[Federal Register Volume 80, Number 148 (Monday, August 3, 2015)]
[Notices]
[Pages 46028-46032]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-18914]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2015-N-0007]


Prescription Drug User Fee Rates for Fiscal Year 2016

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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SUMMARY: The Food and Drug Administration (FDA) is announcing the rates 
for prescription drug user fees for fiscal year (FY) 2016. The Federal 
Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the 
Prescription Drug User Fee Amendments of 2012 (PDUFA V), authorizes FDA 
to collect user fees for certain applications for the review of human 
drug and biological products, on establishments where the products are 
made, and on such products. This notice establishes the fee rates for 
FY 2016.

FOR FURTHER INFORMATION CONTACT: Robert J. Marcarelli, Office of 
Financial Management, Food and Drug Administration, 8455 Colesville 
Rd., COLE-14202F, Silver Spring, MD 20993-0002, 301-796-7223.

SUPPLEMENTARY INFORMATION: 

I. Background

    Sections 735 and 736 of the FD&C Act (21 U.S.C. 379g and 379h, 
respectively) establish three different kinds of user fees. Fees are 
assessed on the following: (1) Certain types of applications and 
supplements for the review of human drug and biological products; (2) 
certain establishments where such products are made; and (3) certain 
products (section 736(a) of the FD&C Act). When certain conditions are 
met, FDA may waive or reduce fees (section 736(d) of the FD&C Act).
    For FY 2013 through FY 2017, the base revenue amounts for the total 
revenues from all PDUFA fees are established by PDUFA V. The base 
revenue amount for FY 2013, which became the base amount for the 
remaining 4 FYs of PDUFA V, is $718,669,000, as published in the 
Federal Register of August 1, 2012 (77 FR 45639). The FY 2013 base 
revenue amount is further adjusted each year after FY 2013 for 
inflation and workload. Fees for applications, establishments, and 
products are to be established each year by FDA so that revenues from 
each category will provide one-third of the total revenue to be 
collected each year.
    This document provides fee rates for FY 2016 for an application 
requiring

[[Page 46029]]

clinical data ($2,374,200), for an application not requiring clinical 
data or a supplement requiring clinical data ($1,187,100), for an 
establishment ($585,200), and for a product ($114,450). These fees are 
effective on October 1, 2015, and will remain in effect through 
September 30, 2016. For applications and supplements that are submitted 
on or after October 1, 2015, the new fee schedule must be used. 
Invoices for establishment and product fees for FY 2016 will be issued 
in August 2015 using the new fee schedule.

II. Fee Revenue Amount for FY 2016

    The base revenue amount for FY 2016 is $718,669,000 prior to 
adjustments for inflation and workload (see section 736(c)(1) and 
(c)(2) of the FD&C Act).

A. FY 2016 Statutory Fee Revenue Adjustments for Inflation

    PDUFA V specifies that the $718,669,000 is to be further adjusted 
for inflation increases for FY 2016 using two separate adjustments--one 
for personnel compensation and benefits (PC&B) and one for non-PC&B 
costs (see section 736(c)(1) of the FD&C Act).
    The component of the inflation adjustment for payroll costs shall 
be 1 plus the average annual percent change in the cost of all PC&B 
paid per full-time equivalent (FTE) position at FDA for the first 3 of 
the preceding 4 FYs, multiplied by the proportion of PC&B costs to 
total FDA costs of process for the review of human drug applications 
for the first 3 of the preceding 4 FYs (see section 736(c)(1)(A) and 
(c)(1)(B) of the FD&C Act).
    Table 1 summarizes that actual cost and FTE data for the specified 
FYs, and provides the percent changes from the previous FYs and the 
average percent changes over the first 3 of the 4 FYs preceding FY 
2016. The 3-year average is 2.2328 percent.

              Table 1--FDA Personnel Compensation and Benefits (PC&B) Each Year and Percent Changes
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             Fiscal year                     2012               2013               2014          3-Year average
----------------------------------------------------------------------------------------------------------------
Total PC&B..........................     $1,824,703,000     $1,927,703,000     $2,054,937,000  .................
Total FTE...........................             13,382             13,974             14,555  .................
PC&B per FTE........................           $136,355           $137,949           $141,184  .................
Percent Change From Previous Year...            3.1843%            1.1690%            2.3451%            2.2328%
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    The statute specifies that this 2.2328 percent should be multiplied 
by the proportion of PC&B costs to total FDA costs of the process for 
the review of human drug applications. Table 2 shows the PC&B and the 
total obligations for the process for the review of human drug 
applications for 3 FYs.

                        Table 2--PC&B as a Percent of Fee Revenues Spent on the Process for the Review of Human Drug Applications
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                     Fiscal year                                2012                     2013                     2014                3-Year average
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Total PC&B..........................................             $592,642,252             $568,206,210             $585,260,720  .......................
Total Costs.........................................           $1,032,419,218             $966,169,007           $1,077,263,695  .......................
PC&B Percent........................................                 57.4033%                 58.8102%                 54.3285%                 56.8473%
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The payroll adjustment is 2.2328 percent from table 1 multiplied by 
56.8473 percent (or 1.2693 percent).
    The statute specifies that the portion of the inflation adjustment 
for non-payroll costs is the average annual percent change that 
occurred in the Consumer Price Index (CPI) for urban consumers 
(Washington-Baltimore, DC-MD-VA-WV; not seasonally adjusted; all items; 
annual index) for the first 3 years of the preceding 4 years of 
available data multiplied by the proportion of all costs other than 
PC&B costs to total costs of the process for the review of human drug 
applications for the first 3 years of the preceding 4 FYs (see section 
736(c)(1)(C) of the FD&C Act). Table 3 provides the summary data for 
the percent changes in the specified CPI for the Washington-Baltimore 
area. The data are published by the Bureau of Labor Statistics and can 
be found on their Web site at http://data.bls.gov/cgi-bin/surveymost?cu 
by checking the box marked ``Washington-Baltimore All Items, November 
1996=100--CUURA311SA0'' and then clicking on the ``Retrieve Data'' 
button.

                                 Table 3--Annual and 3-Year Average Percent Change in CPI for Washington-Baltimore Area
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                        Year                                    2012                     2013                     2014                3-Year average
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Annual CPI..........................................                  150.212                  152.500                  154.847  .......................
Annual Percent Change...............................                  2.2024%                  1.5232%                  1.5390%                  1.7549%
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    To calculate the inflation adjustment for non-payroll costs, we 
multiply the 1.7549 percent by the proportion of all costs other than 
PC&B to total costs of the process for the review of human drug 
applications obligated. Since 56.8473 percent was obligated for PC&B as 
shown in table 2, 43.1527 percent is the portion of costs other than 
PC&B (100 percent minus 56.8473 percent equals 43.1527 percent). The 
non-payroll adjustment is 1.7549 percent times 43.1527 percent, or 
0.7573 percent.
    Next, we add the payroll adjustment (1.2693 percent) to the non-
payroll adjustment (0.7573 percent), for a total inflation adjustment 
of 2.0266 percent (rounded) for FY 2016.
    PDUFA V provides for this inflation adjustment to be compounded 
after FY 2013 (see section 736(c)(1) of the FD&C Act). This factor for 
FY 2016 (2.0266 percent) is compounded by adding 1

[[Page 46030]]

and then multiplying by 1 plus the compound inflation adjustment factor 
for FY 2015 (4.327 percent), as published in the Federal Register of 
August 1, 2014 (79 FR 44807 at 44809), which equals to 1.064414 
(rounded) (1.020266 times 1.04327) for FY 2016. We then multiply the 
base revenue amount for FY 2016 ($718,669,000) by 1.064414, yielding an 
inflation-adjusted amount of $764,961,345.

B. FY 2016 Statutory Fee Revenue Adjustments for Workload

    The statute specifies that after the $718,669,000 has been adjusted 
for inflation, the inflation-adjusted amount shall be further adjusted 
for workload (see section 736(c)(2) of the FD&C Act).
    To calculate the FY 2016 workload adjustment, FDA calculated the 
average number of each of the four types of applications specified in 
the workload adjustment provision: (1) Human drug applications; (2) 
active commercial investigational new drug applications (INDs) 
(applications that have at least one submission during the previous 12 
months); (3) efficacy supplements; and (4) manufacturing supplements 
received over the 3-year period that ended on June 30, 2012 (base 
years), and the average number of each of these types of applications 
over the most recent 3 year period that ended June 30, 2015.
    The calculations are summarized in table 4. The 3-year averages for 
each application category are provided in column 1 (``3-Year Average 
Base Years 2010-2012'') and column 2 (``3-Year Average 2013-2015''). 
Column 3 reflects the percent change in workload from column 1 to 
column 2. Column 4 shows the weighting factor for each type of 
application, estimating how much of the total FDA drug review workload 
was accounted for by each type of application in the table during the 
most recent 3 years. Column 5 is the weighted percent change in each 
category of workload. This was derived by multiplying the weighting 
factor in each line in column 4 by the percent change from the base 
years in column 3. The sum of the values in column 5 is added, 
reflecting an increase in workload of 11.31 percent (rounded) for FY 
2016 when compared to the base years.

                               Table 4--Workload Adjuster Calculation for FY 2016
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                                     Column 1        Column 2        Column 3        Column 4        Column 5
                                 -------------------------------------------------------------------------------
        Application type              3-Year          3-Year      Percent change     Weighting
                                   average base   average  2013-    (column 1 to      factor         Weighted
                                    years 2010-        2015          column 2)       (percent)    percent change
---------------------------------------2012---------------------------------------------------------------------
New Drug Applications/Biologics            124.3           148.3         19.3081            38.9            7.51
 License Applications...........
Active Commercial INDs..........          6830.0          7375.3          7.9839            39.2            3.13
Efficacy Supplements............           136.3           175.0         28.3933             6.0            1.69
Manufacturing Supplements.......          2548.3          2386.7         -6.3415            16.0           -1.01
FY 2016 Workload Adjuster.......  ..............  ..............  ..............  ..............           11.31
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    Table 5 shows the calculation of the revenue amount for FY 2016. 
The $718,669,000 subject to adjustment on Line 1 is multiplied by the 
inflation adjustment factor of 1.064414, resulting in the inflation-
adjusted amount on Line 3, $764,961,345. That amount is then multiplied 
by one plus the workload adjustment of 11.31 percent, resulting in the 
inflation and workload adjusted amount of $851,481,000 on Line 5, 
rounded to the nearest thousand dollars.

     Table 5--PDUFA Revenue Amount for FY 2016, Summary Calculation
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------------------------------------------------------------------------
FY 2013 Revenue Amount and Base       $718,669,000  Line 1.
 Subsequent FYs as published in
 the Federal Register of August 1,
 2012 (77 FR 45639) (Rounded to
 nearest thousand dollars).
Inflation Adjustment Factor for FY        1.064414  Line 2.
 2016 (1 plus 6.4414 percent).
Inflation Adjusted Amount.........    $764,961,345  Line 3.
Workload Adjustment Factor for FY           1.1131  Line 4.
 2016 (1 plus 11.31 percent).
Inflation and Workload Adjusted       $851,481,000  Line 5.
 Amount (Rounded to nearest
 thousand dollars).
------------------------------------------------------------------------

    PDUFA specifies that one-third of the total fee revenue is to be 
derived from application fees, one-third from establishment fees, and 
one-third from product fees (see section 736(b)(2) of the FD&C Act). 
Accordingly, one-third of the total revenue amount ($851,481,000), or a 
total of $283,827,000, is the amount of fee revenue that will be 
derived from each of these fee categories: Application Fees, 
Establishment Fees, and Product Fees.

III. Application Fee Calculations

A. Application Fee Revenues and Application Fees

    Application fees will be set to generate one-third of the total fee 
revenue amount, or $283,827,000 in FY 2016.

B. Estimate of the Number of Fee-Paying Applications and Setting the 
Application Fees

    For FY 2013 through FY 2017, FDA will estimate the total number of 
fee-paying full application equivalents (FAEs) it expects to receive 
the next FY by averaging the number of fee-paying FAEs received in the 
3 most recently completed FYs. Beginning with FY 2016, prior year FAE 
totals will be updated annually to reflect refunds and waivers 
processed after the close of the FY.
    In estimating the number of fee-paying FAEs, a full application 
requiring clinical data counts as one FAE. An application not requiring 
clinical data counts as one-half of an FAE, as does a supplement 
requiring clinical data. An application that is withdrawn, or refused 
for filing, counts as one-fourth of an FAE if the applicant initially 
paid a full application fee, or one-eighth of an FAE if the applicant 
initially paid one-half of the full application fee amount.
    As table 6 shows, the average number of fee-paying FAEs received 
annually in the most recent 3-year period is 119.545 FAEs. FDA will set 
fees for FY 2016 based on this estimate as the number of

[[Page 46031]]

full application equivalents that will pay fees.

                                     Table 6--Fee-Paying FAE 3-Year Average
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                       FY                              2012            2013            2014       3-Year average
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Fee-Paying FAEs.................................         120.375         109.510         128.750         119.545
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Beginning with FY 2016, prior year FAE totals will be updated annually to reflect refunds and waivers processed
  after the close of the FY.

    The FY 2016 application fee is estimated by dividing the average 
number of full applications that paid fees over the latest 3 years, 
119.545, into the fee revenue amount to be derived from application 
fees in FY 2016, $283,827,000. The result, rounded to the nearest 
hundred dollars, is a fee of $2,374,200 per full application requiring 
clinical data, and $1,187,100 per application not requiring clinical 
data or per supplement requiring clinical data.

IV. Fee Calculations for Establishment and Product Fees

A. Establishment Fees

    At the beginning of FY 2015, the establishment fee was based on an 
estimate that 509 establishments would be subject to and would pay 
fees. By the end of FY 2015, FDA estimates that 516 establishments will 
have been billed for establishment fees, before all decisions on 
requests for waivers or reductions are made. FDA estimates that a total 
of 15 establishment fee waivers or reductions will be made for FY 2015. 
In addition, FDA estimates that another 16 full establishment fees will 
be exempted this year based on the orphan drug exemption in section 
736(k) of the FD&C Act. Subtracting 31 establishments (15 waivers, plus 
the estimated 16 establishments under the orphan exemption) from 516 
leaves a net of 485 fee-paying establishments. FDA will use 485 to 
estimate the FY 2016 establishments paying fees. The fee per 
establishment is determined by dividing the adjusted total fee revenue 
to be derived from establishments ($283,827,000) by the estimated 485 
establishments, for an establishment fee rate for FY 2016 of $585,200 
(rounded to the nearest hundred dollars).

B. Product Fees

    At the beginning of FY 2015, the product fee was based on an 
estimate that 2,434 products would be subject to and would pay product 
fees. By the end of FY 2015, FDA estimates that 2,554 products will 
have been billed for product fees, before all decisions on requests for 
waivers, reductions, or exemptions are made. FDA assumes that there 
will be 39 waivers and reductions granted. In addition, FDA estimates 
that another 35 product fees will be exempted this year based on the 
orphan drug exemption in section 736(k) of the FD&C Act. FDA estimates 
that 2,480 products will qualify for and pay product fees in FY 2015, 
after allowing for an estimated 74 waivers and reductions, including 
the orphan drug products, and will use this number for its FY 2016 
estimate. The FY 2016 product fee rate is determined by dividing the 
adjusted total fee revenue to be derived from product fees 
($283,827,000) by the estimated 2,480 products for a FY 2016 product 
fee of $114,450 (rounded to the nearest ten dollars).

V. Fee Schedule for FY 2016

    The fee rates for FY 2016 are displayed in table 7:

                    Table 7--Fee Schedule for FY 2016
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                                                           Fee rates for
                      Fee category                            FY 2016
------------------------------------------------------------------------
Applications:
    Requiring clinical data.............................      $2,374,200
    Not requiring clinical data.........................       1,187,100
    Supplements requiring clinical data.................       1,187,100
Establishments..........................................         585,200
Products................................................         114,450
------------------------------------------------------------------------

VI. Fee Payment Options and Procedures

A. Application Fees

    The appropriate application fee established in the new fee schedule 
must be paid for any application or supplement subject to fees under 
PDUFA that is received on or after October 1, 2015. 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. Please 
include the user fee identification (ID) number on your check, bank 
draft, or postal money order. Your payment can be mailed to: Food and 
Drug Administration, P.O. Box 979107, St. Louis, MO 63197-9000.
    If checks are to be sent by a courier that requests a street 
address, the courier can deliver the checks to: U.S. Bank, Attention: 
Government Lockbox 979107, 1005 Convention Plaza, St. Louis, MO 63101. 
(Note: This U.S. Bank address is for courier delivery only. Contact the 
U.S. Bank at 314-418-4013 if you have any questions concerning courier 
delivery.)
    Please make sure that the FDA post office box number (P.O. Box 
979107) is written on the check, bank draft, or postal money order.
    Wire transfer payment 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 add it to your 
payment to ensure that your fee is fully paid. The account information 
for wire transfers is as follows: New York Federal Reserve Bank, U.S. 
Department of the Treasury, TREAS NYC, 33 Liberty St., New York, NY 
10045, Acct. No.: 75060099, Routing No.: 021030004, SWIFT: FRNYUS33, 
Beneficiary: FDA, 8455 Colesville Rd., 14th Floor, Silver Spring, MD 
20993-0002.

[[Page 46032]]

    Application fees can also be paid online with an electronic check 
(ACH). FDA has partnered with the U.S. Department of the Treasury to 
use Pay.gov, a Web-based payment application, for online electronic 
payment. The Pay.gov feature is available on the FDA Web site after the 
user fee ID number is generated.
    The tax identification number of FDA is 53-0196965.

B. Establishment and Product Fees

    FDA will issue invoices for establishment and product fees for FY 
2016 under the new fee schedule in August 2015. Payment will be due on 
October 1, 2015. FDA will issue invoices in November 2016 for any 
products and establishments subject to fees for FY 2016 that qualify 
for fee assessments after the August 2015 billing.

    Dated: July 28, 2015.
Leslie Kux,
Associate Commissioner for Policy.
[FR Doc. 2015-18914 Filed 7-31-15; 8:45 am]
BILLING CODE 4164-01-P