  significant amounts of time to determine the structure of the contract as  FDA had never conducted a public education campaign of this  magnitude.
Spending for other contracts for both fiscal years 2011 and 2012 was  lower than expected for a number of reasons, according to CTP officials:  fewer than expected contracts were awarded, the scope of a contract  changed, or CTP was short of staff to support the work of the contract.
For fiscal year 2011, CTP’s OCE had planned to award $55 million in  contracts with states to ensure compliance with tobacco regulations,  but CTP awarded a total of $24 million for that fiscal year because  fewer states participated than expected.
For fiscal year 2012, CTP’s OS entered into an interagency  agreement with the Centers for Disease Control and Prevention to  develop analytical methods and establish baseline levels of harmful or  potentially harmful constituents in tobacco products for $20 million  less than planned because of a change in scope of the activities for  this contract.
For fiscal year 2011, CTP’s Office of Health Communication and  Education entered into an interagency agreement with the National  Institutes of Health to support regulatory communications activities.  The agreement was $3.5 million less than initially planned because  the Office of Health Communication and Education was just being  established at the time and it did not have enough staff to support this  joint effort. As a result, the office reduced the scope of the contract.
In addition to issues related to contracting, CTP officials said that plans to  hire more staff than it did and planned management related activities that  were not undertaken were other reasons why the amounts spent were  lower than planned. According to CTP officials, for fiscal years 2011 and  2012, CTP had planned to hire more staff than it did and this accounted  for $6 million and $10 million of the differences between amounts planned  to be spent and spent, respectively. Further, according to CTP officials,  lower than planned spending for other management activities (such as  computer updates and planning potential reorganization) is another  reason why the amounts spent by CTP were lower than planned. For  example, for fiscal year 2011, the CTP spend plan included $35 million for  planning associated with establishing two new offices within CTP.  According to CTP officials, this amount was expected to cover  contingencies, such as computer updates or management development,  if they were needed. However, the officials reported that this reserve was  not used because funds were available in the Office of Management to  handle any issues related to the addition of these new offices.
section_title: Conclusions
paragraphs: Four years after the Tobacco Control Act established CTP and about   3 years after the first new tobacco product submission, FDA has received  about 4,000 submissions and collected over $1.1 billion in tobacco user  fee funds. Although CTP has finished initial review steps for most of these  submissions, as of June 2013, the center made a final decision on only   6 submissions and the time taken on reviews has been significant.  Certainly, insufficient information provided by manufacturers in  submissions, the prioritization of regular SE submission reviews over  provisional SE submissions, and other factors have contributed to the  time CTP has taken in its reviews. Yet, as CTP moves forward with its  work, the lack of performance measures like time frames for reviews of  SE submissions will limit CTP’s ability to evaluate policies, procedures,  and staffing resources in relation to CTP’s submission review process  and, in turn, limit CTP’s ability to reasonably assure efficient operations  and effective results. An entity that is limited in its ability to evaluate its  performance will be hard-pressed to determine what adjustments it  should make to its operations or how to plan for the future.
section_title: Recommendations for Executive Action
paragraphs: To improve CTP’s ability to operate efficiently, achieve effective results,  and plan appropriately, we recommend that the Secretary of Health and  Human Services direct the Commissioner of FDA to establish performance measures that include time frames for making  final decisions on SE submissions and Exemption from SE  submissions, and monitor FDA’s performance relative to those time frames, such as  evaluating whether staff are performing reviews of these submissions  efficiently and effectively.
section_title: Agency Comments
paragraphs: We provided a draft of this report to HHS for comment. In its written  comments, reproduced in appendix II, HHS agreed with our  recommendations. Specifically, HHS stated that FDA will identify  performance measures and time frames for regular SE and Exemption  from SE review processes within 6 months of our report’s publication and  that FDA will monitor its progress to determine if subsequent SE reviews  meet the identified time frames. In addition, HHS commented that FDA  will identify performance measures and time frames for the provisional SE  review process as FDA gains more experience reviewing these SE  submissions. HHS further stated that based on the actual performance of  meeting the identified time frames, FDA will make modifications to the  review process, if appropriate, in order to meet agency objectives.
HHS also provided additional information on CTP activities in its  comments. For example, HHS stated that CTP is working to reach  determinations on SE and Exemption from SE submissions as  expeditiously as possible, and that CTP has continued to make progress  on conducting product reviews and in its process and timeliness for  responding to requests for meetings with CTP offices. Regarding tobacco  user fee funds, HHS commented that CTP is projecting that it will  decrease the amount of unspent tobacco user fee funds to carry over at  the end of fiscal year 2013 to the mid-$200 millions, which is less than  half of the amount carried over at the end of fiscal year 2012. HHS also  suggested that our report should include information on all user fee  spending, including spending by FDA entities other than CTP. We do  report total user fees spent and not spent by FDA, including spending by  both CTP and other FDA entities, through fiscal year 2012. In comparing  spend plans with actual spending, we reported on spending by CTP,  which comprised more than 90 percent of the $513 million spent by FDA  through fiscal year 2012. In reporting on CTP spending, we clearly note  that other FDA entities, including the Office of Regulatory Affairs,  Headquarters, and the Office of the Commissioner, spend tobacco user  fee funds, and that these entities spent $11 million in fiscal year 2011 and  $24 million in fiscal year 2012.
HHS also provided technical comments that were incorporated, as  appropriate.
As agreed with your office, unless you publicly announce the contents of  this report earlier, we plan no further distribution until 30 days from the  report date. At that time, we will send copies of this report to the  Secretary of Health and Human Services, the Commissioner of FDA, and  other interested parties. In addition, the report will be available at no  charge on GAO’s Web site at http://www.gao.gov.
If you or your staff have any questions about this report, please contact  me at (202) 512-7114 or at crossem@gao.gov. Contact points for our  Office of Congressional Relations and Office of Public Affairs can be  found on the last page of this report. Other major contributors to this  report are listed in appendix III.
section_title: Appendix I: Staffing Resources for Conducting Reviews of New Tobacco Product Submissions
paragraphs: As of January 7, 2013, the Office of Science (OS)—the only Center for  Tobacco Products (CTP) office involved in all steps of reviewing new  tobacco product submissions—had 124 staff members on board, and the  majority of the staff (102 or 82 percent) reported spending some portion  of their time reviewing new tobacco product submissions. OS has other  responsibilities in addition to reviewing new tobacco product submissions,  including research to meet regulatory science needs and to evaluate the  population and public health impact of tobacco products. According to OS  officials, of the 102 staff who reported spending time on reviewing  submissions, 60 percent or 61 staff reported that in general they spent at  least half of their time working on reviews of new tobacco product  submissions. The remaining 41 staff reported generally spending less half  of their time on reviews of new tobacco product submissions. (See   fig. 10.)
The amount of time an OS staff person reported spending on new  tobacco product submissions varied by job title. Specifically, the   23 project managers, the OS officials responsible for coordinating the  reviews of new tobacco product submissions, and 17 scientists (such as  chemists and toxicologists) reported spending at least half of their time  working on reviews of new tobacco product submissions. Meanwhile, the  Deputy Director for Research and the Special Assistant to the Director  reported spending less than half of their time on the review of new  tobacco product submissions. (See table 7.)
section_title: Appendix II: Comments from the Department of Health and Human Services
section_title: Appendix III: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, Kim Yamane, Assistant Director;  Danielle Bernstein; Hernán Bozzolo; Britt Carlson; Cathleen Hamann;  Richard Lipinski; and Lisa Motley made key contributions to this report.