President George W Bush’s FY2008 budget proposal includes nearly $2.1 billion for the Food and Drug Administration, up more than 5% over the agency budget submitted to Congress last year. Moreover, the Administration’s request for nearly $444 million in industry fees includes, for the first time, user fees for generic drugs.

The FDA is asking for $5.6 million in budget authority and $15.7 million in fees from the generics sector to be able to conduct more expedited reviews, and faster. “Generic drugs generally cost 20%-70% less than their brand-name counterparts and thus offer an attractive way of reducing healthcare costs associated with prescription drugs,” it says.

However, Kathleen Jaeger, chief executive of the Generic Pharmaceutical Association (GPhA), has warned that the FDA “can hire more reviewers and speed up reviews, but if it doesn't deal with barriers like authorized generics and citizen petitions, affordable generics won't reach consumers any faster.”

1984’s Hatch-Waxman legislation granted 180 days’ exclusivity to generic companies, but brand firms’ practice of launching authorized generics during this period has “cut the legs out from under Congressional intent,” said Ms Jaeger. She welcomed the Fair Prescription Drug Competition Act of 2007, introduced into the Senate by Jay Rockefeller at the end of January, which would block the marketing of “authorized generics” during the 180-day exclusivity period.

Brand companies’ increasing use of citizen petitions is further stifling access to generics, added Ms Jaeger. A Merrill Lynch review had found that the FDA had dismissed 76% of such petitions filed during 2000-5 as having no merit, she said, and urged Congress to pass legislation to address the “abuse” of the petition process.

Finally, she said, “the lack of a clear, efficient abbreviated approval pathway for biogenerics is keeping safe, effective and affordable life-saving medicines from consumers for conditions like cancer and heart disease.”

$11.2M to improve drug safety

Meantime, the FDA is also asking Congress for $11.2 million in FY2008 to improve drug safety “at every stage of the product life cycle, from pre-market testing and development, through post-market surveillance and risk management. With added funds, FDA will increase staff devoted to review of annual safety reports, conduct a pilot program to review the safety profiles of new molecular entities and develop an electronic drug safety tracking system,” it says.

Overall, the President is seeking nearly $700 billion for the Department of Health and Human Services, which is up more than $28 billion over 2007 and includes measures to slow the growth of Medicare spending and make $25.7 billion savings to Medicaid over a five-year period. Other proposals are:

- $15 million for the Agency for Healthcare Research and Quality (AHRQ) to accelerate the movement toward personalized medicine;

- $4.3 billion for bioterrorism spending, up $141 million over FY2007;

- $1.2 billion to continue pandemic flu preparedness efforts to increase vaccine production capacity and stockpiling, buy additional antivirals, develop rapid diagnostic tests and enhance rapid response capabilities; and

- allowing the National Institutes of Health to fund more than 560 new and competing research grants.

Commented FDA Commissioner Andrew von Eschenbach: “As the FDA enters its second century of service, our focus will continue on critical public health initiatives, including ensuring…. the safety and effectiveness of the medicines we take.” Health and Human Services Secretary Mike Leavitt added that the budget proposal “sets out an aggressive, yet responsible, budget that funds our priorities and helps sustain our long-term commitment to seniors and low-income Americans.”

However, Max Baucus, Democrat chairman of the Senate Finance Committee, said the administration appears to blame long-run deficits on spending in just Social Security, Medicare and Medicaid, and to imply that benefits in these programmes need to be cut significantly. “But the budget has the wrong diagnosis” and “proposes the wrong cure,” said Sen Baucus, adding: “The primary cause for long-term deficits is rising costs throughout our healthcare system.” Lynne Taylor