
[Federal Register Volume 77, Number 148 (Wednesday, August 1, 2012)]
[Notices]
[Pages 45639-45643]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-18711]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2012-N-0007]


Prescription Drug User Fee Rates for Fiscal Year 2013

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) 2013. The Federal 
Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the 
Prescription Drug User Fee Amendments of 2012 (Title 1 of the Food and 
Drug Administration Safety and Innovation Act (FDASIA), Public Law 112-
144, which was signed by the President on July 9, 2012) (PDUFA V)), 
authorizes FDA to collect user fees for certain applications for 
approval of drug and biological products, on establishments where the 
products are made, and on such products. Base revenue amounts to be 
generated from PDUFA fees were established by PDUFA V, with provisions 
for certain adjustments. Fee revenue amounts for applications, 
establishments, and products are to be established each year by FDA so 
that one-third of the PDUFA fee revenues FDA collects each year will be 
generated from each of these categories. This document establishes fee 
rates for FY 2013 for application fees for an application requiring 
clinical data ($1,958,800), for an application not requiring clinical 
data or a supplement requiring clinical data ($979,400), for 
establishment fees ($526,500), and for product fees ($98,380). These 
fees are effective on October 1, 2012, and will remain in effect 
through September 30, 2013. For applications and supplements that are 
submitted on or after October 1, 2012, the new fee schedule must be 
used. Invoices for establishment and product fees for FY 2013 will be 
issued

[[Page 45640]]

in August 2012 using the new fee schedule.

FOR FURTHER INFORMATION CONTACT: David Miller, Office of Financial 
Management (HFA-100), Food and Drug Administration, 1350 Piccard Dr., 
PI50, rm. 210J, Rockville, MD 20850, 301-796-7103.

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 approval of 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 is to be adjusted for inflation and 
workload, and that adjusted FY 2013 amount becomes the base amount for 
the remaining 4 FYs of PDUFA V. That 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.

II. Fee Revenue Amount for FY 2013

    The statutory fee revenue amount for FY 2013 is $693,099,000, prior 
to adjustment for inflation and workload (see section 736(b)(1) of the 
FD&C Act). Of this amount, $652,709,000 will be further adjusted for 
inflation and workload, and $40,390,000, for new initiatives, will not 
be adjusted in FY 2013.

A. FY 2013 Statutory Fee Revenue Adjustments for Inflation

    PDUFA V specifies that $652,709,000 of the amount for FY 2013 is to 
be further adjusted for inflation increases for FY 2013 using 2 
separate adjustments--one for payroll costs and one for non-pay costs 
(see section 736(b)(3)(A) of the FD&C Act).
    The component of the inflation adjustment for payroll costs shall 
be one plus the average annual percent change in the cost of all 
personnel compensation and benefits (PC&B) paid per full-time 
equivalent position (FTE) at FDA for the first 3 of the 4 preceding 
fiscal years multiplied by the proportion of PC&B costs to total FDA 
costs of the review of human drug applications for the first 3 of the 
preceding 4 FYs (see section 736(c)(1)(B) of the FD&C Act). The data on 
total PC&B paid and numbers of FTE paid, from which the average cost 
per FTE can be derived, are published in FDA's Justification of 
Estimates for Appropriations Committees.
    Table 1 of this document summarizes that actual cost and FTE data 
for the specified fiscal years, and provides the percent change from 
the previous fiscal year and the average percent change over the first 
3 of the 4 FYs preceding FY 2013. The 3 year average is 2.17 percent.

              Table 1--FDA Personnel Compensation and Benefits (PC&B) Each Year and Percent Change
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             Fiscal year                     2009               2010               2011          3-Year average
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Total PC&B..........................     $1,464,445,000     $1,634,108,000     $1,761,655,000  .................
Total FTE...........................             11,413             12,526             13,331  .................
PC&B per FTE........................           $128,314           $130,457           $132,143  .................
Percent Change from Previous Year...              3.56%              1.67%              1.29%              2.17%
----------------------------------------------------------------------------------------------------------------

    The statute says that this 2.17 percent should be multiplied by the 
proportion of PC&B for the review of human drug applications. Table 2 
of this document shows the amount of PC&B and the total amount 
obligated for the process for the review of human drug applications for 
the same 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                     2009               2010               2011          3-Year average
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Total PC&B..........................       $514,874,163       $573,603,582       $596,627,595  .................
Total Costs.........................        855,426,294        931,845,581      1,025,621,707  .................
PC&B percent........................                60%                62%                58%                60%
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    The payroll adjustment is 2.17 percent multiplied by 60 percent (or 
1.30 percent).
    The statute specifies that the portion of the inflation adjustment 
for non-payroll costs for FY 2013 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 of the preceding 4 years of available 
data multiplied by the proportion of all costs of the process for the 
review of human drug applications other than PC&B (see section 
736(c)(1)(C) of the FD&C Act). Table 3 of this document provides the 
summary data for the percent change in the specified CPI for the 
Baltimore-Washington area. The data is 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 - CUURA311SAO'' and then clicking on the 
retrieve data button.

[[Page 45641]]



               Table 3--Annual and 3-Year Average Percent Change in Baltimore-Washington Area CPI
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                Year                         2009               2010               2011          3-Year average
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Annual CPI..........................            140.718            142.915            146.975  .................
Annual Percent Change...............              0.23%              1.72%              3.34%              1.76%
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    To complete the inflation adjustment for non-pay costs, we multiply 
the 1.76 percent by the proportion of costs of the process for the 
review of human drug applications obligated for costs other than PC&B. 
Since 60 percent was obligated for PC&B as shown in table 2 of this 
document, 40 percent is the portion of costs other than PC&B (100 
percent minus 60 percent equals 40 percent). The non-payroll adjustment 
is 2.5 percent times 40 percent, or 0.71 percent.
    To complete the inflation adjustment, we add the payroll component 
(1.30 percent) to the non-pay component (0.71 percent), for a total 
inflation adjustment of 2.01 percent (rounded), and then add one, 
making 1.0201. We then multiply the amount specified in the statute 
($652,709,000) by 1.0201 percent, yielding an inflation adjusted amount 
of $665,828,451.

B. FY 2013 Statutory Fee Revenue Adjustments for Workload

    PDUFA V specifies that after the $652,709,000 has been adjusted for 
inflation, the inflation adjusted amount ($665,828,451) shall be 
further adjusted for workload (see section 736(b)(3)(B) of the FD&C 
Act). For FY 2013 the workload adjustment will be the percentage by 
which the workload adjustment for FY 2013 exceeds the workload adjuster 
for FY 2012, if both such adjustments were calculated using the 5 year 
base period consisting of FYs 2003 through 2007. As published in the 
Federal Register of August 1, 2011 (76 FR 45831), the FY 2012 workload 
calculated as directed was 8.12 percent.
    To calculate the FY 2013 adjustment factor, 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 5-year period that ended on June 30, 2007 (base 
years), and the average number of each of these types of applications 
over the most recent 5-year period that ended June 30, 2012.
    The calculations are summarized in table 4 of this document. The 5-
year averages for each application category are provided in column 1 
(``5-Year Average Base Years 2003-2007'') and column 2a (``5-Year 
Average 2008-2012'').
    PDUFA specifies that FDA make additional adjustments for changes in 
review activities to human drug applications and active commercial 
INDs. These adjustments, started under PDUFA IV, are summarized in 
columns 2b and 2c in table 4 of this document. The number in the new 
drug applications/biologics license applications (NDAs/BLAs) line of 
column 2b of table 4 of this document is the percent by which the 
average workload for meetings, annual reports, and labeling supplements 
for NDAs and BLAs has changed from the 5-year period 2003 through 2007, 
to the 5-year period 2008 through 2012. Likewise, the number in the 
``Active commercial INDs'' line of column 2b of table 4 of this 
document is the percent by which the workload for meetings and special 
protocol assessments for active commercial INDs has changed from the 5-
year period 2003 through 2007, to the 5-year period 2008 through 2012. 
There is no entry in the last two lines of column 2b because the 
adjustment for changes in review workload does not apply to the 
workload for efficacy supplements and manufacturing supplements.
    Column 3 of table 4 of this document reflects the percent change in 
workload from column 1 to column 2c. Column 4 of table 4 of this 
document 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 5 
years. Column 5 of table 4 of this document 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. At the bottom right of table 4 of this 
document is the sum of the values in column 5 that are added, 
reflecting an increase in workload of 9.99 percent for FY 2013 when 
compared to the base years.

                                                   Table 4--Workload Adjuster Calculations for FY 2013
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                                                                 Column 1    Column 2a    Column 2b    Column 2c     Column 3     Column 4     Column 5
                                                              ------------------------------------------------------------------------------------------
                                                                                                                     Percent
                       Application type                           5-Year       5-Year     Adjustment   Column 2a      change                   Weighted
                                                                 Average      Average    for changes   increased    (column 1    Weighting     percent
                                                                base years   2008-2012    in review    by column    to column      factor       change
                                                                2003-2007                  activity        2b          2c)
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NDAs/BLAs....................................................        123.8        134.4        0.08%        134.5         8.6%        39.6%        3.42%
Active commercial INDs.......................................      5,528.2       6724.2       -3.13%       6513.7        17.8%        40.3%        7.18%
Efficacy supplements.........................................        163.4        153.8           NA        153.8        -5.9%         9.5%       -0.56%
Manufacturing Supplements....................................       2589.2       2575.4           NA       2575.4        -0.5%        10.6%       -0.06%
                                                              ------------------------------------------------------------------------------------------
FY 2013 Workload Adjuster....................................  ...........  ...........  ...........  ...........  ...........  ...........        9.99%
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    Since the calculated workload adjustment for 2013 (9.99 percent) is 
greater than the 8.12 percent that was calculated last year for FY 2012 
the difference between the two, 1.87 percent (9.99 percent minus 8.12 
percent), and that is the amount of the workload adjustment for FY 2013 
(see section 736(b)(3)(B) of the FD&C Act).
    Table 5 of this document shows the calculation of the revenue 
amount for FY 2013. The $652,709,000 subject to adjustment on the first 
line is multiplied by the combined inflation adjustment

[[Page 45642]]

factor of 1.0201, resulting in the inflation adjusted amount on the 
third line. That amount is then multiplied by one plus the workload 
adjustment of 1.87 percent, resulting in the inflation and workload 
adjusted amount of $678,279,443 on the fifth line. Finally the portion 
of the FY 2013 fees not subject to adjustment ($40,390,000) is added, 
resulting in the total FY 2013 fee revenue amount of $718,669,000 on 
the last line of table 5 of this document.

 Table 5--PDUFA Revenue Amount for FY 2013 and Base for Subsequent Years
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Portion of FY 2013 Revenues Subject to Adjustments.....     $652,709,000
Amount of Inflation Adjustment Factor for FY 2013......           1.0201
Inflation Adjusted Amount (1 plus 2.01 percent)........     $665,828,451
Workload Adjustment Factor for FY 2013 (1 plus 1.87               1.0187
 percent)..............................................
Inflation and Workload Adjusted Amount.................     $678,279,443
Portion of 2013 Revenues Not Subject to Adjustment.....      $40,390,000
FY 2013 Revenue Amount and Base for Subsequent Years        $718,669,000
 (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 ($718,669,000), or a 
total of $239,556,333, is the amount of fee revenue that will be 
derived from each of these fee categories: Application Fees, 
Establishment Fees, and Product Fees.
    While the fee revenue amount anticipated in FY 2013 is 
$718,669,000, as the previous paragraph shows, FDA assumes that the fee 
appropriation for FY 2013 will be 5 percent higher, or $754,602,000, 
rounded to the nearest thousand dollars. The latest PDUFA 5-Year 
Financial Plan (which can be found at http://www.fda.gov/ForIndustry/UserFees/PrescriptionDrugUserFee/ucm153456.htm) states in Assumption 14 
(Fee Revenue and Annual Appropriation Amount) that the PDUFA workload 
adjuster is a lagging adjustment dampened by averages over 5 years, and 
will not help FDA keep up with workload if there are sudden increases 
in the number of applications to be reviewed in the current fiscal 
year. Appropriated amounts for PDUFA fee revenue each year are 
estimated at 5 percent higher than estimated fee revenues for each 
year, to provide FDA with the ability to cope with surges in 
application review workload should that occur. If FDA collects less 
than the fee estimate at the beginning of the year and less than the 
fee appropriation, then collections rather than appropriations set the 
upper limit on how much FDA may actually keep and spend. If, however, 
FDA collects more than fee estimates at the beginning of the year, due 
to a workload surge, a slightly higher fee appropriation will permit 
FDA to keep and spend the higher collections in order to respond to a 
real surge in review workload that caused the increased collections--an 
unexpected increase in the number of applications that FDA must review 
in accordance with PDUFA goals. For this reason, in most fiscal years 
since 1993, actual appropriations have slightly exceeded PDUFA fee 
revenue estimates made each year.

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 $239,556,333 in FY 2013, as calculated previously in 
this document.

B. Estimate of the Number of Fee-Paying Applications and the 
Establishment of 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 fiscal year by averaging the number of fee-paying FAEs 
received in the 3 most recently completed fiscal years. This will avoid 
having FDA try to estimate the number it expects to receive in the 
current fiscal year.
    In estimating the number of fee-paying FAEs, full application 
requiring clinical data counts as one FAE. An application not requiring 
clinical data counts as one-half 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 of this document shows, the average number of fee-paying 
FAEs received annually in the most recent 3-year period is 122.3 FAEs. 
FDA will set fees for FY 2013 based on this estimate as the number of 
full application equivalents that will pay fees.

                                     Table 6--Fee-Paying FAE 3-Year Average
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             Fiscal year                     2009               2010               2011          3-Year average
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Fee-Paying FAEs.....................              140.3              118.4             108.25              122.3
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    The FY 2013 application fee is estimated by dividing the average 
number of full applications that paid fees over the latest 3 years, 
122.3, into the fee revenue amount to be derived from application fees 
in FY 2013, $239,556,333. The result, rounded to the nearest $100, is a 
fee of $1,958,800 per full application requiring clinical data, and 
$979,400 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 2012, the establishment fee was based on an 
estimate that 450 establishments would be subject to, and would pay, 
fees. By the end of FY 2012, FDA estimates that 480 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 10 establishment fee waivers or reductions will be made for FY 2012. 
In addition, FDA estimates that another 15 full establishment fees will 
be exempted this year based on the orphan drug exemption in the Food 
and Drug Administration Amendments Act (FDAAA) (see section 736(k) of 
the FD&C Act). Subtracting 25 establishments (10 waivers, plus the 
estimated 15 establishments under the orphan exemption) from 480 leaves 
a net of 455 fee-paying establishments. FDA will use 455 for its FY 
2013 estimate of establishments paying fees,

[[Page 45643]]

after taking waivers and reductions into account. The fee per 
establishment is determined by dividing the adjusted total fee revenue 
to be derived from establishments ($239,556,333) by the estimated 455 
establishments, for an establishment fee rate for FY 2013 of $526,500 
(rounded to the nearest $100).

B. Product Fees

    At the beginning of FY 2012, the product fee was based on an 
estimate that 2,365 products would be subject to and would pay product 
fees. By the end of FY 2012, FDA estimates that 2,525 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 50 waivers and reductions granted. In addition, FDA estimates 
that another 40 product fees will be exempted this year based on the 
orphan drug exemption in FDAAA (see section 736(k) of the FD&C Act). 
FDA estimates that 2,435 products will qualify for product fees in FY 
2012, after allowing for waivers and reductions, including the orphan 
drug products eligible under the FDAAA exemption, and will use this 
number for its FY 2013 estimate. The FY 2013 product fee rate is 
determined by dividing the adjusted total fee revenue to be derived 
from product fees ($239,556,333) by the estimated 2,435 products for a 
FY 2013 product fee of $98,380 (rounded to the nearest $10).

V. Fee Schedule for FY 2013

    The fee rates for FY 2013 are set out in Table 7 of this document:

                    Table 7--Fee Schedule for FY 2013
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                                                           Fee rates for
                      Fee category                            FY 2013
------------------------------------------------------------------------
Applications:
    Requiring clinical data.............................      $1,958,800
    Not requiring clinical data.........................         979,400
    Supplements requiring clinical data.................         979,400
Establishments..........................................         526,500
Products................................................          98,380
------------------------------------------------------------------------

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 after September 30, 2012. 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 
between $15.00 and $35.00. 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. Department of the 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.
    Application fees can also be paid online with an electronic check 
(ACH). FDA has partnered with the U.S. Department of the Treasury to 
utilize 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 the Food and Drug Administration 
is 53-0196965.

B. Establishment and Product Fees

    FDA will issue invoices for establishment and product fees for FY 
2013 under the new fee schedule in August 2012. Payment will be due on 
October 1, 2012. FDA will issue invoices in November 2013 for any 
products and establishments subject to fees for FY 2013 that qualify 
for fee assessments after the August 2012 billing.

    Dated: July 24, 2012.
Leslie Kux,
Assistant Commissioner for Policy.
[FR Doc. 2012-18711 Filed 7-31-12; 8:45 am]
BILLING CODE 4160-01-P


