[Federal Register Volume 88, Number 144 (Friday, July 28, 2023)]
[Notices]
[Pages 48855-48861]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-15918]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2023-N-2966]


Biosimilar User Fee Rates for Fiscal Year 2024

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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SUMMARY: The Food and Drug Administration (FDA, the Agency, or we) is 
announcing the rates for biosimilar user fees for fiscal year (FY) 
2024. The Federal Food, Drug, and Cosmetic Act (FD&C Act), as amended 
by the Biosimilar User Fee Amendments of 2022 (BsUFA III), authorizes 
FDA to assess and collect user fees for certain activities in 
connection with biosimilar biological product development; review of 
certain applications for approval of biosimilar biological products; 
and each biosimilar biological product approved in a biosimilar 
biological product application. BsUFA III directs FDA to establish, 
before the beginning of each fiscal year, the amount of initial and 
annual biosimilar biological product development (BPD) fees, the 
reactivation fee, and the biosimilar biological product application and 
program fees for such year. These fees apply to the period from October 
1, 2023, through September 30, 2024.

FOR FURTHER INFORMATION CONTACT: Olufunmilayo (Funmi) Ariyo, Office of 
Financial Management, Food and Drug Administration, 4041 Powder Mill 
Rd., 6th Floor, Beltsville, MD 20705-4304, 240-402-4989, and the User 
Fees Support Staff at [email protected].

SUPPLEMENTARY INFORMATION: 

I. Background

    Sections 744G, 744H, and 744I of the FD&C Act (21 U.S.C. 379j-51, 
379j-52, and 379j-53), as amended by BsUFA III, authorize the 
collection of fees for biosimilar biological products. Under section 
744H(a)(1)(A) of the FD&C Act, the initial BPD fee for a product is due 
when the sponsor submits an investigational new drug (IND) application 
that FDA determines is intended to support a biosimilar biological 
product application or within 7 calendar days after FDA grants the 
first BPD meeting, whichever occurs first. A sponsor who has paid the 
initial BPD fee is considered to be participating in FDA's BPD program 
for that product.
    Under section 744H(a)(1)(B) of the FD&C Act, once a sponsor has 
paid the initial BPD fee for a product, the annual BPD fee is assessed 
beginning with the next fiscal year. The annual BPD fee is assessed for 
the product each fiscal year until the sponsor submits a marketing 
application for the product that is accepted for filing, the sponsor 
discontinues participation in FDA's BPD program for the product, or the 
sponsor has been administratively removed from the BPD program for the 
product.
    Under section 744H(a)(1)(D) of the FD&C Act, if a sponsor has 
discontinued participation in FDA's BPD program or has been 
administratively removed from the BPD program for a product and wants 
to reengage with FDA on development of the product, the sponsor must 
pay all annual BPD fees previously assessed for such product and still 
owed, and a reactivation fee to resume participation in the program. 
The sponsor must pay the reactivation fee by the earlier of the 
following dates: (1) no later than 7 calendar days after FDA grants the 
sponsor's request for a BPD meeting for that product or (2) upon the 
date of submission by the sponsor of an IND describing an investigation 
that FDA determines is intended to support a biosimilar biological 
product application for that product. The sponsor will be assessed an 
annual BPD

[[Page 48856]]

fee beginning in the next fiscal year after payment of the reactivation 
fee.
    BsUFA III also authorizes fees for certain biosimilar biological 
product applications and for each biosimilar biological product 
identified in an approved biosimilar biological product application 
(section 744H(a)(2) and (3) of the FD&C Act). Under certain conditions, 
FDA will grant a small business a waiver of the biosimilar biological 
product application fee (section 744H(d)(1) of the FD&C Act).
    For FY 2023 through FY 2027, the base revenue amounts for the total 
revenues from all BsUFA fees are established by BsUFA III. For FY 2024, 
the base revenue amount is the FY 2023 total revenue amount excluding 
any operating reserve adjustment, which equates to the amount of 
$48,700,243. The FY 2024 base revenue amount is to be adjusted by the 
inflation adjustment, strategic hiring and retention adjustment, 
capacity planning adjustment (CPA), operating reserve adjustment, and 
the additional dollar amount. Each of these adjustments will be 
discussed in the sections below.
    This document provides fee rates for FY 2024 for the initial and 
annual BPD fee ($10,000), for the reactivation fee ($20,000), for an 
application requiring clinical data ($1,018,753) for an application not 
requiring clinical data ($509,377) and for the program fee ($177,397). 
These fees are effective on October 1, 2023, and will remain in effect 
through September 30, 2024. For applications that are submitted on or 
after October 1, 2023, the new fee schedule must be used.

II. Fee Revenue Amount for FY 2024

    The base revenue amount for FY 2024 is $48,700,243 prior to 
adjustments for inflation, strategic hiring and retention, capacity 
planning, operating reserves, and the additional dollar amount (see 
section 744H(b) and (c) of the FD&C Act).

A. FY 2024 Statutory Fee Revenue Adjustments for Inflation

    BsUFA III specifies that the $48,700,243 is to be adjusted for 
inflation increases for FY 2024 using two separate adjustments: one for 
personnel compensation and benefits (PC&B) and one for non-PC&B costs 
(see section 744H(c)(1) of the FD&C Act).
    The component of the inflation adjustment for payroll costs shall 
be the average annual percent change in the cost of all PC&B paid per 
full-time equivalent (FTE) positions at FDA for the first 3 of the 
preceding 4 fiscal years, multiplied by the proportion of PC&B costs to 
total FDA costs of the process for the review of biosimilar biological 
product applications for the first 3 of the preceding 4 fiscal years 
(see section 744H(c)(1)(B) of the FD&C Act).
    Table 1 summarizes the actual cost and FTE data for the specified 
fiscal years and provides the percent changes from the previous fiscal 
years and the average percent changes over the first 3 of the 4 fiscal 
years preceding FY 2024. The 3-year average is 3.9280 percent.
[GRAPHIC] [TIFF OMITTED] TN28JY23.038

    The statute specifies that this 3.9280 percent be multiplied by the 
proportion of PC&B costs to the total FDA costs of the process for the 
review of biosimilar biological product applications. Table 2 shows the 
PC&B and the total obligations for the process for the review of 
biosimilar biological product applications for the first 3 of the 
preceding 4 fiscal years.
[GRAPHIC] [TIFF OMITTED] TN28JY23.039

    The payroll adjustment is 3.9280 percent from table 1 multiplied by 
49.9405 percent (or 1.9617 percent).
    The statute specifies that the portion of the inflation adjustment 
for nonpayroll costs is the average annual percent change that occurred 
in the Consumer Price Index (CPI) for urban consumers (Washington-
Arlington-Alexandria, DC-VA-MD-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 biosimilar 
biological product applications for the first 3 years of the preceding 
4 fiscal years (see section 744H(c)(1)(B) of the FD&C Act). Table 3 
provides the summary data for the percent changes in the specified CPI 
for the Washington-Arlington-Alexandria area.\1\
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    \1\ The data are published by the Bureau of Labor Statistics and 
can be found on its website at: https://data.bls.gov/pdq/SurveyOutputServlet?data_tool=dropmap&series_id=CUURS35ASA0,CUUSS35ASA0.

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[[Page 48857]]

[GRAPHIC] [TIFF OMITTED] TN28JY23.040

    The statute specifies that this 3.8256 percent be multiplied by the 
proportion of all costs other than PC&B to total costs of the process 
for the review of biosimilar biological product applications obligated. 
Since 49.9405 percent was obligated for PC&B (as shown in table 2), 
50.0595 percent is the portion of costs other than PC&B (100 percent 
minus 49.9405 percent equals 50.0595 percent). The non-payroll 
adjustment is 3.8256 percent times 50.0595 percent, 1.9151 percent.
    Next, we add the payroll adjustment (1.9617 percent) to the 
nonpayroll adjustment (1.9151 percent), for a total inflation 
adjustment of 3.8768 percent (rounded) for FY 2024.
    We then multiply the base revenue amount for FY 2024 ($48,700,243) 
by the inflation adjustment percentage (3.8768 percent), yielding an 
inflation adjustment of $1,888,011. Adding this amount yields an 
inflation-adjusted amount of $50,588,254.

B. Strategic Hiring and Retention Adjustment

    The statute specifies that for each fiscal year, after the annual 
base revenue is adjusted for inflation, FDA shall further increase the 
fee revenue and fees by the strategic hiring and retention adjustment, 
which is $150,000 for FY 2024 (see section 744H(c)(2) of the FD&C Act).

C. FY 2024 Statutory Fee Revenue Adjustments for Capacity Planning

    The statute specifies that the fee revenue and fees shall be 
further adjusted to reflect changes in the resource capacity needs for 
the process for the review of biosimilar biological product 
applications (see section 744H(c)(3) of the FD&C Act). Following a 
process required in statute, FDA established the capacity planning 
adjustment methodology and first applied it in the setting of FY 2021 
fees. The establishment of this methodology is described in the Federal 
Register at 85 FR 47220. This methodology includes a continuous, 
iterative improvement approach, under which the Agency intends to 
refine its data and estimates for the core review activities to improve 
their accuracy over time.
    In FY 2023, updates were made to refine the time reporting 
categories included within the CPA to reflect program changes in the 
current authorization period. As such, time reporting data and baseline 
capacity were revised to match the refinements. For FY 2024, additional 
updates were made including to account for additional activities that 
are also directly related to the direct review of biosimilar biological 
product applications and supplements as provided for in the statute. 
These updates include additional formal meeting types and the direct 
review of postmarketing commitments (PMC) and requirements (PMR) (see 
table 4), the direct review of risk evaluation and mitigation 
strategies (REMS), and the direct review of annual reports for approved 
biosimilar biological products. These updates necessitated an 
additional re-baselining of capacity.
    The CPA methodology consists of four steps:
    1. Forecast workload volumes: predictive models estimate the volume 
of workload for the upcoming fiscal year.
    2. Forecast the resource needs: forecast algorithms are generated 
utilizing time reporting data. These algorithms estimate the required 
demand in FTEs \2\ for direct review-related effort. This is then 
compared to current available resources for the direct review-related 
workload.
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    \2\ Full-time equivalents refer to a paid staff year, rather 
than a count of individual employees.
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    3. Assess the resource forecast in the context of additional 
internal factors: program leadership examines operational, financial, 
and resourcing data to assess whether FDA will be able to utilize 
additional funds during the fiscal year and those funds are required to 
support additional review capacity. FTE amounts are adjusted, if 
needed.
    4. Convert the FTE Need to Dollars: utilizing FDA's fully loaded 
FTE cost model, the final feasible FTEs are converted to an equivalent 
dollar amount.
    The following section outlines the major components of the FY 2024 
BsUFA III CPA. Table 4 summarizes the forecasted workload volumes for 
BsUFA III in FY 2024 based on predictive models, as well as historical 
actuals from FY 2022 for comparison.

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[GRAPHIC] [TIFF OMITTED] TN28JY23.041

    Utilizing the resource forecast algorithms, the forecasted workload 
volumes for FY 2024 were then converted into estimated FTE needs for 
FDA's BsUFA III direct review-related work. The resulting expected FY 
2024 FTE need for BsUFA III was compared to current onboard capacity 
for BsUFA III direct review-related work to determine the FY 2024 
resource delta, as summarized in table 5.
[GRAPHIC] [TIFF OMITTED] TN28JY23.042

    The projected nine FTE delta was then assessed by FDA in the 
context of additional operational and internal factors to ensure that a 
fee adjustment is only made for resources that can be utilized in the 
fiscal year and for which funds are required to support additional 
review capacity. FDA determined that realistic expected net FTE gains 
could be funded through the expected FY 2024 collections amount without 
further adjustment from the CPA. As such, FDA determined that in FY 
2024 the BsUFA fee amounts do not need adjustment from the CPA to 
provide funds for the realistic estimated net FTE gains.
[GRAPHIC] [TIFF OMITTED] TN28JY23.043

    Although an adjustment to the fee amounts for resource needs by the 
CPA will not be made in FY 2024, FDA will evaluate the need for a fee 
adjustment from the CPA in future fiscal years and will make 
adjustments as warranted.

D. FY 2024 Additional Dollar Amount

    For FY 2023 and FY 2024, BsUFA III provides an additional dollar 
amount for additional FTE for the biosimilar biological product review 
program to support enhancements outlined in the BsUFA III Commitment 
Letter. For FY 2024, the statute directs FDA to further increase the 
fee revenue and fees by the additional dollar amount, which is $320,569 
for FY 2024 (see section 744H(b)(1)(G) of the FD&C Act).

[[Page 48859]]

[GRAPHIC] [TIFF OMITTED] TN28JY23.044

E. FY 2024 Statutory Fee Revenue Adjustments for Operating Reserve

    BsUFA III sets forth an operating reserve adjustment to the fee 
revenue and fees. Specifically, for FY 2024, the statute directs FDA: 
(1) to increase the fee revenue and fees if such an adjustment is 
necessary to provide for at least 10 weeks of operating reserves of 
carryover user fees for the process for the review of biosimilar 
biological product applications and (2) if FDA has carryover balances 
for such process in excess of 27 weeks of such operating reserves, to 
decrease such fee revenue and fees to provide for not more than 27 
weeks of such operating reserves (see section 744H(c)(4) of the FD&C 
Act).
    To calculate the 10-week and 27-week threshold amounts for the FY 
2024 operating reserve adjustment, the estimated adjusted revenue 
amount (i.e., the base revenue amount and adjustments prior to the 
operating reserve adjustment), $51,058,823 is divided by 52, resulting 
in a $981,900 cost of operation for 1 week (rounded to the nearest 
dollar). The 1-week value (981,900) is then multiplied by 10 weeks to 
generate the 10-week operating reserve threshold amount for FY 2024 of 
$9,819,004. The 1-week value is multiplied by 27 to generate the 27-
week operating reserve threshold amount for FY 2024 of $26,511,312.
    To calculate the estimated operating reserve of carryover user fees 
at the end of FY 2023, FDA estimated the operating reserves of 
carryover fees at the end of June 2023. The balance of operating 
reserves of carryover fees at the end of June 2023 is combined with the 
forecasted collections and obligations for the remainder of FY 2023 to 
generate a full year estimate for FY 2023. The estimated operating 
reserve of carryover user fees at the end of FY 2023 is $46,551,292.
    The estimated operating reserve of carryover user fees at the end 
of FY 2023 of $46,551,292 is above the 27-week threshold allowable 
operating reserve of carryover user fees for FY 2024 of $26,511,312. As 
such, FDA is applying a downward operating reserve adjustment of 
$20,039,980 (rounded to the nearest dollar), an amount equivalent to a 
reduction of approximately 20 weeks of operations, to bring the 
operating reserve of carryover user fees to $26,511,312 or 27 weeks of 
operations at the start of FY 2024. With this operating reserve 
adjustment, the estimated adjusted revenue amount of $51,058,823 will 
be lowered by $20,039,980, yielding the FY 2024 target revenue amount 
of $31,019,000 (rounded to the nearest thousand), summarized below.
[GRAPHIC] [TIFF OMITTED] TN28JY23.045

III. Fee Amounts for FY 2024

    Under section 744H(b)(2)(A) of the FD&C Act, FDA must determine the 
percentage of the total revenue amount for a fiscal year to be derived 
from: (1) initial and annual BPD fees, and reactivation fees; (2) 
biosimilar biological product application fees; and (3) biosimilar 
biological product program fees. As described above, a downward 
operating reserve adjustment is required for FY 2024. The operating 
reserve adjustment in subsequent years may not be as large. As such, 
the target revenue in FY 2024 may be lower than in prior or future 
years, and thereby the fee amounts may also be lower than in prior or 
future years.

A. Application Fees

    In establishing the biosimilar biological product application fee 
amount for FY 2024, FDA assessed multiple modeling options. The model 
performing the best when tested against historical data forecasts 14 
biosimilar biological product applications requiring clinical data 
submitted for approval in FY 2024 and 0 applications that do not 
require clinical data. Given recent years' data regarding biosimilar 
biological product applications that are refused to file and 
withdrawals before filing, the 14 submissions will be assumed to equate 
to 13.25 full application equivalents.
    For FY 2024 the biosimilar biological product application fee for 
applications requiring clinical data is $1,018,753. Applications not 
requiring clinical data pay half that fee, or $509,377. This is 
estimated to provide a total of $13,498,477 representing 44 percent 
(rounded to the nearest whole number) of the FY 2024 target revenue 
amount.

B. Biosimilar Biological Product Program Fee

    Under BsUFA III, FDA assesses biosimilar biological product program 
fees (``program fees''). An applicant in a biosimilar biological 
product application shall not be assessed more than five program fees 
for a fiscal year for biosimilar biological products identified in a 
single biosimilar biological product application (see

[[Page 48860]]

section 744H(a)(3)(D) of the FD&C Act). Applicants are assessed a 
program fee for a fiscal year for biosimilar biological products that 
are identified in a biosimilar biological product application approved 
as of October 1 of such fiscal year; that may be dispensed only under 
prescription pursuant to section 503(b) of the FD&C Act (21 U.S.C. 
353(b)); and that, as of October 1 of such fiscal year, do not appear 
on a list developed and maintained by FDA of discontinued biosimilar 
biological products. An approved biosimilar biological product that 
appears on the list of discontinued biosimilar biological products as 
of October 1 of a fiscal year would also be assessed the program fee if 
it is removed from the discontinued list during the fiscal year and the 
other statutory criteria for fee assessment are satisfied (see section 
744H(a)(3)(E)(iii) of the FD&C Act).
    Based on available information, FDA estimates that 92 program fees 
will be invoiced for FY 2024. For products invoiced in the FY 2024 
regular billing cycle, FDA anticipates that zero program fees will be 
refunded.
    For FY 2024, the biosimilar biological product program fee is 
$177,397. This is estimated to provide a total of $16,320,524, 
representing 53 percent (rounded to the nearest whole number) of the FY 
2024 target revenue amount.

C. Initial and Annual BPD Fees, and Reactivation Fees

    To estimate the number of BPD fees to be paid in FY 2024, FDA must 
consider the number of new BPD programs, the number of current BPD 
programs, and the number of BPD programs that will be reactivated. 
These estimates provide information that, when aggregated, allows FDA 
to set BPD fees (initial BPD fees, annual BPD fees, reactivation fees).
    FDA analyzed available data to estimate the total number of BPD 
programs for FY 2024. In FY 2024, FDA estimates approximately 23 new 
BPD programs, no reactivations (a single reactivation is weighted as 
two BPD fees), and approximately 97 BPD programs to pay the annual BPD 
fee, yielding a rounded total estimated equivalent of 120 BPD fees to 
be collected in FY 2024. The remainder of the target revenue of 
$1,199,999 or 4 percent is to be collected from the BPD fees. Dividing 
this amount by the estimated 120 BPD fees to be paid equals an initial 
BPD and annual BPD fee amount of $10,000 (rounded to the nearest 
dollar). The reactivation fee is set at twice the initial/annual BPD 
amount at $20,000 (rounded to the nearest dollar).

IV. Fee Schedule for FY 2024

    The fee rates for FY 2024 are displayed in table 9.
    [GRAPHIC] [TIFF OMITTED] TN28JY23.046
    
V. Fee Payment Options and Procedures

A. Initial BPD, Reactivation, and Application Fees

    The fees established in the new fee schedule apply to FY 2024, 
i.e., the period from October 1, 2023, through September 30, 2024. The 
initial BPD fee for a product is due when the sponsor submits an IND 
that FDA determines is intended to support a biosimilar biological 
product application for the product or within 7 calendar days after FDA 
grants the first BPD meeting for the product, whichever occurs first. 
Sponsors who have discontinued participation in the BPD program for a 
product or have been administratively removed from the BPD program for 
a product, and seek to resume participation in the BPD program for the 
product must pay all annual BPD fees previously assessed for such 
product and still owed and the reactivation fee by the earlier of the 
following dates: no later than 7 calendar days after FDA grants the 
sponsor's request for a BPD meeting for that product, or upon the date 
of submission by the sponsor of an IND describing an investigation that 
FDA determines is intended to support a biosimilar biological product 
application for that product.
    The application fee for a biosimilar biological product is due upon 
submission of the application (see section 744H(a)(2)(C) of the FD&C 
Act).
    To make a payment of the initial BPD, reactivation, or application 
fee, complete the Biosimilar User Fee Cover Sheet, available on FDA's 
website (https://www.fda.gov/bsufa) and generate a user fee 
identification (ID) number. Payment must be made in U.S. currency by 
electronic check, check, bank draft, U.S. postal money order, or wire 
transfer. The preferred payment method is online using electronic check 
(Automated Clearing House (ACH) also known as eCheck) or credit card 
(Discover, VISA, MasterCard, American Express). FDA has partnered with 
the U.S. Department of the Treasury to use www.pay.gov, a web-based 
payment application, for online electronic payment. The www.pay.gov 
feature is available on the FDA website after the user fee ID number is 
generated. Secure electronic payments can be submitted using the User 
Fees Payment Portal at https://userfees.fda.gov/pay (Note: only full 
payments are accepted. No partial

[[Page 48861]]

payments can be made online.) Once you search for your invoice, click 
``Pay Now'' to be redirected to www.pay.gov. Electronic payment options 
are based on the balance due. Payment by credit card is available for 
balances that are less than $25,000. If the balance exceeds this 
amount, only the ACH option is available. Payments must be made using 
U.S. bank accounts as well as U.S. credit cards.
    If a check, bank draft, or postal money order is submitted, make it 
payable to the order of the Food and Drug Administration and include 
the user fee ID number to ensure that the payment is applied to the 
correct fee(s). Payments can be mailed to: Food and Drug 
Administration, P.O. Box 979108, St. Louis, MO 63197-9000. If a check, 
bank draft, or money order is to be sent by a courier that requests a 
street address, the courier should deliver your payment to U.S. Bank, 
Attention: Government Lockbox 979108, 1005 Convention Plaza, St. Louis, 
MO 63101. (Note: this U.S. Bank address is for courier delivery only. 
If you have any questions concerning courier delivery, contact U.S. 
Bank at 314-418-4013. This telephone number is only for questions about 
courier delivery). Please make sure that the FDA post office box number 
(P.O. Box 979108) and ID number is written on the check, bank draft, or 
postal money order.
    For payments made by wire transfer, include the unique user fee ID 
number to ensure that the payment is applied to the correct fee(s). 
Without the unique user fee ID number, the payment may not be applied. 
The originating financial institution may charge a wire transfer fee. 
Include applicable wire transfer fees with payment to ensure fees are 
fully paid. Questions about wire transfer fees should be addressed to 
the financial institution. The following account information should be 
used to send payments by wire transfer: U.S. Department of the 
Treasury, TREAS NYC, 33 Liberty St., New York, NY 10045, Acct. No: 
75060099, Routing No: 021030004, SWIFT: FRNYUS33. FDA's tax 
identification number is 53-0196965.

B. Annual BPD and Program Fees

    FDA will issue invoices with payment instructions for FY 2024 
annual BPD and program fees under the new fee schedule in August 2023. 
Under section 744H(a)(1)(B)(ii) and (a)(3)(B) of the FD&C Act, annual 
BPD and program fees will be due on October 2, 2023.
    If sponsors join the BPD program after the annual BPD invoices have 
been issued in August 2023, FDA will issue invoices in December 2023 to 
sponsors subject to fees for FY 2024 that qualify for the annual BPD 
fee after the August 2023 billing. FDA will issue invoices in December 
2024 for any products that qualify for the annual program fee after the 
August 2023 billing.

C. Waivers and Refunds

    To qualify for consideration for a small business waiver under 
section 744H(d) of the FD&C Act, or the return of any fee paid under 
section 744H of the FD&C Act, including if the fee is claimed to have 
been paid in error, a person shall submit to FDA a written request 
justifying such waiver or return and, except as otherwise specified in 
section 744H of the FD&C Act, such written request shall be submitted 
to FDA not later than 180 days after such fee is due. Such written 
request shall include any legal authorities under which the request is 
made. See section 744H(h) of the FD&C Act.

    Dated: July 24, 2023.
Lauren K. Roth,
Associate Commissioner for Policy.
[FR Doc. 2023-15918 Filed 7-27-23; 8:45 am]
BILLING CODE 4164-01-P