[Federal Register Volume 75, Number 176 (Monday, September 13, 2010)]
[Notices]
[Pages 55589-55591]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-22760]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2010-N-0463]


Fee for Using a Priority Review Voucher in Fiscal Year 2011

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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SUMMARY: The Food and Drug Administration (FDA) is announcing the fee 
rates for using a tropical disease priority review voucher for fiscal 
year (FY) 2011. The Federal Food, Drug, and Cosmetic Act (the FD&C 
Act), as amended by title XI of the Food and Drug Administration 
Amendments Act of 2007 (FDAAA), authorizes FDA to determine and collect 
priority review user fees for certain applications for approval of drug 
or biological products when those applications use a priority review 
voucher awarded by the Secretary of Health and Human Services. These 
vouchers are awarded to the sponsor of certain tropical disease product 
applications, submitted after September 27, 2007, upon FDA approval of 
such applications. The amount of the fee to be submitted to FDA with 
applications using a priority review voucher is determined each fiscal 
year (FY) based on the average cost incurred by FDA in the review of a 
human drug application subject to priority review in the previous FY.
    This notice establishes the priority review fee rate for FY 2011.

FOR FURTHER INFORMATION CONTACT: David Miller, Office of Financial 
Management (HFA-100), Food and Drug Administration, 1350 Piccard Dr., 
Rockville, MD 20850, 301-796-7103.

SUPPLEMENTARY INFORMATION:

I. Background

    Section 1102 of FDAAA added new section 524 to the FD&C Act (21 
U.S.C. 360n). In section 524, Congress encouraged development of new 
drug and biological products for prevention and treatment of certain 
tropical diseases by offering additional incentives for obtaining FDA 
approval of such products. Under section 524, the sponsor of an 
eligible human drug application submitted after September 27, 2007, for 
a qualified tropical disease (as defined in section 524(a)(3)), shall 
receive a priority review voucher upon approval of the tropical disease 
product application. The recipient of a priority review voucher may 
either use the voucher with a future submission to FDA under section 
505(b)(1) of the FD&C Act (21 U.S.C. 355(b)(1)) or section 351 of the 
Public Health Service Act (21 U.S.C. 262), or transfer (including by 
sale) the voucher to another party that may then use it. A priority 
review is a review conducted with a Prescription Drug User Fee Act 
(PDUFA) goal date of 6 months.
    The applicant that uses a priority review voucher is entitled to a 
priority review but must pay FDA a priority review user fee in addition 
to any other fee required by PDUFA. FDA has published a draft guidance 
on its Web site about how this priority review voucher program will 
operate (available at: http://www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/ucm080599.pdf).
    This notice establishes the priority review fee rate for 2011 of 
$4,582,000, and outlines FDA's process for implementing the collection 
of the priority review user fees. This rate is effective on October 1, 
2010, and will remain in effect through September 30, 2011, for 
applications submitted with a priority review voucher, and the payment 
of this priority review user fee is required in addition to the payment 
of any other fee that would normally apply to such an application under 
PDUFA before FDA considers the application complete and acceptable for 
filing.

II. Priority Review User Fee for FY 2011

    Under section 524(c)(2) of the FD&C Act, the amount of the priority 
review user fee is to be determined each FY based on the average cost 
incurred by FDA in the review of a human drug application subject to 
priority review in the previous FY.
    A priority review is a review conducted with a PDUFA goal date of 6 
months. Normally, an application for a Center for Drug Evaluation and 
Research (CDER) product will qualify for a priority review if FDA 
determines that the product, if approved, would provide safe and 
effective therapy where no satisfactory alternative therapy exists or 
would be a significant improvement compared to marketed products, 
including non-drug products and/or therapies, in the treatment, 
diagnosis, or prevention of a disease. A Center for Biologics 
Evaluation and Research (CBER) product will qualify for a priority 
review if FDA determines that the product, if approved, would be a 
significant improvement in the safety or effectiveness of the 
treatment, diagnosis, or prevention of a serious or life-threatening 
disease. FDA has committed to a goal to review and act on 90 percent of 
the applications that have been granted priority review status no later 
than 6 months after receipt. An application that does not receive a 
priority designation will receive a ``standard'' review. Under the 
goals identified in the letters referenced in section 101(c) of FDAAA, 
FDA commits to a goal to review and act on 90 percent of ``standard'' 
applications within 10 months of the date of receipt. A priority review 
involves a more intensive level of effort and a higher level of 
resources than a standard review.
    Section 524 of the FD&C Act specifies that the fee amount should be 
based on the average cost incurred by the Agency for a priority review 
in the previous FY. Because FDA has never tracked the cost of reviewing 
applications that get priority review as a separate cost subset, FDA 
estimated this cost based on other data that the Agency has tracked and 
kept. FDA started by using data that the Agency estimates and publishes 
on its Web site each year--standard costs for review. FDA does not 
publish a standard cost for ``the review of a human drug application 
subject to priority review in the previous fiscal year.'' However, we 
expect all such applications would contain clinical data. The standard 
cost application

[[Page 55590]]

categories with clinical data that FDA does publish each year are as 
follows:
    (1) New drug applications (NDAs) for a new molecular entity (NME) 
with clinical data and
    (2) Biologic license applications (BLAs).
    The worksheets for standard costs for FY 2009, the latest year for 
which standard cost data are available, show a standard cost of 
$4,021,000 (rounded to the nearest thousand dollars) for an NDA with 
clinical data and $3,530,000 (rounded to the nearest thousand dollars) 
for a BLA. Based on these standard costs, the total cost to review the 
55 applications in these 2 categories in FY 2009 (24 BLAs and 31 NDAs 
with clinical data) was $209,371,000. (Note: no investigational new 
drug (IND) review costs are included in this amount; they will be 
calculated separately and added in the next paragraph.) Records 
acquired from CDER and CBER by the Office of Policy, Planning and 
Budget (OPPB), Economics Staff, indicate that a total of 17 of these 
applications (8 NDAs [excluding the President's Emergency Plan for Aids 
Relief NDAs] and 9 BLAs) received priority review, which would mean 
that the remaining 38 received standard reviews. Because a priority 
review compresses a review that ordinarily takes 10 months into 6 
months, OPPB estimates that a multiplier of 1.67 (10 months divided by 
6 months) should be applied to non-priority review costs in estimating 
the effort and cost of a priority review as compared to a standard 
review. This multiplier is consistent with published research on this 
subject. In the article ``Developing Drugs for Developing Countries,'' 
published in Health Affairs, vol. 25, Number 2, in 2006, the analysis 
by David B. Ridley, Henry G. Grabowski, and Jeffrey L. Moe supports a 
priority review multiplier in the range of 1.48 to 2.35. The multiplier 
derived by FDA falls well below the midpoint of this range. Using FY 
2009 figures, the costs of a priority and standard review are estimated 
using the following formula:
    (17a x 1.67) + (38a) = $209,371,000
where ``a'' is the cost of a standard review and ``a'' times 1.67 is 
the cost of a priority review. Using this formula, the cost of a 
standard review for NMEs is calculated to be $3,154,000 (rounded to the 
nearest thousand dollars) and the cost of a priority review for NMEs is 
1.67 times that amount, or $5,267,000 (rounded to the nearest thousand 
dollars).
    Next, the cost of the IND review phase for these applications is 
calculated. The standard lifetime cost of reviewing a drug IND in FY 
2009 was $291,000 (rounded to the nearest thousand dollars). The 
standard lifetime cost of a biologic IND review in FY 2009 was $860,000 
(rounded to the nearest thousand dollars). Because there were 8 
priority NDAs and 9 priority BLAs received in FY 2009, the following 
formula estimates the average cost of the IND review phase of an 
application:
    (8 NDAs x $291,000) + (9 BLAs x $860,000) = $10,068,000
    This is the full cost of the IND review associated with the 17 
priority review applications received in FY 2009. Dividing $10,068,000 
by 17 (the total number of priority review applications received in FY 
2009), yields an average IND review phase cost of $592,000 (rounded to 
the nearest thousand dollars) per priority review application.
    Adding the cost of the NDA/BLA priority review calculated 
previously, $5,267,000, to the cost of the IND review phase of 
$592,000, results in an estimated average cost for priority review for 
an application received in FY 2009 of $5,859,000.
    Section 524 of the FD&C Act specifies that the fee amount should be 
based on the average cost incurred by the Agency for a priority review 
in the previous FY. FDA is setting fees for FY 2011, and the previous 
FY is FY 2010. However, the FY 2010 submission cohort has not been 
closed out yet, and the cost data for FY 2010 are not complete. The 
latest year for which FDA has data is FY 2009. Accordingly, FDA will 
adjust the previously mentioned FY 2009 cost figure by the average 
amount by which FDA's average salary and benefit costs increased in the 
5 years prior to FY 2011, to adjust the FY 2009 amount for cost 
increases in FY 2010. That figure, published in the Federal Register of 
August 4, 2010 (75 FR 46952 at 46954), which set Prescription Drug User 
Fees for FY 2011, is 4.53 percent. Increasing the FY 2009 average 
priority review cost figure of $5,859,000 by 4.53 percent results in an 
estimated cost of $6,124,000 (rounded to the nearest thousand dollars).
    FDA will deduct from this amount the PDUFA fee that must also be 
paid in addition to the priority review fee when an NDA or BLA with 
clinical data is submitted in FY 2011. That amount, also published in 
the Federal Register of August 4, 2010 (75 FR 46952 at 46957), which 
set PDUFA fees for FY 2011, is $1,542,000. The difference, rounded to 
the nearest thousand dollars, is $4,582,000. This is the priority 
review user fee amount for FY 2011 that must be submitted with a 
priority review voucher in FY 2011, in addition to any PDUFA fee that 
is required for such an application.

III. Priority Review Fee Schedule for FY 2011

    The fee rate for FY 2011 is set out in table 1 of this document.

                                Table 1.
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               FEE CATEGORY                     FEE RATE FOR FY 2011
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APPLICATIONS SUBMITTED WITH A PRIORITY REVIEW VOUCHER
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  In addition to the normal PDUFA Fee      $4,582,000
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IV. Implementation of Priority Review Fee

    Under section 524(c)(4)(A) of the FD&C Act, the priority review 
user fee is due upon submission of the application for which the 
priority review voucher is used. Section 524(c)(4)(B) specifies that 
the application will be considered incomplete if the priority review 
user fee and all other applicable user fees are not paid in accordance 
with FDA payment procedures. FDA may not grant a waiver, exemption, 
reduction, or refund of any fees due and payable under this section of 
the FD&C Act, and FDA may not collect priority review voucher fees 
prior to a relevant appropriation for fees for that FY. Beginning with 
FDA's appropriation for FY 2009, the annual appropriation language 
states specifically that ``priority review user fees authorized by 21 
U.S.C. 360n (section 524 of the FD&C Act) may be credited to this 
account, to remain available until expended.'' (Public Law 111-8, 
Section 5, Division A, Title VI).
    The priority review fee established in the new fee schedule must be 
paid for any application that is received after September 30, 2010, and 
submitted with a priority review voucher. This fee must be paid in 
addition to any other fee due under PDUFA. Payment must be made in U.S. 
currency by check, bank draft, or U.S. postal money order payable to 
the order of the Food and Drug Administration. The user fee 
identification (ID) number should be included on the check, followed by 
the words ``Priority Review''. Payments can be mailed to: Food and Drug 
Administration, P.O. Box 70963, Charlotte, NC 28272-0963.
    If checks are sent by a courier that requests a street address, the 
courier can deliver the checks to: Wells Fargo QLP Lockbox D1113-022, 
Attn: Food and Drug Administration Lockbox 70963, 1525 West WT Harris 
Blvd., Charlotte,

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NC 28262. (Note: This Wells Fargo address is for courier delivery 
only.) The FDA post office box number (P.O. Box 70963) must be written 
on the check. The tax identification number of the Food and Drug 
Administration is 53-0196965.
    Wire transfer payments may also be used. Please reference your 
unique user fee ID number when completing your transfer. The 
originating financial institution may charge a wire transfer fee. 
Please ask your financial institution about the fee and include it with 
your payment to ensure that your fee is fully paid. The account 
information is as follows: New York Federal Reserve Bank, U.S. Dept. of 
Treasury, TREAS NYC, 33 Liberty St., New York, NY 10045, Acct. No.: 
75060099, Routing No.: 021030004, SWIFT: FRNYUS33, Beneficiary: FDA, 
1350 Piccard Dr., Rockville, MD 20850.
    Application fees can also be paid online with an electronic check 
(ACH). FDA has partnered with the U.S. Department of Treasury to 
utilize Pay.gov, a Web-based payment application, for online electronic 
payment. The Pay.gov feature is available on FDA's Web site after the 
user fee ID number is generated.

    Dated: September 7, 2010.
Leslie Kux,
Acting Assistant Commissioner for Policy.
[FR Doc. 2010-22760 Filed 9-10-10; 8:45 am]
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