Legislation put together by a Senate committee stops short of allowing
FDA to impose penalties on the manufacturers of generic drugs if they fail to
warn federal regulators about upcoming shortages.
The version of the bill that funds the regulatory agency’s activities through
user fees was marked up by the Senate Committee on Health Education Labor
and Pensions April 25.
The Prescription Drug User Fee Act needs to be reauthorized by Sept. 30
if FDA is to continue receiving funds from the industry.
For the first time since user fees were enacted two decades ago, the
legislation will require generic drug manufacturers to contribute about $300
million a year toward the agency’s operations.
While some legislative proposals suggested criminal and civil penalties for
generic manufacturers who fail to avert shortages, the generic drug industry
claims that it’s able to self-police, relying in part on IMS Health, a company
that compiles drug sales statistics.
Under a deal with the Generic Pharmaceutical Association, IMS Health will
serve as the Independent Third Party in the generic industry’s initiative designed
to accelerate the recovery of critical drugs in short supply.
In a news analysis that appears on page 1, Rena Conti, a health economist
and assistant professor in the Section of Hematology/Oncology at the University
of Chicago, examines the peculiarity of the role IMS Health would play in the
generic industry’s “accelerated recovery initiative.”
Capitol Hill sources said that the idea of potential penalties, whether criminal
or civil, was a non-starter with Republicans. Democrats had to abandon the idea
of penalties in part because there was no time to waste.
FDA has come to rely on user fees to cover as much as 60 percent of the
cost of drug regulation activities, and as much as 20 percent of its device
regulation activities.
Oncologists, whose ability to treat patients and conduct clinical trials is
affected by drug shortages, said they were disappointed to see penalties stripped
out of the Senate committee’s version of the new legislation.
“We are pleased that the bill requires manufacturers to give the Food and
Drug Administration six-months’ notice of an anticipated shortage of a life-saving
therapy,” said Michael Link, president of the American Society of Clinical Oncology.
“However, fines or some other type of enforcement mechanism are needed to ensure
manufacturers comply with this requirement. ASCO hopes that this change may be
added before final passage.”
Shortages currently affect 19 cancer therapies.
During markup April 25, Sen. Richard Blumenthal (D-Conn.) introduced an
amendment that included penalties, but promptly withdrew it. A draft of the legislation
circulated by Sen. Orrin Hatch (R-Utah) includes penalties for failure to report impending
shortages to FDA, but this proposal is unlikely to survive in future iterations of the
legislation as well.
