[Senate Hearing 117-394]
[From the U.S. Government Publishing Office]


                                                    S. Hrg. 117-394

                   FDA USER FEE AGREEMENTS: ADVANCING
                    MEDICAL PRODUCT REGULATION AND 
                 INNOVATION FOR THE BENEFIT OF PATIENTS

=======================================================================

                                HEARING

                                 OF THE

                    COMMITTEE ON HEALTH, EDUCATION,
                          LABOR, AND PENSIONS

                          UNITED STATES SENATE

                    ONE HUNDRED SEVENTEENTH CONGRESS

                             SECOND SESSION

                                   ON

            EXAMINING FOOD AND DRUG ADMINISTRATION USER FEE AGREE-
              MENTS, FOCUSING ON ADVANCING MEDICAL PRODUCT REGULATION
              AND INNOVATION FOR THE BENEFIT OF PATIENTS

                               __________

                             APRIL 5, 2022

                               __________

 Printed for the use of the Committee on Health, Education, Labor, and 
                                Pensions
                                
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]                                


        Available via the World Wide Web: http://www.govinfo.gov
        
        
                              __________

                                
                    U.S. GOVERNMENT PUBLISHING OFFICE                    
48-905 PDF                  WASHINGTON : 2023                    
          
-----------------------------------------------------------------------------------     
        
          COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS

                    PATTY MURRAY, Washington, Chair
BERNIE SANDERS (I), Vermont          RICHARD BURR, North Carolina, 
ROBERT P. CASEY, JR., Pennsylvania       Ranking Member
TAMMY BALDWIN, Wisconsin             RAND PAUL, M.D., Kentucky
CHRISTOPHER S. MURPHY, Connecticut   SUSAN M. COLLINS, Maine
TIM KAINE, Virginia                  BILL CASSIDY, M.D., Louisiana
MAGGIE HASSAN, New Hampshire         LISA MURKOWSKI, Alaska
TINA SMITH, Minnesota                MIKE BRAUN, Indiana
JACKY ROSEN, Nevada                  ROGER MARSHALL, M.D., Kansas
BEN RAY LUJAN, New Mexico            TIM SCOTT, South Carolina
JOHN HICKENLOOPER, Colorado          MITT ROMNEY, Utah
                                     TOMMY TUBERVILLE, Alabama
                                     JERRY MORAN, Kansas

                     Evan T. Schatz, Staff Director
               David P. Cleary, Republican Staff Director
                  John Righter, Deputy Staff Director
                           
                           
                           C O N T E N T S

                              ----------                              

                               STATEMENTS

                         TUESDAY, APRIL 5, 2022

                                                                   Page

                           Committee Members

Murray, Hon. Patty, Chair, Committee on Health, Education, Labor, 
  and Pensions, Opening statement................................     1
Burr, Hon. Richard, Ranking Member, a U.S. Senator from the State 
  of North Carolina, Opening statement...........................     3

                               Witnesses

Richardson, Liz, Director, Health Care Products Project, The Pew 
  Charitable Trusts, Washington, DC..............................     6
    Prepared statement...........................................     8
    Summary statement............................................    11
Esham, Cartier, Ph.D., Chief Scientific Officer and Executive 
  Vice President of Emerging Companies, Biotechnology Innovation 
  Organization, Washington, DC...................................    12
    Prepared statement...........................................    13
    Summary statement............................................    23
Gaugh, David, Senior Vice President, Sciences and Regulatory 
  Affairs, Association for Accessible Medicines, Alexandria, VA..    24
    Prepared statement...........................................    25
    Summary statement............................................    32
Leahey, Mark, President and Chief Executive Officer, Medical 
  Device Manufacturers Association, Washington, DC...............    33
    Prepared statement...........................................    34
    Summary statement............................................    36

                          ADDITIONAL MATERIAL

Statements, articles, publications, letters, etc.
Burr, Hon. Richard:
    Letters to and from the FDA..................................    59
    Count of In-Person Medical Product Inspections by Month-FY17 
      to FY21 (to date)..........................................   128
Smith, Hon. Tina:
    Biosimilars Forum Letter.....................................   130
Braun, Hon. Mike:
    Letter Requesting a Patient Focused User Fee Hearing.........   131

                         QUESTIONS AND ANSWERS

Response by Cartier Esham to questions of:
    Senator Braun................................................   132
    Senator Romney...............................................   133
Response by David Gaugh to questions of:
    Senator Kaine................................................   134
    Senator Romney...............................................   135
Response by David Leahey to questions of:
    Senator Burr.................................................   136

 
                   FDA USER FEE AGREEMENTS: ADVANCING
                     MEDICAL PRODUCT REGULATION AND
                 INNOVATION FOR THE BENEFIT OF PATIENTS

                              ----------                              


                         Tuesday, April 5, 2022

                                       U.S. Senate,
       Committee on Health, Education, Labor, and Pensions,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 10:02 a.m., in 
room 106, Dirksen Senate Office Building, Hon. Patty Murray, 
Chair of the Committee, presiding.
    Present: Senators Murray [presiding], Casey, Baldwin, 
Murphy, Kaine, Hassan, Smith, Rosen, Hickenlooper, Burr, 
Collins, Cassidy, Braun, Marshall, and Scott.

                  OPENING STATEMENT OF SENATOR MURRAY

    The Chair. Good morning. The Committee will come to order. 
The Senate Health, Education, Labor, and Pensions Committee 
will come to order. And today we are having the first of two 
hearings on reauthorizing four Food and Drug Administration 
user fee programs. I will have an opening statement followed by 
Ranking Member Burr. We will then introduce our witnesses.
    After they give their testimony, Senators will each have 5 
minutes for a round of questions. Again, while we are unable 
yet to have the hearing fully opened to the public or media for 
in-person attendance, live video is available on our Committee 
website at help.senate.gov. And if you are in need of 
accommodations, including closed captioning, you can reach out 
to the Committee or the Office of Congressional Accessibility 
Services.
    Every day, families in Washington State and across the 
country count on the Food and Drug Administration to keep them 
safe more times than they even realize. Whether we are getting 
a meal or a prescription or an ultrasound, or almost anything 
in between, we have the FDA to thank for reviewing the data, 
inspecting the supply chain, holding companies accountable, and 
taking unsafe products off the market.
    It is no small task ensuring the safety of nearly 80 
percent of our Nation's food supply, inspecting thousands of 
food, drug, and device manufacturing sites each year, and of 
course, quickly and carefully reviewing the data on new and 
potentially lifesaving medical products. As we have seen 
throughout this pandemic, this work is incredibly important, 
which is why it is also important we reauthorize the user fee 
programs, which ensure as FDA gets new drugs or devices to 
consider for approval.
    As it gets more potentially lifesaving work to do, it also 
gets more resources to support that work. Congress has 
regularly reauthorized the user fee programs in a bipartisan 
way, and I am glad to be working with Senator Burr and our 
colleagues on the Committee to get this done once again in a 
timely manner. Because it should be unthinkable that after 2 
years when FDA's work has been more important than ever, we 
would fail to get this done and force the agency to send pink 
slips.
    Just as it should be unthinkable that we would fail to 
learn the lessons of this pandemic, including lessons for FDA, 
like how we can get tests to families sooner, or how we can 
avoid political interferences like we saw during the Trump 
administration, including the reckless push for unproven 
treatments like hydroxychloroquine, or how we can improve 
transparency and communication to prevent some of the confusion 
and frustration we have seen around the timelines for booster 
shots and vaccines for younger children.
    Beyond pandemic response, it is clear we can't simply 
settle for business as usual, because when you look at issues 
like the exorbitant cost of prescription drugs, the lack of 
diversity in clinical trials, the scourge of opioids and 
especially fentanyl, the lack of oversight for dietary 
supplements and cosmetics, and how long it took to get 
contaminated baby formula off the market, it is clear to me and 
to people back in Washington State that business as usual is 
not good enough.
    We have to make sure the approval process works for 
families, not just pharmaceutical companies' bottom lines. That 
means better steps to ensure drugs work for everyone, such as 
increased diversity in clinical trials and pediatric drug 
research. It means ensuring the accelerated approval pathway 
benefits patients. And it absolutely means lower costs, because 
even a miracle cure is no help if it is too expensive for 
people who need it.
    We need to fight skyrocketing health care costs with every 
tool in our arsenal from stopping pharmaceutical companies who 
game the FDA system to block competition and keep cheaper drugs 
off the shelves, to bringing down barriers that block cheaper 
generics and biosimilars from getting to market, to finally 
making good on legislation Congress passed to let hearing aids 
to be sold over-the-counter and at lower cost for millions of 
people.
    I worked with many of my colleagues on this Committee to 
pass that into law a half a decade ago, and I am incredibly 
frustrated FDA has not been focused on helping so many 
Americans. There is just no good reason we are still waiting 
for FDA to implement that step and save millions of people 
thousands of dollars. We also need to do more to protect 
families from dangerous products that have gone for too long 
with too little scrutiny.
    When it comes to cosmetics, products people put on their 
face, rub into their skin, and more, we have discovered known 
carcinogens like asbestos and formaldehyde in baby powder, 
children's makeup kits, and hair products. And when it comes to 
dietary supplements, people across the country who are looking 
to make healthy choices are faced with a shelf full of products 
that make health claims but lack rigorous oversight.
    Yet FDA does not have the authority to collect basic 
information about those products or even to know what is on the 
market. That makes no sense. People in Washington State and 
across the country buy, use, and entrust their health to these 
items every day. They deserve to know these products are safe, 
vetted, and subject to the same type of careful FDA oversight 
people rely on when it comes to food, drugs, and medical 
devices. So I hope we will make progress on all of those issues 
and more as we rework--as we work to reauthorize the user fee 
programs.
    All of us on this Committee are grateful for the tireless 
work of FDA scientists during this pandemic to review and 
authorize safe and effective tests, treatments, and of course, 
vaccines for COVID-19. And we are grateful for the constant 
work they do to ensure the safety of our food supply, provide 
people with the information they need to make healthy choices, 
and uphold the gold standard of safety and effectiveness for 
drugs and medical devices. But the FDA does not run on 
gratitude.
    I look forward to today's conversation on the user fee 
programs, and to working with my colleagues on bipartisan 
legislation that supports and strengthens FDA's ongoing work by 
reauthorizing these programs and taking additional steps to 
lower drug costs, increase diversity in clinical trials, ensure 
the safety of cosmetics and dietary supplements, and more.
    With that, I will turn it over to Ranking Member Burr for 
his opening remarks.


                   OPENING STATEMENT OF SENATOR BURR

    Senator Burr. Thank you, Madam Chair. And welcome to our 
witnesses here today. I look forward to our discussion. Every 5 
years, this Committee is charged with evaluating FDA's user fee 
programs and the agency's performance in meeting its existing 
commitments. At their core, these programs are about bringing 
new hope to Americans.
    The faster, more predictable, and more accountable the 
programs are, the more patients stand to benefit from 
lifesaving, innovative drugs and devices. When FDA does not 
live up to its commitments, patients are the ones that suffer. 
I have served in Congress since 1995, so I have been here for 
all but the first user fee process.
    Each time, I have gradually added provisions to improve 
FDA's accountability to the commitments that FDA makes. Every 5 
years, industry agrees to provide more funding under the duress 
of negotiating with the regulator. So it is Congress's job to 
make sure that those negotiations were not a hostage situation, 
and that these arrangements are a good deal for patients and 
the industry that brings that hope.
    The user fee programs are intended to supplement FDA's 
congressionally appropriated resources to speed the review of 
medical products and get treatments to patients as quickly as 
possible. The user fee agreements negotiated between FDA and 
industry partners lay out the process for bringing new products 
to market that will treat, prevent, and cure disease. In 1992, 
under the first Prescription Drug User Fee Agreement or PDUFA, 
the drug application fee was about $100,000.
    Today, the drug application fee is $1.3 million. The 
medical device user fee agreements were first signed into law 
in 2002. In 2007, a 510(k) submission was just over $4,000. 
Today, this application costs more than $12,700. When Members 
of Congress complain about the cost of prescription drugs or 
medical devices, we should evaluate all aspects of the 
pipeline, including the cost of development and regulatory 
review, to make sure costly and burdensome regulations are not 
part of the cost problem.
    The enormous growth in the oldest of the user fee programs 
underscores my longstanding concerns. In 1993, FDA collected 
just over $35 million in annual fees from the Prescription Drug 
User Fee Program. Today, FDA collects over $1 billion in PDUFA 
user fees annually. Even accounting for inflation, that is an 
increase of more than 1,500 percent since the start of the 
program.
    Yet FDA continues to request more and more resources from 
industry, even when they don't meet agreed upon performance 
goals. For example, in Fiscal Year 2019 and 2020, FDA missed 12 
out of the 14 goals related to scheduled meetings, delaying 
needed conversations for innovators to move forward with their 
products. As part of the proposed new prescription drug program 
commitments, FDA is requesting an additional $324 million over 
the 5-year cycle. Let me say that again, $324 million.
    The proposed agreement includes $111 million for hiring an 
additional 352 people. That is 122 more new hires than the 
agency committed to in the last cycle. In fact, across all four 
programs, FDA is committing to more than 880 new hires when the 
agency has more than 700 vacancies outstanding. Let me say that 
again. In fact, across all four programs, FDA is committing to 
more than 884 new hires when the agency has more than 700 
vacancies outstanding today.
    Generic and biosimilar drugs are our best tool at driving 
down the cost of prescription drugs and should be a top 
priority of the agency. The biosimilar agreement should help 
boost the number of biosimilars in the market, including 
biosimilars in insulin production. FDA, again, has struggled to 
meet some important program goals.
    During Fiscal Year 2020, FDA missed its goal to review 90 
percent of biosimilar applications within 10 months, only 
reviewing 50 percent within that time, and missed 7 out of 15 
goals related to product development meetings. Under the 
proposed biosimilar agreement, FDA is requesting an additional 
$5 million over the 5-year cycle and 15 new hires.
    The generic drug program collects more than $494 million in 
annual fees and supports more than 2,100 staff positions. Under 
the proposed generic drug agreement, FDA is requesting 
additional funding of more than $40 million and 128 new hires. 
While FDA appears to be on track to meet the majority of its 
commitments under the current generic agreement, its 
performance has been impacted by COVID-19 in terms of delayed 
facility inspections.
    As of last August, these inspections challenges had delayed 
more than 29 generic drug applications, with many more 
applications likely delayed since then. Turning our attention 
to the medical device agreement, I have watched this very 
carefully and I am concerned. This Committee only recently 
received the draft medical device commitment letter.
    The final medical device arrangements were due by law to 
Congress by January 15th. By the time we receive these final 
agreements, the device commitment letter was more than 3 months 
late. Under this proposal, FDA is requesting up to $1.9 billion 
over the 5-year cycle, nearly $1 billion increase.
    This proposed increase is roughly doubling fee collections. 
Yet again, the FDA did not meet deliverables under this user 
fee program. The FDA missed goals for 510(k) reviews, resulting 
in longer review times, failed to explain its reasoning to 
sponsors each time it sent a deficiency letter about their 
product, and it failed to issue an important digital health 
guidance on time. Let me remind my colleagues, these are not 
optional actions.
    These were requirements, requirements under the last deal 
for categories of submissions. For the first 2 years, review 
times for premarket approval applications would hold steady at 
290 calendar days, and in the last 3 years, review times would 
reduce to 285 calendar days. Wow.
    However, FDA is significantly walking back its current 
commitment to reviewing 510(k) submissions within 180 days. 
Instead, FDA is proposing longer review times of 108 days. FDA 
Safety and Innovation Act, which we passed in 2012, requires 
FDA to review 95 percent of these applications within 90 days. 
This agreement almost doubles the user fees and includes longer 
review times for some categories of products.
    Pay more, get less is not exactly a selling point. MDUFA V 
also includes a new pilot program called TAP. This aimed to 
initiate early and frequent engagement between FDA and sponsors 
of innovative devices. I might say, something already 
negotiated in the agreement. As the author of the breakthrough 
device pathway, I still can't figure out whether this new 
program will offer anything different from FDA's current 
activities for breakthrough devices.
    The new pilot program is set to grow over the 5-year cycle, 
without clear accountability, metrics, or deliverables to help 
measure the success of the program. No metrics. The pilot has 
the ability to grow to 325 devices, which would cost at least 
$477,000 per device. Congress deserves a full accounting of how 
FDA plans to spend these resources and operate this new 
nebulous program.
    I will tell you right now, Congress is going to require 
accountability in the new program. With each reauthorization, 
FDA receives huge increases in resources despite not fulfilling 
or delivering what has previously been promised. And with a 
declining percentage of congressional appropriations for the 
overall program, FDA is increasingly removing itself from 
Congress's reach.
    My colleagues should be concerned with this. I question 
whether the agreements both passed and proposed reflect a good 
deal for patients they are designed to serve. In 2017, during 
the user fee hearings in this Committee, I asked each industry 
representative testifying about the importance of the user fee 
agreements and whether they would support a mechanism to hold 
FDA more accountable.
    The response was clear, FDA should be held accountable to 
its commitments. I look forward to hearing from each of you and 
about why you have agreed to these commitments, and how they 
would accelerate innovation and lifesaving products for the 
American people. I thank the Chair.
    The Chair. Thank you, Senator Burr. I would like to ask 
unanimous consent to introduce into the record a statement from 
the National Organization for Rare Disorders.
    Senator Burr. Madam Chair, I would also like to ask 
unanimous consent to enter into the record letters that I sent 
to then Acting Commissioner Woodcock, requesting information 
about the user fee programs and the negotiations for these 
proposed new agreements, and the responses I received from the 
FDA. One of these letters I sent to the FDA in November last 
year, and I am still awaiting a response. I hope to receive 
that response soon.
    The Chair. So ordered on both.

    [The information referred to by Senator Murray was not 
submitted:]

    [The information referred by Senator Burr can be found on 
page 59 in Additional Material:]
    The Chair. With that, I want to welcome all of our 
witnesses today. Thank you for joining us. Our first witness 
will be Liz Richardson, who is the Director of the Health Care 
Products Project at the Pew Charitable Trusts. Ms. Richardson, 
thank you for sharing your time and expertise with us today.
    I look forward to your testimony. Our next witness is Dr. 
Cartier Esham, the Chief Scientific Officer and Executive Vice 
President of Emerging Companies at the Biotechnology Innovation 
Organization. Thank you for joining us today, Dr. Esham. We 
look forward to your testimony. I am also pleased to welcome 
David Gaugh, who is the Senior Vice President for Sciences and 
Regulatory Affairs at the Association for Accessible Medicines.
    Mr. Gaugh, I appreciate your being here today to share your 
perspectives. Finally, we have Mark Leahey, President and Chief 
Executive Officer of the Medical Device Manufacturers 
Association. Mr. Leahey, thank you for taking the time to be 
with all of us today. Ms. Richardson, you may begin your 
opening statement.


  STATEMENT OF LIZ RICHARDSON, DIRECTOR, HEALTH CARE PRODUCTS 
       PROJECT, THE PEW CHARITABLE TRUSTS, WASHINGTON, DC

    Ms. Richardson. Chair Murray, Ranking Member Burr, and 
Members of this Committee, thank you for the opportunity to 
testify today about how the reauthorization of the FDA user fee 
agreements can support patients and public health. The Pew 
Charitable Trust is a global non-governmental organization that 
seeks to improve public policy, invigorate civic life, and 
inform the public.
    We believe that evidence based policies and investments can 
both spur the development of new drugs and medical devices and 
ensure effective oversight of these products. Today, I would 
like to focus my remarks on the role that the user fee 
agreements can play in promoting innovation and supporting a 
broad range of public health priorities, ultimately leading to 
improvements in patient care and outcomes.
    Since 1992, user fees have provided FDA with significant 
and sustained resources that have allowed the agency to both 
facilitate the development of urgently needed medical products 
and to review those products quickly so they can get to the 
patients who need them.
    This issue is particularly important to Pew's Antibiotic 
Resistance Project, which is working to advance policies that 
would spur the creation of new antimicrobial products and 
establish stewardship programs that would ensure these products 
are prescribed only when necessary. Since 2014, FDA has 
approved 14 antibiotics, three of which represent a novel drug 
class or novel mechanism of action.
    These advances are critical as the world faces a dangerous 
shortage of antimicrobial products to address both current and 
future patient needs. In 2002, Congress also established a user 
fee program for medical devices. The fees that FDA collects 
under these agreements provide the agency with resources to 
review applications and deliver a more efficient oversight 
process, one that can adapt to a rapidly evolving device market 
where emerging technologies like AI enabled digital health 
tools and 3D printing are posing challenges to traditional FDA 
oversight.
    Pew is currently conducting research to inform how the 
agency can better facilitate ongoing innovation while still 
providing adequate public health safeguards for these rapidly 
changing products. But no matter how the agency decides to 
adapt its regulatory approaches, it needs adequate resources to 
fund its core activities, and this includes user fees.
    A second key aspect of the user fee agreement process is 
how each successive reauthorization has provided an opportunity 
to advance other priorities that can advance patient health. 
For example, in its 2012 PDUFA Reauthorization Bill, Congress 
acknowledged the vital need for new antibiotics by enacting the 
GAIN Act as part of that package.
    The GAIN Act represented an important first step in 
launching innovator companies devoted to antimicrobial research 
and development, but more work is needed to ensure that these 
companies can earn a fair return on investment and continue to 
innovate. But to that end, the PASTEUR Act proposes a unique, 
only pay for success pull incentive that will strengthen U.S. 
preparedness for future pandemics.
    We urge Congress to include that measure in its current 
PDUFA reauthorization. Pew also believes that reforming 
oversight for diagnostic tests, an issue currently addressed in 
bipartisan legislation known as the VALID Act, is of critical 
importance. As the COVID-19 pandemic has shown, the Nation's 
public health depends on rapid access to accurate and reliable 
tests that can diagnose disease or identify past infection. But 
faulty diagnostic tests can compromise both patient care and 
the Nation's response to infectious diseases.
    Current gaps in oversight have allowed tests that are 
developed and used within the same laboratories, called lab 
developed tests, to come to market without FDA approval, even 
if those tests are otherwise high risk. Pew believes strongly 
that tests should be regulated according to their risk to 
patients if they are inaccurate, not according to where they 
are developed and used.
    By including VALID as part of the MDUFA reauthorization 
package, Congress can strengthen and update FDA's oversight of 
these critical products to make it more flexible and more risk-
based.
    Finally, I want to note that while review times are 
important insofar as they speed patient access to potentially 
important products, it is critical to remember that true 
innovation is not just about getting products to market faster, 
it is about developing products that are safer and more 
effective than what is already available.
    While user fees are important to the efficient function of 
FDA, they cannot and should not be a substitute for adequate 
appropriations. User fees do not cover all of FDA's essential 
functions, such as conducting most post-market oversight 
activities or regulating non-drug products, including the large 
and ever-growing market of dietary supplements. FDA needs 
resources beyond user fees to sustain these core activities.
    Because FDA is a public health agency that works to promote 
the health of all Americans, the agency should receive public 
funds and be accountable to the public, not just to the 
industries that it regulates. That being said, I want to 
conclude by underscoring again the importance of user fees to 
the basic functioning of the FDA.
    Given the critical role that the agency plays in protecting 
and promoting public health, we urge Congress to reauthorize 
these agreements and ensure adequate funding for FDA to carry 
out its mission. Thank you for your time and I look forward to 
answering any questions.

    [The prepared statement of Ms. Richardson follows:]
                  prepared statement of liz richardson
    Chair Murray, Ranking Member Burr, and Members of this Committee, 
thank you for the opportunity to testify about the proposed FDA user 
fee agreements and how legislation reauthorizing these agreements can 
support patients and public health.

    Established in 1948, The Pew Charitable Trusts is a global 
nongovernmental organization that seeks to improve public policy, 
inform the public, and invigorate civic life. Through research and 
analysis, Pew's projects work to improve Americans' health and well-
being. We believe that evidence-based policies and investments can help 
expand access to life-saving treatments, spur the development of 
innovative drugs and medical devices, and provide effective oversight 
of the benefits and risks associated with these products.

    Today, I would like to talk about how the user fee agreements can 
promote innovation and help to ensure the safety and effectiveness of 
medical products, ultimately leading to improvements in health.
The User fee Agreements Promote Innovation of Drugs and Medical Devices
    Since 1992, user fees paid by the drug and device industry have 
provided FDA with significant and sustained resources that allow the 
agency to facilitate the development of urgently needed medical 
products, and to review those products quickly.

    This issue is particularly important to Pew's antibiotic resistance 
project, which is working to advance policies that would spur the 
creation of new antibiotics and establish stewardship programs to 
ensure that antibiotics are prescribed only when necessary in human 
health care settings. Since 2014, FDA has approved 14 antibiotics \1\--
three of which represent a novel drug class or mechanism of action--to 
treat a variety of life-threatening bacterial infections, including 
community-acquired pneumonia and certain abdominal infections. These 
advances are critical as the world faces a dangerous shortage of 
antibiotics to address current and future patient needs.
---------------------------------------------------------------------------
    \1\  K. Talkington. ``Analysis Shows Continued Deficiencies in 
Antibiotic Development since 2014'', The Pew Charitable Trusts, last 
modified March 9, 2021, https://www.pewtrusts.org/en/research-and-
analysis/data-visualizations/2019/five-year-analysis-shows-continued-
deficiencies-in-antibiotic-development.

    Overall, the user fee programs have substantially sped up the 
review of new drug applications. In the decade after the first user fee 
agreement was passed, the median review time fell by half, from nearly 
28 months to less than 14 months. Review times for drugs given priority 
status have also fallen significantly. Indeed, a standard review today 
is faster than a priority review a decade ago (around 10 months). \2\
---------------------------------------------------------------------------
    \2\  https://www.fda.gov/media/102796/
download'msclkid=381a13f5b03e11ec9429b69ceba87906.

    In 2002, Congress also established a user fee program for medical 
devices. The fees FDA collects under these agreements provide the 
agency with additional resources to review applications and better 
facilitate the introduction of a wide variety of new medical 
technologies. Under the proposed agreement, the total fees collected 
are expected to reach at least $1.78 billion, \3\ and if certain 
specified goals are met, the agency could collect up to $1.9 billion by 
2027, up from about $1 billion in fees authorized under the previous 
reauthorization. \4\ These funds help FDA deliver a more efficient and 
comprehensive oversight process that is better resourced to protect 
consumer safety and adapt to a rapidly evolving device market, where 
emerging technologies are posing challenges to traditional FDA 
oversight.
---------------------------------------------------------------------------
    \3\  U.S. Food and Drug Administration, ``FDA Statement on Medical 
Device User Fee Amendments (MDUFA),'' news release, March 22, 2022, 
https://www.fda.gov/news-events/press-announcements/fda-statement-
medical-device-user-fee-amendments-mdufa.
    \4\  FIND.
---------------------------------------------------------------------------
    Today, for example, health care organizations use AI-enabled 
digital health tools for a growing range of clinical, administrative, 
and research purposes. FDA has approved or cleared nearly 350 AI-
enabled devices for a broad range of applications. \5\ Nearly 140 of 
these approvals or clearances have been granted since the start of 
2020, \6\ and the pace of submissions that include an AI component is 
only expected to grow over the next 5 years. These tools offer unique 
opportunities to improve patient care and health outcomes, but the 
volume of applications and the pace at which these products evolve pose 
unique challenges to FDA's traditional approach to oversight. These 
products will not only need to be reviewed to ensure they are safe and 
effective at the time of approval, they also need to be adequately 
monitored over time to ensure that they continue to be safe and 
effective in the real world, and when used on diverse patient 
populations. FDA must have sufficient resources--both through robust 
user fee programs and annual appropriations--as well as the internal 
expertise and commitment to develop regulatory policies that can 
facilitate ongoing innovation while still providing adequate public 
health safeguards for these rapidly changing products.
---------------------------------------------------------------------------
    \5\  https://www.fda.gov/medical-devices/software-medical-device-
samd/artificial-intelligence-and-machine-learning-aiml-enabled-medical-
devices.
    \6\  Ibid.

    Similarly, 3D printing is increasingly being used at the point of 
care to manufacture a range of products, including anatomical models 
used to guide surgery planning and medical devices like surgical 
cutting guides. This technology allows for the decentralized 
manufacturing of highly customized products--which could 1 day include 
implants, pharmaceuticals, and even biological products--that are 
manufactured directly within health care facilities. However, 3D-
printed devices--like any medical product--also carry risks, and 
existing laws, regulations, and guidance meant to ensure the safety of 
devices and drugs do not clearly map to this emerging technology. FDA 
needs the resources to be able to adapt its regulatory approach to meet 
the demands of the changing field and regulate the increasing number of 
sites that utilize the technology in order to ensure that medical 
products printed at the point of care are safe and effective.
    The User fee Process can Support a Broad Range of Public Health 
                               Priorities
    Though the matter of FDA funding is central to the user fee 
negotiation process, each successive reauthorization of those 
agreements has provided an opportunity for Congress to pass additional 
reforms that advance public health. For example, past reauthorizations 
led to the establishment of the Sentinel Initiative, provided important 
incentives for the development of new antimicrobial drug products, 
strengthened FDA's ability to require postmarket trials or labeling 
changes in response to safety signals, and facilitated efforts to 
better incorporate the patient perspective within the agency's 
decision-making process, among many other consequential changes. \7\ We 
urge Congress to consider other worthy opportunities to improve public 
health during the current reauthorization.
---------------------------------------------------------------------------
    \7\  A. Mitchell et al. ``The Prescription Drug User Fee Act'', 
Medical Care, Volume 60--Issue 4: 287-293, April 2022, https://
journals.lww.com/lwwmedicalcare/Citation/2022/04000/The-Prescription-
Drug-User-Fee-Act-Much-More-Than.4.aspx.

    In particular, the issue of diagnostic test oversight, currently 
addressed in bipartisan legislation known as the Verifying Accurate 
Leading-edge IVCT Development (VALID) Act, is of critical importance. 
As the COVID-19 pandemic has shown, the Nation's public health depends 
on rapid access to accurate and reliable tests that can diagnose 
disease or identify past infection. But faulty diagnostic tests can 
compromise both patient care and the Nation's response to infectious 
---------------------------------------------------------------------------
diseases.

    Current gaps in oversight have allowed tests that are developed and 
used within the same laboratories, called lab-developed tests, to come 
to market without FDA approval, even if those tests are otherwise high-
risk. Once used to test for rare diseases for which commercially 
manufactured diagnostics were unavailable, these tests have now become 
widespread and increasingly complex. However, because there is no 
central registration or reporting requirements for these tests, the 
exact size of the market is unknown, leaving countless people exposed 
to potential harm from unreliable or misleading results.

    As Committee Members discussed at a recent hearing, the current 
MDUFA reauthorization is an appropriate vehicle for the VALID Act. By 
including VALID in the user fees legislation, Congress can strengthen 
and update current medical device regulations and enable FDA to adopt a 
risk-based approach to diagnostics oversight that balances safety and 
innovation.

    Congress also acknowledged in its 2012 PDUFA reauthorization bill 
the importance of addressing the growing public health threat of 
antibiotic-resistant superbugs and the vital need for new antibiotics 
by enacting the Generating Antibiotic Incentives Now (GAIN) Act as part 
of that package. The GAIN Act represented an important first step that 
supported the launch of small biotechnology innovator companies devoted 
to antimicrobial research and development.

    But on this front, more work is needed. A robust, market-based 
subscription model is necessary to ensure that these companies can earn 
a fair return-on-investment and continue to innovate. The 
sustainability of the antibiotic drug pipeline is absolutely 
foundational to modern medicine. To that end, the Pioneering 
Antimicrobial Subscriptions to End Upsurging Resistance (PASTEUR) Act 
proposes a unique, `only pay for success' pull incentive that will 
substantially strengthen U.S. preparedness for future pandemics. We 
urge Congress to include that measure in its current PDUFA 
reauthorization.
       The User fee Process is no Substitute for Adequate Funding
    Review times are important insofar as they speed patients' access 
to potentially important products. The user fee agreements make review 
times a performance metric. However, it is critical to remember that 
true innovation is not just about getting products to market faster; it 
is about developing products that are safer or more effective than 
existing drugs and devices. While more challenging to measure than 
review times, protecting and promoting health is the ultimate goal of 
the FDA.

    As important as user fees are to the efficient function of FDA, 
they cannot be a substitute for adequate appropriations. User fee 
agreements do not cover a broad range of essential health functions, 
such as enforcing good manufacturing practices, conducting most post-
market safety activities, and regulating non-drug products, including 
food and the large and ever-growing market of dietary supplements. FDA 
needs sufficient additional resources beyond user fees to sustain these 
critical activities.

    Furthermore, FDA is a public health agency that works to promote 
the health of all Americans. Because of the public interest in a well-
performing FDA, the agency should receive public funds and be 
accountable to the public, not just to the industries it regulates.
                               Conclusion
    In conclusion, I want to emphasize the importance of user fees to 
the basic functioning of the FDA. We urge Congress to ensure that FDA 
has continued, sustained funding to carry out its important public 
health mission.

    Thank you for your time and I look forward to answering any 
questions.
                                 ______
                                 
                 [summary statement of liz richardson]
    The Pew Charitable Trusts believes that evidence-based policies and 
investments can both spur the development of new drugs and medical 
devices, and ensure effective oversight of these products. Since 1992, 
user fees have provided FDA with significant and sustained resources 
that have allowed the agency both to facilitate the development of 
urgently needed medical products, and to review those products quickly.

    This issue is particularly important to Pew's antibiotic resistance 
project, which is working to advance policies that would spur the 
creation of new antimicrobial products and establish stewardship 
programs that would ensure these products are prescribed only when 
necessary. Since 2014, FDA has approved 14 antibiotics, three of which 
represent a novel drug class or new mechanism of action. These advances 
are critical, as the world faces a dangerous shortage of antimicrobial 
products to address both current and future patient needs.

    In 2002, Congress also established a user fee program for medical 
devices. The fees that FDA collects under these agreements provide the 
agency with resources to review applications and deliver a more 
efficient oversight process, one that can adapt to a rapidly evolving 
device market, where emerging technologies like AI-enabled digital 
health tools and 3D printing are posing challenges to traditional FDA 
oversight.

    A second key aspect of the user fee agreement process is how each 
successive reauthorization has provided an opportunity to advance other 
public health priorities. For example, in its 2012 reauthorization of 
user fees, Congress acknowledged the vital need for new antibiotics by 
enacting the GAIN Act as part of that package. The GAIN Act represented 
an important first step, but more work is needed to ensure that drug 
developers can earn a fair return-on-investment and continue to 
innovate. To that end, the PASTEUR Act proposes a unique, `only pay for 
success' pull incentive that will strengthen U.S. preparedness for 
future pandemics. Pew urges Congress to include that measure in its 
current user fee reauthorization.

    Similarly, Pew also believes that reforming oversight for in vitro 
diagnostic tests, an issue currently addressed in bipartisan 
legislation known as the VALID Act, is of critical importance. The 
Nation's public health depends on rapid access to accurate and reliable 
diagnostic tests. But current gaps in oversight have allowed tests that 
are developed and used within the same laboratories, called lab-
developed tests, to come to market without FDA approval, even if those 
tests are otherwise high-risk. Pew believes strongly that tests should 
be regulated according to their risk, not where they are developed and 
used. By including VALID as part of the MDUFA reauthorization package, 
Congress can strengthen and update FDA oversight of these critical 
products to make it more flexible and risk-based.

    Finally, while user fees are important to the efficient function of 
FDA, they cannot be a substitute for adequate appropriations. User fees 
do not cover all of FDA's essential functions, such as conducting most 
post-market safety activities, or regulating non-drug products, 
including food and the large and ever-growing market of dietary 
supplements. FDA needs resources beyond user fees to sustain these core 
activities. And because FDA is a public health agency that works to 
promote the health of all Americans, the agency should receive public 
funds and be accountable to the public, not just to the industries it 
regulates.
                                 ______
                                 
    The Chair. Ms. Richardson, thank you for your testimony. I 
am going to turn it over to Dr. Esham for testimony next. And 
then I am going to turn the Committee over to Senator Burr. I 
will go vote. There are two votes that are being called and I 
will be back shortly. Thank you, Senator Burr.
    Dr. Esham.

STATEMENT OF CARTIER ESHAM, PH.D., CHIEF SCIENTIFIC OFFICER AND 
 EXECUTIVE VICE PRESIDENT OF EMERGING COMPANIES, BIOTECHNOLOGY 
            INNOVATION ORGANIZATION, WASHINGTON, DC

    Dr. Esham. Thank you. Good morning, Chair Murray, Ranking 
Member Burr, Members of the Committee. My name is Cartier 
Esham, and I am the Chief Scientific Officer at the 
Biotechnology Innovation Organization, or BIO. BIO is the 
world's largest trade association, representing biotech 
companies, academic institutions, and related organizations 
across the United States and in more than 30 other nations.
    While our membership includes most of the large 
pharmaceutical companies, the majority of our members are 
small, pre-revenue companies working on cutting edge biomedical 
innovations. We appreciate the opportunity to speak with you 
today, and we are committed to and working toward modernizing 
the clinical development paradigm to one that is more 
efficient, more patient centric, more inclusive, and best able 
to provide timely availability of next generation medicines 
that will improve the lives of patients and their families.
    We do urge timely reauthorization of the prescription drug 
and biosimilar user fee agreements as they are vital to 
advancing these goals and to ensuring the FDA is able to 
effectively carry out its vital mission to protect and promote 
the public health.
    Congress has built a strong foundation over many years with 
the enactment of previous user fee agreements and other key 
laws that have collectively worked to ensure effective and 
timely reviews, improve drug and biologic safety monitoring, 
enable the agency to keep pace with medical and scientific 
process, and provided the support necessary to ensure that 
advanced medicines are provided to patients as quickly and 
safely as possible.
    The PDUFA and MDUFA User Fee Agreements will build on these 
efforts and foster next generation scientific medical advances 
that will benefit patients. For example, the PDUFA VII 
agreement aligns meeting opportunities with the needs of 
complex and innovative clinical development programs that will 
support productive scientific dialog and foster early 
identification, and better enable timely resolution of those 
issues when possible.
    This includes the advancement of best practices--best 
meeting practices, as it is a shared responsibility between the 
biopharmaceutical industry and the FDA to ensure productive and 
effective meetings. The commitments in PDUFA will work to 
continue to advance the systematic integration of patient 
centric perspectives into drug development and review, building 
on efforts that began in earnest under the PDUFA V agreement.
    They will provide the resources, capacity, and expertise 
needed for CBER to manage the exciting and vastly growing 
pipeline of cell and gene therapies. They will provide 
resources to improve safety monitoring and ensure the FDA is 
able to meet the demands and opportunities of the data and 
digital age.
    Advance evidence collection and analysis approaches--
analytical approaches that are more patient centric, more 
informative about health outcomes for all patients. They will 
provide resources and drive actions that will work better to 
enable the use of advanced manufacturing technologies and 
ensure that processes relating to the safe manufacturing of 
complex medicines is done in a manner that does not unduly 
delay availability of these medicines.
    The PDUFA commitments will also include provisions that 
will further strengthen the accelerated approval pathway and 
the orphan drug designation processes, both of which have been 
foundational in enabling the timely availability of medicines 
for patients suffering from devastating and life threatening 
diseases.
    These include provisions that will advance regulatory 
understandings about what is necessary to support the 
utilization of a surrogate endpoint as a basis for approval and 
approve processes to ensure timely or post-market requirement 
assessments are made and better enable effective study designs, 
as well as improve the ability to engage with the FDA post-
approval to resolve study challenges when they arise and better 
support timely determinations of continued scientific validity.
    Like PDUFA, BsUFA agreement also works to ensure timely and 
productive scientific dialog, and advances regulatory science 
in key areas, including supporting the more efficient and 
better understood processes for the approval of interchangeable 
biosimilars. And they both work to ensure that FDA is best 
able--better able to recruit and retain world-class personnel 
and effectively manage resources.
    Before I close, I would like to take this opportunity to 
convey BIO's commitment to improving clinical trial diversity. 
In addition to important commitments in the PDUFA VII 
agreement, BIO has provided Members of this Committee with 
proposals we believe are essential to advancing regulatory 
understandings that will drive change and support a clinical 
development ecosystem that is more inclusive and representative 
of the patients we serve.
    Thank you again, and we look forward to working with you on 
these reauthorizations and toward advancing a new clinical 
development paradigm that is more expansive, more inclusive, 
more patient centric, and better enables the timely delivery of 
safe and effective next generation medicines that will improve 
the lives of patients and their families. Thank you.

    [The prepared statement of Dr. Esham follows:]
                  prepared statement of cartier esham
                              Introduction
    Good morning, Chair Murray, Ranking Member Burr, and Members of the 
Committee. My name is Cartier Esham, and I am the Chief Scientific 
Officer at the Biotechnology Innovation Organization, or BIO. BIO 
appreciates the opportunity to speak with you today about key 
priorities we believe will improve regulatory oversight and 
transparency, as well as enable biopharmaceutical companies to 
modernize the clinical development paradigm to one that is more 
patient-centric, efficient, and inclusive. Congress has built a strong 
foundation over many years that has served to expedite patients' access 
to safe and effective therapies, and helped innovators develop next-
generation medicines that have improved the lives of patients and their 
families. We look forward to working with this Committee to continue to 
building on these efforts and urge that the Committee proceed with the 
timely reauthorization of the Prescription Drug User Fee Act and 
Biosimilar User Fee Act to ensure FDA can continue to meet its mission 
to protect and promote public health.

    BIO is the world's largest trade association representing 
biotechnology companies, academic institutions, state biotechnology 
centers, and related organizations across the United States and more 
than 30 other nations. While our membership includes most of the large, 
international biopharmaceutical companies, the majority of our members 
are small biotechnology companies working on cutting-edge biomedical 
innovations. These companies are pre-revenue and take enormous risks 
every day to develop the next generation of biomedical breakthroughs 
for the millions of patients suffering from diseases for which there 
are no effective cures or treatments today. BIO is proud of their 
innovative spirit and dedication to improving the lives of patients and 
their families.

    Since the initial enactment of the Prescription Drug User Fee Act 
(PDUFA) in 1992, user fees have played a key role in ensuring that 
effective and efficient regulatory processes keep pace with the 
continual advancement of scientific and medical innovation. As a 
result, more innovative treatments and therapies are first approved in 
the United States, providing our citizens with faster access to 
innovative medicines. Additionally, the PDUFA program ensures that FDA 
has the resources, capabilities, and processes in place to establish a 
clear and direct pathway from initial scientific discovery to 
widespread availability of cutting-edge medicines. This benefits not 
only regulators, patients, and the biopharmaceutical industry, but also 
the entrepreneurial community that makes significant investments in 
high-risk, early stage, innovative medicine development. Today, it can 
take anywhere from 10 to 15 years at an average cost of approximately 
$1 billion or more to advance a single drug or biological product from 
a promising idea to an approved product that benefits patients. \1\, 
\2\ A well-run and comprehensible pathway to approval is critical to 
maintaining U.S. leadership in investment, development, and 
availability of next-generation medicines.
---------------------------------------------------------------------------
    \1\  Olivier J. Wouters, Ph.D; Martin McKee, MD, DSc; Jeroen 
Luyten, Ph.D. Estimated Research and Development Investment Needed to 
Bring a New Medicine to Market JAMA. 2020, 323(9).
    \2\  Joseph A. DiMasi; Henry G. Grabowskibi; Ronald W. Hansen. 
Innovation in the pharmaceutical industry: New estimates of R&D costs. 
2016. Journal of Health Economics. 2016, Vol. 47.

    The Prescription Drug and Biosimilar User Fee Acts (PDUFA and 
BsUFA) have collectively worked to ensure effective and timely reviews, 
improve drug and biologics safety monitoring, enable the Agency to keep 
pace with medical and scientific advancements, allow for earlier and 
more frequent FDA-sponsor engagement to identify and resolve drug and 
biologic development challenges, and provide the support necessary to 
ensure that advanced medicines are available to patients as efficiently 
and safely as possible. These user fee programs, which are reauthorized 
by Congress every 5 years, provide FDA with the authority to collect 
fees from companies that produce certain human drugs, biologics, 
medical devices, and generics. These user fees, in addition to the 
resources provided through direct appropriations from Congress, have 
ensured that FDA is a global leader in regulatory advancement and 
oversight. Last year, 76 percent of novel drugs approved by FDA's 
Center for Drug Evaluation and Research (CDER) were approved in the 
U.S. before any other country. \3\
---------------------------------------------------------------------------
    \3\  https://www.fda.gov/media/155227/download.
---------------------------------------------------------------------------
    User fee programs are not fee-for-service programs, and fees paid 
by a company for a medical product application are not tied to the 
review of that particular application. Instead, these fees support a 
wide range of regulatory programs and ensure FDA has the resources, 
capabilities, and processes in place to maintain clear regulatory 
pathways and keep pace with medical and scientific innovation. The 
PDUFA and BsUFA agreements currently under consideration continue to 
advance those goals and activities and include additional commitments 
that will strengthen review fundamentals, enhance accountability and 
transparency, ensure stable growth of successful existing regulatory 
programs, and foster innovative scientific advancements.

    Highlighting a few key topics that are most important to BIO, our 
member companies, and, most importantly, the patients we serve, we 
would like to emphasize the importance of promoting effective 
scientific dialog between FDA and sponsors of medical product 
development programs, enabling the utilization of regulatory tools that 
are more effective and support broader and more meaningful 
understandings of clinical outcomes for all patients, the incorporation 
of patient perspectives in clinical trials and post-approval data 
collection, and the necessity to provide the resources and capacity 
needed to meet the demands and opportunities of the digital age. The 
COVID-19 pandemic has shown us that decentralized clinical trials, 
digital health technology tools, and other innovations utilized during 
the pandemic have the potential to improve how we develop medicines 
that meet the needs of patients and greatly reduce the burden on 
clinical trial participants, especially for those who belong to 
historically underserved populations and for those who suffer from rare 
diseases, where clinical trial populations are small and geographically 
dispersed. We urge an on-time reauthorization of FDA's user fee 
programs to allow the enactment of the PDUFA VII and BsUFA III 
Commitment Letters that will continue to advance meaningful integration 
of the patient voice and experience into drug and biosimilar biological 
product development and review processes, build upon important lessons 
learned from the pandemic, and pave a path forward to a clinical 
development paradigm that is more effective, more informative, and more 
inclusive.
                      Overall Goals for PDUFA VII
    Each user-fee Commitment Letter has continued to build upon the 
efforts of previous agreements. The following testimony will describe 
the content and benefit of critical provisions addressed in seven 
primary themes included in the PDUVA VII Commitment Letter:

        1. Strengthen scientific dialog and advance innovation

        2. Support the next wave of advanced biological therapeutics

        3. Enhance patient-centric drug development, review, and 
        protections

        4. Modernize regulatory evidence generation and drug 
        development tools

        5. Enhance innovation in manufacturing and product quality 
        reviews

        6. Advance digital technologies and information technology (IT) 
        infrastructure

        7. Enhance FDA hiring, retention, and financial management
          Strengthen Scientific Dialog and Advance Innovation
    A goal of PDUFA VII most critical to advancing innovation involves 
enhancing and strengthening scientific dialog between sponsors of 
applications and FDA. To that end, FDA, for the first time, will 
provide consistent timelines for Initial Targeted Engagement for 
Regulatory Advice on CBER Products (INTERACT) meetings and expand the 
scope of these meetings to include products regulated by the Center for 
Drug Evaluation and Research (CDER). INTERACT meetings have been 
critical for sponsors of innovative biological products who face unique 
challenges that could otherwise delay entry into clinical development. 
FDA will also establish a new Type D meeting that enables FDA and 
sponsors to engage in more rapid and focused conversations about 
innovative approaches or unique challenges that will allow for earlier 
resolution of discrete issues. The Commitment Letter also formalizes a 
process where sponsors can submit clarifying questions to FDA following 
a meeting to ensure alignment on expectations and requirements. We 
collectively recognized that establishing and following best practices 
for productive meetings is a shared responsibility between 
biopharmaceutical companies and FDA.

    There are at least 7,000 known rare diseases collectively impacting 
over 25 million Americans with new rare diseases identified each year. 
Because rare diseases have limited or no treatment options and lack 
well-established regulatory precedents, the development and review of 
these medicines introduces additional challenges that must be overcome 
to deliver new therapies to patients who need them. Key among these 
challenges is reaching agreement with regulators about determining the 
appropriate efficacy endpoints to support approval of innovative 
medicines for rare diseases. The current mechanisms for companies with 
rare disease treatments in their pipeline to collaborate with FDA has 
not consistently provided avenues for much needed discussions about 
these unique issues, which can cause delays in the development and 
availability of medicines to these patients who often lack options. The 
Rare Disease Endpoint Advancement (RDEA) pilot program in PDUFA VII 
will provide avenues for focused engagement opportunities that will 
serve to advance and share learnings and enable more efficient drug 
development and review process for all rare disease medicines.

    The Commitment Letter will establish a Split Real Time Application 
Review (STAR) pilot program for certain applications that are intended 
to treat a serious condition with an unmet need. The pilot builds on 
the concepts that have proven successful for FDA's Real Time Oncology 
Review (RTOR) program and expands them to other disease areas to enable 
more timely reviews and availability of these medicines to vulnerable 
patient populations. The STAR pilot will improve both the stakeholders 
and industry's workload management by allowing sponsors of applications 
to submit their applications in two parts rather than one, allowing for 
earlier review of key components such as proposed labeling, clinical 
protocols, and topline efficacy and safety results prior to the final 
application submission.

    Biopharmaceutical companies and FDA recognize the importance of 
post-marketing requirements (PMRs) to ensure timely availability of 
information on the safety and efficacy of certain therapies to patients 
when further post-approval studies are warranted. PDUFA VII includes 
commitments to ensure necessary PMRs are identified and communicated 
earlier in the review process and enable the development and 
implementation of more thoughtful study designs. This will better 
ensure that these PMRs are completed on time and avoids delays in 
confirmatory trials. PDUFA VII will also establish stronger processes 
for the continued evaluation of PMRs post-approval to ensure 
requirements are being met, issues can be resolved, and the studies 
remain scientifically valid.
       Support the Next Wave of Advanced Biological Therapeutics
    Advancing the new wave of biological therapies is a top priority 
for BIO member companies. A 2020 analysis by BIO found that there were 
231 gene therapy products under development compared to only 93 
products in 2015, a trend that is expected to continue in the coming 
years. To ensure that new and innovative cell and gene therapy products 
are developed and available to patients in a timely manner, the 
Commitment Letter will provide FDA with the resources and capacity 
needed to address the growing workload of the Cell and Gene Therapy 
Program. This will enable FDA to maintain the level of highly trained 
and experienced Cell and Gene Therapy staff needed to address CBER's 
workload caused by increased regulatory submission volume as projected 
over the next 5 years as well as keep pace with scientific and 
technological advancements. As part of the commitment, FDA will 
facilitate a better understanding of patient perspectives on gene 
therapy products, including cell-mediated gene therapy, and provide 
greater clarity on expedited pathways for regenerative medicines. FDA 
will streamline and harmonize processes, procedures, and interactions 
by enhancing, improving, and issuing guidance describing best practices 
for communication related to aspects of Cell and Gene Therapy product 
development, including the use of novel trial designs.
   Enhance Patient-Centric Drug Development, Review, and Protections
    One of the most important goals of PDUFA VII involves continuing to 
advance the systematic integration of patient perspective data into 
drug development and review processes. This work began in earnest under 
PDUFA V with the establishment of the Voice of the Patient Program that 
supported public meetings where patients provided insights about their 
conditions and how they themselves evaluated benefits, risks, and 
needs. PDUFA VI advanced this work by holding a series of public 
meetings and publishing guidance that provided information about how to 
determine the most important impacts to patients, how to measure 
disease impact, and how to incorporate Clinical Outcome Assessments 
(COAs) into clinical development and review processes.

    During PDUFA VII, FDA will continue this critical work by 
continuing to strengthen capacity and knowledge through the expansion 
of training opportunities for FDA staff and ability to better engage 
external methodological experts. FDA will seek public input on 
methodologies and approaches for the submission of high-quality patient 
perspective data designed to inform benefit-risk assessments and 
inclusion of information in the label. PDUFA VII will provide 
supplementary support to FDA's development of a publicly available 
virtual catalog of Standard Core Sets of COAs and related endpoints 
that will help make possible the broader utilization of patient 
perspective data in clinical product development. FDA will also seek 
public input on which diseases areas have the greatest need for 
Standard COA development. Additionally, FDA will work to increase 
shared understandings about how patient preference studies can inform 
meaningful benefit-risk assessments in therapeutic areas, which is of 
very high value to the patient community.
  Modernize Regulatory Evidence Generation and Drug Development Tools
    Advancing innovative, patient centric drug development tools, and 
modernizing the regulatory evidence generation paradigm is a top 
priority for BIO member companies. Advancements in science and 
technology offer real opportunities to reduce patient burden, improve 
ability to recruit and conduct effective clinical trials and provide 
more informative analyses of benefit and risk pre and post approval. 
PDUFA VII will continue to build on several key initiatives that were 
launched under PDUFA VI. Under this Commitment Letter, FDA will advance 
the use of real-world evidence (RWE) to support approval of labeling 
claims, approval of new indications and to satisfy post approval study 
requirements. The agreement establishes an Advance RWE pilot program 
that will provide shared learnings with the public and inform the 
publication of guidance increasing broad knowledge about how and when 
RWE can be utilized in future applications.

    Complex innovative trial designs can be more efficient, improve 
patient outcomes, and produce high-quality information faster compared 
to traditional trial designs. PDUFA VII will continue both the Complex 
Innovative Trial Design and Model-Informed Drug Development (MIDD) 
pilot programs which enable the utilization of these tools and 
approaches more broadly. Additionally, the Agreement will enhance the 
drug development tool (DDT) qualification pathway for biomarkers by 
retaining and enhancing staff capacity and piloting processes that 
enhance the review of biomarker qualification submissions. High quality 
biomarkers can accelerate and enable drug development in areas of unmet 
need, improve clinical trial feasibility and efficiency thus continued 
improvement of the qualification pathway is beneficial to regulators, 
the research and development community, and patient communities.

    To enhance FDA's drug safety system, PDUFA VII provides resources 
and processes that will enable the adoption of new scientific 
approaches designed to improve the utility of existing tools for the 
detection, evaluation, prevention, and mitigation of adverse events. 
PDUFA VII will modernize and improve Risk Evaluation and Mitigation 
Strategies (REMS) approaches and processes through new guidance 
documents and timelines for feedback to companies on REMS 
methodologies. Newly allocated resources will expand and optimize FDA's 
electronic safety data base (the Sentinel program) including supporting 
the integration of Sentinel and BEST (Biologics Effectiveness and 
Safety) systems, and FDA will advance knowledge about how Sentinel data 
can be used for regulatory purposes (e.g., PMRs, PMCs and labeling) and 
how real-world evidence (RWE) may be used for evaluating the 
effectiveness of medicines. Collectively, these improvements and 
advancements in FDA's drug safety system will improve patient 
protections and utilization of this vast data resource to gain deeper 
insights about the benefits and risks of medicines for all patients.
    Enhance Innovation in Manufacturing and Product Quality Reviews
    One of the critical needs for PDUFA VII was to advance innovation 
in manufacturing and inspection review processes and improve the 
ability to get medicines to patients in a timely manner. A rate-
limiting step for the past several years has been discussions and 
resolution of chemical manufacturing and control (CMC) issues, 
especially for innovative biologic therapies and treatments. FDA will 
improve the timeliness and effectiveness of CMC communications through 
training and updating CDER and CBER guidance designed to enable more 
consistent review of high-quality information requests from sponsors. 
FDA will also engage a third party to assess, seek public comment, and 
provide recommendations about how these processes can be optimized to 
support modernization of CMC-related processes.

    To address the outsized hindrance of timely availability of 
innovative treatments for serious and life-threatening diseases 
undergoing expedited reviews due to CMC issues, FDA will publish new 
internal documents to better align CMC communications and processes to 
meet the desired timelines for approval decisions more consistently. 
The FDA will also establish a CMC Development and Readiness Pilot 
(CDRP) in both CDER and CBER to provide additional opportunities for 
engagement between FDA and sponsors that will help companies meet 
critical CMC milestones. Learnings from this pilot and an associated 
public workshop will inform a strategy document describing the Agency's 
plans to revise processes and information about submission strategies 
to accelerate CMC development.

    Over the past several years there have been significant scientific 
advancements about how to effectively and efficiently manufacture high-
quality complex medicines. PDUFA VII will work to identify and remove 
current barriers to the utilization and adoption of advanced 
manufacturing technologies. FDA will conduct a workshop where best 
practices, case studies, and regulatory strategies will be shared and 
discussed, including how to assess innovative technologies across 
platform products and sites. We are pleased that this Committee 
included a focus on manufacturing in the PREVENT Pandemics Act, and BIO 
supports the pathways for reviews of technologies established under 
Sections 506 and 518 of that bill which will enhance these PDUFA goals 
and facilitate the adoption of advanced manufacturing.

    During the COVID-19 pandemic, regulators, biopharmaceutical 
companies, and other key stakeholders from around the world held 
discussions about how best to ensure the continued availability of 
medicines and meet the needs of providing COVID vaccines and treatments 
to all in need. Among the results of those discussions were the 
increased utilization, when appropriate, of alternative tools such as 
use of information shared by trusted foreign regulatory partners and 
record requests for assessing manufacturing facilities. PDUFA VII will 
continue the advancement of those lessons learned by issuing draft 
guidance about when and how these types of alternative approaches may 
be utilized beyond the pandemic.
     Advance Digital Technologies and Information Technology (IT) 
                             Infrastructure
    It is of vital importance that support be provided to FDA to 
increase its capacity and ability to meet the demands and opportunities 
of the data and digital age. Increasing utilization of cloud 
technologies is necessary for FDA to meet the growing needs, demands, 
and advantages of modern-day development and review of innovative 
medicines. Today's medical product applications have large and/or 
complex data sets that require high-quality repository and analytical 
capabilities. PDUFA VII activities and resources, collectively, will 
enable FDA to make the necessary changes to meet these needs. These 
advancements will serve to improve the quality of applications 
submitted to FDA and improve our ability to better understand the 
benefits and risks of medicines to all patients before and after they 
are approved.

    First, FDA will continue to meaningfully advance its Data and 
Technology Modernization Strategy to improve both FDA's enterprise 
needs and to advance key PDUFA objectives such as completing transition 
to a cloud-based system. FDA also committed to regular engagement with 
the biopharmaceutical industry to provide progress updates, share 
learnings, and discuss challenges in meeting PDUFA VII goals and 
advancing objectives outlined in the Data and Technology Modernization 
Strategy.

    Second, FDA will launch a series of demonstration projects in 
collaboration with external partners to improve the core capabilities 
necessary for reviewing data captured via digital technology tools. We 
expect continued growth in the utilization of digital technologies as 
they offer the ability to reduce burdens on patients in clinical 
trials, better assess clinical outcomes for all patients, and more 
efficiently collect high-quality data and evidence to support approvals 
and inform life-cycle management of medicines. Findings and planned 
next steps from these demonstration projects will be shared with 
biopharmaceutical companies and made available to the public on FDA's 
website.

    Third, critical IT modernization and capacity needs for the review 
of Biologic License Agreements will be provided to CBER to meet the 
demands of current and future applications that are projected to 
increase significantly over the next 5 years. In coordination with the 
Data Technology Modernization Strategy described above, CBER will 
develop a specific multi-year modernization roadmap to chart specific 
steps necessary for CBER to meet current and projected needs necessary 
to continue to successfully carryout its mission.
        Enhance FDA Hiring, Retention, and Financial Management
    PDUFA VII continues to build upon the resource management and 
fiscal accountability provisions included in PDUFA VI. For example, the 
time reporting system initiated under the previous Agreement will be 
optimized to allow for time and associated costs to be reported and 
examined on a more continual basis. Additionally, to strengthen fiscal 
and staff resource management, accountability, and transparency, PDUFA 
VII will continue to mature the resource capacity planning system that 
includes a publication of an updated implementation plan describing how 
resource capacity planning and time reporting will be improved and 
implemented over the coming 5-year PDUFA cycle. A third-party 
assessment of the capacity planning system will be conducted and inform 
the 5-year fiscal planning activities. Recommendations and findings of 
this assessment will be included in the annual financial reports. 
Additionally, FDA will maintain a stronger operating reserve to ensure 
they are better able to mitigate against disruptions to funding 
resources and continue to carry out mission critical activities.

    Ensuring FDA can recruit and retain world-class personnel is the 
bedrock for maintaining U.S. regulatory leadership around the world. 
PDUFA VII continues to provide resources and tools to better enable FDA 
to attract and retain leading medical and scientific professionals. 
Specifically, PDUFA VII provides FDA with resources to conduct a third-
party assessment of hiring and retention to identify challenges and 
provide recommendations for the Agency. These recommendations will be 
made available to the public where FDA will also share its plans to 
address issues raised.
                          BSUFA III Highlights
    The Biosimilar User Fee Agreement (BsUFA) contains several 
commitments that have the same goals and objectives as those included 
in PDUFA VII, including: maintaining and improving performance goals 
for the effective and timely review of biosimilars, improving 
scientific dialog and meeting best practices, modernizing IT 
capabilities, advancing utilization of RWE to assess safety and support 
regulatory decision-making, and strengthening the ability to recruit 
and retain world-class personnel. Below I will highlight a few key 
beneficial provisions included in the BsUFA III Commitment Letter most 
important to our member companies and the patients we serve.
                     Improving Scientific Dialogue
    Ensuring timely scientific dialog throughout the review process is 
a top priority for BIO member companies. BsUFA will improve the ability 
to engage in timely and focused discussions through the creation of new 
and improved meeting opportunities. Specifically, FDA will now provide 
a new meeting structure that enables FDA and sponsors of applications 
to engage in focused conversations on a narrow set of issues. BsUFA III 
also reforms the biosimilar initial advisory (BIA) \4\ advisory meeting 
process to better manage FDA workload and ensure productive discussions 
about whether licensure of a biosimilar is feasible, and if so, plans 
and expectations for the development of that biosimilar.
---------------------------------------------------------------------------
    \4\  A BIA meeting is an initial assessment limited to a general 
discussion regarding whether licensure under section 351(k) of the PHS 
Act may be feasible for a particular product, and if so, general advice 
on the expected content of the development program.
---------------------------------------------------------------------------
   Improving Review Processes of Biosimilar Supplemental Applications
    The BsUFA III agreement will bring more predictability and 
efficiency to the review of supplements. Specifically, there will be 
timelines and goals established for 6 different types of supplement 
categories. These commitments will increase efficiency, consistency, 
and predictability of biosimilar supplemental applications and provide 
patients with timelier access to these medicines.
  Advancing the Development and Review of Interchangeable Biosimilars
    BsUFA III will continue to support more efficient and better 
understood processes for the approval of interchangeable biosimilars. 
FDA will hold a scientific workshop to discuss shared learnings and 
remaining challenges to the development of interchangeable biosimilars 
that will help FDA determine what additional steps need be taken to 
support the development and availability of these medicines (e.g., 
additional guidance or research). Following the workshop, FDA will 
publish a strategy document describing the specific actions FDA will 
implement to facilitate development of interchangeable biosimilars.

    To advance regulatory science in this field, FDA will pilot a 
regulatory science program that is designed to advance the development 
of interchangeable products and improve the efficiency of their 
development. Specifically, this pilot program will work to improve 
knowledge about how data (including RWE) can be utilized to meet safety 
standards for determining interchangeability and what methodologies can 
be utilized to assess the potential impact of differences between 
proposed interchangeable biosimilars and their reference products. The 
findings and shared learnings from this pilot program will greatly 
advance the development, review, and availability of interchangeable 
biosimilar medicines.
     Interchangeable Biosimilar Labeling and Manufacturing Guidance
    Under BsUFA III, FDA will publish guidance that will serve to 
improve communication of important biosimilar labeling information to 
patients and their caregivers and better facilitate resolution of 
manufacturing issues. Specifically, FDA will publish a guidance on 
labeling for interchangeable biosimilars, a guidance on promotional 
labeling and advertising considerations for interchangeable biosimilar 
products, and a guidance on what information is needed to support post-
approval manufacturing changes to approved biosimilar and 
interchangeable biosimilar products. Collectively, these will serve to 
provide a greater understanding of what is required for efficient 
review and approval of changes to labels and manufacturing processes.
Priorities for Advancing Medical Product Regulation and Innovation for 
                        the Benefit of Patients
    BIO strongly supports the objectives and activities outlined in the 
PDUFA VII and BsUFA III commitment letters. These commitments, in 
addition to other key pieces of legislation and initiatives from 
Congress and the pharmaceutical industry, will facilitate innovation 
that benefits all patients served by our member companies. The 
testimony below outlines additional priorities that we believe will 
support this objective.
  Building a New Clinical Development Paradigm: More Inclusive, More 
 Patient Centric and More Informative About Clinical Outcomes for All 
                                Patients
    BIO is committed to enhancing clinical trial diversity, and we 
included this commitment as part of our BIOEquality Agenda launched in 
2020. The COVID-19 pandemic highlighted the urgent need to remove 
barriers and advance solutions that enable clinical trials to be more 
representative of the patients being treated. Scientific advancements 
are providing opportunities to establish clinical development and post-
approval data collection approaches that can improve our understanding 
of clinical outcomes for all patients. The PDUFA VII Commitment letter 
will provide resources, capacity, and the development of guidance that 
will significantly advance regulatory certainty and promote the 
acceptance of real-world data/evidence (RWD/RWE) and digital health 
tools (DHTs) like remote monitoring devices, cell phones, and smart 
watches that are essential in more broadly enabling the utilization of 
decentralized or non-traditional clinical trial locations.

    BIO stands ready to work with Congress, the Administration, and 
stakeholders to create a more expansive, inclusive, and sustainable 
clinical development ecosystem. We need to modernize the regulatory 
system to accept innovative tools and approaches that enable increased 
participation in clinical trials from underrepresented communities and 
the ability to collect data that improve our understanding of clinical 
outcomes for all patients. In addition to important legislation 
addressing these issues that will be discussed today, BIO has provided 
this Committee with legislative proposals we believe are essential to 
removing barriers and establishing a regulatory framework that is more 
inclusive and representative of the patients we serve.

    The lack of reliable data sources capturing U.S. demographics is a 
challenge that must be resolved. Incomplete or outright missing 
demographic data for many disease areas leads to poorly or inaccurately 
informed enrollment targets and action plans during drug development. 
While FDA regulations require sponsors to present a summary of safety 
and effectiveness data by demographic subgroups within their trials, it 
is difficult to compare this data to epidemiological data to understand 
whether enrollment targets are representative of the disease 
population. Sponsors also lack certainty regarding innovative clinical 
trial designs that could improve trial diversity. Traditional clinical 
trial designs are typically geographically centralized around academic 
medical centers and associated with significant burden for patients, 
such as multiple mandatory visits to the clinic. This creates 
significant challenges when recruiting individuals who are 
geographically dispersed, unable to travel, or unable to take leave 
from work. By contrast, modern trial designs that embrace innovative 
tools and methods, like digital health technologies, decentralized 
clinical trials, and RWD/RWE, have demonstrated success in facilitating 
trials and driving diverse enrollment throughout the COVID-19 pandemic, 
\5\ but companies currently lack a regulatory framework to fully 
leverage such techniques and tools.
---------------------------------------------------------------------------
    \5\  https://jamanetwork.com/journals/jamanetworkopen/fullarticle/
2789002.
---------------------------------------------------------------------------
    We need to re-examine and update approaches to and criteria for the 
establishment of inclusion and exclusion criteria and advance 
approaches to data collection for approved medicines that enhance our 
understanding of benefits and risks for all patients and enable that 
information to be more transparent and available to patients and their 
care givers. Our proposal requires public meetings with comment periods 
and the publication of guidance on each of these topics that together 
will work to remove present-day barriers and establish a regulatory 
framework that promotes inclusive and representative clinical 
development and review processes.

    To help build a more expansive, inclusive, and sustainable clinical 
trial network infrastructure, BIO also recommends that HHS conducts a 
series of public roundtable discussions that converge stakeholders from 
FDA, NIH, CDC, community organizations, industry, and clinical research 
organizations (CROs) to discuss, develop, and implement recommendations 
that will serve to create a more expansive and inclusive clinical 
development infrastructure. Roundtable discussion topics could include 
establishing a publicly available data base of well-indexed active 
clinical trialists, establishing clinical trialist training programs 
and mentoring networks for investigators/trialists serving 
underrepresented communities, and establishing a publicly available 
data base of community engagement organizations supported by NIH. HHS 
should also establish new or leverage existing programs for a federally 
funded clinical trial investigator fellowship pilot program for women, 
members of the LGBTQIA+ community, and racial and ethnic minorities to 
help increase participation of underrepresented populations in clinical 
trials.

    To promote diversity and inclusion for workforce development in the 
STEM community, BIO also recommends requirements for FDA and NIH to 
improve transparency around hiring, retention, and promotion practices 
within their organizational leadership and scientific workforces. 
Requirements should outline clear objectives for staff and leadership 
diversification and include a regular reporting cadence to Congress on 
metrics related to progress on these objectives. Such provisions would 
work synergistically with human resources (HR) authorities established 
by the 21st Century Cures Act of 2016 that enable FDA to build and 
maintain a talented workforce that keeps pace with rapid scientific and 
technical advancements in the biopharmaceutical industry. These H.R. 
authorities grant FDA increased flexibility to streamline the hiring 
process for recruits with specific scientific, technical, and 
professional occupations. They also established a new pay authority 
enabling FDA to compete with the private sector and academia when 
recruiting and retaining highly qualified candidates for these key 
positions. Together, these activities would strengthen the Federal 
public health workforce in terms of talent, expertise, and diversity.

    We acknowledge that removing regulatory barriers and enhancing and 
developing data sources and infrastructure will not address all 
existing barriers to inclusive clinical trial participation, including 
language and health literacy disparities and historical mistrust of 
certain clinical research tactics and ethics. We have established a 
website, The Power of Participation (www.ctpop.org), for patients, 
designed to help assess and locate clinical trial opportunities and 
identify patient and community organizations they may find helpful. We 
remain committed to working with stakeholders across the public health 
spectrum to provide meaningful educational materials for all patients.
 Accelerated Approval Brings Life Changing Treatments to Patients who 
                           Urgently Need Them
    BIO continues to strongly support the Accelerated Approval Pathway 
(AAP) for reviewing safe and effective therapies that address critical 
unmet patient needs in serious and life-threatening disease states. 
This pathway has proven to be very effective in addressing some of the 
most pressing public health needs and has been foundational to 
extending and saving countless lives since its enactment. As of June 
2021, 269 new drugs or biologics to treat serious or life-threatening 
diseases or conditions with high unmet medical needs have been approved 
through this pathway, extending, and in certain cases, saving patients' 
lives by providing novel therapies earlier than would have been 
possible using the traditional pathway. \6\ Medicines approved through 
this pathway meet FDA's well-established approval standard of safety 
and effectiveness. The AAP is essential to providing timely access to 
treatments where there is an unmet need and for patients who lack 
therapeutic options.
---------------------------------------------------------------------------
    \6\  https://www.fda.gov/drugs/nda-and-bla-approvals/accelerated-
approvals.

    Since the AAP was established in 1992, \7\ the pathway has led to 
the approval of treatments that have significantly improved the care of 
patients suffering from many different diseases, including rare 
cancers, Human Immunodeficiency Virus (HIV), bacterial infections, 
multiple sclerosis, sickle cell disease, and other serious and life-
threatening conditions. The AAP encourages scientific and medical 
advancement by allowing the use of surrogate or intermediate clinical 
endpoints that are reasonably likely to predict clinical benefit to 
support approval. Prior to the establishment of the AAP, patients with 
HIV recognized the need for a new pathway as the development of 
treatments using traditional endpoints of disease progression and death 
were prohibitory to providing access to much needed treatments for 
patients suffering from this deadly disease. The AAP enabled the 
approval of the first HIV/AIDS treatment based on the use of surrogate 
endpoints (viral load and CDR count) which served to prolong and save 
the lives of millions of patients. The PDUFA VII agreement includes 
commitments that will strengthen the AAP, such as advancing surrogate 
endpoint development through the RDEA Pilot Program and providing 
avenues for earlier and more timely discussions on the design of post-
market requirements to avoid delays in confirmatory trials. (PMRs), 
which are critical to confirming the clinical benefits of products 
receiving accelerated approval. \8\ The Commitment Letter will also 
serve to advance regulatory understandings about when and how RWE may 
be used to support PMRs that may significantly improve the ability to 
complete PMRs in a more effective and efficient manner, modernizing the 
conduct of confirmatory trials required by the AAP.
---------------------------------------------------------------------------
    \7\  In 1992, and partially codified in 1997, FDA instituted the 
Accelerated Approval regulations (21 CFR 314 Subpart H and 601 Subpart 
E) to formalize the process for approving drugs to treat serious 
conditions that filled an unmet medical need based on a study of 
surrogate endpoints.
    \8\  Sponsors planning to use surrogate endpoints as primary 
efficacy endpoints also gained an opportunity to consult with FDA 
earlier in the drug development process through Type C Surrogate 
Endpoint meetings established during PDUFA VI.

    Patients have consistently voiced their support for the use of AAP 
over the last 30 years. We have all seen how this pathway has led to 
more timely access to treatments that improve, extend, and save lives 
and has been foundational to continued advancements in the treatment of 
serious and life-threatening diseases. BIO looks forward to working 
with the Committee to ensure that the Accelerated Approval Pathway is 
working efficiently, effectively, and as intended.
                            Closing Comments
    BIO member companies are committed to advancing innovation on 
behalf of all patients, especially in areas of unmet medical need. Our 
members constantly adapt to keep pace with technological and scientific 
advancements that create opportunities to develop new therapies for 
patients without any other options. The regulatory framework 
established and refined over multiple reauthorization cycles by 
Congress, including Members of this Committee, enables our member 
companies to collaborate with the academic, advocacy, and patient 
communities to develop innovative solutions to health challenges that 
have historically left patients with little to no hope.

    In 2021 alone, FDA approved 60 new therapeutic products between 
CDER and CBER, including treatments to prevent and mitigate the impact 
of COVID-19. 27 of these new drugs were first-in-class, up from 21 
first-in-class approvals in the previous year. There were 26 approvals 
for rare disease treatments that received orphan drug designations. 
\9\, \10\ FDA staff adapted to unforeseen challenges to fulfill their 
mission to protect and promote public health, and industry continues to 
adapt as well. In addition to efforts from regulators, these life-
changing and life-saving approvals would not have been possible without 
unwavering commitment by our member companies to create innovative 
treatments and ensure that they reach the patients who urgently need 
them. The biopharmaceutical industry supports and shares FDA's mission 
to protect and promote public health by ensuring access to safe and 
effective drugs and biological products for patients, and this shared 
commitment enabled continued progress toward this mission despite 
unprecedented obstacles posed by the pandemic. This reauthorization is 
an opportunity to build on lessons learned from responding to the 
COVID-19 public health emergency and incorporate these innovations into 
the regulatory paradigm.
---------------------------------------------------------------------------
    \9\  https://www.fda.gov/media/155227/download.
    \10\  https://www.raps.org/news-and-articles/news-articles/2022/1/
fda-approved-more-first-in-class-drugs-more-with-a#:-:text-
Other%20drugs%20approved%20by%20CDER,treatment%20options%20for%20rare%20
diseases.

    Companies continue to invest in and develop advanced manufacturing 
technologies that offer the promise of increased capacity and 
efficiency to help expedite production, enhance product quality, and 
address shortages of essential medications. Innovation in new drug and 
biologic development has been robustly incentivized by the modern drug/
biologic regulatory framework at FDA, and BIO continues to work with 
Members of Congress to tackle unprecedented technical and regulatory 
challenges like those associated with investment in advanced 
manufacturing technologies and tools to modernize medical product 
---------------------------------------------------------------------------
development and distribution.

    Drug development for patient populations with unique needs, such as 
the pediatric community, remains a priority for BIO and our members, 
and we celebrate the many successes that benefit our youngest patients 
stemming from these efforts. Today, we have numerous therapies with 
pediatric indications, including for neonates, that are making a 
measurable difference for these patients and their families. We have 
seen advancements across a range of conditions, including recent drug 
approvals in sickle cell, cystic fibrosis, pediatric rheumatologic 
conditions, and even Ebola, and we are optimistic about the 
breakthroughs to come. BIO is committed to building on this progress by 
delivering more innovative medicines to pediatric patients.

    PDUFA VII and BsUFA III include provisions to enhance drug 
development with the goal of advancing novel therapies for patients, 
including in disease areas with an unmet medical need and which have 
proven to be more challenging areas for developing therapies, like rare 
diseases and pediatrics. Leveraging advances in science, enhancing the 
application of drug development tools, and modernizing clinical trials 
are critical to continuing to improve the drug development paradigm and 
regulatory processes for these medicines so we can better serve these 
patients and their families.

    These commitments will build on the numerous provisions Congress 
has enacted over the years to help foster the development of promising 
therapies for children, including the Best Pharmaceuticals for Children 
Act (BPCA) and the Pediatric Research Equity Act (PREA). The most 
recent PDUFA reauthorization bill (The FDA Reauthorization Act of 2017) 
included new requirements for pediatric studies of certain cancer drugs 
that FDA is in the process of implementing. The initial impact of that 
legislation is beginning to work through the development cycle and BIO 
and its member companies will continue to work with FDA to ensure 
effective implementation of these programs.

    The Orphan Drug Act (ODA) is a critical tool used to incentivize 
the expensive and heavily uncertain investment necessary to bring 
therapeutics for rare and orphan diseases to market. It is difficult to 
identify a more successful and consequential regulatory incentive than 
the ODA. Before it passed, there were merely a handful of treatments 
for rare disease patients. Today, we have hundreds of life changing 
treatments for these patients with countless more in the pipeline. We 
celebrate scientific progress that has led to innovative medical 
product development alongside patients, parents, and caregivers who 
have new treatment options, and sometimes even cures, that were 
previously unthinkable. While there is now immense hope for even the 
rarest diseases, many more are still waiting. There are thousands of 
identified rare diseases afflicting patients across the globe, many of 
which still have no alternative or meaningful treatments on the market. 
Given the tremendous risk, capital, and time it takes to discover and 
develop such medicines, the rare disease development paradigm should be 
handled with the utmost care and with significant consideration for 
potentiality of unintended consequences.

    BIO strongly supports timely enactment of the PDUFA VII and BsUFA 
III Commitment Letters. The resources provided will serve to maintain 
FDA's global leadership and enable the Agency to keep pace with the 
medical and scientific advances of today and tomorrow. We look forward 
to working with Congress to advance proposals that support a new 
clinical development paradigm that is more expansive, inclusive, and 
patient-centric and continues to incentivize the development and timely 
delivery of next-generation medicines that save and improve the lives 
of patients and their families.
                                 ______
                                 
                  [summary statement of cartier esham]
    My name is Cartier Esham, and I am the Chief Scientific Officer at 
the Biotechnology Innovation Organization, or BIO. BIO appreciates the 
opportunity to speak with you today about key priorities we believe 
will improve regulatory oversight and transparency and enable 
biopharmaceutical companies to modernize the clinical development 
paradigm to one that is more patient-centric, efficient, and inclusive. 
We look forward to working with this Committee to build on the strong 
foundation forged by Congress over many years that has expedited 
patients' access to safe and effective therapies and helped innovators 
develop next-generation medicines that have improved the lives of 
patients and their families. We urge that the Committee proceed with 
the timely reauthorization of the Prescription Drug User Fee Act 
(PDUFA) and Biosimilar User Fee Act (BsUFA) to ensure FDA can continue 
to meet its mission to protect and promote public health.

    We emphasize the importance of promoting effective scientific 
dialog between the FDA and sponsors of medical product development 
programs, enabling the utilization of regulatory tools that are more 
effective and support broader and more meaningful understandings of 
clinical outcomes for all patients, the incorporation of patient 
perspectives in clinical trials and post-approval data collection, and 
the necessity to provide the resources and capacity needed to meet the 
demands and opportunities of the digital age and the next wave of 
advanced biologic therapies. The COVID-19 pandemic has shown us that 
decentralized clinical trials, digital health technology tools, 
utilization of real-world data and evidence, and other innovations have 
the potential to improve how we develop innovative medicines. 
Incorporating these lessons learned into the regulatory framework 
enables the biopharmaceutical industry to better meet the needs of 
patients, improve care, and greatly reduce burden on clinical trial 
participants, especially those who belong to historically 
underrepresented populations and those who suffer from rare diseases, 
where clinical trial populations are small and geographically 
dispersed.

    BIO is committed to enhancing clinical trial diversity, and we 
included this commitment as part of our BIOEquality Agenda launched in 
2020. We stand ready to work with Congress, the Administration, and all 
stakeholders to create a more expansive, inclusive, and sustainable 
clinical development ecosystem. In addition to important legislation 
addressing these issues that will be discussed today, BIO has provided 
this Committee with legislative proposals we believe are essential to 
removing barriers and establishing a regulatory framework that is more 
inclusive and representative of the patients we serve by building 
reliable demographic and epidemiological data, modernizing inclusion/
exclusion criteria, utilizing clinical trial modernization efforts as a 
tool to improve diversity, formalizing scientific workforce 
diversification, and other key actions.

    Further, we strongly support the Accelerated Approval Pathway (AAP) 
for reviewing safe and effective therapies that address critical unmet 
patient needs in serious and life-threatening disease states. The AAP 
has proven essential in addressing some of our most pressing public 
health needs and has been foundational to extending and saving 
countless lives since its enactment. We emphasize the role it plays in 
providing timely access to treatments when there is an unmet medical 
need and patients lack therapeutic options.

    We urge an on-time reauthorization of FDA's user fee programs to 
allow the enactment of the PDUFA VII and BsUFA III Commitment Letters 
that will continue to advance meaningful integration of the patient 
voice and experience into drug and biosimilar biological product 
development and review processes, build upon important lessons learned 
from the pandemic, and pave a path forward to a clinical development 
paradigm that is more efficient, more effective, more informative, and 
more representative of the patients we serve.
                                 ______
                                 
    Senator Burr. Cartier, thank you. David, the floor is 
yours.

 STATEMENT OF DAVID GAUGH, SENIOR VICE PRESIDENT, SCIENCES AND 
   REGULATORY AFFAIRS, ASSOCIATION FOR ACCESSIBLE MEDICINES, 
                         ALEXANDRIA, VA

    Mr. Gaugh. Chair Murray, Ranking Member Burr, and Members 
of the Committee, thank you for the opportunity to testify 
about the critical role of GDUFA and BsUFA, and which they hold 
in increasing patient access to more affordable generic and 
biosimilar medicines. My name is David Gaugh, Senior Vice 
President for Sciences and Regulatory Affairs at the 
Association for Accessible Medicines.
    I am a licensed pharmacist with many years of experience 
with a generic and biosimilar industries. I represent the 
industry in the initial development and in both subsequent 
renewals of generic and biosimilar user fee agreements. AAM's 
biosimilar council strongly support congressional 
reauthorization of GDUFA and BsUFA as negotiated and without 
changes.
    Timely approval of the FDA user fee agreements ensure 
patients will continue to benefit from new, more affordable 
generic and biosimilar medicines. Over the last 10 years, GDUFA 
and BsUFA significantly increased the resources available to 
FDA for the review of applications. The benefits of this is 
clear.
    A record number of generic drugs were approved in 2017, 
2018, and 2019, and a total of 34 biosimilars have been 
licensed to date. A direct result of this increased competition 
is lower prescription drug costs for the American patients. 
Since 2012, patients in the U.S. health care system have saved 
more than $2 trillion, including $469 billion from new generics 
and more than $12 billion from biosimilars.
    GDUFA III and BsUFA III build upon the successes of the 
last decade. The user fee agreements incorporate lessons 
learned, include enhancements to ensure the timely review of 
applications, and will provide FDA with sufficient resources 
over the next 5 years. GDUFA III and BsUFA III are the 
culmination of months of negotiations, have been subject to 
public review and comment, and represent a careful balance 
between stakeholders.
    My written statement details many improvements negotiated 
in GDUFA III and BsUFA III but let me highlight a couple. 
First, complex generics are generic versions of brand name 
drugs that have complex active ingredients or drug device 
combinations, for example. These drugs are more difficult to 
develop due to the part--due in part to the lack of FDA product 
specific guidance.
    GDUFA III includes commitments to facilitate the 
development and publication of product specific guidance for 
complex generics. These commitments will increase transparency 
and developers' understanding of FDA's expectations to allow 
for a more predictable review process. Inspections.
    Generic and biosimilar developers support FDA's inspection 
program. One of the original purposes of GDUFA was to provide 
resources for FDA to conduct risk based facility inspections. 
GDUFA III enhances the efficiencies of the inspection process 
by helping ensure re-inspections occur within a specified 
timeframe. In addition, under BsUFA III, FDA commits to 
increasing guidance on its use of alternative tools to request 
records for documentation.
    BLA supplements. Biosimilar developers can submit 
supplements to modify an approved BLA. For example, updating 
labeling with new study information or changes to indications.
    Under pursue BsURA III, FDA commits to accelerating 
supplemental reviews for safety labeling, for extrapolation, 
for label carve in, carve out, and also for new data. 
Interchangeability. As of March 2022, FDA has licensed two 
interchangeable biosimilars. BsUFA III will help manufacturers 
to develop more interchangeable biosimilars through the newly 
negotiated regulatory science demonstration projects.
    These demonstration projects will also evaluate mechanisms 
to streamline overall biosimilar development. In closing, we 
strongly support the timely reauthorization of GDUFA and BsUFA.
    We look forward to working with Members of both parties to 
accomplish this goal. Thank you for the opportunity to testify, 
and I look forward to answering any questions you might have.

    [The prepared statement of Mr. Gaugh follows:]
                   prepared statement of david gaugh
    Chair Murray, Ranking Member Burr and Members of the Committee:
    Thank you for holding today's hearing on the reauthorization of the 
Food and Drug Administration's (FDA) user fee programs and for the 
opportunity to testify about the critical role the Generic Drug User 
Fee Amendments (GDUFA) and the Biosimilar User Fee Act (BsUFA) hold in 
increasing patient access to more affordable generic and biosimilar 
medicines. My name is David Gaugh, Senior Vice President for Sciences 
and Regulatory Affairs at the Association for Accessible Medicines 
(AAM). I am a licensed pharmacist with more than two decades of 
experience working in and around the generic and biosimilar medicines 
industry, and I represented the industry in the initial development and 
in both subsequent renewals of the generic and biosimilars user fee 
agreements.

    AAM and its Biosimilars Council are the Nation's leading trade 
association for the manufacturers and distributors of FDA-approved 
generic and biosimilar prescription medicines. Today, generic and 
biosimilar medicines comprise 90 percent of prescriptions in the United 
States at only 18 percent of total drug spending. \1\ AAM's members 
provide more than 52,000 jobs at nearly 150 facilities and manufacture 
more than 60 billion doses of generic medicines in the United States 
every year. \2\ Our core mission is to improve lives by advancing 
timely access to high-quality, more affordable safe and effective 
generic and biosimilar medicines.
---------------------------------------------------------------------------
    \1\  AAM, ``The U.S. Generic & Biosimilar Medicines Savings 
Report,'' October 2021 (link).
    \2\  ``A Blueprint for Enhancing the Security of the U.S. 
Pharmaceutical Supply Chain,'' October 2021 (link).

    In today's testimony, I will highlight the success of the FDA's 
generic and biosimilars programs in significantly increasing patient 
access to lower-cost medicines and, in turn, dramatically lowering the 
cost of prescription drugs for America's patients and our health care 
system over the last 10 years; outline the improvements made to the 
public-private partnership embodied in GDUFA III and BsUFA III; and 
discuss how congressional approval of the FDA user fee programs for the 
next 5 years (FY2023-2027) will benefit patients and increase their 
---------------------------------------------------------------------------
access to more affordable treatments.

    AAM and its Biosimilars Council strongly support congressional 
reauthorization of GDUFA and BsUFA as negotiated and without changes. 
Timely approval of the FDA user fee agreements ensures patients will 
continue to benefit from new, more affordable generic and biosimilar 
medicines. The GDUFA III and BsUFA III commitment letters were 
carefully negotiated to balance program enhancements and resource 
requirements provided to FDA. The agreements include a year-over-year 
capacity planning adjuster (CPA) that allows FDA to automatically add 
additional full-time equivalent (FTE) resources when increased workload 
criteria exceed expectations. Therefore, AAM would have concerns about 
adding policies into the reauthorization package that require 
additional FTEs to implement if the package does not also include 
corresponding appropriations. Adding such policies would increase 
industry's year-over-year costs beyond what was negotiated and agreed 
to with FDA.
                      GDUFA and BsUFA at 10 Years
    Ten years ago, Congress created the FDA's user fee programs for 
generic and biosimilar medicines when it enacted GDUFA and BsUFA as 
part of the FDA Safety and Innovation Act of 2012. For generic drugs, 
the number of applications submitted to the FDA had increased 
substantially since enactment of the Hatch-Waxman Act. Prior to GDUFA, 
FDA's review of abbreviated new drug applications (ANDA) was often slow 
and unpredictable. For biosimilar medicines, FDA's licensure pathway 
for these new treatments had been created in 2010 as part of the 
Biologics Price Competition and Innovation Act (BPCIA). With passage of 
the first GDUFA and BsUFA iterations in 2012, Congress helped ensure 
FDA would have sufficient resources to carry out its mission.

    Congressional authorization of the FDA's generic and biosimilars 
user fee programs in 2012 and reauthorization in 2017 substantially 
increased the resources available to the Agency to review applications. 
More than $4 billion in supplemental user fees from generic and 
biosimilars developers was and will be provided as a result. \3\
---------------------------------------------------------------------------
    \3\  AAM Analysis of FDA's fiscal year 2014--fiscal year 2020 GDUFA 
and BsUFA Financial Reports and Five-Year Financial Plans (2021 
Update). FDA's reports are available at https://www.fda.gov/about-fda/
user-fee-reports/user-fee-financial-reports.

[GRAPHIC] [TIFF OMITTED] T8905.002


    .epsWith the additional resources, FDA was able to increase 
efficiencies and approval of generic drugs increased significantly, 
with full and tentative approvals exceeding 1,000 in fiscal years 2017, 
2018 and 2019. The median number of ANDA approvals has increased over 
time as a result of GDUFA I and GDUFA II. \4\ The partnership between 
FDA and the generic industry has enhanced the overall stability and 
predictability of the GDUFA program and accelerated the timely review 
of ANDAs, increasing access to quality affordable generic medicines.
---------------------------------------------------------------------------
    \4\  AAM Analysis of the FDA Office of Generic Drug Annual Reports 
(2015-2020) and Activities Report of the Generic Drug Program (FY13-
FY15, fiscal year 2021). FDA's reports are available at https://
www.fda.gov/drugs/generic-drugs/annual-reports.

[GRAPHIC] [TIFF OMITTED] T8905.001


    .epsFollowing the creation of the biosimilars pathway and 
subsequent development of the biosimilars program, FDA licensed the 
first biosimilar in 2015 and has now licensed 34 biosimilars in the 
U.S. \5\ Biosimilar medicines are safe, effective and more affordable 
treatments for patients and, with 21 products launched and available to 
patients, biosimilars are already delivering on their promise of lower 
costs and expanded patient access to care.
---------------------------------------------------------------------------
    \5\  Biosimilars Council, ``FDA Biosimilars Approvals,'' March 2022 
(link).

[GRAPHIC] [TIFF OMITTED] T8905.003


    .epsWith FDA approval, the introduction of new generic and 
biosimilar medicines leads to competition in the pharmaceutical 
market--and the result is a significant reduction in the cost of 
prescription drugs for patients. Experience shows drug prices decline 
rapidly when generics enter the market. \6\ According to FDA, prices 
fall as generics enter the market--by an average of 39 percent when 
there is only one generic and by nearly 80 percent when four or more 
generics enter the market. \7\ Evidence with biosimilar medicines is 
similar with an average cost savings of nearly 50 percent. \8\ 
Importantly, biosimilar competition also results in lower brand 
biologic costs--by more than 25 percent on average. \9\
---------------------------------------------------------------------------
    \6\  IMS Institute for Healthcare Informatics, ``Price Declines 
after Branded Medicines Lose Exclusivity in the U.S.,'' January 2016 
(link).
    \7\  FDA, ``New Evidence Linking Greater Competition and Lower 
Generic Drug Prices,'' December 2019 (link).
    \8\  AAM Analysis of Average Sales Price Files, January 2022.
    \9\  Ibid.
---------------------------------------------------------------------------
    Over the last 10 years, generics and biosimilars provided more than 
$2 trillion in savings--including $469 billion from new generics and 
more than $12 billion from biosimilars--to patients and the U.S. health 
care system. \10\ In addition to the cost savings provided, patient 
access to life-saving treatments is broadened as the price of medicine 
falls. A recent analysis of Medicare Part D from the Congressional 
Budget Office noted ``the number of standardized prescriptions 
dispensed for generic drugs more than doubled from 2009 through 2018.'' 
\11\
---------------------------------------------------------------------------
    \10\  Ibid., AAM Generic & Biosimilar Savings Report.
    \11\  CBO, ``Prescription Drugs: Spending, Use, and Prices,'' 
January 2022 (link).

[GRAPHIC] [TIFF OMITTED] T8905.004


    .epsGDUFA and BsUFA aim to put FDA's generic and biosimilar drug 
programs on firm financial footing by enabling FDA to assess user fees 
to fund critical and measurable enhancements and, in turn, bringing 
greater predictability and timeliness to the review of applications. As 
a direct outcome, the generic and biosimilars drug programs have 
increased patient access to safe, effective and affordable quality 
medicines.
                         GDUFA III Enhancements
    FDA plays a critically important role in making lower-cost, high-
quality generic medicines available to patients. FDA reviews ANDAs 
submitted by generic drug manufacturers (ANDA sponsors). To receive FDA 
approval, data submitted in an ANDA must generally demonstrate that the 
generic drug is bioequivalent to the Reference Listed Drug (RLD), more 
commonly known as the innovator or brand product.

    The GDUFA commitment letter specifies various fees the FDA sets and 
can collect from manufacturers, such as ANDA applications, Drug Master 
Files (DMF), and facility and program fees. \12\ The fees paid by the 
generic drug industry aid FDA's ability to meet agreed-upon performance 
goals and commitments, such as timely reviews and other regulatory 
activities. FDA also provides annual reports to Congress on its 
performance. \13\ The increases in transparency and communication are 
important to FDA's ability to meet the commitments, which enhance the 
overall stability and predictability of the GUDFA program.
---------------------------------------------------------------------------
    \12\  AAM, ``The Generic Drug User Fee Amendments (GDUFA III),'' 
October 2021 (link); FDA, ``GDUFA Reauthorization Performance Goals and 
Program Enhancements Fiscal Years 2023-2027,'' October 2021 (link).
    \13\  FDA, GDUFA Performance Reports, fiscal year 2015--fiscal year 
2020 (link).

    The negotiated GDUFA III performance goals will further strengthen 
and build upon the progress made and lessons learned from GDUFA I and 
GDUFA II. Let me take a moment to highlight five areas--advancing 
approvals, complex generics, inspections, suitability petitions and 
sustainability--where we believe the FDA's generic drug program will be 
enhanced with congressional ratification of GDUFA III.
                          Advancing Approvals
    GDUFA III includes important performance goals that will maintain 
FDA's rigorous ANDA review standards, building upon and improving the 
review process to increase timely patient access to high-quality, 
lower-cost generic medicines. For example, the newly negotiated 
provision known as ``imminent action'' will allow the FDA to extend a 
goal date by up to 60 days if, in FDA's judgment, an approval or 
tentative approval of the application is imminent. This commitment will 
mitigate the need to add additional review cycles unnecessarily and 
delay approvals over minor, easily resolvable issues.

                            Complex Generics
    Complex generics are generic versions of brand-name drugs that have 
complex active ingredients, routes of administration, drug-device 
combinations or formulations. These drugs are more difficult to develop 
due in part to the lack of FDA product-specific guidance. Congress and 
FDA helped spur competition for complex products by including 
provisions in the previous user fee authorizations to increase product-
specific guidance publication and meetings with FDA during the product 
development phase. GDUFA III builds on this success through performance 
goals to facilitate the development and publication of product-specific 
guidances for complex generic products--increasing transparency and 
understanding of FDA's expectations to allow for a more predictable 
review process.
                              Inspections
    Generic and biosimilar developers support FDA's inspections 
program. One of the original purposes of GDUFA was to provide resources 
for FDA to conduct facility inspections. Under the inspections process, 
FDA typically inspects a facility and identifies deficiencies. The 
facility has a specified timeframe to address and correct the 
identified deficiencies and subsequently request a reinspection from 
FDA. In some cases, extended time passes from when a facility performs 
the corrective actions to resolve the deficiencies and the time period 
when FDA can reinspect. Delays in reinspection lead to significant 
delays in the review process. GDUFA III enhances the efficiencies of 
the inspection process by helping ensure reinspection occurs within a 
specified timeframe.
                         Suitability Petitions
    Suitability petitions are required to be submitted to FDA when a 
generic drug manufacturer intends to seek approval of an ANDA for a 
drug that differs from the reference brand product in terms of the 
active ingredient (for a combination product), route of administration, 
strength and/or dosage form. Current law requires FDA to grant or deny 
suitability petitions within 90 days from petition submission. That 
deadline, however, is rarely met. This results in delays to generic 
market entry. GDUFA III includes performance goals and resources to 
facilitate the FDA's ability to conduct a timely review of suitability 
petitions. These new resources will help FDA meet these goals, 
including conducting completeness assessments within 21 days from 
petition submission and using agreed upon metrics to prioritize 
petition reviews.
                      Sustainability of Resources
    Under GDUFA II, FDA committed to developing a Resource Capacity 
Planning (RCP) capability to optimize resources and better anticipate 
future resource needs. GDUFA III provides an additional tool to further 
enhance the utility of the RCP to allow FDA to better forecast resource 
needs via the Capacity Planning Adjustment (CPA). The CPA will help 
promote sustainability for both FDA and industry by allowing FDA to 
increase full-time employee needs as workload increases. In turn, the 
CPA will provide predictability for generic developers through a 3 
percent cap to prevent significant fluctuation in fees and minimize the 
financial barriers for smaller generic manufacturers.
                         BsUFA III Enhancements

    Similar to FDA's generic drug program, FDA helps ensure that 
America's patients can gain access to high-quality, more affordable 
biological products in the form of biosimilars. FDA reviews abbreviated 
biologics license applications (BLA) submitted by biosimilar 
developers. In order for a biosimilar to be licensed, data submitted in 
a BLA must demonstrate the biosimilar drug product is ``highly 
similar'' to the brand-name reference biologic and there are no 
clinically meaningful differences in safety, purity or potency.

    BsUFA allowed FDA to assess and collect fees from developers and 
manufacturers that submit BLAs for FDA's review. The negotiated 
commitments enhance and improve the review process to facilitate timely 
access to biosimilar medicines and ensures the Agency has the necessary 
resources to fulfill the agreed upon commitments. FDA also provides 
annual reports to Congress on its performance. \14\
---------------------------------------------------------------------------
    \14\  FDA, BsUFA Performance Reports, fiscal year 2013--fiscal year 
2020 (link).

    The negotiated BsUFA III performance goals will further strengthen 
and build upon the progress made and lessons learned from BsUFA I and 
BsUFA II. \15\ Let me highlight several enhancements to FDA's 
biosimilars program: supplement reviews, meeting management, regulatory 
science and interchangeability, inspections, use of carryover funds and 
IT modernization. I will briefly describe each.
---------------------------------------------------------------------------
    \15\  AAM, ``Key Elements of BsUFA III,'' September 2021 (link); 
FDA, ``Biosimilar Biological Product Reauthorization Performance Goals 
and Procedures Fiscal Years 2023 Through 2027,'' September 2021 (link).
---------------------------------------------------------------------------
                            BLA Supplements
    Biosimilar developers can submit supplements to modify an approved 
BLA, for example, updating labeling with new safety information or 
changes to indications. Under BsUFA III, FDA commits to accelerating 
supplement reviews for safety labels, extrapolation, label carve-in and 
carve-outs and new pharmacokinetic data.
                           Meeting Management
    Biosimilar developers participate in meetings with FDA to gain 
insight into the agency's expectations and perspectives on different 
issues. These meetings help facilitate a predictable and efficient 
review process. BsUFA III includes commitments to: add a new type of 
meeting to get feedback on focused questions; make meetings more 
efficient; help provide FDA with sufficient information in advance of 
meetings; and obtain rapid clarification of meeting minutes.
               Regulatory Science and Interchangeability
    As of March 2022, FDA has licensed two interchangeable biosimilars. 
In order to achieve the interchangeable designation, a biosimilar must 
produce the same clinical result as the brand-name biologic. With the 
interchangeable designation and subject to state law, a pharmacist may 
dispense an interchangeable biosimilar when a brand-name biologic is 
prescribed without intervention from the provider. BsUFA III will help 
manufacturers to develop more interchangeable biosimilars through the 
new Regulatory Science Program's demonstration project. These 
demonstration projects will also evaluate mechanisms to streamline 
overall biosimilars development. Findings from the demonstration 
projects will inform a comprehensive strategy to advance 
interchangeability and the development of future guidance documents.
                           Remote Inspections
    FDA uses alternate tools to conduct inspections and supplement its 
ability to assess manufacturing facilities remotely. Due to the COVID-
19 pandemic, FDA used these alternate tools to request records and 
documentation from its regulatory partners. Under BsUFA III, FDA 
commits to issuing guidance on the use of alternative inspection tools.
                         Use of Carryover Funds
    Any remaining user fees collected by FDA but not yet spent are 
carried over to the next year. Under BsUFA III, FDA commits to reducing 
the carryover balance from 39 weeks to 21 weeks over a 3-year period.
                            IT Modernization
    FDA continues to modernize the Agency's IT capabilities. BsUFA III 
will further FDA's efforts. For example, FDA will modernize and move 
the Electronic Submissions Gateway to the cloud to help improve 
transparency and communication.
              COVID-19 and FDA's Use of Remote Inspections
    Given congressional interest about lessons learned from the COVID-
19 pandemic and this Committee's leadership in driving forward 
solutions to prepare the country for future public health emergencies, 
I do want to take a moment to share the experience of AAM's members in 
regard to FDA inspections over the last 2 years. Manufacturing facility 
inspections are an essential part of evaluating applications to market 
all FDA-approved pharmaceuticals, including brand-name, generic, and 
biosimilar medicines. When FDA does not conduct inspections in a timely 
manner, approvals and patient access to new treatments, as well as more 
affordable options, can be delayed.

    During the last 2 years, there have been significant disruptions to 
the inspections program. In March 2020, FDA announced that it was 
suspending domestic and foreign inspections due to the COVID-19 
pandemic. The Agency focused only on ``mission-critical'' inspections, 
a narrow category that does not include inspections tied to most drug 
applications. As the pandemic subsided in mid-2021, FDA attempted to 
resume all domestic inspections. However, with the rise of the Omicron 
variant in December 2021, FDA reverted to performing only mission-
critical inspections and did not resume a normal domestic inspection 
schedule until February 2022.

    These inspection disruptions have had a significant effect on our 
members' ability to obtain timely approval of more affordable generics 
and biosimilars. By FDA's account, as of the end of fiscal year 2021--
the most recent data available to AAM at the time of this hearing--52 
human drug application decisions remain ``delayed solely due to a 
pending inspection or facility assessment.'' \16\ The tally of 52 
likely underestimates the extent of the delays, as it excludes 
applications that might have had a minor issue unrelated to an 
inability to inspect. Inspections for biosimilar applicants are also 
impacted, including biosimilars for brand-name biologics like Humira. 
\17\ Prompt inspection of such facilities is urgently needed.
---------------------------------------------------------------------------
    \16\  FDA, ``An Update to the Resiliency Roadmap for FDA 
Inspectional Oversight,'' November 2021 (link).
    \17\  Center for Biosimilars, ``FDA Delays Review of Alvotech's 
AVT02 Adalimumab Biosimilar Candidate,'' September 2021 (link).

    Under existing authorities FDA has several alternatives to 
physically inspecting facilities, including: (1) obtaining inspection 
records remotely; (2) requesting information and records from 
applicants, facilities, and other inspected entities; (3) conducting 
remote interactive evaluations (real-time video interactions with 
facilities that cover the same ground as inspections); and (4) relying 
on inspections conducted by trusted foreign regulatory authorities 
under the Mutual Recognition Agreements (MRA). FDA, however, 
infrequently uses these alternatives. For example, FDA informed AAM 
that, as of December 2021, it had conducted only five remote 
---------------------------------------------------------------------------
interactive evaluations.

    AAM recognizes the important role inspections play in FDA's ability 
to assess the overall quality of applications. Our members also share 
the Agency's concerns about public health and preventing the spread of 
COVID-19 among FDA and manufacturing facility employees. The 
interruptions caused by COVID-19, however, delayed and denied patients 
prompt access to new therapies and generic and biosimilar choices that 
would lower drug costs. If new COVID-19 variants emerge, or if there is 
a future pandemic, FDA's inspections could be paused again.

    AAM believes FDA should expand the use of remote interactive 
evaluations and use them more frequently in place of a physical 
inspection, in addition to using alternative tools in place of an in-
person inspection to verify corrective actions for a site that had 
received a warning letter. Specifically, we recommend requiring FDA to 
evaluate alternatives when an in-person inspection is not possible. 
Should FDA determine that an alternative to an in-person inspection 
cannot be used, the Agency should be required to inform the applicant 
which alternatives were considered and the reasons why an in-person 
inspection was deemed necessary. We believe this additional 
transparency and accountability will encourage FDA to perform its 
critical mission without delay, while preserving the Agency's 
discretion and judgment to require in-person inspections when 
necessary.
                               Conclusion
    Patient access to generic and biosimilar medicines has never been 
more critical. Over the last 10 years, GDUFA and BsUFA significantly 
increased the resources available to FDA for review of generic and 
biosimilars applications. The benefit of this partnership between FDA 
and industry is clear: record levels of generic drugs were approved in 
2017-2019, and more than 30 biosimilar medicines were licensed. The end 
result is lower prescription drug costs for America's patients. Since 
the establishment of FDA's generic and biosimilars programs in 2012, 
patients and the U.S. health care system have saved more than $2 
trillion--including $469 billion from new generics and more than $12 
billion from biosimilars. Congressional passage of GDUFA and BsUFA, 
along with their reauthorization in 2017, made this possible.

    GDUFA III and BsUFA III build on this success. The user fee 
agreements incorporate lessons learned, include enhancements to ensure 
the timely review of applications and provide FDA with sufficient 
resources over the next 5 years (FY23-27). GDUFA III and BsUFA III are 
the culmination of months of negotiations, have been subject to public 
review and comment, and represent a careful balance between 
stakeholders. AAM and its Biosimilars Council strongly support 
congressional reauthorization of GDUFA and BsUFA as negotiated and 
without changes. Timely approval of the FDA user fee agreements ensures 
patients will continue to benefit from new, high-quality and more 
affordable generic and biosimilar medicines. We look forward to working 
with Members of both parties to accomplish this goal.

    Thank you again for the opportunity to testify on this important 
issue. I look forward to answering your questions.
                                 ______
                                 
                   [summary statement of david gaugh]
    The Association for Accessible Medicines (AAM) and its Biosimilars 
Council, represented by David Gaugh, Senior Vice President of Sciences 
and Regulatory Affairs, will provide testimony on the importance of 
timely reauthorization of GDUFA and BsUFA to continued patient access 
to high quality, more affordable generic and biosimilar medicines. Mr. 
Gaugh's testimony highlights the success of FDA's generic and 
biosimilar programs in significantly increasing patient access to 
lower-cost medicines and, in turn, dramatically lowering the cost of 
prescription drugs for patients over the last 10 years. Since 2012, 
more than $4 billion in funding has been provided under GDUFA (70 
percent) and BsUFA (60 percent) to help ensure FDA has sufficient 
resources to review and approve applications. As a result, FDA approval 
of generic drugs increased significantly with full and tentative 
approvals exceeding 1,000 in fiscal years 2017, 2018 and 2019. The 
first biosimilar was approved in 2015 and now 34 biosimilars are 
approved in the U.S. These approvals increased competition from 
generics and biosimilars and led to significant savings to patients and 
the health care system--more than $2 trillion in savings over the last 
10 years. The GDUFA III and BsUFA III agreements includes enhancements 
with the goal of: advancing approvals; ensuring timely inspections; 
improving review of complex generics; streamlining suitability 
petitions; providing for BLA supplement reviews; addressing 
interchangeability; and ensuring the efficient of resources.
                                 ______
                                 
    Senator Burr. David, thank you very much. Mark, the floor 
is yours.

    STATEMENT OF MARK LEAHEY, PRESIDENT AND CHIEF EXECUTIVE 
OFFICER, MEDICAL DEVICE MANUFACTURERS ASSOCIATION, WASHINGTON, 
                               DC

    Mr. Leahey. Thank you, Ranking Member Burr. Thanks again to 
Chair Murray and Members of the Committee for the invitation to 
testify today. My name is Mark Leahey, and I am the President 
and CEO of the Medical Device Manufacturers Association, a 
national trade association representing hundreds of medical 
technology companies.
    MDMA was founded in 1992 to be the voice of the innovative 
and entrepreneurial sector of our industry. According to the 
Department of Commerce, 98 percent of medical technology 
companies have fewer than 500 employees and 80 percent have 
fewer than 50 employees.
    These small companies drive the majority of innovation in 
med-tech. Our industry is dedicated to one mission, to 
alleviate human suffering and improve patient care. Perhaps no 
recent example is more profound than what innovators have done 
since the outset of the COVID-19 pandemic.
    In addition to the extraordinary efforts of our industry 
and health care professionals, I would also like to take a 
moment to acknowledge the dedicated professionals at FDA who 
are 24-7 on COVID and non-COVID medical technologies to improve 
patient care during the pandemic, their efforts ensure that 
patients have timely access to safe and effective products. The 
MDUFA V draft agreement that we are discussing today and the 
historic increase in user fee funding that it contains 
demonstrates our commitment to provide additional capacity and 
expertise to further advance FDA's mission.
    MDUFA V provides over $2 million in investible funding to 
FDA. As a point of reference, MDUFA I totaled approximately 
$150 million. While each MDUFA typically provides the resources 
to fund approximately 200 new hires, under MDUFA V, FDA will be 
able to hire at a minimum 273 FTEs and up to 387 new FTEs.
    This represents a historic increase in both overall funds 
and people, and it is our expectation that this will be the 
last major investment needed for the MDUFA program, and that 
moving forward, any necessary increases will be much more 
modest and targeted. MDUFA V also establishes more transparency 
around the use of funds, including ensuring that annual hiring 
targets are met.
    FDA will also conduct an H.R. assessment during MDUFA V to 
identify how many MDUFA funded vacancies exist. Beyond the 
financial and accountability provisions that MDUFA V contains, 
performance goals associated with De Novos and PMA Total Time 
to Decision also improve over the course of the agreement.
    One goal that was elusive under MDUFA IV was the total--
510(k) total time to decision goal in Fiscal Year 2022 of 108 
days. COVID did impact FDA capacity, including the ability to 
meet certain B MDUFA IV goals.
    Under MDUFA V, the 510(k) total time to decision goal will 
improve each year, hopefully achieving 108 days by Fiscal Year 
2026. Also for the first time the agreement incorporates add on 
payments that will provide the agency up to $150 million in 
additional funding above the baseline in the final year of the 
agreement if FDA meets modest but important performance goals 
in the first 2 years of the agreement.
    The United States medical technology ecosystem is the envy 
of the world, and this is in no small part due to FDA's gold 
standard of reviewing the safety and efficacy of medical 
devices. The billions of dollars in user fees provided by 
industry under this agreement will enable FDA to hire hundreds 
of new reviewers and scientific experts, strengthening the 
agency's ability to maintain its strong track record.
    This agreement also makes additional investments to enhance 
device safety. This includes increased funding to better 
incorporate the patient perspective in the product evaluation 
process, as well as funding to improve the use of real world 
evidence.
    The agreement also contains resources to pilot the Total 
Product Lifecycle Advisory Program, also known as TAP, a top 
priority for FDA during these negotiations. Medical 
technologies that serve patients with unmet needs unfortunately 
can take longer to navigate the regulatory process.
    This is often due to the complexity and novel approach that 
breakthrough devices encompass. Innovators participating in the 
Safer Technologies Program, or STeP, will also be eligible for 
the TAP pilot. TAP is designed to allow FDA and sponsors to 
share early feedback to improve the process.
    Based upon the data and independent assessment of the 
pilot, industry and FDA will determine whether to continue, 
expand, or terminate the TAP pilot during the MDUFA V 
negotiations--VI negotiations, excuse me. In conclusion, this 
is a historic investment in the FDA and will be critical over 
the coming years to meet the goals and milestones within the 
user fee agreement to help ensure that the United States 
remains the global leader in medical technology development.
    It is also critical that Congress continues its vital 
oversight role and provides the necessary appropriations to FDA 
to achieve its mission. MDMA and our members remain committed 
to working closely with you to reach our shared goal of 
providing safe and effective medical technologies to patients 
and providers in a timely manner.
    Thank you once again, Chair Murray, Ranking Member Burr, 
and Members of the Committee, for the opportunity to testify, 
and I welcome your questions.

    [The prepared statement of Mr. Leahey follows:]
                   prepared statement of mark leahey
    Thank you Chair Murray, Ranking Member Burr and Members of the 
Committee for this opportunity to testify today. My name is Mark Leahey 
and I am the President and CEO of the Medical Device Manufacturers 
Association (``MDMA''), a national trade association representing 
hundreds of medical technology companies. MDMA was founded in 1992 to 
be the voice of the innovative and entrepreneurial sector of our 
industry. While the industry is broadly represented throughout the 
United States, one of the unique components of this vibrant part of 
America's innovation ecosystem is that the majority of companies are 
small businesses. According to data from the Department of Commerce, 
over 98 percent of med tech companies have fewer than 500 employees, 
and more than 80 percent have less than 50 employees, yet they are the 
major source of innovation and America's competitive advantage in 
medical technology. Our industry is dedicated to one mission: to 
alleviate human suffering and improve patient care.

    Our industry has a proud tradition of answering the needs of 
patients and providers, and perhaps no example is more profound than 
what innovators have done since the outset of the COVID-19 pandemic. 
Whether it was respiratory technologies, diagnostics, advanced patient 
monitoring, or personal protective equipment, the medical technology 
industry worked tirelessly to help the United States and the entire 
world to confront this challenge, and they continue to do so today. In 
addition to the extraordinary efforts of this industry and health care 
professionals, I would also like to take a moment to acknowledge the 
dedicated professionals at the FDA who worked 24/7 on COVID and non-
COVID medical technologies to improve patient care during the pandemic. 
Their efforts ensured that patients had timely access to safe and 
effective medical technologies.
                     MDUFA V--A Historic Investment
    The MDUFA V draft agreement that we are discussing today, and the 
historic increase in user fee funding that it contains, demonstrates 
our commitment to provide additional capacity and expertise to further 
advance FDA's mission.

    MDUFA V provides over $2B in investable funding to FDA. As a point 
of reference, MDUFA I totaled approximately $150M over the 5-years of 
the program. While each MDUFA typically provides funding for an 
additional 200 new hires, under MDUFA V, FDA will be able to hire a 
minimum of 273 FTEs and up to 387 new FTEs to support the MDUFA 
program. This represents a historic increase in both overall funds and 
people, and it is our hope and expectation that this will be the last 
major investment needed for the MDUFA program and that moving forward, 
any necessary increases will be much more modest and targeted.

    With these significant investments, MDUFA V also establishes more 
transparency around the use of the funds, including ensuring that 
annual hiring targets are met. FDA will also conduct a H.R. assessment 
during MDUFA V to identify how many MDUFA funded vacancies exist. 
Currently, CDRH is only able to track MDUFA IV and later FTEs. Public 
reports in 2016 indicated MDUFA funded vacancies exceeded 25 percent, 
and innovators want to ensure that the additional capacity we are 
funding through user fees is realized in the new additional hires and 
backfilling any vacancies that arise.

    Beyond the financial accountability and transparency provisions 
that MDUFA V contains, performance goals associated with De Novos and 
PMA Total Time to Decision (TTD) also improve over the course of the 
agreement. One goal that was elusive under MDUFA IV was the 510(k) 
Total Time to Decision Goal in fiscal year 2022 of 108 days. As was 
mentioned earlier, COVID did impact FDA capacity, including the ability 
to meet certain MDUFA IV goals. Under MDUFA V, the 510(k) TTD goal will 
ramp down each year, hopefully achieving 108 days by fiscal year 2026. 
Also, for the first time, the agreement incorporates add on payments 
that will provide the agency up to $115 million in additional funding 
above the baseline in the final years of the agreement if FDA meets 
modest but important performance goals in the first 2 years of the 
agreement.
                    Maintaining FDA's Gold Standard
    The United States medical technology ecosystem is the envy of the 
world, and this is in no small part due to the FDA's gold standard of 
reviewing the safety and efficacy of medical devices. The billions of 
dollars in user-fees provided by industry under this agreement will 
enable FDA to hire hundreds of new reviewers and scientific experts 
strengthening the agency's ability to maintain its strong track record. 
The agreement also makes targeted investments to enhance device safety. 
This includes increased funding for patient perspective and engagement 
in the product evaluation process to better incorporate their 
experiences, as well as new funding to improve the use of real-world 
evidence in the review process.

    The agreement contains resources to start a pilot for the ``Total 
Product Lifecycle Advisory Program,'' also known as ``TAP.'' Medical 
technologies that serve patients with unmet needs unfortunately can 
take longer to navigate the regulatory process, despite the fact that 
these patient populations often have no other alternatives. This is 
often due to the complexity and novel approach that breakthrough 
devices encompass. Beyond breakthroughs, TAP will support devices 
developed to significantly improve the safety of currently available 
devices and diagnostics under the Safer Technologies Program (STeP). 
FDA was very vocal during negotiations about the importance of piloting 
the TAP concept. TAP is designed to allow FDA and innovators to share 
early feedback to improve this process. Based upon the data and 
assessment of the TAP pilot, industry and FDA will determine whether to 
continue, expand or terminate the TAP pilot during MDUFA VI 
negotiations.
                               Conclusion
    As we all know, America's medical technology ecosystem was not 
built overnight. It took decades of work between countless 
stakeholders, including Congress, the FDA, innovators, physicians, 
patient groups and more to design the regulatory pathways that has 
resulted in the gold standard of safety and efficacy. At the same time, 
we all recognize that this is a delicate balance to ensure that the 
right policies are in place to support innovation, and to spur the next 
generation of cures, therapies and diagnostics that so many patients 
are relying on. As I noted, this is a historic investment in the FDA, 
and it will be critical over the coming years to meet the goals and 
milestones within this user fee agreement to help ensure that the 
United States remains the global leader in medical technology 
development. It is also critical that Congress continues its vital 
oversight role, and providing the necessary resources and investments 
to FDA for it to achieve its mission. MDMA and our members remain 
committed to working closely with you to reach our shared goal of 
providing safe and effective medical technologies to patients and 
providers in a timely manner. Thank you once again Chairwoman Murray 
and Ranking Member Burr for your passionate leadership on this 
important work, and I look forward to answering any questions that the 
Committee Members might have.
                                 ______
                                 
                   [summary statement of mark leahey]
    I am the President and CEO of the Medical Device Manufacturers 
Association (``MDMA''), a national trade association representing 
hundreds of medical technology companies. MDMA was founded in 1992 to 
be the voice of the innovative and entrepreneurial sector of our 
industry, including the small companies who make up the majority of the 
industry and drive medical innovation.

    The device industry's singular mission--to alleviate human 
suffering and improve patient care--has been on display since the 
outset of the COVID-19 pandemic. Whether it was respiratory 
technologies, diagnostics, advanced patient monitoring, or personal 
protective equipment, medical technology innovators worked tirelessly--
partnering with the dedicated professionals at the FDA--to help the 
U.S. and the world confront the pandemic.

    MDUFA V_A Historic Investment--The MDUFA V draft agreement provides 
$2B in user fees enabling the FDA to hire a minimum of 273 FTEs and up 
to 387 new FTEs to support the MDUFA program. By comparison, MDUFA I 
totaled approximately $150M and subsequent MDUFA's typically provided 
funding for 200 new hires. It's our expectation that this will be the 
last major investment needed for the MDUFA program and that moving 
forward any necessary increases will be much more targeted.

    MDUFA V also includes provisions to help ensure that annual hiring 
targets are met. Currently, CDRH is only able to track MDUFA IV and 
later FTEs. Public reports in 2016 indicated MDUFA industry-funded 
vacancies exceeded 25 percent, and it's essential that FDA hits the new 
hiring targets and backfills any vacancies.

    Beyond the financial accountability and transparency provisions in 
MDUFA, performance goals associated with De Novos and PMA Total Time to 
Decision (TTD) also improve over the course of the agreement. One goal 
that was elusive under MDUFA IV was the 510(k) Total Time to Decision 
Goal in fiscal year 2022 of 108 days. COVID did impact FDA's ability to 
meet certain MDUFA IV goals. Under MDUFA V, the 510(k) TTD goal will 
ramp down each year, hopefully achieving108 days by fiscal year 2026. 
Also, for the first time, the agreement incorporates add on payments 
that will provide the agency up to $115 million in funding above the 
baseline in the final years of the agreement if FDA meets modest 
performance goals in the first 2 years of the agreement.

    Maintaining FDA's Gold Standard--The United States medical 
technology ecosystem is the envy of the world, and this is in no small 
part due to the FDA's gold standard of reviewing the safety and 
efficacy of medical devices. The billions of dollars in user-fees 
provided by industry under this agreement will enable FDA to hire 
hundreds of new reviewers and scientific experts, strengthening the 
agency's ability to maintain their strong track record. The agreement 
makes targeted investments to enhance device safety including increased 
funding for patient perspective and engagement in the product 
evaluation process, as well as new funding to improve the use of real-
world evidence in the review process.

    The agreement contains resources to start a pilot for the ``Total 
Product Lifecycle Advisory Program,'' also known as ``TAP.'' Medical 
technologies that serve patients with unmet needs unfortunately can 
take longer to navigate the regulatory process, despite the fact that 
these patient populations often have no other alternatives. Beyond 
breakthroughs, TAP will support devices developed to significantly 
improve the safety of currently available devices and diagnostics under 
the Safer Technologies Program (STeP).

    Conclusion--It took decades of work between countless stakeholders, 
including Congress, the FDA, innovators, physicians, patient groups and 
more to design the regulatory pathways that has resulted in the gold 
standard of safety and efficacy. At the same time, we all recognize 
that this is a delicate balance to ensure that the right policies are 
in place to support innovation, and to spur the next generation of 
cures, therapies and diagnostics that so many patients are relying on. 
It is also critical that Congress continues its vital oversight role, 
and provides the necessary resources and investments to FDA for it to 
achieve its mission.
                                 ______
                                 
    The Chair. Thank you very much. And thank you to all of our 
witnesses, and we do apologize having a vote, Members in and 
out, but we do have your written testimony and appreciate, 
again, all of you being here. We will now begin a round of 5-
minute questions. I ask my colleagues to keep track of your 
clocks always and stay within the 5-minutes. Prescription drug 
prices in the United States continue to skyrocket. In 2020, our 
Nation spent over $535 billion on pharmaceuticals.
    That number is rising. That is really outrageous. We have 
too many Americans who we know are choosing between paying 
their rent or mortgage and getting a lifesaving medicine. 
According to the Urban Institute, in 2018, nearly 13 million 
adults delayed getting or did not get needed medications 
because of the high cost, and Congress just really has to 
address this.
    Families really need us to take some bold steps to get this 
problem under control like giving Medicare new power to 
negotiate and force drug companies to bring down prices and 
stopping the games pharmaceutical companies play to keep their 
prices high, for example, creating a tangle of patents that 
block competition.
    I want you all to know I remain committed to working with 
all of my colleagues in Congress, on both sides of the aisle, 
to bring down prices and make sure prescription medication and 
lifesaving treatments are not just available, but accessible 
and affordable. Now, while FDA does not regulate drug prices, 
it does have a role in increasing access to lower cost generics 
and biosimilars, which can increase competition and drive down 
prices.
    But for that to work, we have to build off the steps we 
took in the Lower Health Care Costs Act by doing more to stop 
pharmaceutical companies from gaming the system with sham 
petitions, exclusivity, parking, and other tactics that block 
cheaper generic drugs, and increase transparency and 
information sharing that can help bring more affordable 
generics and biosimilars to the market.
    Mr. Gaugh, how do the generics and biosimilar user fee 
programs help increase competition and expand patient access to 
critical drugs without sacrificing safety, efficacy, or 
quality?
    Mr. Gaugh. Thank you for the question. Yes, we have spent a 
significant amount of time in GDUFA III to get enhancements 
that we felt we had left on the table, if you will, in GDUFA 
II. So in that prospect, we have a 10 month time point within 
which the FDA is going to take an action on a product. We found 
that in that 10 month time point, at a certain point in time, 
we can get toward the end and run out of time, which means we 
get a complete response letter for that product.
    In GDUFA III, we put forward an imminent action capability. 
So when the FDA knows that the product is about to be approved 
or could be approved with just a short period of time, they can 
take the imminent action route, which gives an additional 60 
days for review. And while it is now a 12 month clock, it is 
also a first cycle approval.
    If it went into a second cycle approval, that would be 
months down the road. So it would be at least 6 to 9 to 12 
months delay. And this will help get access to the American 
public more quickly.
    The Chair. What barriers exist for generic applicants in 
demonstrating their products have the same ingredients as more 
expensive brand name drugs, and how do we address those 
barriers?
    Mr. Gaugh. Well, there is one area that we refer to is Q1, 
Q2. And in Q1, Q2, that is a qualitative and quantitative 
analysis of the product. So we know what the active ingredient 
is when we are reverse engineering the product, if you will. 
What we don't know is the inactive ingredients or the 
concentrations of those inactive ingredients.
    Prior to 2017, when we had those issues come up, we would 
submit a control correspondence to the FDA, they would tell us 
what that product is, the inactive ingredient, and then we 
would look at ranges of what the concentration were and the FDA 
would say, usually high or low.
    After 2017, that was changed. They no longer will tell us 
what the product is, nor give us a plus minus on the 
concentration. And when we put a control correspondence in to 
ask those questions, we can only have three products in that 
control correspondence.
    If we don't guess right on the first time, it goes back for 
the next, and the next, and the next. So it is more of a 
guessing game and that delays even longer.
    The Chair. Okay, thank you. Dr. Esham, we have seen 
pharmaceutical companies abuse the citizen petition process to 
delay cheaper drugs from competitors. In fact, the FTC and FDA 
have both called out that behavior, with FDA arguing that those 
shenanigans present obstacles to the availability of follow on 
drugs. Isn't it right that the citizen petition process should 
not be used to reduce choice for consumers?
    Dr. Esham. Let me just start by saying that we do believe 
that the citizen petition process is an important mechanism not 
only for the public to express its views to the FDA, but also 
for the FDA to hear stakeholder perspectives on scientific, 
technical, and regulatory topics. We do understand that our 
colleagues at FDA have expressed concerns about situations 
where a company might try to use this process to block generics 
or follow-on biologics from entering the market.
    We also understand that they do conduct their own research. 
And while process requirement is associated with the 505(q), 
petitions have the potential to add some burdens to the generic 
drug review process. Citizen petitions have really delayed 
specific generic drug approvals.
    That being said, if this is an issue that the Committee 
would like to explore, we stand committed to working with you 
and other stakeholders.
    The Chair. Okay. Appreciate that.
    Senator Cassidy.
    Senator Cassidy. Ms. Richardson, and Mr. Gaugh, I will 
probably hit you afterwards. Some go to the doctor, eye doctor, 
he gives me a prescription for something which is four times a 
day, eye drop for the pain, and it cost me like $50 bucks. 
Except they can't find it. The only thing I find is something 
which is taken twice daily.
    Same active ingredient, which cost me $400. Now that 
clearly is not innovation. It is not a once monthly depo shot 
to prevent pregnancy or once daily shot for HIV. It is 
something which allows them to remove the generic so that 
instead of paying $50 bucks, the patient is now paying $400.
    How do we differentiate true innovation from faux 
innovation, which frankly works to the detriment of the 
consumer?
    Ms. Richardson. Thank you very much for the question, 
Senator. I have to confess that the question of measuring 
innovation is not something that Pew has done any research on 
or is currently focused on, although certainly as a patient and 
as a consumer, it is on my mind all the time. Every time I go 
to the doctor----
    Senator Cassidy. Let me go to Mr. Gaugh. Mr. Gaugh, how do 
we measure innovation? It is something because I am a big 
believer that innovation needs to be rewarded and that we need 
to have that profit motive for people to innovate. But I am 
also recognizing that it is gamed at times so that, I call it 
faux innovation, is merely gaming the patient. How would you 
respond?
    Mr. Gaugh. Thank you, Senator Cassidy. So you bring up a 
great point, and we have always believed and felt that the 
generic and biosimilar industry does promote innovation and 
moves the innovator companies to better products, different 
products. But there is still some gaming that goes on to your 
point.
    Whether it is a single daily dose or it used to be three 
times a day goes to a single. That is not necessarily an 
innovation, but it is really hard to judge how you stop that 
gaming, if you will.
    Senator Cassidy. Okay. Ms. Esham--Dr. Esham, I am sorry. 
Clearly, we want to bring drugs to market more quickly, and 
there is this discussion of using the accelerated approval with 
this reliance upon post-market data. Now, tell me, just kind of 
from your perspective, what various sources of post-market data 
could be used to evaluate whether something is a true innovator 
value and improves patient outcomes to make sure that whatever 
we are using it for is bringing value to the patient.
    Dr. Esham. Certainly. I would say that when we entered into 
the PDUFA agreements, we did recognize the need for improving 
how we design, have conversations pre-approval about post-
market requirements associated with--that are always required 
with accelerated approval, and improving processes post-
approval to ensure that we are able to address challenges as 
they arise and not just let them hang there and, not know a 
path forward.
    The processes improvements in the commitment letter we do 
think will be helpful. In addition, I think more specifically, 
probably to your question, is advancing the ability to utilize 
patient registries, real world evidence that we do believe have 
the potential to offer more efficiencies and realistic pathways 
toward completing those requirements.
    Senator Cassidy. These are patient registries that you are 
establishing, or will this be borrowed from some master 
registry of EHRs, etcetera?
    Dr. Esham. I don't think it is an either, or, but happy to 
meet with you and your staff and discuss in more detail if that 
would be helpful.
    Senator Cassidy. Okay. Mr. Leahey, I am concerned--the 
cybersecurity. Now, there is a lot of stuff, a lot of medical 
devices that are going to be increasingly cyber, correct?
    Mr. Leahey. Yes.
    Senator Cassidy. Senator Baldwin and I have a bill called 
the Patch Act, which requires a premarket demonstration of 
cybersecurity measures and post-market updates for any issue 
discovered. Can you tell me a little bit of how the 
manufacturers are thinking about cybersecurity in the context 
of hospital networks or individuals who may be affected?
    Mr. Leahey. Thank you, Dr. Cassidy. As you noted, devices 
are becoming more interoperable each day. And MDMA as part of 
the HCC. It is a private, public partnership with HHS, FDA, 
hospitals, insurers working to address these issues. 
Fortunately, we haven't seen any issues directly related to 
compromising the devices themselves.
    But as you noted with the ransomware and other issues, 
these have certainly become challenges. So in 2019, the HHSC 
published the Medical Cybersecurity Joint Security Plan to 
provide device makers with a playbook on how to develop best in 
class cyber management.
    But clearly, much more work needs to be done, and we look 
forward to working with you and your colleagues to making sure 
that again, as technologies evolve, we make sure that the 
hospital system, the patients are ultimately protected within 
these cyber threats.
    Senator Cassidy. Thank you. I yield.
    The Chair. Senator Kaine.
    Senator Kaine. Thank you, Chair Murray. And thanks to our 
witnesses. Five years ago, when Congress last addressed user 
fee reauthorization, I asked Dr. Woodcock of the FDA a question 
on the availability of biosimilar drugs. This is something that 
Senator Collins and I have done some work on, together with the 
Biologic Patent Transparency Act.
    Dr. Woodcock told me then that biosimilars were being 
analyzed and improved at that time, and that would set a 
standard for future biosimilars to come to market. She also 
shared that as of that time, 2017, the FDA had approved four 
biosimilars. I don't think they were yet on the market. They 
had 13 pending applications and that there were 64 biosimilars 
in development.
    Mr. Gaugh, in your testimony, you stated there are now 34 
biosimilars approved by the FDA, 21 of which are on the market 
and available to patients, many others in development. Could 
you talk about how the advancements over the last 5 years have 
brought more biosimilars to market, have increased the number 
of available biosimilars to address the rising costs of 
prescription drugs, and how patients have benefited from the 
growth in this industry?
    Mr. Gaugh. Thank you, Senator Kaine. Yes, your points are 
exactly right. So we started the biosimilar program in 
basically 2012, when legislation was put in place in 2010, but 
the guidance first came out in 2012 with the FDA, that gave us 
the pathway for biosimilars.
    Since that time, we have approved 34--or the FDA has 
approved 34, as you just noted, and 21 on the market. But there 
has been a significant cost savings to the patients for that. 
So in the biosimilar realm, it is a cost savings of roughly 50 
percent. Also, something that you don't see on the generic side 
is that the innovator price has come down about 25 percent on 
those products.
    Having that access has provided cost savings for the 
patients. You noted 64 program development back in 2017. There 
is now 97 that we know of that are in development. So it is 
continuing to grow and expand, and BsUFA III is addressing 
several of the enhancements, if you will, from BsUFA II to 
BsUFA III that will improve that through meetings, through 
supplement review process and being more timely, and some 
things about inspections.
    Senator Kaine. Excellent. Thank you. Dr. Esham, I have a 
question for you about treatment for rare diseases. It is clear 
that sponsor companies that want to address treatments for 
these diseases face a number of challenges, particularly the 
limited number of patients with these types of conditions. 
However, it is not a limited number of people who suffer from 
rare disease conditions.
    There are about 7,000 known rare diseases, and they 
collectively affect over 25 million Americans. You also state 
in your written testimony that the current mechanisms for 
companies with rare disease treatments and their pipeline to 
collaborate with FDA have not consistently provided avenues for 
such needed discussions.
    Could you talk a little bit about the provisions of PDUFA 
VII that would allow for better collaboration between the FDA 
and sponsor companies in the rare disease treatment area?
    Dr. Esham. Yes. First, thank you for that question. And 
again, I think we are all very excited about the progress we 
have made, but there is just much more work to be done here in 
this--in terms of providing treatments for rare diseases. I 
think there are a number of provisions that collectively we 
believe will work to improve regulatory clarity and 
understanding for rare diseases.
    That includes the Rare Disease Endpoint Advancement Pilot 
Program, which is really designed to pilot engagements with 
sponsors to increase our understanding about what is needed to 
develop and support utilization of an endpoint for the basis of 
approval for rare diseases.
    Those learnings will be shared across industry, academics, 
researchers, and the entire research and development ecosystem. 
There are also provisions that I think will be particularly 
important for rare diseases, and that is the ability to have 
focused meetings on complex and unique challenges, both at 
preclinical as well as during development that I think will 
be--offer a chance to really address those unique challenges.
    As well as some of the provisions designed to ensure that 
there is a better utilization of innovative clinical trial 
designs. And that is just to name a few. I don't want to run 
out of my time, but collectively again, we did try to work to 
make sure that there was the ability to engage at the right 
time and have those discussions in advanced innovation for 
these treatments.
    Senator Kaine. Thank you. Mr. Gaugh, I am going to submit a 
question for the record about interchangeable biosimilars that 
I would direct to you, but I will put that in for the record. 
Chair Murray, I yield back.
    The Chair. Thank you.
    Senator Collins.
    Senator Collins. Thank you, Madam Chair. Before I turn to 
my questions, let me thank the Chair and the vice Chair for 
their hard work on this issue and to express the hope that a 
bill that Senator Feinstein and I have worked on for some time, 
that has to do with personal care products, can also be 
considered.
    Chair Murray brought that up in her opening statements, so 
I just wanted to mention it. Dr. Esham accelerated approval is 
a critical regulatory pathway that provides timely review of 
treatments for patients with serious and life threatening 
conditions for which there is an unmet need.
    Sponsors must meet, as I understand it, the same 
substantial evidence standard as traditional approval, but they 
can rely on a surrogate endpoint that predicts a clinical 
benefit rather than measuring that clinical benefit directly. 
Obviously, clinical outcomes can take significantly more time 
to manifest. And an example is that tumor size is often used as 
a surrogate in oncology.
    It can be measured much earlier than mortality and is 
reasonably likely to predict an effect on that devastating 
clinical outcome. Understanding that science does not move at 
the same pace across all disease areas, why hasn't this pathway 
been used to the same degree in fields like neurology or for 
rare diseases?
    Dr. Esham. I really appreciate this question, and you are 
correct. We know that historically over 60 percent of 
accelerate approvals to date have been for oncology 
indications, and that is wonderful. There are multiple factors 
as to why this has been the case, including the maturity of an 
investment in oncology basic research.
    There has also been incredible collaborations between 
doctors, academics, patient organizations, the pharmaceutical 
industry, and the regulatory leaders that have resulted in the 
identification of surrogate endpoints and other informative 
biomarkers and subsequent validations.
    Again, we can't underscore--I can't undervalue the 
leadership that is really important in this, both within the 
industry research and the regulatory agency. And we have long 
advocated for broader utilization of this pathway across more 
therapeutic areas. We do think that it would be helpful for the 
FDA to hold disease specific or disease or therapeutic area 
specific meetings or promote that multi-stakeholder dialog on 
appropriate biomarkers and clinical endpoints.
    It is our hope that the Rare Disease Pilot Program that I 
have referred to earlier will also advance our learnings about 
how to approach--it is not just looking at an individual 
endpoint, it is thinking of the how, what is needed, how do you 
think about developing evidence, and how will that evidence be 
evaluated, that we think will hopefully drive more innovation 
and utilization of this pathway to, as you say, provide more 
timely access to these medicines that are--just really 
devastating.
    Senator Collins. You have mentioned the Rare Disease Pilot 
Program, and I want to follow-up on that issue with you as 
well. More than half of the 400 million people in the world who 
are affected by rare diseases are children, and about one-third 
of those children will sadly die before the age of five.
    Drug development is hamstrung by the fact that we simply do 
not have well characterized the endpoints for most rare 
diseases. The PDUFA agreement establishes the Rare Disease 
Endpoint Advancement Pilot Program, which would enable FDA and 
industry to collaborate to develop more meaningful, consistent, 
and relevant endpoints for clinical diseases.
    I am thinking of diseases like Duchenne muscular dystrophy, 
for example. It is difficult to precisely measure progression 
of the neurological and neuromuscular effects associated with 
many of these diseases, and thus it can be difficult to 
determine a treatment's impact.
    This pilot program that you referred to is limited to a few 
select applicants, but how can we share the lessons learned 
through this pilot to ensure that other rare disease drug 
applications can build on its findings?
    Dr. Esham. Very important point to raise. And I will note 
that when we worked with the FDA to develop this pilot program, 
it was modeled after what we view as a successful pilot program 
for complex innovative clinical trials and modeled for drug 
development that used the same model of having only a limited 
number of applications that went through the pilot program, but 
that the learnings if you go through that program, the FDA has 
the ability to share those learnings to the entire stakeholder 
community.
    It was very specifically modeled after that. We have seen 
that be successful and create opportunities for learnings 
across the academic, medical research, and biopharmaceutical 
industry.
    It is our expectation that the minimum of the three public 
workshops will serve that. But we do expect more engagement and 
more shared learnings in other venues of scientific dialog that 
occur on a normal basis.
    Senator Collins. Thank you.
    The Chair. Senator Hassan.
    Senator Hassan. Well, thank you, Madam Chair. And I want to 
thank you and the Ranking Member for holding this hearing, and 
I want to thank all of our witnesses for being here today. Dr. 
Gaugh, let me start with a question to you. While Americans 
struggle to afford lifesaving drugs, brand name manufacturers 
continued to increase prices.
    Generic competition can help drive down drug prices now. So 
how do new generic drugs affect brand name prices? And how much 
do generic drugs save consumers each year?
    Mr. Gaugh. Thank you for the question. So significant 
savings is brought forth by the generics. If you look at the 
numbers, over the last 10 years, we have saved $2 trillion, and 
$469 billion of that was in new generics that came to market.
    It is a significant improvement in the increase for the 
patients. We find that when one generic drug is approved, the 
price comes down about 50 percent--the generic price comes down 
50 percent, excuse me, not the brand. And with four or more, it 
is more like 80 to 85 percent. So it is a significant increase 
in savings to the American patient and U.S. health care 
systems.
    Senator Hassan. Thank you. Also another question to you, 
Mr. Gaugh. For some medications with serious safety concerns, 
FDA requires manufacturers to set up risk evaluation and 
mitigation strategies, otherwise known as REMS programs. REMS 
helps to minimize the risk associated with these medications 
and make them safer for the public and for patients.
    For example, a REMS program may require prescribing 
clinicians to receive training on the risks of a drug and to 
perform monthly lab tests. Even though REMS programs are meant 
to protect patient safety, some brand name manufacturers have 
patented these programs to prevent generic competitors from 
entering the market.
    Mr. Gaugh, how have brand-name manufacturers use REMS 
patents to delay the launch of generic drugs? And how have 
these delays affected drug prices?
    Mr. Gaugh. Thank you. Thank you for the additional 
question. So REMS is a very important program. As you 
mentioned, it is about safety for patients, and it is a very 
restricted program in its set up. I would almost make it akin 
to new drug IRBs when they are doing the study process, so it 
has to be patient specific, signed off, and given.
    REMS has really had two problems with, the first one was we 
as the generics, as we reverse engineer, need the product that 
we are reverse engineering to make that. The CREATES Act help 
solve that because we were being blocked from even getting the 
drug. We weren't a patient. We couldn't sign up for it. We 
wouldn't get it. So that has now been changed.
    But what is new is what you just brought up, and that is 
the patenting of the REMS programs. And so if the REMS program 
is actually patented, then I, as a generic company, can't get 
on that REMS structure to be able to bring my product to 
market. So it is a further delay of not months, but years.
    Senator Hassan. And it is using the notion of patient 
safety to delay the development of additional drugs that could 
bring down the cost.
    Mr. Gaugh. Absolutely.
    Senator Hassan. Yes. Okay, last question for you, sir. 
There is a long history of brand name manufacturers playing 
games with the law to delay and block the launch of generic 
drugs. As a result, patients pay more at the pharmacy counter 
with some rationing life medications because they can't afford 
them.
    I would expect that every single Senator on this Committee 
has heard stories from their constituents about their decisions 
to ration their drugs and the impact that has on their health. 
Mr. Gaugh, how are brand name manufacturers manipulating the 
system to limit generic competition?
    Mr. Gaugh. We just talked about two of those methods. And 
Dr. Cassidy brought up the point about some quasi-innovation, 
if you will, moving a product from twice a day to one today, 
for example. And that in and of itself is not necessarily 
innovation. It is an improvement.
    But in that particular case, the physicians and the 
pharmacists can overturn that by having the patient go ahead 
and take the twice daily at the lesser price than once daily at 
the higher price point level.
    Senator Hassan. Thank you. I yield my time.
    The Chair. Senator Burr.
    Senator Burr. Thank you, Madam Chair. Cartier, again, 
welcome. More than 278 therapies have been approved under the 
accelerated approval pathway over the 30 year history, saving 
and improving thousands of lives.
    This pathway has been the subject of recent scrutiny. But 
it is a successful and important tool for the FDA to bring game 
changing innovation to patients faster. What promise does the 
accelerated approval pathway provide for companies investing in 
novel treatments and particularly treatments for rare diseases?
    Dr. Esham. Thank you, Senator. The role of this program 
played in improving care for patients suffering from serious 
and life threatening diseases when their needs are not being 
met or where precedents are little or do not exist, or are not 
well known, cannot be overstated. And we have seen this be very 
successful in driving innovation and investment in oncology and 
infectious diseases.
    It is our hope that we expand utilization of this pathway 
across more therapeutic areas, including for rare diseases. It 
is critical for continued innovation--continued investment and 
innovation in these disease areas that are complex and where 
there are little or evolving precedents, which is the case in 
many rare diseases.
    It is also foundational to advancing scientific 
understandings that allow us to continue to innovate and 
continue to improve care for these complex and devastating 
diseases. And so if it did not exist or it is not able to 
function as intended, the path forward for timely access to 
improved care for these devastating diseases will be limited 
and delayed.
    Senator Burr. May I ask you, how could we ensure the 
accelerated approval pathway is used to create new 
breakthroughs in more fields like neurology?
    Dr. Esham. Great question. And there are provisions in the 
PDUFA VII commitment that we think will strengthen the pathway, 
such as the ability to engage with the FDA early to discuss 
what is needed to support the use of a novel surrogate 
endpoint. And as we have discussed previously, there is also 
the rare disease endpoint pilot program, which should lead to 
broader understandings about how to approach and develop 
support for the utilization of a surrogate endpoint to support 
approval.
    There are also process provisions--process improvements to 
try to improve what the approach will be to accomplish post-
approval requirements. Which again, in neurology, that is an 
assessment that you make before you endeavor into a clinical 
development program.
    The more that we can improve those processes, enable 
utilization of things like real world evidence to enable them 
to be more realistically completed and in a more efficient 
timeline, will also be quite helpful, I think, in driving more 
investment and research and utilizing the accelerate approval 
more broadly.
    Last, just one quick thing, can't underestimate the 
importance of multi-stakeholder engagement with regulators to 
really identify new surrogates and advance their utilization.
    Senator Burr. Thank you. Mark, FDA is proposing longer 
review times for 510(k) devices. FDA committed to review 
510(k)'s within 108 days in Fiscal Year 2022, and I understand 
that FDA is not currently meeting that goal. What does it mean 
for a small company when FDA misses these goals, and what does 
it mean to patients?
    Mr. Leahey. Obviously meeting goals are critical to timely 
patient access and to small companies, the predictability. The 
small companies don't have a number of products to subsidize 
delays, so it is critically important. COVID was certainly an 
impact, but we need FDA to get back on track and meeting that 
shared outcome goal of 108 days as quickly as possible.
    Senator Burr. Why did FDA agree, and why did the industry 
agree to longer review times of 128 days on 510(k)'s and 
provide the agency with so much more money?
    Mr. Leahey. There is no doubt this is a significant 
increase in funding. And as I said in my opening testimony, 
this doubling of fees is certainly not sustainable. As MDMA is 
representing small companies, it is of great concern.
    But we do recognize the challenges that FDA went through 
during COVID, and this investment is obviously put forward to 
get them back on track, and there are additional accountability 
measures to make sure that these metrics are met going forward.
    Senator Burr. Just so I and my colleagues understand 
better, I went through a litany in my opening statements of the 
deficiencies in what FDA committed to and what they missed. And 
they missed resoundingly in things like meeting with 
applicants, explanations and deficiencies letters. Is this 
really a difficult thing, or is this just a choice by FDA to 
stiff somebody on meeting them, even though there is a 
requirement to do it?
    Mr. Leahey. I can just say from our Members' perspective, 
the quality of the journey is so much more important than the 
time. If you have high quality inputs and timely interaction, 
you get there.
    Obviously, it has been disappointing that simply providing 
the rationale for a deficiency is something that we have to 
bake into a commitment. And it is not just part of the basic 
offering. But we are where we are, and we hope that we have a 
productive and effective meeting for V.
    Senator Burr. I thank all of you. Thank you, Madam Chair.
    The Chair. Senator Smith.
    Senator Smith. Thank you, Madam Chair and Ranking Member 
Burr, and I really appreciate this Committee and all of your 
testimony. Madam Chair, I would like to request unanimous 
consent to submit into the record a letter from the biosimilars 
forum expressing support for the biosimilar user fee agreement 
and urging additional action to address the impact of the 
pandemic on approvals of low cost biosimilar products like 
biosimilar insulin.
    The Chair. Without objection.

    [The information referred to can be found on page 130 of 
Additional Material:]
    Senator Smith. Thank you. I think we all agree that these 
FDA user fee agreements are critical for supporting the FDA's 
work, and I want to just note that I worked with Senator 
Cassidy to move forward legislation to streamline the process 
for bringing biosimilar products to the market.
    I want to thank Senator Hassan for her questions about how 
that streamline process and bringing biosimilars, bringing 
generic drugs to market helps to contribute to our goals of 
lowering costs for Americans, which is very much on the minds 
of my constituents. Mr. Gaugh, I want to ask you about 
something specific to the therapeutic equivalence ratings.
    According to the FDA, complex generic products, I mean, 
there are so called because they have complex active 
ingredients, routes of administration, drug device 
combinations, or formulations. So in short, these drugs are 
more difficult for generic manufacturers to develop. Examples 
might include inhalers, or topical ointments.
    These complex generic products face regulatory challenges 
compared to other generics. It is harder for them to be 
assigned a therapeutic equivalence or TE rating from the FDA. 
In fact, it can take years to get a rating if they ever get a 
rating at all.
    This TE rating is important because it lets 
pharmaceuticals--pharmacists, excuse me, automatically 
substitute a lower cost generic product for a brand name 
product at the pharmacy counter so patients can get cheaper 
medicines.
    Mr. Gaugh, could you please describe for us why it is 
harder for certain complex generic manufacturers to receive 
this TE rating, what medicines are impacted by this issue, and 
what we can do to make this process more efficient?
    Mr. Gaugh. Thank you for the question. And there are 
different categories of generics, including and most often 
complex generics that have to use a 505(b)(2) pathway for 
approval. So it is not the normal generic pathway, if you will. 
That approval pathway does not give 100 percent therapeutic 
equivalence.
    The FDA does not grant 100 percent therapeutic equivalence 
when the product is approved. Therefore, we have to go back to 
the FDA, as you mentioned, through a citizen's petition process 
to get the FDA to grant that. That can take years for that to 
happen. And to your point, if it is not granted, it is not 
therapeutically equivalent and therefore the pharmacist cannot 
automatically substitute it.
    That is an area that we hope to work with Congress on, with 
this Committee on to get that changed and get the citizens 
petitions moving in a more quick process.
    Senator Smith. And is the solution to that to get those 
citizens petitions moving more quickly? Is that what you see?
    Mr. Gaugh. Well, there is also some other rule, regulation 
processes that the FDA can put in place for that as well.
    Senator Smith. Thank you. So I am working with Senator 
Cassidy on legislation that would require the FDA to provide a 
TE rating at the request of an applicant on a much quicker 
timetable. And I look forward to working with the Chair and 
Ranking Member as we move forward with these user agreements.
    Ms. Richardson, I have a question for you. I appreciate how 
your written testimony highlights that these user fee 
agreements are important for streamlining the review of medical 
products. But the FDA's role is not just about bringing 
products to market faster.
    As you note, the FDA is a public health agency that works 
to promote health of all Americans. So could you just expand 
upon the recommendations that you have made that the FDA should 
be receiving public funds and be accountable to the public 
through these user free processes?
    Ms. Richardson. Thank you very much for that question, 
Senator. As I noted in my remarks and really just want to 
reemphasize, user fees are essential to the functioning of the 
FDA, but they are dedicated to specific functions like 
expedited review.
    That is very useful, but it is limited because there are so 
many other areas that FDA's mission--of FDA's mission that 
don't enjoy that kind of support. They don't cover food, they 
don't cover supplement oversight, they don't cover a lot of the 
agency's post-market oversight activities like inspections.
    Appropriations really are essential to fully support FDA's 
public health mission in the years ahead. So thank you again 
for the question. I welcome the opportunity to underscore how 
important it is to ensure adequate appropriations for the 
agency.
    Senator Smith. Thank you. And do you have any specific 
recommendations for how we should improve the use of free 
agreement process to better engage Americans in that process?
    Ms. Richardson. That is not an area that Pew works on, 
although I do know there have been suggestions about increasing 
transparency, right. I know that there were some issues with 
posting of meeting minutes, things like that. So I am sure that 
there are some solutions that FDA would be more than happy to 
consider, but I don't have any more specific recommendations.
    Senator Smith. Thank you very much. Thank you, Madam Chair.
    The Chair. Thank you.
    Senator Marshall.
    Senator Marshall. Thank you, Madam Chair. If I could have a 
moment of privilege first and just start by congratulating my 
University of Kansas Jayhawks on their fourth national 
championship, and I would be remiss for not congratulating my 
friends from North Carolina on a great game, one of the 
greatest games in NCAA history, and just Kansas so much as a 
special connection to North Carolina, going back to Dean Smith 
being a player for KU in the early 1960's. So congratulations 
to our amateur sports and my Jayhawks. Thank you.
    Madam Chair, I want to start off by talking about the 
importance of innovation. I have always said that innovation 
would do more to drive the cost of health care down than any 
legislation that we can write. And I was so excited when 
biosimilars came on the market and I thought that competition 
would drive the cost of insulin down.
    Unfortunately, brand name manufacturers have found out ways 
to prevent this competition, these new biosimilars to come to 
market. And it is so frustrating. We have a saying back in 
Kansas that pigs get fat and hogs get slaughtered. And my point 
is that these middlemen and big pharma is getting hogwash. That 
they are--they can't have it both ways. You can't want 
protection from price fixes or price costs, but you can't--but 
you don't allow innovation.
    You can't allow it to work both ways. And my first question 
is going to be for Mr. Gaugh. Right now, we are seeing with 
these brand name manufacturers using inactive ingredients now 
to keep biosimilars to come to market. And I think of Humira 
using the size of a needle to keep something from coming to 
market.
    I would ask both sides of the aisle, the staff to start 
looking into if we get rid of the rebates, that is what is 
going to solve this problem. If we get rid of the middlemen 
rebates, that is what is going to drive the price of insulin 
down. And if we put a price fixed at $35, a price cap, all that 
is going to do is drive up the cost of health care for 
everybody else in the plan.
    It is just basically given the middleman a license to 
charge whatever they want to, even though the person that is 
getting the insulin is going to be capped with an out-of-pocket 
expense. It is going to drive the cost of prescriptions up for 
everybody else in the plan. So I am all about promoting 
competition.
    Mr. Gaugh, what--in the review of this reauthorization, 
what can we do to make it better for patients to have faster 
access to generics and biosimilars without compromising 
innovation?
    Mr. Gaugh. Thank you for the question. And so we did build 
in several enhancements in both GDUFA and BsUFA to help move 
that along more quickly. I talked earlier about the imminent 
approval in the GDUFA realm.
    In the BsUFA realm, in the biosimilars--which we now have 
two interchangeable insulins that are in or one insulin that is 
in the market, so that is out there for competition and 
hopefully that will help bring----
    Senator Marshall. Have we done everything we can, or do we 
need to do more?
    Mr. Gaugh. There is always more that we can do. Absolutely, 
yes. So we built that in with meeting management and supplement 
reviews.
    Senator Marshall. Thank you. Dr. Esham, my next question 
for you. It takes 10 years and $1 billion to get a new product 
to market and often maybe a 1 or 2 percent chance it ever 
actually reaches the market. The reauthorization process of 
these new drugs, authorizing these new medications, we talk 
about that process, but I want to back up in the research going 
on here. So often we are using animal models, which are like 
night and day to the real world when it comes to human biology.
    What we see in the animals, consequently, typically, not 
uncommonly, doesn't apply to humans. There is something now 
called where we can use human cells with bioprinting.
    For instance, if we know a medication that is going to be 
metabolized through the liver, we would test it with human 
liver cells. Do you see any way that we can start implementing 
that technology in helping the process of approval for new 
medications?
    Dr. Esham. Thank you, Senator. And first, let me say again, 
congratulations. As a University of Kentucky fan, I really hope 
that I believe that at some point. I will get there. But to 
your point, in all seriousness, we actually have a very active 
group of scientists in what we call our bio-safe working group 
that has been publishing papers on advancing non-human primate 
ability to use utilize alternative tools to primates for 
preclinical work.
    We certainly see a lot of innovation in this space that you 
have mentioned, and we would be happy to bring our scientists 
to meet with you and discuss in detail their potential. But the 
bottom line is, yes, we do think we can continue to innovate 
here and be much more--less dependent on primates----
    Senator Marshall. Speed up the process and hopefully make 
it safer. Both.
    Dr. Esham. Yes----
    Senator Marshall. That is a win, win.
    Dr. Esham [continuing]. However they have--the goal is to 
fail earlier or fail better and then advance most 
optimistically.
    Senator Marshall. Quickly to Mr. Leahy. I am a big fan of 
using real world evidence. And how does the FDA currently 
lack--does the FDA currently lacks the expertise and 
infrastructure to interpret real world data? And what can we do 
to make that situation better?
    Mr. Leahey. Well, absolutely. This is critically important 
to leverage that, as you noted, information out there in the 
world to help accelerate additional patient access. Under MDUFA 
IV, we invested tens of millions of dollars to help build the 
real world evidence capacity in a private public, partnership.
    We are continuing that investment in MDUFA V to help both 
private, public partnerships enhance their capabilities and 
also make sure that FDA have the personnel to take that 
information and leverage that for the purposes of application.
    Senator Marshall. Thank you so much, Madam Chair. I yield 
back.
    The Chair. Thank you. I will turn it over to Senator Casey. 
I am going to go vote and I will be back.
    Senator Casey. Chair Murray, thanks very much. I have a 
question for Dr. Esham and Ms. Richardson. Doctor, I want to 
start with you. Patients with rare diseases and conditions 
often face their diagnosis with either a limited or no 
treatment options.
    I was glad to see PDUFA VII, the commitment letter, have 
dedicated pages to advancing the development of drugs for rare 
diseases, including a commitment for FDA's rare disease team 
staff to be more closely involved in training, outreach, and 
application review. With their expertise, what--I should say, 
while their expertise is very valuable, I am not--I am sure you 
will agree that they are the voice and the unique experience of 
patients with rare diseases must be heard within FDA.
    In your written testimony, you discuss the Rare Disease 
Endpoint Advancement Pilot Program in PDUFA VII. I know Senator 
Collins made reference to this on. Page five of your testimony, 
you say, and I am quoting, ``key among these challenges is 
reaching agreement with regulators about determining the 
appropriate efficacy endpoints to support approval of 
innovative medicines for rare diseases.''
    How can we ensure that firsthand knowledge and expertise of 
this small group of patients, for whom the drugs are ultimately 
intended, are considered in developing endpoints that are 
meaningful for these patients?
    Dr. Esham. Thank you for that question, and it is quite 
important. And, when--back in PDUFA V, when we, the commitment 
sort of started that voice of the patient meetings, I think 
that is where we learned really what mattered to patients, and 
more importantly, learned that we were often wrong about how to 
interpret their needs.
    In addition to that pilot program, when you think about 
what is needed to support, what evidence is needed to support 
the utilization of surrogate endpoint, it is our hope that 
there will be--that the utilization of patient perspective data 
will be incorporated into that assessment, either for the 
assessment--the evaluation of the benefit, risk evaluation or 
as support as an endpoint.
    Again, it is our hope, desire, and we will certainly be 
advocating for inclusion of those perspectives into the 
learnings of that pilot program.
    Senator Casey. Thanks, doctor. Ms. Richardson, I want to 
thank you for raising the issue of antimicrobial resistance. 
The Committee has taken steps in previous user fees 
reauthorizations to encourage the development of new 
antimicrobial drugs to mitigate the serious impact of 
antimicrobial resistance.
    In 2012, we had the GAIN Act, for example. Yet the 
realities here, the financial realities of developing these new 
agents remain very challenging. And investment, as well as 
research, as well as drug development are not keeping pace with 
the need.
    I know that the Pew Charitable Trust has been an important 
partner in a proposal that I have been working on with Senator 
Cassidy, the Disarm Act, which would use reimbursement tools 
through CMS to help stabilize the market for novel 
antimicrobial agents. Can you talk about why these multiple 
approaches are necessary?
    Ms. Richardson. Yes, Senator, and thank you for that 
question. I absolutely agree with you that antimicrobial 
resistance is a public health crisis, and no single solution is 
going to fix the problem. We need creative ideas that can 
realign current market incentives to encourage drug developers 
to stay in this business, right.
    Large companies are exiting the market. Small companies are 
going bankrupt. It is just a tough business model. And so we 
need to provide new types of incentives to antibiotic drug 
developers so that this absolutely crucial antibiotics pipeline 
doesn't dry up completely. So your legislation, the DISARM Act, 
is certainly part of that solution, as well as the PASTEUR Act, 
which is authored by Senators Bennet and Young.
    We support both DISARM and PASTEUR, and we believe the 
solution to the broken antibiotic pipeline, it will require 
multiple creative solutions on both the legislative and the 
regulatory fronts.
    We hope Congress will remain open to considering additional 
options like DISARM, and we support the PASTEUR Act as an 
immediate opportunity for policymakers to make progress in 
fixing the market.
    The PASTEUR Act has an innovative only pay for success 
subscription approach that will stimulate the antibiotic drug 
pipeline and help ensure that patients will have access to 
these lifesaving drugs when they need them. Thank you, again, 
for that question.
    Senator Casey. Thank you. Thanks very much, Mr. Chairman.
    Senator Burr. Senator Murphy.
    Senator Murphy. Thank you very much, Mr. Chairman. Thank 
you all for your testimony. I have been in and out of the 
hearing today, but I look forward to reviewing the record. I 
wanted to talk a little bit about the issue of mental health 
drug discovery. And I will maybe sort of ask this question to 
you, Dr. Esham, but others I am glad to hear from.
    It is interesting, when you look at some of the data about 
recent drug discovery, it just doesn't seem that the 
development of new drugs in the mental health space is keeping 
up with the need.
    I was taking a look at recent records from the FDA on novel 
drug approvals from 2015 to 2022, and there is about 333 
approvals during that 8 year time span. And let me just sort of 
give a--my best attempt at an apples to apples comparison. Of 
those 333, 90 were cancer drugs.
    About 40 percent of Americans over the course of their 
lifetime will be diagnosed with cancer. And so I am glad that 
there were 90. But 46 percent of Americans at some point over 
their life will have a diagnosable mental illness. And yet of 
those 333 drugs, only 12 of them were mental health drugs.
    You hear this pretty routinely from the medical community 
that we just aren't keeping pace with the need when it comes to 
drug discovery in the mental illness space. So let me just sort 
of ask the sort of broad question here, how do we get your 
members, how do we get the private sector more interested in 
developing novel pharmaceuticals for mental health conditions? 
What are the barriers and are there public policies you would 
recommend to this Committee?
    Dr. Esham. Thank you for that question. I think it is fair 
to state that none of us are--believe that we are anywhere near 
the level of innovation in mental health, providing innovative 
treatments for those suffering from mental health, anywhere 
near where we want to be.
    There are--I will point you and your staff, your office and 
your staff to some reports that we did over the course of 
years, kind of looking at the challenges of highly prevalent 
chronic diseases. And we did one specifically in 2018 on 
depression, sort of as an example on the mental health space, 
to try to understand what was going on and sort of what looks 
like an inverse investment in public health need trend lines.
    I think that there are some challenges in understanding the 
underlying causes of these diseases. There are challenges in 
developing and implementing clinical--effective clinical trial 
designs. And there are also challenges on the access coverage 
side. And so, it is a, unfortunately in the space I think it is 
all of the above more often than not.
    But we would be happy to bring in some scientists and 
researchers from our companies working in this space to really 
kind of dove into the details here. But I think that clearly 
some pretty collaborative multi-stakeholder dialog is really 
needed here.
    Senator Murphy. Well, I will be glad to do that. And I will 
just note for the Committee, one part of your answer, you 
referenced an uncertainty about reimbursement, which is true 
generally in the mental health space.
    We have been working very hard on this Committee over the 
years to make sure that there is parity between reimbursement 
for mental health and for physical health. I am interested to 
know whether that exists on the drug reimbursement side. I 
doubt it is as dire as it is on the sort of in-person treatment 
side, but I look forward to follow-up with you on that. Mr. 
Leahey, I wanted to ask you a question with my remaining time 
about the state of clinical trials and clinical research.
    I heard Senator Murray references in her opening 
statements. But there, as you know, is a concern that trials 
and research often don't represent the democratic diversity of 
the populations that are going to ultimately benefit from these 
drugs and devices.
    We have seen how COVID clearly had a disproportionate 
impact on racial ethnic minorities, and it has, I think, 
spurred a conversation about how we make sure that there is 
broader representation in those that are part of these trials.
    Is that a question one that you are grappling with, that 
your members are grappling with? Why is it important that, and 
do you think it is important that we make sure that there is 
broad demographic representation amongst the populations who 
are part of the research and the trial process?
    Mr. Leahey. Thanks, Senator, for that question. And 
absolutely, MDMA and our member companies support diversity in 
clinical trials and agree that the trial enrollment should 
accurately reflect the intended patient population. And we look 
forward to working with Congress and FDA to ensure that 
proposals are thoughtfully structured to achieve this 
objective.
    Senator Murphy. Just why is it important?
    Mr. Leahey. Ultimately, it is because it is about the 
patient. We want to make sure that these drugs, devices all are 
tested in populations and age demographics, racial dynamics to 
ensure that, again, they meet the mark of having the safety and 
effectiveness for those who are intended to help.
    Senator Murphy. Right. Thank you. Thank you, Mr. Chairman.
    Senator Burr. Thank you, Senator.
    Senator Braun.
    Senator Braun. Thank you. The FDA user fee program was 
established to provide a predictable and accountable regulatory 
framework that supports expedited FDA review and approval of 
safe and effective treatments for patients. The user fee 
process has given lip service to the patient's voice in the 
conversation.
    PDUFA commitment letter includes a number of provisions to 
address unmet medical needs and advance rare disease endpoint 
development. The purpose of today's hearing is to discuss 
advancing medical product regulation and innovation for the 
benefit of the patient.
    There should be a witness here, I think, that would be from 
the patient's perspective. There is not. There should also be a 
representative from the rare disease community, which I have 
wrestled with since I have been here on for families that have 
issues, where the diagnosis is bleak, and time is the most 
important thing. They are not represented, either.
    In fact, there is not one hearing scheduled for this that 
brings in that patient voice. I would like to submit to the 
record a letter I sent to the HELP Committee yesterday 
requesting a patient focused user fee hearing.
    Senator Burr. Without objection.

    [The information referred to can be found on page 131 in 
Additional Material:]
    Senator Braun. In general, the Members of this Committee 
are given 5 minutes to talk about whatever they want to. Today, 
I had planned to show a video. There is really nothing in the 
rules that says I can't do that. We use video aids often here. 
But it hasn't been done before. A lot of things I have tried to 
do over 3 years I have been here is to fix the things that 
haven't been done before to give the patient, to give the 
constituent a better outcome.
    In this case, it is Ala, a happy go lucky girl who dreams 
of 1 day becoming a scientist. Without the necessary FDA 
reforms, timely access to promising therapies, that is not 
going to happen. Won't be able to achieve that goal. Her 
parents share a similar grief knowing that they won't see their 
daughter graduate from college or walk down the aisle. The 
average survival time for this particular ailment is only a 
year.
    Imagine from the patient, the family, are they interested 
in the cumbersome process that we always want to keep as a gold 
standard, but that doesn't necessarily mean you don't change it 
to adapt, keeping those standards in place to the 
particularities of this and many other ailments. The video 
highlighted the patient perspective and the need for the FDA to 
reform its process there.
    As a U.S. Senator, I have been proud since I have been here 
to represent Main Street, to represent the voice that is not 
heard, to represent the patient and the family that wonders 
why. No rules have prevented it, yet we couldn't show it today.
    I think it is kind of sad when you have got a hearing and 
that all kinds of different ways to make your point are 
generally available, and here, maybe because of the poignancy 
and the fact that it is coming from the patient who drives this 
process, maybe that is too much for us to bear when we keep 
giving it lip service and do nothing about it.
    I have had the Promising Pathways Act out there, sponsored 
by many on this Committee, and it is just saying one thing, 
give some hope to these families that there is more than just 
what we have been doing for decades, which is a process we call 
the gold standard, but yet it lets so many individuals feel 
that they are not having their voice heard. I think as elected 
officials, we got to always point out something that we would 
rather see change in the process.
    That is what I am doing here today. I think the Committee 
should have allowed it, but when that doesn't happen, you go to 
plan B. You can find that video on my Senate account, my 
Twitter profile at Senator Braun, and you will find that video 
is worth a thousand words, if not more, of what we will hear 
today, because it speaks to the frustration that people across 
the country feel when it comes to this particular issue. Thank 
you for listening.
    Senator Burr. Thank you, Senator Braun. And before I move 
on, let me just say this Committee and many committees in 
Congress have held specific hearings over the years with rare 
disease individuals. That is not out of the ordinary.
    One of the reasons that Pew is here, Pew represents the 
patients, the folks that don't have the opportunity to be here, 
the multiple categories. It is not one, it is hundreds of 
thousands of individuals.
    We are grateful for Pew's participation in this. It is my 
hope that we will be able to satisfy your needs--I am not 
speaking for the Chair, but I will leave that up to her, 
because I think there is value to that.
    But there is much more value outside of the user fee 
agreements. This is a small part of the access that they don't 
have today that they need in the future. And the No. 1 thing is 
innovating at what today's pace will allow us to do so that we 
would begin to bring those breakthroughs. So I thank you.
    Senator Rosen.
    Senator Rosen. Well, thank you, Chair Burr, Ranking Member 
Burr, and of course, Chair Murray. Thank you all for being 
here, for the important work you do and participating today. I 
want to move on to something, of course, that is in everybody's 
thought every day is cybersecurity and getting hacked.
    We have medical devices and I want to address medical 
device cyber security because cyber-attacks really remain a 
major threat to the health care sector, particularly as bad 
actors like Russia are beginning to target or threatening to 
target our domestic industries.
    That is why I recently introduced bipartisan legislation 
with Senator Cassidy that improves collaboration among agencies 
to improve cybersecurity in the health care sector, sharing 
that threat information, and providing cybersecurity training 
to medical professionals. It is really important.
    But however, as we work to increase the cybersecurity of 
our hospitals, our health care systems as a whole, we must also 
ensure there aren't cybersecurity gaps with our medical 
devices, our pacemakers, for example. As more and more medical 
devices become connected to networks, they are accessible 
online, they become more vulnerable to cyber-attacks. It 
impacts patient safety. It impacts their health, and the 
vulnerability of the entire health system to which the devices 
connect.
    Mr. Leahey, the current FDA guidance for the medical device 
cybersecurity is from 2018. It is in the process of being 
updated. Can you speak about the importance of timely Federal 
cybersecurity guidance, how nimble we have to be as technology 
just continues to outpace our ability to protect it?
    Mr. Leahey. Absolutely. Thank you, Senator, for that 
question. And cyber is a top priority for our members. As we 
spoke with Dr. Cassidy earlier and you noted the 
interoperability of these technologies, how they interface with 
other technologies with hospital systems is of paramount 
importance.
    I think that, fortunately, thus far there haven't been any 
devices that have been compromised that impact patients' 
safety. But as you noted, the ransomware, the security threats 
and how that impacts hospitals on the system is very important.
    We have actually been active members of the HCC, the 
private public, partnership with FDA, HHS, hospital systems, 
insurers, innovators all together, sharing information in real 
time because this is something that is ever evolving. And in 
2019, the HHSC published the MedTech Cybersecurity Joint 
Security Plan to provide device makers a playbook. As you 
noted, there is a guidance being updated.
    This is something that we have to have real time 
conversations with all the stakeholders so that we are ahead of 
the curve. And we are committed to doing that and working with 
you and other Members of the Congress to ensure that we have 
the proper protocols in place.
    Senator Rosen. Thank you. I just introduced a bill for HHS 
and DHS to work with hospital systems just for what you are 
speaking about, ransomware, cyber-attacks, and really 
considering them critical infrastructure. But I would like to 
build a little bit upon what Senator Murphy was talking about, 
next clinical trial diversity, and more specifically, gender 
diversity, how it relates to women.
    Because, Ms. Richardson, in 2015, FDA released a women's 
health research roadmap as a strategy for science and 
innovation to improve the health of women. And so among the 
topics included are improving clinical trial design and 
evaluating differences between men and women, how they respond 
to drugs and medical technologies.
    Again, we are talking about roadmaps, we are talking about 
being nimble. Is it time for the FDA to update this roadmap so 
that women are included more broadly? And what actions do you 
recommend the FDA take to improve this?
    Ms. Richardson. Yes. Thank you so much for that question, 
Senator. As I noted in my testimony, one of the benefits of the 
user fee renegotiation process is that it provides FDA with an 
opportunity to think really clearly and concretely about where 
it wants to focus attention over the next 5 years.
    Not just on reducing review timelines or meeting 
procedures, but where it really wants to focus its policies. 
And I think, of course, that could involve a renewal of the 
women's health roadmap, which I believe was housed within the 
Office of Women's Health. One of the core focus areas of the 
roadmap was to support studies to advance the understanding of 
how sex differences affect the safety and effectiveness of 
emerging technologies like AI enabled devices and 3D printing.
    That has been a real area of focus for Pew and our research 
lately. I know that office has funded some important research 
in that area. But I think that in addition to additional 
research funding, it would be helpful for the agency to focus 
on how that research gets translated into policy at the level 
of the centers, which is where the rubber meets the road policy 
wise. That is where it really happens.
    CDRH, for example, recently announced strategic priorities 
that would focus on over the next 3 years, and health equity 
was a core focus area. As a part of their process, I think it 
will be important for them to focus on women's health in 
addition to other populations that may be underrepresented in 
clinical trials or in real world datasets, which includes not 
just women, of course, but also minority populations.
    Thank you very much for that question.
    Senator Rosen. Thank you. Mr. Chairman, I see I am out of 
time, but I would have asked Dr. Esham about health equity and 
how the use of telemedicine, satellite sites, health centers, 
rural health clinics, we can improve diversity in clinical 
trials for urban and rural, for women and people of color. All 
of that really matters. Will ask for your response----
    Dr. Esham. Will be happy to engage with you in detail 
following the hearing. Thank you.
    The Chair. Thank you very much. And I was out of the room 
for the discussion before, but I really do understand the 
desire to bring in the voices of patients. And both Ranking 
Member Burr and I are very focused on keeping patients at the 
center of this conversation. I actually think every Member of 
this Committee believes what is best for patients and their 
families absolutely needs to be at the center of any discussion 
on medical advancements and innovation.
    Like everybody, I have heard from patients across my state 
who are forced to choose between paying for medicines or paying 
for rent. I am sure we have all heard those. And it really is 
imperative that patient's voice be heard at every step of 
medical product development, from new research to pricing, user 
fee reauthorization, and I hope we can all work together to 
make sure that as this process goes forward, we can ensure that 
their voices are heard.
    With that, I will turn it over to Senator Baldwin for her 
questions.
    Senator Baldwin. Thank you, Madam Chair. As Chair of the 
Appropriations subcommittee that provides funding for the Food 
and Drug Administration, I am well aware of the resource 
constraints that the agency is under. We recently worked on a 
bipartisan basis to increase FDA funding for Fiscal Year 2022, 
including for food safety activities, medical product safety, 
infrastructure and cross-cutting initiatives.
    Still, I know that with current budget constraints, the 
increase will not be enough. Ms. Richardson, can you describe 
some of the agency's obstacles when it comes to critical 
operations and hiring necessary additional staff?
    Ms. Richardson. Yes, happy to. I will say that this is not 
an area that Pew has spent a lot of time focused on. And when 
it comes to hiring, I do know that, as I think Senator Burr 
pointed out, the agency has a lot of open positions.
    They have a lot of trouble hiring. I do know that one 
proposal that FDA has supported in the past and continues to 
support is direct hiring authority Pew doesn't take a position 
on that, but I think it is certainly worth considering, 
personally.
    Senator Baldwin. Thank you. Over the past week, NPR has 
been sharing stories of individuals diagnosed with cancer 
attributed to asbestos exposure. One possible source of that 
exposure is baby powder, which is a personal care product 
regulated by the FDA. The stories of these cancer patients are 
harrowing, but they also point to the fact that when it comes 
to personal care products, as widespread as make-up, deodorant, 
and lotion, we have really failed to protect consumers. Mr. 
Leahey, how many employees does FDA have assigned to work on 
medical devices?
    Mr. Leahey. That is a question we asked during the 
negotiations. I know in the Congressional report, the 2021 
Financial Report to Congress, I think there are about 1,800 or 
so FTEs related to the device review process. I think there are 
a few hundred more--hundreds more, but that is about 1,800 I 
would say.
    Senator Baldwin. Okay. Mr. Gaugh, how about the number for 
generics and biosimilars?
    Mr. Gaugh. There are about 1,600 for generic and 
biosimilars that are paid for by the user fee dollars. 1,550 
for the generic side and about 50 for the biosimilar side.
    Senator Baldwin. Dr. Esham, how many FDA employees work on 
drugs and biologics?
    Dr. Esham. When--at the end of December 2021, I believe the 
CDER had around over 5,300 employees and CBER had around 1,200, 
a little over 1,200 employees. I would say the majority of 
those, probably in some way, work on the review of drugs and 
biologics.
    Senator Baldwin. Thank you. In contrast, the FDA has only 
30 full time employees that work on personal care products, 30. 
And I don't believe that is acceptable. FDA needs more 
resources and more authorities to ensure that personal care 
products are safe, and cosmetics reforms--reform needs to be a 
part of this package. I yield back.
    The Chair. Thank you very much. That concludes our hearing 
today, and I want to thank all of our colleagues for their very 
thoughtful questions. I want to thank all of our witnesses, Dr. 
Esham, Mr. Gaugh, Mr. Leahey, and Ms. Richardson for sharing 
your time and your expertise.
    I am looking forward to continuing our work to reauthorize 
the FDA's user fee programs in the coming weeks to ensure the 
agency has the resources to support its vital work. With that, 
the Committee stands adjourned.

                          ADDITIONAL MATERIAL
                          
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

                                 Biosimilars Forum,
                                      Washington, DC 20006,
                                                     April 4, 2022.
Hon. Patty Murray, Chair,
Hon. Richard Burr, Ranking Member,
U.S. Senate Committee on Health, Education, Labor, and Pensions,
428 Dirksen Senate Office Building,
Washington, DC 20510.

    Re: FDA User Fee Agreements: Advancing Medical Product 
Regulation and Innovation for the Benefit of Patients.

    Dear Chair Murray and Ranking Member Burr and Members of 
the Committee:

    On behalf of the Forum members, I would like to thank you 
for considering this letter in advance of the hearing ``FDA 
User Fee Agreements: Advancing Medical Product Regulation and 
Innovation for the Benefit of Patients.''

    The Biosimilars Forum is the non-profit trade association 
representing the companies with the most significant U.S. 
biosimilars development portfolios, including: Biogen, 
Boehringer Ingelheim, Coherus BioSciences, Organon Inc., Pfizer 
Inc., Samsung Bioepis, Sandoz, Teva, and Viatris. This letter 
represents the views of our members, all of whom manufacture or 
market biosimilar products in the US as well as other parts of 
the world.

    Biosimilars have the potential to provide very significant 
health care savings in the U.S. Without robust competition, 
innovator biologics will continue to represent approximately 40 
percent of total prescription drug spending while they 
represent only 4 percent of the medicines prescribed to 
patients. Biosimilars provide competition to allow Americans 
access to lower-cost biologic alternatives, and their timely 
licensure and launch is vital to ensuring patient access to 
lower cost biologic medicines.

    The Biosimilars Forum is supportive of the negotiated BsUFA 
III agreement, and we believe it represents important progress 
in facilitating timely access to safe and effective biosimilar 
medicines for patients. We are pleased the commitment letter 
codifies review timelines for labeling supplements, provides 
meeting management enhancements, and promotes best practices of 
communication between FDA and sponsors.

    The Forum is particularly pleased that the BsUFA III 
program will include a regulatory science program that can help 
bring more biosimilars to market faster. Since the BPCIA was 
enacted over a decade ago, there have been many advances in the 
science of developing biological drugs. The regulatory science 
program will provide FDA and industry the ability to 
incorporate the latest scientific innovations into biosimilar 
development and regulation.

    Although we are very satisfied with the progress 
represented in the BsUFA III commitment letter, we want to 
stress that the pandemic has impacted biosimilars and patient 
access disproportionately hard for almost 2 years. COVID-19 has 
stalled onsite inspections for biosimilars delaying their 
approvals.

    While biosimilar inspections have been delayed over the 
past 2 years, on-time actions for the GDUFA and PDUFA programs 
have averaged over 90 percent; and the BsUFA program, plunged 
to 75 percent during Quarter 4 of fiscal year 2020, and further 
dropped to 67 percent during Quarter 1 of fiscal year 2021 and 
it remains at 67 percent today. In addition, per the Agency's 
May 2021 Roadmap for FDA Inspection Oversight, biosimilar 
inspections are not, considered to be ``mission critical'' and 
thus are not prioritized. This has the ultimate outcome of 
slowing timely approvals of biosimilars. We would like to ask 
the FDA for clarity to sponsors and the public as to the 
estimated timelines the FDA believes it will take to address 
the backlog in inspections and reviews and why biosimilars are 
not prioritized or treated equitably.

    For the BsUFA III Commitment Letter to be a success the 
inspection backlog for biosimilars must be addressed and remote 
inspections be implemented consistently across all programs, 
biosimilars cannot remain a low priority for the Agency.

    The Forum is encouraged by FDA's commitment to hire and 
retain sufficient numbers and types of technical and scientific 
experts to efficiently conduct reviews and applauds the 
agency's efforts to improve its use of data and technology. 
Industry understands FDA staff works on numerous types of 
applications, a small cadre of focused Biosimilar staff could 
help expedite the assessment and inspection process for 
Biosimilars. We will work with the FDA to determine how can we 
allocate reviewers specifically for BsUFA goals.

    As we head into BsUFA III we look forward to working with 
the Agency to implement the commitment letter to the mutual 
benefit of biosimilar sponsors and FDA. We are committed to 
developing a robust biosimilar industry in the US, and to help 
the BsUFA program further develop over the next 5 years. We are 
at a critical inflection point for the biosimilars industry and 
we believe that enhancing the process for biosimilar 
development, review and educating the public of the importance 
of biosimilars is critically important to sustaining and 
cementing the biosimilar pathway for years to come, but as you 
all know, more needs to be done outside of BSUFA to help us all 
achieve our goal of lowering the costs of medicines and 
improving patient access to biosimilars.

    To conclude, thank you for the opportunity to provide this 
letter. The Forum strongly supports efforts to advance the 
FDA's biosimilars program. We need to see the FDA prioritize 
biosimilar inspections and continue their work to streamline 
the development of biosimilars as well as advance the guidances 
we need. Policies that support timely approval of biosimilars 
will ensure that patients have more access to high quality, 
safe, effective, and affordable biological therapies.

            Sincerely,
                                           Juliana M. Reed,
                                                Executive Director.
                                ------                                

                                Senator Mike Braun,
                                      Washington, DC 20510,
                                                     April 4, 2022.
Hon. Patty Murray, Chair,
Hon. Richard Burr, Ranking Member,
U.S. Senate Committee on Health, Education, Labor, and Pensions,
428 Dirksen Senate Office Building,
Washington, DC 20510.

    Dear Chair Murray and Ranking Member Burr:

    As Senate hearings begin tomorrow on the U.S. Food and Drug 
Administration (FDA) user fee renewal, I write to urge you to have a 
patient-focused hearing that allows the rare disease community to 
testify at Senate Health, Education, Labor, and Pensions (HELP) 
Committee. Simply put, the user fee renewal process will not be 
successful if it ignores the end users of the medicines in the hearing 
process, or rubberstamps a proposal without patient input.

    The overarching mission of the FDA user fee program is to provide a 
predictable and accountable regulatory framework that supports 
expedited FDA review and approval of pharmaceuticals and medical 
devices, ensuring Americans receive access to safe and effective 
products. Recognizing the importance of incorporating patient voices in 
the review and approval of medical products, the FDA, medical 
industries, and Congress have taken steps to encourage patient-focused 
drug and device development. Integrating patient perspectives with drug 
development is especially important for patients with rare, lesser 
known, progressive, and serious diseases and conditions, as well as for 
diseases with unmet clinical. It is therefore critical that the FDA 
user fee program incorporate patient experiences and perspectives, 
especially patients with rare diseases and unmet needs.

    In September 1992, Congress passed the Prescription Drug User Fee 
Act into law, authorizing the FDA to collect fees from pharmaceutical 
companies to review their product applications for approval. Since its 
enactment, Congress has reauthorized the user fee program every 5 
years, and is responsible for reauthorizing the program for the sixth 
time in September 2022. Over the last 30 years, the user fee program 
has expanded to include medical devices, generic drugs, and 
biosimilars. Importantly, the user fee program reauthorization process 
has evolved into an opportunity for Congress to direct FDA and medical 
industries to implement new policies for the benefit of patients, 
including 21st Century tools and techniques to address rare disease 
drug development.

    While the FDA, medical industries, and Congress have made great 
improvements to include patients and patient perspectives in the user 
fee program, there is still more to be done to ensure that patients 
with rare diseases receive representation and consideration for the 
September 2022 user fee reauthorization. For example, during the 2012 
and 2017 user fee reauthorization process, the Senate HELP Committee 
invited a witness to provide the patient perspective and testimony, in 
addition to witnesses from the pharmaceutical and medical device trade 
associations, at user fee reauthorization hearings. I commend the 
Committee for its efforts to ensure patient representation in user fee 
reauthorization discussions and hearings. However, I am concerned about 
the lack of representation of patients with rare diseases at upcoming 
HELP hearings, especially given the considerable number of provisions 
related to rare disease drug and device development included in FDA and 
industry's final user fee agreements for 2022.

    In general, rare and lesser known diseases present a unique set of 
challenges, particularly for drug and device development, clinical 
trial design, and patient access to therapies, that are not commonly 
experienced during traditional product development. For example, 
clinical trials for rare disease drugs often struggle to recruit and 
maintain a patient sample size large enough to generalize the data, as 
well as lack biomarkers and endpoints to adequately demonstrate 
efficacy. Despite increased efforts to address these issues and 
expedite approval of rare disease treatments, more than 90 percent of 
rare diseases have no treatment. \1\ Unfortunately, the current 
regulatory framework for rare disease product development has failed to 
support efficient development, review, and approval of treatments for 
rare diseases, further preventing patients from access to therapies.
---------------------------------------------------------------------------
    \1\  Nord, ``New Report Finds Medical Treatments for Rare Diseases 
Account for Only 11 percent of U.S. Drug Spending; Nearly 80 percent of 
Orphan Drug Products Treat Rare Diseases Exclusively,'' Mar. 4, 2021, 
https://rarediseases.org/new-report-finds-medical-treatments-for-rare-
diseases-account-for-only 11-of-us-drug-spending-nearly-80-of-orphan-
products-treat-rare-diseases-exclusively/#:-
:text=Approximately%207%2C000%20known%20rare%20diseases,rare%20diseases%
20 have%20no%20treatment.

    The FDA user fee program and reauthorization has helped modernize 
FDA regulatory requirements, establish new approval pathways, and 
improve the Agency and development process in tandem with medical and 
technological advancements to ensure expedited approval of products 
that benefit patients across the United States and globally. The FDA 
and industry fmal agreements reflect a shift in FDA and industry 
priorities to encourage and advance rare disease product development 
and accessibility. As a result, it is imperative that Senate ensures 
the rare disease community is represented by a witness in the on-going 
user fee reauthorization discussions held in the Senate HELP Committee 
to ensure the translational success of new policies incorporated into 
---------------------------------------------------------------------------
the final user fee agreement.

    For these reasons, I request that the Senate HELP Committee provide 
a full patient representative hearing from the rare and life 
threatening disease community in order to advance medical product 
regulation and innovation for the benefit of patients, including those 
diagnosed with rare diseases. I appreciate your attention to this 
request, and my staff and I are willing to help you both organize this 
hearing.

            Sincerely,
                                        Senator Mike Braun.
                                 ______
                                 

                        Questions for the Record

Response by Cartier Esham to Questions From Senator Braun, and Senator 
                                 Romney

                             senator braun
    The PDUFA commitment letter stresses the importance of new programs 
to allow earlier patient access to therapies that address unmet medical 
needs and advance rare disease endpoint development.

    Question 1. What challenges exist in FDA's current framework for 
rare disease drug development? Does the PDUFA agreement go far enough 
to provide the necessary regulatory flexibilities to address these 
challenges?

    Answer 1. Due to the smaller than average patient populations 
affected by rare diseases, study recruitment, retention, and other 
factors that can inhibit adequate endpoint measurement, thus limiting 
drug development in these spaces. BIO supports the PDUFA VII Rare 
Disease Endpoint Advancement (RDEA) Pilot Program and its goal to 
advance and facilitate the development and timely approval of drugs and 
biologics for rare diseases, including rare diseases in children. The 
RDEA pilot is modeled after the Complex Innovative Trial and Model 
Informed Drug Development programs initiated under PDUFA VI, which 
provide foundational experience for a potentially successful rare 
disease pilot.

    The RDEA Pilot's aim to accept a proposal for a development program 
for a common disease that includes innovative or novel endpoint 
elements can allow for new rare disease treatments that utilize the 
most cutting-edge and patient-centric study designs to reach the right 
patients.

    Given the FDA Pilot's small allotment of a maximum three 
participating sponsors per year, we look forward to engaging with the 
Agency regarding the best ways to glean useful and broadly applicable 
data to inform our members, and most importantly, yield faster and 
better results for our rare disease patient community.

    Overall, we are optimistic that the RDEA pilot can provide 
learnings to the biotech and greater R&D community regarding surrogate 
endpoint use in rare disease drug development.
                             senator romney
    U.S.-China Competition--FDA approval of a new drug or device does 
not grant the U.S. exclusive access to that drug or device. Companies 
aren't prohibited from also applying for approval in other countries, 
where regulatory bodies may move comparatively faster to approve new 
products.

    Question 1. Aside from the consumer health benefits, how does 
timely FDA approval promote American interests?

    Answer 1. BIO agrees that the timely approval of safe and effective 
medical products by FDA can mean the difference between death, 
disability, relief, or potentially a cure for American patients with 
urgent medical needs who lack other treatment options. We agree that 
beyond consumer health benefits, timely FDA approval promotes American 
interests in areas outside of patient outcomes.

    FDA approval is often considered the ``gold standard'' globally 
with respect to regulatory authority and rigor due to stringent safety 
and efficacy standards. This reputation of regulatory excellence and 
consistency has policy implications; for example, the US engages in 
Mutual Recognition Agreements (MRAs) with almost 30 other countries, 
allowing for a degree of reciprocity and data sharing between trusted 
health authorities if FDA deems those authorities capable of conducting 
inspections that meet US standards. In 2021 alone, almost half (27/60) 
of FDA's new drug approvals in the Center for Drug Evaluation and 
Research (CDER) and the Center for Biologics Evaluation and Research 
(CBER) were first-in-class. That same year, 76 percent of novel drugs 
approved were approved in the US before any other country. \1\, \2\ 
Approval by FDA can indicate likelihood for approval by other health 
authorities. For example, a study indicated that FDA and the European 
Medicines Agency (EMA) had 91-98 percent concordance in decisions on 
marketing approvals between 2014 and 2016. \3\ Approval in multiple 
markets translates into more revenue for US-based sponsors, increasing 
their ability to conduct research and development on new innovative 
treatments to help more patients.
---------------------------------------------------------------------------
    \1\  https://www.fda.gov/media/155227/download.
    \2\  https://www.raps.org/news-and-articles/news-articles/2022/1/
fda-approved-more-first-in-class-drugs-more-with-
a#::text=Other%20drugs%20approved%20by%20CDER,treatment%20options.
    \3\  Kashoki, M., Hanaizi, Z., Yordanova, S., Vesely, R., Bouygues, 
C., Llinares, J. and Kweder, S.L. (2020), A Comparison of EMA and FDA 
Decisions for New Drug Marketing Applications 2014-2016: Concordance, 
Discordance, and Why. Clin. Pharmacol. Ther., 107: 195-202. https://
doi.org/10.1002/cpt.1565.

    In addition to economic and financial benefits, timely FDA approval 
yields earlier availability of US-generated real-world evidence and 
real-world data (RWE/RWD). As soon as patients have access to new 
treatments, American academic institutions, health systems, software/
technology companies, and other stakeholders can begin to harness and 
apply clinical outcome data generated by the use of these novel 
products. In addition to supporting regulatory submissions and 
decision-making, increased availability of RWE/RWD improves health 
equity for Americans. Such data enable the utilization of decentralized 
and non-traditional clinical trial locations, allowing for increased 
diversity in clinical trials that can improve our understanding of 
---------------------------------------------------------------------------
clinical outcomes for all American patients.

    Question 2. How does timely approval affect the rate and 
willingness of U.S.-based firms to invest in research and development?

    Answer 2. Bringing a drug to market in the US is associated with 
significant time, effort, resource expenditure, and risk for American 
companies. It can take anywhere from 10 to 15 years at an average cost 
of approximately $1 billion or more to advance a single drug or 
biological product from a promising idea to an approved product that 
benefits patients. \4\, \5\ Timely review and approval helps mitigate 
risks and opportunity costs associated with regulatory submissions for 
American firms.
---------------------------------------------------------------------------
    \4\  Olivier J. Wouters, Ph.D; Martin McKee, MD, DSc; Jeroen 
Luyten, Ph.D. Estimated Research and Development Investment Needed to 
Bring a New Medicine to Market JAMA. 2020, 323(9).
    \5\  Joseph A. DiMasi; Henry G. Grabowskibi; Ronald W. Hansen. 
Innovation in the pharmaceutical industry: New estimates of R&D costs. 
2016. Journal of Health Economics. 2016, Vol. 47.

    Every day that an approval is delayed translates into unrealized 
revenue for the sponsor of an application. Small companies with limited 
research and development budgets, or even new companies that are pre-
revenue, are disproportionately impacted by such delays. These firms 
might only have the resources, staff, and facilities to manage a single 
product in their pipeline at a given time. Delayed approval results not 
only in financial impact but can also chill innovation efforts due 
solely to resource constraints. As approval timelines shorten, US-based 
firms are more likely and more able to invest in biopharmaceutical 
---------------------------------------------------------------------------
research and development.

    Question 3. How does U.S.-based research and development investment 
in medical products (drugs and devices) compare to Chinese-based 
investment?

    Answer 3. The biopharmaceutical industry is one of the largest 
economic sectors domestically and globally. A recent study indicated 
that total US medical and health research and development reached 
$245.1 billion in 2020. Specifically, US private industry accounts for 
66 percent of these investment dollars at $161.8 billion. \6\ During 
that same year, Chinese pharmaceutical research and development reached 
$187 billion. \7\
---------------------------------------------------------------------------
    \6\  U.S. Investments in Medical and Health Research and 
Development 2016-2020. Research! America. (n.d.). Retrieved April 29, 
2022, from https://issuu.com/researchamerica.
    \7\  Zhang, W. (2022, January 27). China: Pharmaceutical R&D 
spending 2023. Statista. Retrieved April 29, 2022, from https://
www.statista.com/statistics/1202091/china-pharmaceutical-randd-
spending/.

    According to census data from datacommons.org, American and Chinese 
populations in 2020 were 329.5 million and 1.402 billion, respectively. 
Using private industry spending data, we can estimate per capita 
research and development spending at $49.1 in the US and $62.1 in 
China.
                                 ______
                                 

 Response by David Gaugh to Questions From Senator Kaine, and Senator 
                                 Romney

                             senator kaine
    Mr. Gaugh, in your testimony you shared that as of March 2022, the 
FDA has licensed two interchangeable biosimilar products. We know that 
interchangeable biosimilars must produce the same clinical result as 
the brand-name biologic and that a pharmacist may dispense an 
interchangeable biosimilar when a brand-name biologic is prescribed 
without intervention from a provider. As you shared in the hearing, the 
development of biosimilars, and interchangeable biosimilars, has worked 
to reduce the price that patients pay at the drug counter. We also know 
this is a relatively new space and that we are still learning more 
about the best science and oversight in the development of these 
products.

    Question 1. Mr. Gaugh, which provisions of the BsUFA III agreement 
will help manufactures quickly develop additional interchangeable 
biosimilar products?

    Answer 1. Following enactment of the BPCIA in 2010, the first 
biosimilar was licensed by FDA in 2015. Today, a total of 35 
biosimilars including two interchangeable biosimilars--are now licensed 
in the United States. Biosimilar medicines are safe, effective and more 
affordable treatment options for patients than their brand-name 
counterparts. Biosimilars are already delivering on their promise of 
lower costs and expanded patient access to care with average prices of 
nearly 50 percent less than their reference biologics at time of the 
biosimilar's launch. Biosimilars represent much needed competition to 
the specialty medicines that now account for more than 55 percent of 
all drug spending.

    The interchangeable designation permits a pharmacist to dispense, 
subject to state law, an interchangeable biosimilar when a brand-name 
biologic is prescribed without intervention from the provider. It 
requires a biosimilar developer to demonstrate the same clinical result 
for its medicine as the brand-name biologic. It is important to note 
that the interchangeable designation is unique to the Unites States and 
is not an indication of superior quality.

    As part of the industry's negotiations with FDA, enhancements were 
made to help facilitate more timely patient access to interchangeable 
biosimilars. BsUFA III will help manufacturers to develop more 
interchangeable biosimilars through the new Regulatory Science 
Program's demonstration project. These demonstration projects will also 
evaluate mechanisms to streamline overall biosimilars development. In 
our view, the findings from these demonstration projects will inform a 
comprehensive strategy to advance interchangeability and the 
development of future guidance documents.

    We appreciate your interest and attention to the important role 
biosimilar medicines--and, in particular, interchangeable biosimilars--
can play in lowering prescription drug costs. We would welcome the 
opportunity to further discuss how Congress could take steps to reduce 
the clinical burden on biosimilars and interchangeable manufacturers to 
ensure more timely patient access to low-cost medicines.
                             senator romney
    U.S.-China Competition--FDA approval of a new drug or device does 
not grant the U.S. exclusive access to that drug or device. Companies 
aren't prohibited from also applying for approval in other countries, 
where regulatory bodies may move comparatively faster to approve new 
products.
    Question 1. Aside from the consumer health benefits, how does 
timely FDA approval promote American interests?
    Answer 1. In addition to the consumer health benefits, timely FDA 
approval of generic and biosimilar medicines benefits America's 
interests through increased market-based competition and lower health 
care costs. Experience shows drug prices decline rapidly when generics 
enter the market. According to FDA, prices fall as generics enter the 
market--by an average of 39 percent when there is only one generic and 
by nearly 80 percent when four or more generics enter the market. 
Evidence with biosimilar medicines is similar with an average cost 
savings of nearly 50 percent. Importantly, biosimilar competition also 
results in lower brand biologic prices--by more than 25 percent on 
average for brands with biosimilar competition.
    Over the last 10 years, generics and biosimilars provided more than 
$2 trillion in savings--including $469 billion from new generics and 
more than $12 billion from biosimilars--to patients and the U.S. health 
care system. In addition to the cost savings provided, patient access 
to life-saving treatments is broadened as the price of medicine falls. 
A recent analysis of Medicare Part D from the Congressional Budget 
Office noted ``the number of standardized prescriptions dispensed for 
generic drugs more than doubled from 2009 through 2018.'' And 
biosimilars have already resulted in more than 10 million additional 
patient days of treatment.
    GDUFA III and BsUFA III, as negotiated, will further these 
interests. Both GDUFA and BsUFA aim to put FDA's generic and biosimilar 
drug programs on firm financial footing by enabling FDA to assess user 
fees to fund critical and measurable enhancements and, in turn, 
bringing greater predictability and timeliness to the review of 
applications. As a direct outcome, the generic and biosimilars drug 
programs increase patient access to safe, effective and more affordable 
quality medicines.
    Question 2. How does timely approval affect the rate and 
willingness of U.S.-based firms to invest in research and development?
    Answer 2. Timely approval of generic and biosimilar medicines by 
FDA increases the likelihood generic and biosimilar developers will 
invest in bringing more affordable medicines to market going forward. 
AAM's member companies invest significant resources in building and 
operating U.S.-based facilities and in bringing generic and biosimilar 
medicines through FDA's approval process to market. Manufacturing sites 
can cost as much as $1 billion to build in the U.S. In addition, the 
development and approval of biosimilar medicines, for example, require 
8-10 years at a cost of $100 to $250 million.
    GDUFA III and BsUFA III ensure FDA has sufficient resources for 
review of generic and biosimilars applications, while building on the 
success and incorporating lessons learned over the last 10 years. As 
described in more detail in my written statement, GDUFA III and BsUFA 
III include a number of enhancements to ensure the timely review of 
applications over the next 5 years (FY23-27). Timely approval of the 
FDA user fee agreements ensures America's patients will continue to 
benefit.
    Question 3. How does U.S.-based research and development investment 
in medical products (drugs and devices) compare to Chinese-based 
investment?
    Answer 3. We do not have any data on how U.S.-based investment in 
the research and development of generic and biosimilar medicines 
compares to Chinese-based investment.
                                 ______
                                 

        Response by David Leahey to Questions From Senator Burr

                              senator burr
    Question 1. Aside from the consumer health benefits, how does 
timely FDA approval promote American interests?

    Answer 1. There is broad bipartisan agreement on the importance of 
American patients gaining first access to American medical 
technologies, a goal shared by innovators, FDA and most importantly, 
patients. In addition to the health benefits, a timely and efficient 
FDA review of medical technologies strengthens the entire medical 
device ecosystem. Physicians, surgeons and all healthcare professionals 
are able to work collaboratively with innovators to improve existing 
technologies, as well as develop the next generation of cures, 
therapies and diagnostics here in the United States. Unnecessary 
regulatory delays also drive capital to markets outside the United 
States and weaken our Nation's global leadership in device innovation. 
It's in our collective public health, economic and national security 
interests that the U.S. remains the most attractive country in the 
world for medical device development and manufacturing.

    Question 2. How does timely approval affect the rate and 
willingness of U.S.-based firms to invest in research and development?

    Answer 2. FDA has made significant progress since 2009. At that 
time, FDA's performance slipped and as a result venture investments 
fled the device markets. Thankfully, Congress intervened and passed key 
reforms to improve FDA's review programs. FDA, to their credit, has 
made improvements since then, and our expectation is that the $2B in 
new resources provided under the MDUFA V agreement--a doubling of fees 
from the current MDUFA--will build on this progress. Still, the harsh 
reality remains that every dollar spent on research and development 
carries risk, and many ventures fail. Ongoing improvements in 
transparency, consistency and accountability at FDA will help ensure 
that research and development investments in new medical technologies 
continue.

    Question 3. How does U.S.-based research and development investment 
in medical products (drugs and devices) compare to Chinese-based 
investment?

    Answer 3. While there has always been shifts in venture capital 
investments and others who support the medical technology ecosystem, 
there has been an alarming trend of the majority of investments being 
made in later stage companies. This is certainly necessary and 
beneficial to patient care, but it is critical that investments are 
also being made in early stage companies and startups. Reports show 
that there are ongoing increases in these types of investments in China 
with direct support from the Chinese government. In fact, the People's 
Republic of China identified medical technologies as a critical sector 
of investment as part of their Made in China 2025 industrial policy to 
grow indigenous industries. Keeping the Chinese market open to U.S. 
exports is critical to U.S. manufacturers, but improvements to the 
regulation and reimbursement of medical technologies in the United 
States will protect our Nation's leadership position in this vibrant 
industry.

    Question 4. How confident are device manufacturers these 
adjustments will incentivize the FDA to meet its own commitment's?

    Answer 4. The milestones and commitments contained in the MDUFA V 
draft agreement are designed to help ensure that the investments being 
made by industry will strengthen patient care and innovation. As the 
agency works to maintain its gold standard of providing safe and 
effective medical technologies to the public, we are confident that the 
structure of the agreement before Congress will achieve our shared goal 
of protecting the United States' leadership position in medical 
technology innovation. Ongoing congressional oversight will also play a 
central role to ensure that these important goals are met.

    Question 5. How confident are device manufacturers that the FDA's 
methods for measuring and reporting on hiring goals will provide both 
accurate and reliable data?

    Answer 5. During the MDUFA V negotiations, it was concerning to 
learn that FDA was unable to identify how many MDUFA I-IV funded 
positions were vacant. FDA did implement a tracking system for MDUFA IV 
hires and has committed to an independent assessment during MDUFA V to 
better assess workforce tracking and management. Given the significance 
increase in funding under MDUFA V, it is a reasonable expectation that 
FDA will do more to ensure timely hiring for new positions and existing 
vacancies during MDUFA V and beyond. The results of the independent 
assessment, coupled with FDA's annual financial report to Congress, 
should provide more transparency into these workforce issues and any 
gaps that need to be filled.
                                 ______
                                 
    [Whereupon, at 11:49 a.m., the hearing was adjourned.]

                                  [all]