Prescription Drug User Fee Act: Structure and Reauthorization Issues

Publication Date: October 2002

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Manufacturing and industry

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Abstract:

In 1992, Congress passed the Prescription Drug User Fee Act (PDUFA) to spped up the approval of pharmaceuticals in the United States. The legislation created sections 735 and 736 of the Federal Food, Drug and Cosmetic Act (FFDCA), authorizing the Food and Drug Administration (FDA) to collect user fees from drug manufacturers in exchange for the faster review of drug and biological products. The law stipulated that the additional user fee revenues could only be used for activities necessary to review of huyman drug applications. It also specified that the revenues raised under the program had to be “in addition to” baseline monies already dedicated to drug approvals. As Congress decides the agency’s annual appropriation each year, it sets out the total amount of user fee authority, but separate from the law, the FDA, drug and biotech industries settled on specific annual performance goals that were laid out in letters of agreement between the agency and Congress. To meet these goals, FDA hired nearly 600 new reviewers, and upgraded its information system for tracking pending drug applications. Congress authorized first user fee program, referred to as PDUFA I, to run for a period of 5 years.