Funding Cutbacks at FDA: A Sequester Primer

At a time when FDA’s responsibilities continue to grow rapidly, the agency has been caught in an across-the-board reduction (sequester) in federal discretionary spending, effective March 2, 2013. Although Congress may yet reverse course and restore money to affected federal agencies, this is not considered a high probability.

Altogether, FDA will lose about $209 million between now and September 30, 2013. This will reduce inspections, slow drug and device approvals, and restrict implementation of the Food Safety Modernization Act and other recent legislation. Because of the many questions about the process and outcome, this is FDA Matters’ primer on the sequester of FDA funds.

How much of FDA’s FY 13 (current year) money is involved and which funds are cut? 

Sequestration	FY 13 CR (to 3/27/13)	Less sequester	Net amount
Budget appropriations	$2.521 billion	$ 126 million	$2.395 billion
User fees (inc. tobacco & generics UF)	$1.647 billion	$   82  million	$1.565 billion
Totals	$4.168 billion	$ 209 million (rounded)	$3.960 billion (rounded)

Will all programs within FDA be cut by precisely the same amount? Generally, yes.  Unless Congress or OMB change the sequester rules (and they might), each Center and the Commissioner’s office will be cut by about 5.0% to achieve the $209 million reduction. However, fixed items (rent, utilities, etc.) will still cost the agency the same amount, creating an internal deficit. This will require additional cuts (above the 5.0%) from the agency’s program activities.

Beyond the specific dollars, why will the impact be greater on FDA than on most federal agencies?  FDA is a staff-intensive organization. More than 80% of its funding is spent on personnel-related costs. Much of the remainder is fixed costs, rather than grants or contracts that could be cancelled or cut back. Many federal agencies are hoping to meet their sequester obligations without personnel cutbacks. FDA will do its best to follow this model.

FDA has said that no employees will be furloughed as a result of the sequester. How is that consistent with the agency’s staff-intensive nature and the depth of the cuts? To absorb the $209 million without furloughs, most of the savings will have to come from unfilled and/or delayed filling of vacancies—a process that probably started months ago. Many offices are probably already short-staffed and most will become so as we get deeper into the sequester. Hence, the predicted impact of the sequester is slowdowns in food (and other) inspections, drug and device reviews, and implementation of new FDA legislation and its global responsibilities.

In offices where staff reductions are needed as part of the sequester but no vacancies exist, some appropriately qualified employees may be saved through internal transfers into slots that can be paid for by the Generic Drug User Fee program (FDA’s one big growth area this year and for which it will definitely need to be hiring).

How would you characterize FDA’s “story” about the impact of the sequestration?  While $209M is a large cut with severe consequences, it may well be achieved by a thousand little bits and pieces, a vacancy here, a training contract there, a bunch of cancelled plane flights, some underspending early in the year, etc. It doesn’t make for a very dramatic story, which may account for why FDA has been relatively quiet while other departments and agencies have been talking about the severe impact of the sequester cuts.

Conclusion

If food is less safe…if drug and devices reviews go more slowly….if problems with imports increase....and if regulatory science and agency modernization stall….then there is a huge loss to the American people.

This loss is made larger by the knowledge that the agency’s mission is not static.  Congress has passed 6 new laws since 2009 giving FDA substantially more responsibility. Globalization and complex science makes the agency’s job larger and more difficult each year.

FDA staff wasn’t large enough to get the whole job done last year. Problems will  multiply quickly over the coming months as existing employees represent an every smaller proportion of the numbers needed to carry out this year’s and next year’s responsibilities.

Steven

*  For purposes of disclosure: I am one of the founders and serve as Deputy Executive Director of the Alliance for a Stronger FDA, www.strengthenfda.org, a multi-stakeholder group that advocates for increased FDA funding.  For more information on joining, contact me at sgrossman@strengthenfda.org.

Note that my duties with the Alliance are in addition to, and apart from, the work of my policy and regulatory consulting firm, HPS Group, LLC, which is the publisher of FDA Matters.  The views expressed in FDA Matters are my own, and those of HPS Group, and are not necessarily the views or positions of the Alliance.

FDA Post-Election: Continuity and Progress Likely to Mark 2013

Looking back over the last 40 years at FDA (as I have), there are three characteristics that create a more progressive environment at the agency: continuity of leadership, presidential support, and increased funding. For FDA in 2013 (as the saying goes): 2 out of 3 ain’t bad.

In particular, medical innovation seems poised to flourish in an FDA environment where there is continuity of policy and leadership, instead of a new team learning the ropes. I explore this and other themes in the latest issue of Pharmaphorum.com. You can read my thoughts at: http://www.pharmaphorum.com/2013/01/29/fda-post-election-continuity-and-progress-likely-to-mark-2013/.

Steven

“Governing,” Not “Campaigning,” Key to Post-Election FDA

Since last week’s two columns on “FDA After the Election” (here and here or a combined version here), FDA Matters has been treated to some wild speculation about what will happen next. I have been told, in effect, that “if Obama is re-elected, there will be massive new industry regulation” and also that “if Romney is elected, FDA will be transformed into a non-entity that only says ‘yes’ to industry.”

What history tells us is different: whoever wins will have the burden of governing. As a result, massive new regulation is no more likely than FDA becoming a toothless regulatory agency. Winners, it turns out, spend a lot of time explaining why campaign promises haven’t been translated into action.

Of course, everyone is entitled to their own opinion—particularly to imagine their own worst fears.

My advice, however, is to pour a glass of your favorite beverage (alcoholic or not) and watch the election returns with the calm that is appropriate for democratic elections in the United States. Our Founding Fathers intentionally created a system of checks and balances that limits the ability of any one party or any one election to radically re-create government institutions.

FDA is one of those institutions that is changeable (which is actually a good thing), but not likely to be transformed into something dramatically different.

If Obama Wins.  Year 5 of an incumbent President almost always stresses changes in personnel and policies, rather than continuity.  The focus will shift toward new ways of dealing with budget and fiscal matters, jobs and unemployment, and stabilizing our nation’s global position while winding down our involvement in Afghanistan.  Implementing ObamaCare will likewise be a key priority, as major provisions of the law go into effect over the next few years.

While Obama’s focus will follow the campaign promises, the specific actions will probably not. Most likely, he will still be dealing with a hostile House of Representatives and a sharply divided Senate. Events will occur that will also reshape what happens—something unforeseeable like 9/11 or Hurricane Sandy or something foreseeable like a massive fight over the next extension of the federal debt ceiling.

Given this larger picture, what is the probability that FDA will suddenly turn regulation-happy and start a major push to burden industry? I say “none at all.” The entire tenor of Commissioner Hamburg’s tenure—public statements and actions—has been to try to create more science-based decisionmaking, publish more guidances for industry, and to listen to both Congress and industry about FDA’s role in supporting medical innovation.

If there is more regulation in 2013 and 2014, it will be largely to satisfy the legal requirements of new laws passed by Congress on a bi-partisan basis over the last three years. If that winds up feeling excessive to industry, it will certainly not be because of President Obama's philosophy.

If Romney Wins. Year 1 of a new President is inherently one of change—but remembering back to four years ago, one could argue that the predominant motif is uncertainty, not change. If Governor Romney is elected, there will be a continuous stream of speculation. Nobody knows…and those fearing the worst will get the most attention.

A newly-elected President Romney will actually be dealing with the same issues as President Obama would be: budget and fiscal matters, jobs and unemployment, foreign policy and implementing (or failing to implement) ObamaCare.  FDA will be very low on the list of priorities—if it appears at all. (A conclusion also reached by Matthew Herper of Forbes).

What changes should we expect with a Romney victory and when will we know? The answer is nothing too dramatic and it will take months to play itself out.

I have argued that a Romney Administration would do best to find a well-known, well-respected, candidate who could win easy Senate confirmation. Taking me at my word, Ed Silverman in a Pharmalot column has suggested that Romney could nominate a well-respected commissioner to cut back on safety and speed up approvals (i.e. carry out Romney’s campaign promises and please industry). However, Senate confirmation will not be easy for such an individual—regardless of how well respected—unless they commit to fairly specific boundaries for such changes. (If Romney wins, you will be hearing much more about this in future columns).

If you are an American citizen, please take the time to vote.

Steven

FDA After the Election---Part 2: Leadership and Change

Apart from an occasional reference, FDA is not part of the campaign dialogue leading up to the November 6 nationwide U.S. election. Yet, FDA Matters believes that FDA will be strongly impacted by the election’s outcomes.  Part 1 of “FDA After the Election” concentrated on the agency’s budget situation.

Part 2 of “FDA After the Election” focuses on leadership and change--directly and as they may be affected by potentially large budget cuts. There are some predictable elements, but other elements with great impact may depend upon the perspective of those in power for the next two years and beyond.

Drivers of Change, Post-Election.  Whether President Obama is re-elected or Governor Romney becomes President-elect, FDA’s primary responsibilities remain roughly the same: to be the guardian of food, drug and device safety and to provide a reasonable and responsible pathway for pre-market review of drugs and devices. Likewise, no President has the power to alter the main drivers of FDA’s increasing workload: globalization, scientific complexity, growing regulated industries and new legislative and regulatory mandates in food safety, drugs and devices.

Historically, change at FDA is affected by:  

• the interest level of the President (most Presidents aren’t interested in FDA),
• a growing or shrinking agency budget  (budget cutbacks distract, reduce options),
• an acting vs. a confirmed Commissioner (“acting’s” tend to be placeholders),  and
• the political will of Congress (legislation, oversight/investigations, or indifference).

If President Obama is Re-elected….then the two main drivers of change are likely to be whether Commissioner Hamburg decides to stay and the federal budget situation.  

This chart explores the variables and draws some conclusions about the opportunities for change. Not surprisingly, they are greatest if Dr. Hamburg stays and there is no sequester. The worst case would be a sequester and a long-term “acting” commissioner; it is only a slight exaggeration to suggest the agency would be set adrift and some panic might set in.

President	Commissioner	Most like what prior situation?	Budget Status	Opportunities for change
Obama Year 5	Hamburg	Kessler 1993-1994	No sequester	Change continues
			Sequester	Orderly retreat?
	New nominee	Von Eschenbach    2006-08	No sequester	Orderly transition: some change
			Sequester	Disorderly retreat?
	“Acting” for >  than 6 months	Crawford 2004-05	No sequester	Orderly transition: few changes
			Sequester	Agency set adrift?

If Governor Romney is Elected…..then the main drivers of change are likely to be his interest level (his plate is likely to be full elsewhere), how quickly he nominates a new commissioner, how controversial his nominee is, and the federal budget situation.

This chart (as the one above) explores the variables and draws some conclusions about the opportunities for change. The best situation would be a well-known, well-respected, candidate who could win easy confirmation. That person would have the opportunity to make a lot of changes—although there would be notable differences if a new commissioner faces budget cuts. The worst case for change would be a replay of 2001-2002, when President Bush allowed more than 18 months to go by without a commissioner in place.

President	Commissioner	Most like what prior situation?	Budget Status	Opportunities for change
Romney Year 1	New nominee easy to confirm	Hamburg  2009-2010	No sequester	Time to shake the place up
			Sequester	Accelerates shake-up?
	New nominee  hard confirmation (not “acting”)	None?	No sequester	Congressional constraints in exchange for confirmation?
			Sequester	How long is someone acting?
	“Acting” for >  than 6 months	2001-2002	No sequester	Confusion: who to serve?
			Sequester	Panic in the streets?

Timeframes.  While the charts provide a more comprehensive overview of the prospects for leadership and change at FDA, the scenarios will actually unfold over a period of months. Presumably, we will know who will be President within a day or two of the election. However, sequester (or other budget cuts) are not likely to be determined until later this year or may be delayed into next year.

Whether Dr. Hamburg stays will be both her decision and that of President Obama. That might be announced quickly or not.  If there is to be a Romney Administration, it is likely to be at least March 2013 (more likely later) before a nominee is announced.

Steven

FDA After the Election---Part 1: Budget

Apart from an occasional reference, FDA is not part of the campaign dialogue leading up to the November 6 nationwide U.S. election. FDA Matters believes this is probably good—any intelligent  discussion of FDA’s future requires a long-term perspective and a mastery of detail and nuance—both of which are in short supply during “sound bite”-oriented politicking.  

Yet, FDA will be strongly impacted by the election’s outcomes. Part 1 of “FDA After the Election” concentrates on the agency’s budget situation, while Part 2  focuses on leadership and change (http://www.fdamatters.com/?p=2164).

Both parts reflect that ultimately FDA is people-driven—not only by who leads, but also because over 80% of the agency’s costs are people-related. More money = more people = more capability and activity. Less money will have the opposite effect.

The Potential for 8.2% Cuts in January 2013. Most of the current focus is on the potential 8.2% across-the-board federal budget cuts slated for January 2, 2013. Sequester, as the process is known, will leave FDA with about $320 million less to spend in FY 13 than it did in FY 12.

This includes cuts to taxpayer-funded FDA appropriations (about a $2.5 billion base) and user fee revenue (nearly a $1.4 billion base). If the cuts were applied entirely to FDA personnel, the agency would have to lay-off or furlough about 1000 employees.

We know that the sequester of FDA funding has consequences:  food will be less safe; drug and device approvals will be slower; problems with imports and globalization will become more numerous; and FDA modernization will be severely slowed. Note that this is the opposite of what everyone--critics included--wants. The precise impact is hard to quantify because FDA will try to prioritize its remaining manpower to avoid immediate disasters and avoid any visible failure to approve life-saving therapies.

Congress does not want to reduce the federal deficit through a sequester. This view is supported by President Obama and his opponent, Governor Romney.  Despite this seeming unanimity, an alternative deficit reduction package would need to deal with entitlement programs and taxes. So—politically—deficit reduction is a mess and sequester may happen.

Budget Threats Will Continue, Regardless of Sequester. Even if sequester were somehow to be avoided, pressure on federal spending will continue far beyond the immediate future. Sequester is the most immediate hurdle in what is likely to be an annual challenge to all federal agencies, including (and especially) FDA.

In the face of this, the Alliance for a Stronger FDA* is asking Congress for three sane and sensible things that should help FDA:

• Recognize and properly fund the special and growing role of FDA as a protector of food and drug safety and a gateway to medical innovation and science.
• Find alternative means to reduce the budget deficit and avoid the across-the-board sequestration of 8.2% of federal agency funding on January 2, 2013.
• Return federal budget-making to a process under which national priorities (such as FDA) are adequately funded.

The Alliance’s call for a return to funding based on national priorities is a statement of faith: that FDA is a core function of national government and that we can demonstrate that funding the agency is essential.

Re-affirming FDA as a National Priority. We should not, however, assume that FDA’s core governmental role is self-evident to everyone. We need to convince policymakers, the media, and the public that we belong in the very special group of federal programs that need to grow--even as other important programs suffer cutbacks and some even wither and die. Implicitly, the responsibilities of the federal government are going to be redefined, whether consciously or as the residue of decisions that will be forced on the President and Congress after the election and over the next few years.

How well will FDA compete for scarce dollars, assuming that the situation is not pre-determined by across-the-board cuts? The elite tier of federal programs has some heavy-hitters, such as air-traffic controllers and the nation’s judiciary. The absence of funding in their areas often has more concrete and immediate consequences than a lack of funding for FDA.

With FDA funds being used to oversee products and services that mount in the trillions and encompass 25% of consumer spending….our case is equally compelling. Everyone involved with FDA has an obligation to make themselves advocates for increased funding.

Steven

*  For purposes of disclosure: I am one of the founders and serve as Deputy Executive Director of the Alliance for a Stronger FDA, www.strengthenfda.org. It is the only multi-stakeholder (consumers, patients, health professionals, industry) that advocates for increased FDA funding. Our strength is in the breadth and number of our members, so I urge you to contact me for more information about belonging. Contact me at sgrossman@strengthenfda.org.

Note that my duties with the Alliance are in addition to, and apart from, the work of my policy and regulatory consulting firm, HPS Group, LLC, which is the publisher of FDA Matters.  The views expressed in FDA Matters are my own, and those of HPS Group, and are not the views or positions of the Alliance.

FDA and the Republican Platform: Harsh Words, Unclear Intent

Between “the FDA today” and the “FDA in 2013” stands a U.S. presidential election—one that appears to offer Americans a choice of philosophy about the size of government and the role of regulatory agencies.  FDA Matters’ previous blog laid out some very early comparisons between the candidates on regulatory policy and the role of Commissioner.

Along with nominating Mitt Romney as its Presidential candidate, this past week’s Republican Party convention produced the party’s 2012 Platform --a series of policy positions to guide the campaign. FDA reform commands about 180 words—laying out the case for aggressive (although unspecified) changes.

Campaigning vs. Governing. Before looking at the specific words and thoughts in the Republican Platform, it is worth providing some context. One of the enduring lessons of my 50 years watching American politics is that there is often a profound difference between campaigning and governing. The Platform is put together by party delegates from every state, working with subject-matter experts and overseen by the Presidential nominee’s team.

Mitt Romney would not allow a party platform with which he disagreed. However, should he be elected, he will not feel bound by the positions taken in it. That said, the Platform’s words on FDA reform appear to generally reflect other things that Mr. Romney (and his surrogates) have said on other occasions.  What he will want to do about FDA if elected (or even what he will be able to do) is unknown.

The 2012 Republican Platform on FDA Reform. The  platform report states:

America’s leadership in life sciences R&D and medical innovation is being threatened. As a country, we must work together now or lose our leadership position in medical innovation, U.S. job creation, and access to life-saving treatments for U.S. patients. The United States has led the global medical device and pharmaceutical industries for decades. This leadership has made the U.S. the medical innovation capital of the world, bringing millions of high-paying jobs to our country and life-saving devices and drugs to our nation’s patients. But that leadership position is at risk; patients, innovators, and job creators point to the lack of predictability, consistency, transparency and efficiency at the Food and Drug Administration that is driving innovation overseas, benefiting foreign, not U.S., patients.

We pledge to reform the FDA so we can ensure that the U.S. remains the world leader in medical innovation, that device and drug jobs stay in the U.S., that U.S. patients benefit first from new devices and drugs, and that the FDA no longer wastes U.S. taxpayer and innovators’ resources because of bureaucratic red tape and legal uncertainty.

While the rhetoric expressed in the platform is not new to FDA Matters—it has a certain menacing quality when it is “the voice” of an American political party as opposed to a “government is bad” Tea Party leader or a frustrated medical device executive.

It begs the question: didn’t America’s global leadership in the life sciences come in part from the FDA’s competence and high standards and not despite them? I would emphatically say “yes,” but there certainly seem to be others that would answer “no.”

Harsh Words for FDA: Consistent with the Overall Tone of the Platform. FDA definitely needs some improving—as past FDA Matters’ columns have made clear. I try to stay constructive and be mindful that complex problems rarely have simple solutions.

Perhaps more to the point, FDA—by itself and working with Congress—seems to have made enormous strides over the last few years. One could even argue that FDA is already working hard on implementing a “pro-innovation” and “create more predictability” agenda that Republicans should like.

This, perhaps, brings us full circle around to our prior warning not to read too much into campaign rhetoric.

FDA reform is two paragraphs in a 50 page document—one that stridently and broadly promotes smaller government and fiscal prudence, almost regardless of consequences. For example, on budget issues, the Platform calls for “Reining in Out-of-Control Spending, Balancing the Budget, and Ensuring Sound Monetary Policy.”

When government is cast as incompetent and out-of-control, it leaves little space to say good things about federal agencies, such as FDA, that work hard, are underfunded, and are committed to improving their performance. When it comes to FDA, we can be hopeful that Republican candidates are more judicious while campaigning…..and, if elected, more restrained in their actions than their rhetoric suggests.

Steven

FDA and the 2012 U.S. Presidential Election

FDA Matters has been wondering: when is the right time to start talking about the 2012 U.S. Presidential election and how it might affect FDA’s future? The best answer is: when Congress has finished its FDA policy work for the year. With the enactment of FDA user fee reauthorization legislation and a pending agreement on government funding for the first half of FY 2013 (starts October 1, 2012), it is now time to start talking. 

Without picking sides: what issues face FDA after the election and in 2013? How might the agency be affected by whether President Barack Obama is given another four year term or challenger Mitt Romney is elected President?

For those of us deeply involved in the FDA world, the most important difference between the candidates might well be their approach to the agency and particularly toward FDA leadership.

President Obama has not yet issued any statements about FDA on his   campaign website  . However, based on the last 3 ½ years, he supports FDA and its mission and sees that the agency’s role is likely to continue to grow because of globalization, public health and safety, and the need to encourage innovation. 

His overall regulatory positioning might be considered less favorable to FDA. New agency regulations must pass through the Office of Management and Budget (OMB)’s Office of Information and Regulatory Affairs (OIRA). Cass Sunstein, a distinguished legal scholar appointed to head OIRA in 2009, is considered to be more open to de-regulatory approaches that may be inconsistent with FDA’s growing responsibilities. For example, it is his office that is currently holding up some of the regulations needed to implement the Food Safety Modernization Act.

The Republic nominee, Mitt Romney, has not yet issued any specific policy statements on FDA. However, he appeared at a medical device company event in late March and       su   ggested     that FDA is part of an “attack on free enterprise” by “the thousands upon thousands of bureaucrats that work in Washington.”

His campaign website does not reference FDA, but it does have a position paper on regulation. In it, he advocates:

·                  Imposing a regulatory cap of zero dollars on all federal agencies*

·                  Requiring congressional approval of all new “major” regulations

One should never take campaign speeches too seriously. Even allowing for that, it would appear there are significant differences in how the two candidates view FDA today.  These differences may narrow or expand in the three months until Election Day. 

Just as the two candidates appear to differ strongly on the role of FDA, they are also likely to differ on their choice of FDA commissioners. This is not just a matter of whether Romney wins, but also if Commissioner Hamburg is thinking about leaving (and we have no knowledge of this, only that it is not uncommon for Administration leaders to leave in the year after a President is re-elected).

The history of appointments of FDA commissioners is quite varied, starting with 1991 when Dr. David Kessler became the first Commissioner to face a Senate confirmation hearing. He resigned at the beginning of Clinton’s second term (analogous to an Obama victory and a decision by Dr. Hamburg to leave). It took nearly two years for President Clinton to appoint his successor and the Senate to confirm the appointment.

Hiring a new commissioner was not a priority for the new Bush Administration in 2001. Dr. Mark McClellan was confirmed in November 2002, more than 20 months after the new Administration took office. In contrast, Dr. Hamburg was appointed by the Obama Administration and was confirmed by May, a delay of less than 5 months.

So, if Romney wins or Obama wins/Hamburg resigns….we may have a new Commissioner quickly or the job may be vacant for a long time.

Overall, the differences between Barack Obama and Mitt Romney are likely to matter a great deal to FDA. In turn, this will affect FDA stakeholders….regardless of their politics or their views on whether FDA needs continuous improvement or an outright overhaul.

   Steven

*   My understanding of this: the private sector cost impact of any new federal regulation must be offset by the private sector savings from repealing or significantly revising an existing federal regulation.

P.S. For those wanting more on FDA and the U.S. elections, FDA Matters intends to write often on this topic over the next few months.

2012 Mid-Year Report on FDA: Opportunities, Threats and Accomplishments

So much is going on at FDA right now, that it is difficult to pick just one topic for this week’s FDA Matters. Instead, we are going to take a quick tour of some “hot spots” at FDA and how they might affect the agency over the remainder of the year and beyond.

Please read on…there is something for everyone in the topics covered.

The “Lost” FSMA Regulations. At the very end of 2010, Congress passed the Food Safety Modernization Act (FSMA). The law was intended to fundamentally re-set the term under which FDA acts to assure a safe food supply. It focuses on preventing problems, rather than fixing or limiting them afterward. FSMA provides the agency with new authorities and additional resources consistent with FDA’s role of overseeing a global food supply.

The first provisions of FSMA went into effect in January 2012 and additional requirements become effective this month. To guide implementation of these requirements, FDA has produced four draft regulations. None have been published; all are stuck in the review process at OMB.

The mystery of the “lost” FSMA regulations prompted two reporters to call me this past week and ask: is OMB holding back these (and other) regulations until after the election, presumably for political reasons. I couldn’t see an electoral connection, plus the first of the proposed regulations was submitted to OMB in December 2011, a very long time before the election.

The “lost” FSMA draft regulations are worrisome by themselves, but especially with so much else going on at FDA that may require OMB review.  

FDA’s Drug Safety Monitoring Program Hits Target, Will Expand. We don’t read often enough about the successes that come from cooperation and hard-work at FDA. In the 2007 user fee reauthorization legislation, Congress directed FDA to construct a nationwide electronic post-market safety monitoring system that would allow FDA to examine tens of millions of patient records to discover or refute possible safety concerns about FDA-approved products.

In a recent edition of FDA Voice, the FDA’s own blog site, the agency reported that the monitoring system, called “Sentinel,” now has access to the de-identified medical and/or insurance records of about 126 million Americans, collected through 17 data sources (e.g. VA, Kaiser). Sentinel is definitely still a “work in progress” on a number of levels, but it will be of increasing value as medical products become even more complex and even more integral to medical care.  

Funding Ups and Downs. Despite Congressional reauthorization of the prescription drug and medical device user fee programs, the budget authority (BA) (taxpayer-funded) portion of FDA’s budget is still the bulk of the dollars. The Senate has included a small increase in BA funding for FDA for FY 13; the House has proposed a small decrease.

Of compelling concern is the strong potential that FDA (along with all federal discretionary funding programs) will be hit with a 7% to 10% “sequestration”—an across-the-board cut--on January 2, 2013. This would reduce the agency’s budget  by between $175 million and $250 million in FY 13. This is FDA’s "contribution" to saving the federal budget more than $1 trillion over the next 10 years. 

If sequestration occurs, FDA will try to avoid lay-offs by shifting more employees from taxpayer funding to user fees. In that case, increases in user fee income will be backfilling the BA cuts, rather than contributing to real agency growth. Yet, FDA will be obligated to undertake the user fee-driven activities and meet the law’s performance measures as if the new user fee money was paying for additional staff.

User Fee Reauthorization Will Drive, Not Disrupt, the Agency Agenda. Five years ago, the user fee reauthorization (PDUFA 4) didn’t become law until late September, a few days before fiscal year 2008. The combination of immediate deadlines, delays in collecting user fees, and insufficient trained personnel set off a series of problems that took three years to fully overcome.

This time, Congress finished the reauthorization in late June and FDA has been planning the law’s smooth implementation for months. Instead of panic, CDER in particular, seems to be feeling good about the path forward and the many changes called for in PDUFA 5. 

Dr. Janet Woodcock, head of CDER, has listed her priorities as, among other things: timely transition to new user fee requirements (including start-up of new generic drug and biosimilars user fees); dealing with drug shortages, moving forward on data standards and new IT support systems, and advancing regulatory science.

Results are still what matters and there are always critics….but a sense of optimism at CDER is always welcome.

 Steven

A Well-Funded FDA: Only if Congress Stands Behind its Own Words

This week, FDA Matters raises the delicate question: can Congress be counted to act upon its own words supporting the FDA? This is desperately important as Congress makes decisions on FDA’s FY 13 funding and possible sequestration.

 Over the last few weeks, the Senate and the House have passed the FDA user fee reauthorization legislation by large bipartisan majorities with almost no opposition. Both bodies have extolled the importance of the FDA. The urgency of it funding needs have been fully acknowledged. The incredible breadth of support for the agency has been counted and documented. But will Congress provide the funding to back this up?

The single most important determinant of FDA’s success is whether it has the money to carry out its responsibilities. Yet, this is a very tough environment for any agency to receive funding increases.

So, it was particularly encouraging that the FDA’s cause became linked to J-O-B-S during House passage of the user fee legislation. The House Energy and Commerce Committee fact sheet on the legislation begins:

The United States has led the global medical device and biopharmaceutical industries for decades.  This leadership has made the U.S. the medical innovation capital of the world, bringing hundreds of thousands of high-paying jobs to our country and life-saving devices and drugs to our nation’s patients.  U.S. medical device-related employment totals over 2 million jobs, and these are good, rewarding jobs as employees in the device industry earn an average of $60,000 per year.  The U.S. biopharmaceutical industry is responsible for over 4 million U.S. jobs. 

The media has noted that the user fee legislation assures FDA of nearly $6.5 billion in industry monies over the next 5 years. This is indeed a lot of money. FDA will need every dollar of it to meet the commitments it has made in writing to use these monies on specific activities and on achieving specific performance benchmarks.  

User fees, then, are basically set for the next five years. However, they only supplement the funding FDA needs to carry out its responsibilities. FDA CANNOT LIVE BY USER FEES ALONE.  

To conduct the bulk of its functions, FDA received a budget authority (BA) appropriation of about $2.5 billion in FY 12. This is taxpayer, not industry, monies. Assuming a very modest 6 % annual increase in costs and responsibilities each year, FDA will need about $150 million more to meet its responsibility in FY 13. Additional 6% increases would be needed annually in succeeding years.

Using the 6% annual growth and projected out to five-years--as has been done for the user fee monies--FDA will need a total of $15 billion in non-user fee, BA appropriations from FY 13 to FY 17.  This is in addition to the industry contribution of $6.5 billion over the same 5-year period.

Prospects for 6% increases, even in the first year (FY 13), do not look good. The Senate is recommending only a 0.5% increase for FY 13 (about +$25 million of the needed 6% increase of $150 million). The House appropriations subcommittee is marking the bill up later this week. There is no reason to be optimistic since the House is operating under a total budget ceiling that is much lower than the Senate.

Even worse, the BA appropriations portion of the FDA budget faces a potential January 2013 sequester (automatic across-the-board reduction in most federal discretionary spending) of about 8% of BA funds ($200 million).

If the sequester occurs, FDA would be provided only $2.3 billion in FY 13, taking the agency below the funding level it had in FY 10. Even if 6% increases were to start in FY 14 after an FY 13 sequester, FDA would receive only $13 billion in BA funding from FY 13-17. That is about a $2 billion gap in BA funding over 5 years, solely as a result of the possible FY 13 sequestration. 

The modest $15 billion, 5-year estimate for BA appropriations (based on 6% annual increases) does not account for the costs of the Food Safety Modernization Act.  Nor does it account for the increased non-user fee responsibilities Congress has incorporated in the user fee reauthorization legislation (e.g. provisions to deal with drug shortages). Further, the FDA’s job becomes larger and more difficult each year (globalization, more complex science) so that the agency budget should increase by more than 6% each year.  

This brings us back to the delicate question we began with: will the Senate and House stand behind their own words about the importance of FDA and its role in job-creation and the economy?  If so, Congress needs to appropriate more money for FDA in FY 13 and each of the succeeding four years and it must exempt FDA from any sequestration.  

Steven

For purposes of disclosure: I am one of the founders and serve as Deputy Executive Director of the Alliance for a Stronger FDA, www.strengthenfda.org. It is the only multi-stakeholder (consumers, patients, health professionals, industry) that advocates for increased FDA funding. Our strength is in the breadth and number of our member, so I urge you to contact me for more information about belonging. Contact me at sgrossman@strengthenfda.org.

Note that my duties with the Alliance are in addition to, and apart from, the work of my policy and regulatory consulting firm, HPS Group, LLC, which is the publisher of FDA Matters.  The views expressed in FDA Matters are my own, and those of HPS Group, and are not the views or positions of the Alliance.

Post-Market Safety: Can Sentinel Do Some of the Heavy Lifting?

In the FDA-regulated world, success is often defined as approval of a new product or indication based on two, well-controlled clinical trials. However, the scrutiny doesn’t end there. FDA’s mission includes determining whether already-approved drugs perform safely and effectively when used by large numbers of patients in routine medical practice. 

To understand what happens under these “real world conditions,” FDA has expanded its post-market  efforts, including development of a monitoring system (called Sentinel) that will be able to track drug usage and medical history information on tens of millions of patients. Although such information will be useful, it can only provide post-hoc inferences, not proof of causation. Even with this limitation, FDA Matters thinks developing the system is worthwhile and may provide multiple benefits. 

There are multiple tools for assessing post-approval safety and efficacy that fit loosely under the rubric of pharmacovigilance. When approving medical products, FDA mostly relies on data that comes from pre-specified hypotheses that are tested through randomized, placebo-controlled, double-blind clinical trials. In contrast, the data that comes from pharmacovigilance is inherently less rigorous; indeed it constitutes a form of “data dredging” that FDA abhors. The heart of the problem is that:  

Real world data sets = uncontrolled variables + inconsistent data collection + questionable data accuracy.

When FDA and manufacturers collect adverse events reports, they know there will be underreporting of incidents, as well as limited ability to judge whether problems are drug-related. When FDA looks at the Medicare database, they know that information submitted as part of medical claims is unreliable and subject to systemic bias (e.g. medical coding is designed to support reimbursement, not public health analysis).

The Sentinel database should be superior because it incorporates medical records and patient registry information, along with claims data. Still it provides inferences, not proof.

Active surveillance—continuously monitoring millions of health records---is only worthwhile if these limitations are acknowledged. It can never provide certainty about whether drugs are safe and effective. It can tell you what is worth further examination…but can never tell you the cause of any problem that is identified.

As the FDA mantra goes: association is not causation. No matter how many health records and claims data are reviewed, this is still true.

Clinical trials have limitations, also. Trials don’t tell us how a drug will be used by prescribers. They can never provide complete information about patient outcomes for those individuals with several medical conditions (i.e. multi-morbidity) or who take many medications simultaneously (i.e. poly-pharmacy).

By inference (although not with certainty), pharmacovigilance and active surveillance could bring us closer to addressing potential problems that can’t be resolved by clinical trials. For example, many years ago, I worked on a drug to treat pre-term labor. As I recollect, there were two instances of respiratory problems in a trial of several hundred women. No one could say for sure whether this effect was caused by the drug or occurred at random. A study large enough to find out was infeasible.

Based on the potential respiratory problem, FDA rejected the drug despite the benefits it might have provided to women experiencing pre-term labor. If this same situation were to come up today…maybe FDA would decide differently, knowing it could collect patient outcomes information through pharmacovigilance, particularly active surveillance.

Ideally, FDA would know everything it needs to know about a drug at the time of its approval. Information derived from review of real world data sets can never be as good. But properly understood and carefully analyzed, the inferences derived from pharmacovigilance can add to our understanding about safety, efficacy, drug interactions and side effects.

Instead of just using that capacity to identify post-approval problems, FDA needs to incorporate pharmacovigilance into its thinking about when to approve drugs and with what conditions. FDA’s capacity to do pharmacovigilance and active surveillance should lead to a greater willingness by FDA to approve drugs, particularly those with otherwise solid benefit-risk equations, but burdened by questions that cannot be resolved prospectively or through clinical trials (even in phase 4).

Patients would benefit if FDA made this one of the Sentinel priorities.

Steven

This column first appeared on June 21, 2011. It is one of my favorites from last year.

FDA Funding Prospects Altered by the Budget Control Act

The just-passed Budget Control Act of 2011 (BCA) will have a heavy impact on FDA’s future.  Under this new law, most discretionary spending programs will shrink—not merely cease to grow.  Yet, FDA’s growing responsibilities and resource needs are not diminished because federal spending is being reduced. Our nation is less safe and less healthy if FDA cannot excel at its mission

FDA Matters urges Congress and the President to see that increased funding of FDA is the only option.  Ultimately, the pressures created by the BCA will test the government’s commitment to FDA’s essential role in our society.  

Appropriations Caps and the Impact on FY 12.  The BCA limits discretionary federal spending for every fiscal year from 2012 through 2021. By capping annual appropriations growth, federal spending will be reduced by more than $900 million over 10 years.

For FY 12, the House and Senate appropriations committees cannot spend more than $1.043 trillion. Within this total, the ceiling for non-security programs (e.g. FDA, NIH, education, etc.) is slightly below the FY 11 appropriations level.

The ceiling is also substantially above the level the House has been using to mark up FY 12 bills. This is particularly encouraging because the House-passed Ag/FDA appropriations bill would cut FDA by $285 million below FY 11 (-11.5%) and $572 million below the President’s FY 12 budget request (-21%).

Senate staffs are currently preparing FY 12 appropriations bills using the aggregate spending levels in the BCA. Subcommittee and then full committee mark-ups are expected to start in early to mid-September.  Advocates, notably the Alliance for a Stronger FDA and its members, have been encouraging the Senate to put more money into FDA. The goal is to provide the agency with an increase in its FY 12 appropriation, not merely undo the cuts proposed in the House bill.

FY 13 Appropriations and Beyond.  A second part of the BCA requires a further reduction of the federal deficit by $1.2 trillion over the next 10 years. This can be achieved by any combination of changes in entitlements, revenues and appropriations.  

To pull together this deficit reduction plan, a so-called “super committee” has been appointed. It is composed of 12 members—3 each from the majority and minority parties in the House and the Senate. The group’s work must be completed by November 23, 2011. Any resulting bill will not be amendable and must pass Congress by December 23, 2011. If no legislation passes or the President fails to sign it, then across-the-board cuts (“a sequester”) will occur during  fiscal year 2013, which starts on October 1, 2012.

The general consensus in Washington is that the super committee appointees are too divided ideologically to pull together the needed deficit package. Democrats will only accept entitlement changes if there are new tax revenues. Republicans are pledged to oppose any tax increase.

Predictions of failure may be premature because the super committee will be under intense public and political pressure to find a compromise. In addition, sequester cuts would fall heavily on defense programs that most of Congress supports.

FDA is vulnerable in the “super committee/sequestration” process in two ways.

• If the super committee produces a plan, it may include further cuts in discretionary spending. There is no guarantee that Congress would allocate those cuts in a way that would protect FDA and other essential programs.
• If the super committee does not produce a plan, then the sequester would go into effect in FY 13.  If the entire 10-year $1.2 trillion in savings must be found through sequestration, then FDA is likely to sustain an across-the-board reduction in FY 13 of at least 8% to 10%.

Conclusion. Over the last five years, FDA has been one of few discretionary programs to receive substantial funding increases. This reflected both Congressional and Executive Branch recognition that the agency was dramatically underfunded for its growing responsibilities in an increasingly complex world. FDA still needs more resources, even though the downward budgetary pressures have become significantly greater.

Steven

Imports: FDA Issues a Cry for Help          June 26th, 2011

No challenge to FDA’s mission looms larger than the rapid globalization of the world markets for food, drugs, medical devices and other FDA-regulated products. By way of making this point, on June 20, the FDA released a special report, entitled “Pathway to Global Product Safety and Quality.” FDA Matters read the report carefully and heard a cry for help, if not an actual primal scream. Read the rest of this entry

FDA “Exceptionalism” at the Funding Crossroads       May 2nd, 2011

Congress returns at the beginning of May to start the FY 12 appropriations process. Downward pressure on federal spending will intensify. If, despite this, the FDA receives another increase, then it will move closer to establishing itself as an exception to the budget cutting process. Thus, FDA Matters sees the coming funding battle as a crossroads for FDA.  Read the rest of this entry

FDA, Reorganization and the Four Crises

In previous posts, FDA Matters has expressed its disdain for efforts to solve problems by reorganizing government agencies. So, it may be surprising that I am giving Commissioner Hamburg an “A” for her recent reorganization of FDA’s senior management.

In the reorganization, she is addressing four crises that beset the agency: industry discontent with the medical product review process; public concern about import safety; implementation of the Food Safety Modernization Act; and Congressional concerns that the agency is inefficient in its use of resources. The new structure should drive better decisonmaking and greater productivity…. at a time when the agency is struggling to fulfill its growing mission and faces the potential for budget cuts.  

Until the beginning of this year, Dr. Hamburg has relied upon Dr. Joshua Sharfstein, a trusted deputy and alter-ego, to assist in managing the agency. In addition, he had served as a buffer between the agency and external forces, particularly Congress.  Instead of replacing Dr. Sharfstein, the Commissioner has chosen a new organizational approach that responds to the agency’s most difficult challenges:

Crisis #1: Growing discontent among the medical product industries. They allege that unreasonable FDA requirements and the agency’s overly-cautious approach to potential safety issues are keeping innovative and effective products from becoming available to patients. For more details, see my columns at:  http://www.fdamatters.com/?p=1428 and http://www.fdamatters.com/?p=1401.

Response: Create a new Deputy Commissioner for Medical Products and Tobacco and appoint Stephen P. Spielberg, MD., PhD, a distinguished physician and researcher and former dean of Dartmouth Medical School. He also spent 11 years in industry, working for Merck and then J&J.

In his new role, Dr. Spielberg will oversee the Center for Drug Evaluation and Research (CDER), the Center for Biologics Evaluation and Research, the Center for Devices and Radiological Health and the Center for Tobacco Products.

The intent is for him to serve as a “senior partner” to the four center directors, facilitating decisions that might otherwise wait for the Commissioner. When appropriate, he would also stand-in for the Commissioner on their behalf. Right now, these center directors can’t be getting very much of Dr. Hamburg’s time and they are quite vulnerable on the Congressional side.

In addition to the stature he brings, Dr. Spielberg’s bio describes his research interests as: mechanisms of idiosyncratic adverse drug reactions, human pharmacogenetics and personalized medicine, and pediatric clinical pharmacology. This background is germane to the areas of industry concern about pre- and post-market review of medical products and also positions him to be one of the agency’s chief advocates for improvements in regulatory science.

Crisis # 2: The safety and quality of imported food and medical products.  The American people and Congress want safe products and expect FDA to use its very limited resources to make it so. For more details, see my column at: http://www.fdamatters.com/?p=1408.

Response: Create a new Deputy Commissioner for Global Regulatory Operations and Policy and appoint Deborah Autor, now Director of CDER’s Office of Compliance. Her “directorate” will oversee the Office of Regulatory Affairs (ORA) and the Office of International Programs.

The intent is to increase coordination and greatly reduce the number of decisions that would otherwise wait for the Commissioner’s availability. Just as importantly, the new structure brings together FDA’s overseas relationship and capacity-building successes with a tougher, more regulatory posture to assure that imports meet the same standards for safety and quality as domestic goods.

Crisis #3: Implementation of the new Food Safety Modernization Act to create a sophisticated risk-based food safety system. This is a complex multi-faceted task being made more difficult by inadequate funding.

Response: Continue the existing position of Deputy Commissioner for Foods, which oversees the Center for Food Safety and Applied Nutrition and the Center for Veterinary Medicine. Michael Taylor, who will continue in this post, has already demonstrated the advantages of Dr. Hamburg’s new organizational approach….by his general leadership and his representation of the agency with Congress on food issues.

Crisis #4: FDA’s ability to sustain and grow its FY 2011 funding level is being challenged in the Congressional appropriations process.

Response: Create a new Office of Operations, headed by a Chief Operating Officer (COO) to oversee human resources, facilities, information technology and finance. This will strengthen the agency’s ability to respond to Congress on administrative matters and, in particular, assure Congress that the agency is under tight fiscal management.

Conclusion: FDA has many problems, some of which are reaching crisis-proportion. While more resources are necessary, good leadership is essential.

Regardless of the demands, Commissioner Hamburg can never have more than 24 hours each day to address the agency’s needs. The new organizational arrangement—with four deputy commissioners providing span of control over most of the agency--seems well-suited to address this limitation.

Steven

Here is a link to read the Commissioner’s message to agency employees conveying the new organizational structure:  http://carl1anderson.wordpress.com/2011/07/14/major-reorganization-at-fda/.

I would hope in the future that FDA would post these types of communications directly onto the agency website, rather than relying on the Commissioner’s messages to be reprinted in newsletters and blogs.

Should FDA Have an Independence Day?

Years ago, while helping an incoming administration evaluate the public health service agencies at HHS, I became captivated by the idea that a series of reorganizations would solve many of the problems. I eventually snapped out of my trance and learned a life-long lesson: redrawing organizational boxes and altering reporting relationships are rarely effective solutions.

FDA Matters thinks that making FDA an independent agency will not make FDA more effective or more efficient. Although the idea is not truly harmful, proposing independent agency status is a seductive distraction from the tough job of improving FDA.    

Making FDA an independent agency has been proposed many times before. The issue has come up now because Jim Greenwood, CEO of the Biotechnology Industry Organization (BIO), included it last week among a number of proposals in his “state of the industry” speech. The industry is to be applauded for its commitment to new thinking, which focuses on ways to stimulate investment in biosciences, as well as improve FDA. While I think there may be some great ideas in BIO’s proposals, an independent FDA is not one of them.

An” independent agency” is a federal government organization that is not located within one of the 15 executive departments.  While most independent agencies are commission-type organizations run by a board, some are structured in a manner similar to the executive departments.  Examples include the Environmental Protection Agency (EPA), the National Aeronautics and Space Administration (NASA), and the National Science Foundation (NSF).

Being independent sounds great, but would it really help FDA become a more effective or better-resourced agency?

Independent agencies do not run independently of the President and the Executive Branch. Whether part of HHS or independent, FDA’s authority derives from the President, its money comes through the Office of Management and Budget (OMB), its manpower is cleared by the Office of Personnel Management (OPM), and its office space and purchases are controlled by the General Services Administration (GSA).

The chief advantage to FDA of being independent would be the ability to by-pass HHS leadership and bureaucracy. While HHS may be a problem, does anyone want to argue that it is so bad that it requires FDA to be uprooted? Historically, it is OMB that has pushed FDA budget requests downward and objected to FDA regulations. That wouldn’t change.

Being an independent agency does not necessarily improve access to the President. Because only heads of executive departments are cabinet members, the HHS secretary currently speaks for FDA when the cabinet meets.  The head of EPA has the status of “cabinet-rank,” along with OMB. I am not sure whether EPA gets much out of this honor, but similar standing for FDA would seem unlikely.  

Being an independent agency does not move an organization to a different appropriations committee. EPA is funded by the Interior, Environment and Related Agencies subcommittee. NASA and NSF are funded by the Commerce, Justice, Science and Related Agencies subcommittee. Independent or not, FDA will be funded as part of the Agriculture appropriations bill.

Independent agencies haven’t necessarily prospered, either. NASA had a good track record while it embodied a national aspiration, but it is clearly on the decline now. The National Science Foundation has never enjoyed the level of support given the National Institutes of Health.

That leaves us, perhaps, EPA as the embodiment of an independent agency with regulatory and scientific responsibilities. Has science triumphed at the agency because its independent status shields it from politics? It seems unlikely that anyone would make that argument. EPA, too, appears to be an agency on the decline.  

Maybe FDA would benefit from being an independent agency, although I don’t think so. At best, it would take enormous political effort to accomplish….energy that could be applied toward more effective ways to improve the agency.

Steven

Jim Greenwood, President and CEO, 2011 BIO STATE OF THE INDUSTRY ADDRESS. “Unleashing the Promise of Biotechnology to Cure Disease and Save Lives”  http://www.bio.org/news/speeches/2011_greenwood_convention_speech.pdf

A more in-depth description of the BIO proposals is at: http://www.bio.org/aboutbio/promiseofbiotech.pdf

List of independent agencies: http://www.usa.gov/Agencies/Federal/Independent.shtml 

Imports: FDA Issues a Cry for Help

No challenge to FDA’s mission looms larger than the rapid globalization of the world markets for food, drugs, medical devices and other FDA-regulated products.  By way of making this point, on June 20, the FDA released a special report, entitled “Pathway to Global Product Safety and Quality.”  

FDA Matters read the report carefully and heard a cry for help, if not an actual primal scream.

The report provides startling statistics on the recent and future growth of imports. A decade ago, 6 million shipments of FDA-regulated goods passed through our nation’s 300 ports; this year the number will quadruple to 24 million shipments.

The impact is across all areas of FDA responsibility. Currently, 60% of fruits and vegetables and 80% of seafood consumed in the US are imported. About 80% of active ingredients found in pharmaceutical products (not finished products) originated abroad. More than 35% of the US medical equipment market is imported devices.

The world is an unsafe place. Despite that, Americans are not going to restrict themselves to seasonal and locally grown food. Nor will we limit ourselves to the drugs and devices that can be developed and manufactured using only ingredients and parts that come from within the US.

We count on FDA to be sure our foods are safe and medical products safe and effective, regardless of origin.  However, imports inspire less confidence because there are hundreds of thousands of products made under local laws and business practices. We have much to be concerned as these numbers continue to grow.  

Even with additional resources, new legal authorities, international cooperation, improved strategies, complex databases and a bunch of good luck…keeping the American people safe will require the agency to invest several times more effort than it has in the recent past.

FDA’s plan is logical and appropriate:

1) FDA, in close partnership with its foreign counterparts, will assemble global coalitions of regulators dedicated to building and strengthening the product safety net around the world.

2) With these coalitions, FDA intends to develop a global data information system and network in which regulators worldwide can regularly and proactively share real-time information and resources across markets.

3) FDA will continue to expand its capabilities in intelligence gathering and use, with an increased focus on risk analytics and thoroughly modernized IT capabilities.

4) FDA will effectively allocate agency resources based on risk, leveraging the combined efforts of government, industry, and public- and private-sector third parties.

In short, FDA’s strategy is: let’s build the food, drug, and device equivalent of Interpol, then “let’s get the bad guys before they get us.”

This seems like a good approach, but it is not enough. In a speech in April, Dr. Murray Lumpkin, Deputy Commissioner for International Programs, referred to FDA-regulated products as coming from “roughly 200 countries, using 825,000 importers through over 300 US ports-of-entry.” How do you possibly manage that?   

I can’t claim to know the answer. Significantly increased funding for import safety is essential. A larger FDA overseas force is necessary to work with other governments and set up international standards. Tougher US laws are needed. We have learned, however, that it is hard to prevent problems when one or two business owners are prepared to willfully neglect standards and heedlessly adulterate food and drug products.

Our only choice is to respect what FDA has accomplished.....and give them the support and funding (and maybe some out-of-the-box ideas) to do an even better job.

Steven

FDA’s Report on Imports: http://www.fda.gov/AboutFDA/CentersOffices/OC/GlobalProductPathway/default.htm

Dr. Lumpkin’s presentation:  Viewing the world through the FDA international lens: Advancing domestic public health through international engagement. Slides from presentation given to membership of the Alliance for a Stronger FDA, April 26, 2011.

Post-Market Safety: Getting the Most Out of Inferences That Aren’t Proofs

In the FDA-regulated world, success is often defined as approval of a new product or indication based on two, well-controlled clinical trials. However, the scrutiny doesn’t end there. FDA’s mission includes determining whether already-approved drugs perform safely and effectively when used by large numbers of patients in routine medical practice. 

To understand what happens under these “real world conditions,” FDA has expanded its post-market  efforts, including development of a monitoring system (called Sentinel) that will be able to track drug usage and medical history information on tens of millions of patients. Although such information will be useful, it can only provide post-hoc inferences, not proof of causation. Even with this limitation, FDA Matters thinks developing the system is worthwhile and may provide multiple benefits. 

There are multiple tools for assessing post-approval safety and efficacy that fit loosely under the rubric of pharmacovigilance. When approving medical products, FDA mostly relies on data that comes from pre-specified hypotheses that are tested through randomized, placebo-controlled, double-blind clinical trials. In contrast, the data that comes from pharmacovigilance is inherently less rigorous; indeed it constitutes a form of “data dredging” that FDA abhors. The heart of the problem is that:  

Real world data sets = uncontrolled variables + inconsistent data collection + questionable data accuracy.

When FDA and manufacturers collect adverse events reports, they know there will be underreporting of incidents, as well as limited ability to judge whether problems are drug-related. When FDA looks at the Medicare database, they know that information submitted as part of medical claims is unreliable and subject to systemic bias (e.g. medical coding is designed to support reimbursement, not public health analysis).

The Sentinel database should be superior because it incorporates medical records and patient registry information, along with claims data. Still it provides inferences, not proof.

Active surveillance—continuously monitoring millions of health records---is only worthwhile if these limitations are acknowledged. It can never provide certainty about whether drugs are safe and effective. It can tell you what is worth further examination…but can never tell you the cause of any problem that is identified.

As the FDA mantra goes: association is not causation. No matter how many health records and claims data are reviewed, this is still true.

Clinical trials have limitations, also. Trials don’t tell us how a drug will be used by prescribers. They can never provide complete information about patient outcomes for those individuals with several medical conditions (i.e. multi-morbidity) or who take many medications simultaneously (i.e. poly-pharmacy).

By inference (although not with certainty), pharmacovigilance and active surveillance could bring us closer to addressing potential problems that can’t be resolved by clinical trials. For example, many years ago, I worked on a drug to treat pre-term labor. As I recollect, there were two instances of respiratory problems in a trial of several hundred women. No one could say for sure whether this effect was caused by the drug or occurred at random. A study large enough to find out was infeasible.

Based on the potential respiratory problem, FDA rejected the drug despite the benefits it might have provided to women experiencing pre-term labor. If this same situation were to come up today…maybe FDA would decide differently, knowing it could collect patient outcomes information through pharmacovigilance, particularly active surveillance.

Ideally, FDA would know everything it needs to know about a drug at the time of its approval. Information derived from review of real world data sets can never be as good. But properly understood and carefully analyzed, the inferences derived from pharmacovigilance can add to our understanding about safety, efficacy, drug interactions and side effects.

Instead of just using that capacity to identify post-approval problems, FDA needs to incorporate pharmacovigilance into its thinking about when to approve drugs and with what conditions. FDA’s capacity to do pharmacovigilance and active surveillance should lead to a greater willingness by FDA to approve drugs, particularly those with otherwise solid benefit-risk equations, but burdened by questions that cannot be resolved prospectively or through clinical trials (even in phase 4).

Patients would benefit if FDA made this one of the Sentinel priorities.

Steven

Forget the Hype: Change Takes Time

FDA Matters is always impressed by how much FDA does. The everyday tasks are overwhelming: reviewing, approving, monitoring and inspecting the products and facilities responsible for 80% of our food supply and 100% of drugs, biologics, medical devices, vaccines, and animal drugs. Then there are the policy issues, big and small, that must be tended to.

These are largely functional tasks—someone has a job (or several) and does them. Yet, FDA has another life, as the bridge to the future of foods, drugs and devices. This responsibility is vitally important to our nation. It also takes time to bear fruit.

FDA is determined to help develop the fields of personalized medicine, nanotechnology, biomarkers, population-based adverse event tracking, safe use of genetically-modified foods, and regulatory science. By statutory directive, the agency is also helping to develop the fields of generic biologics (formerly bio-similars), medical countermeasures against bio-terrorist threats, and antibiotics for emerging infectious diseases. Advocates usually offer these activities as the rationale for strengthening science at the agency.

There is something more that connects these initiatives--the role of FDA in accelerating public benefits from the increasingly complex science generated by medical and food product companies, academia and federal agencies. There is understandable impatience from stakeholders. While there is a resource issue (more people working on these issues equals faster progress), there is also a rate-limiting aspect--procedural and scientific--to success.

Some have wondered (including me) as to why FDA did not appear more ready to take on generic biologics when the new legislation passed….or why the agency’s subsequent action have exhibited more energy than urgency.

One reason is that FDA has unveiled new complexities of interpretation and implementation each time it has moved forward on generic biologics. Since this is, arguably, the first new approval pathway for medical products in 20 years, perhaps we should all take a deep breath…and acknowledge that a viable program (with regulations, guidances, scientific support and usable precedents) might take four to six years or more to implement. The field itself will be developing for years to come.

Patience is also needed for personalized medicine, biomarkers, antibiotics, etc. At a minimum, we know that clinical trials often fail, sometimes quite miserably, just when everyone is surest that the solution is logical, success is guaranteed and progress is certain. The human body is almost always more complex and subtle than we can discern, even with the best tools.

My yardstick is the history of biotechnology. As with all great transformative achievements, latecomers might imagine that success was inevitable and progress was smooth and relatively trouble-free. The reality has been quite different:

·         A rocky childhood, including efforts to restrict or ban experiments (1970′s)

·         The “next big thing,”  with a very limited number of successes (1980′s)

·         Finally a significant impact, but also several “near death” experiences (1990′s)

·         Some biotechs mature and big pharma swallows small biotechs for their knowledge, capacity and pipeline (2000′s)

There was almost 20 years between childhood and impact…and about the same amount of time between initial successes and a track record of success. Nearly forty years later, biotechnology is still as much about promise as it is about accomplishments.

So, forget the hype and re-calibrate your expectation about how fast the future will arrive. FDA is fully committed and only needs sufficient resources to hasten that day. Just as importantly, don’t lessen your own (or your organization’s) commitment to the future. Despite frustrations with the seemingly slow pace of change, the benefits to patients and other stakeholders will come in due time.

Steven

 

Some related columns:

FDA: An Honest Broker on the Slow Path to Biosimilars

October 24th, 2010

FDA Matters’ enthusiasm for biosimilars is a matter of public record. The market will build slowly, but 10 years from now the new law will be seen as ushering in a new age of biopharmaceutical product development. FDA will be satisfied (and successful) if the new law stimulates biosimilars, bio-betters, and innovative new biological products, along with a dramatic increase in knowledge about the nature and characterization of biologic products.  Read the rest of this entry

Long-term Challenges Need Short-term Attention

December 13th, 2009

FDA Matters  sees seven long-term challenges for FDA. Some of these challenges may take years to accomplish; all need to be started now. Three or four years from now, the Commissioner will be judged by whether she moved the agency forward in these areas. I think she has gotten off to a very good start, but there is immense amount of work still required. Read the rest of this entry     

FDA Is Fighting on Two Fronts

FDA is still a 20th century agency. It lacks the databases, technologies and tools to do its work. It does not have the depth of manpower to be experts in all the increasingly complex sciences associated with medical products and foods. It lacks the confidence to consistently make decisions based on risk-benefit analysis, rather than leaning toward the highly restrictive Precautionary Principle.

FDA Matters can’t see any downside to the FDA gaining the technology, the manpower and the confidence to transform itself into the 21st century FDA that our nation needs. Yet, Commissioner Hamburg has to fight on two fronts to preserve her ability to make the necessary changes.

The new Congress has a different set of priorities than the previous two. Deficit cutting and government accountability are on everyone’s mind.

Under a House-passed bill that would fund the federal government in Fiscal Year (FY) 11, the FDA would be allotted $241 million below the level at which it was funded in FY 10. Were this to become law, the agency would need to cut new programs, abandon initiatives and probably lay off staff. To reach agreement with the House, the Senate will also have to cut the federal budget, although perhaps not the funds for FDA.

A 21st century FDA requires capacity to meet new challenges. This won’t occur if the FDA’s budget is being cut.

At the same time, Congress is increasing its oversight/investigative activities. Oversight of FDA needs to occur, but it comes at a price. Investigative hearings are a potent reminder to FDA that cautious, risk-adverse decisions are the ones Congress won’t question. Thus, FDA is reinforced in being a 20th Century agency, rather than encouraged to modernize and think more broadly about problem-solving in the 21st century.

Also, there is an ongoing shift from public funding of FDA to industry funding. User fees pay for very specific tasks. Over-reliance on them reduces the flexibility that FDA leadership needs to handle public health challenges, especially modernizing and strengthening the agency.

Prevailing with Congress won’t be easy and must be considered Commissioner Hamburg’s top priority. At the same time, she must deal with growing unhappiness among FDA-regulated medical product companies.

Based on some recent FDA decisions (e.g. on three weight-loss therapies), many in industry believe FDA is erecting an insurmountable wall of trial design and safety requirements, all intended to slow or deny approval for large-population drugs. Yet, the blockbuster drug (rather than personalized medicine) will remain the industry’s primary business model for at least the next 10 years. Further, Americans still need safe and effective drugs that can treat hundreds of thousands of patients.

Similarly, there have been a number of skirmishes about review standards for medical devices. FDA has moved slowly, listened hard and made compromises. However, with some justification, industry still fears that proposed new standards and procedures will be expensive and delay approval of safe and effective medical devices in the US. FDA also finds itself being compared to the European system, where medical devices are approved far more quickly.

Current industry unhappiness might not be such a challenge for the Commissioner, except for its likely impact on user fee negotiations, agency funding, Congressional oversight and the national debate over how to stem the flow of American jobs and capital to Europe and Asia.  

Ultimately, the FDA’s “fight” with Congress and “fight” with industry come down to one issue: the creation of a 21st century FDA.

It won’t happen if Congress doesn’t fund modernization, tears FDA apart with investigations or relies too heavily on user fees. It also won’t happen if industry—which is the natural advocate for a more modern FDA—can’t work with the FDA to synchronize public health and safety concerns…with efficient and effective ways to review and approve new therapies.

 Steven

FDA and Congress: FY 11 Deficit Reduction Could Cut Deep   February 13th, 2011

Based on budget-cutting actions in the House of Representatives, the FDA is now vulnerable to substantial cuts in its current-year programs. This column analyzes the House situation for FY 11, based on analysis I have done for the Alliance for a Stronger FDA, which is the leading voice for increased appropriations for FDA. Read the rest of this entry

Will the New Congress Be Good for FDA-Regulated Industries?     December 19th, 2010

FDA Matters is hearing that FDA-regulated industries will benefit from the 2010 election. It is assumed that a Republican-led House and more Republicans in the Senate will benefit drug, device and food companies. After all, aren’t Republicans more business-friendly and more concerned about perceived regulatory excess?

Those saying and thinking these things may be in for a rude awakening. Everybody—FDA, industry, patients and consumers—is going to have a rough time over the next two years. Industry will be heard more often, but not always have the winning position. Read the rest of this entry

FDA and Election 2010: Oversight and Investigations     November 13th, 2010

The return of a Republican majority in the House of Representatives means an increase in Congressional oversight and investigations. This mirrors 2006, when the Democrats took back Congress and immediately started investigating the Bush administration. Once again, the agency will find itself buffeted by political forces that are as concerned about “scoring points” as they are about improving government. FDA Matters thinks this will have a large impact on FDA, as well as the agency’s stakeholders.  Read the rest of this entry

Will the Real FDA Please Stand Up?

This e-mail grabbed my attention this week:

TAKE ACTION: FDA Whistleblowers being Fired - HELP THEM.

[Organization] has received an appeal for help to prevent the firing of courageous, honest FDA scientists who risked their careers to save lives by informing Congress about serious safety concerns involving dangerous, FDA-approved drugs and medical devices.

FDA employees should not be afraid to speak honestly and freely about misconduct that threatens the health and safety of all Americans.

This isn't the FDA that FDA Matters has known and followed for 30 years. Yet claims like the one in this e-mail are persistent and come from many sources.

Many FDA critics—inside and outside the agency—believe the FDA is corrupt, industry-beholden, and arbitrary in its decisions. They allege that the agency is insufficiently concerned about safety and that managers have too much power to overrule staff and suppress dissent.

FDA Matters has itself raised questions about workplace problems at FDA. There are links below to columns on "Dissent and Efficiency: Difficult Trade-offs for FDA," "Why Do Some People Dislike the FDA?" and "FDA: A Hit and a Miss" (about Avandia). Nobody would take the position that all 12,000 FDA employees are happy, fulfilled or satisfied with their work.

Nonetheless, I have always found FDA employees to be committed to the American people and dedicated to the public health needs of patients and consumers.

After spending four years as a government manager in the 1980's and over a decade as a manager in the private sector, I believe FDA is like most companies or organizations: encompassing a broad range of competency and commitment and having its fair share of job dissatisfaction. From my government experience, I also remember how hard it can be to re-assign government workers who lack commitment or are incompetent or disruptive.

So, would the real FDA please stand up? Is it my very positive experiences or the dark accusations of ethical lapses, industry coziness and harmful suppression of disagreements? How can two such disparate views co-exist?

Forming a consensus and "speaking with one voice" are logical and sensible for FDA, but not an accurate reflection of what usually happens when well-trained, analytically-oriented people with different perspectives gather to make a decision. For example, reviewers focused on the risk-benefit of a medical product are often at odds with reviewers whose focus is safety.

The situation can become more confused when data is open to different interpretation. In such a clash, some people will feel they were not heard or that their views were not considered seriously enough. This is understandable and inevitable. Further, no one can deny that FDA has made some bad decisions and might have done better if it had listened to dissenting views.

However, aggrieved employees may also feel that malicious agency thinking and dictatorial managers have kept their views from becoming the FDA's position. It is this generalization--from a single instance to the entire agency--that fosters the corrupt image of FDA propounded by agency critics.

I am not persuaded that these critics are right. FDA is making progress in handling dissent and in encouraging managers to be more open-minded. As happened with the Avandia decision, the agency is trying to be honest about disagreements. I am still impressed by the FDA's self-evaluation of its poor performance in the ReGen medical device approval.

To me, these are hopeful signs, as well as indications that FDA values the nation's public health above all other interests. FDA makes mistakes, but there is no conspiracy. The agency is fully committed to serving the American people. 

Steven

Some related columns:

Dissent and Efficiency: Difficult Trade-offs for FDA
May 9th, 2010

FDA has a reputation for being tough on dissent, whether it comes from employees or regulated companies. It is often alleged that FDA employees with contrary views are re-assigned, marginalized or ousted. Within the regulated industries, there is a widespread belief that arguing with FDA has adverse consequences for a company.

 

Whatever the truth has been in the past, FDA is trying to develop an institutional cultural that welcomes and accepts dissent from employees, industry and other stakeholders. It is difficult, even messy, to do this. Yet, FDA’s reputation and authority rests on showing that it listened to all competing views–without unreasonably slowing the decisionmaking process. Read the rest of this entry

Why Do Some People Dislike FDA?
October 15th, 2009

Yesterday, I received separate posts from three organizations that are anti-industry, one of which dislikes FDA and one of which hates FDA. They are not alone in these feelings. There are many groups and individuals who believe that industry and physician professional societies run FDA. I don’t accept their premise or the “facts” from which they launch attacks. Read the rest of this entry

FDA: A Hit and A Miss
September 26th, 2010

FDA Matters has watched FDA handle the Avandia decision differently from any prior controversy. I like the new approach. In the same week, FDA provided a status report on its long-overdue social media and Internet communications policy. Because the agency’s efforts have been glacial, the prospect of useful guidance is dim. I think this is a serious problem. Read the rest of this entry

The State of the FDA—January 2011

FDA's touches the lives of every American at least 6 to 10 times each day. The agency oversees 80% of the nation's food supply, all of human/animal medical products and cosmetics, and almost all radiation-emitting devices. Altogether, the agency is responsible for about 20% of all consumer dollars spent in the United States.

With the President set to deliver his State of the Union address to Congress in 10 days, it seemed a good time for FDA Matters to provide its view of the "State of the FDA." At the beginning of 2011, the agency is doing well, but has a lot of catching-up to do and faces a number of threats.

Strengths: FDA's most important strength is the dedication of the agency's staff and the leadership of Commissioner Hamburg's team. They have made great strides in advancing the public health mission of the FDA, aided by increasing appropriations and the momentum of a new presidency. The renewed emphasis on public health has become a core strength of the FDA.

The agency's commitment to science is another strength. Not every decision can be answered with science (e.g. policy on social media), but a substantial number can. The FDA is successfully building its scientific capabilities, although it is a work in progress. Similarly, the agency's new initiatives to establish an international presence represent a strong response to the challenges of globalization.

Weaknesses: While FDA has been doing better, it is still an organization with workplace issues. Within the agency, barriers still exist to sharing knowledge across offices and divisions. To the broader world, the whole agency seems insular. In particular, the FDA makes inadequate use of expertise that lies outside the agency, particularly in academia.

FDA's information technology (IT) systems are grossly inadequate for an agency with such large, far-flung responsibilities. Some major, badly needed databases aren't going to be available anytime soon, preventing the agency from making the best, most well-supported decisions.It also dooms staff to perform tedious work that could be done in seconds with better tools.

Opportunities: Within FDA, there is the potential for a 21st century regulatory and public health agency that could be the world's benchmark for decades. While such standing is a goal in itself, it is also true that the world-wide use of FDA standards opens up export markets and can contribute to our nation's economic growth.

To realize this opportunity, FDA needs to do a better job in explaining regulatory science to Congress, the media and the public. The tools and standards FDA uses every day are still largely anchored in the last century. Public investment in improving regulatory science is what will bring the agency into the new century.

Another opportunity for the agency is to break the secrecy of how decisions are made. Observers often wonder about the agency's rationale. Industry needs the benefit of understanding the agency's actions. Dr. Hamburg and other senior FDA leaders have taken an important step by publishing more articles in mainstream journals. The handling of internal dissent in FDA's ranks was accomplished deftly in last summer's Avandia decision. In doing so, honestly and forthrightly, FDA increased it credibility and was better able to defend its ultimate decision.

A very different type of opportunity is presented by FDA's ongoing consolidation of personnel at just two locations, White Oak and College Park. This provides the opportunity for a more cohesive workforce, as well as a more efficient one.

Threats: FDA's largest threat relates to its funding and the possibility of being dragged back by budget cutting. Several years of increases have greatly helped the agency, but it is not enough to offset decades of budgetary neglect or carry the agency forward without more money. The gap can widen quickly because FDA's responsibilities keep increasing: more complex science, globalization and two major new laws to implement, food safety and bio-similars.

Another looming threat comes from the ongoing negotiations for re-authorization of pharmaceutical and medical device user fees. FDA needs the funding, but not the likely hit on its public credibility. When Congress considers renewal legislation in 2012, the agency is likely to be caught in the crossfire between those who think FDA is too industry-friendly and those who think the agency impedes FDA-regulated industries in bringing new, sometimes life-saving products to market.

Compounding this threat, user fee re-authorization will probably be the only FDA legislation that must pass Congress over the next two years. Dozens of legislator are going to try to get their FDA-related concerns addressed in the legislation. No one knows how much damage the final legislation might do to FDA.

Steven

Success is Uncertain for FDA’s Regulatory Science Initiative

FDA Matters was an early advocate for regulatory science. It has been exciting to see the concept grow from the Commissioner's first public speech to the President's request for $25 million in FY 2011. And now, FDA has released a White Paper describing the Regulatory Science Initiative (RSI).

It is an excellent report and I applaud those who worked hard to create it. Still, I have misgivings about the way the White Paper characterizes regulatory science, leading to concerns about whether RSI will develop the necessary political and public support to be a long-term, permanent part of FDA.

According to the report:

"Regulatory science is the science of developing new tools, standards, and approaches to assess the safety, efficacy, quality and performance of FDA-regulated products." (emphasis added).

I would suggest that:

"Regulatory science is the tools, techniques and knowledge needed by food, medical product and other FDA regulators to carry out their public responsibilities."

FDA's definition makes regulatory science about what FDA develops (new tools, standards, etc.) and about regulated products. Instead, it should be about how regulatory science makes it possible for FDA to carry out its public health mission in an increasingly complex scientific and global environment. It needs to be clear that consumers, patients and regulated industries benefit when regulators have sophisticated, state-of-the-art capabilities and use them transparently, so that no stakeholder has to guess about the agency's approach. These are public purposes for which it is possible to gather broad support.

Most agency funds are spent to carry out applied regulatory science. A smaller, but not insignificant part of the agency budget is already being spent to create and improve regulatory science. For example, much of the budget of the Center for Food Safety and Nutrition that is not spent on inspections and enforcement is focused on better tools and knowledge to create a safer food supply. Most of the work of the National Center for Toxicological Research is devoted to improving regulatory science through the creation of science-based standards.

Regulatory science is not new and is much larger than an agency initiative. Rather, it is a re-conceptualization of who the agency is and what it does. Without this larger and more visionary framework, I fear that RSI is going to be underfunded by Congress and pushed aside when dollars are tight.

What reason is there to think so? The Critical Path Initiative (CPI) was launched with significant fanfare. The original report was one of the most lucid statements I have ever read from a government agency. The projects that Critical Path supported appear to have been well-conceived and responsive to broad, serious regulatory science needs within FDA.

Yet, the Critical Path completely failed to capture Congress' imagination. It received very modest financial support from Congress, even in the last few years when the FDA's budget expanded significantly.

RSI risks the same failure if Congress and other policymakers can neither explain "regulatory science" nor understand why it is fundamental to FDA's mission success. As judged by CPI funding and the limited enthusiasm that it generated, Congress saw it as a nice add-on, but not a necessity.

If RSI can't do better than this, it will not grow and prosper once the initial excitement fades. This would be a great shame because improving regulatory science is essential to making FDA into a 21st century regulatory agency.

That's why it matters what FDA says now about the RSI. Undoubtedly, the agency wants regulatory science to be seen as a better, more holistic way to understand and improve the agency. At the moment, it still looks more like a collection of worthwhile agency improvements that have been bundled into a new initiative.

Steven

The FDA White Paper, Advancing Regulatory Science for Public Health, can be found here, along with the Commissioner's speech on the topic at the National Press Club: http://www.fda.gov/ScienceResearch/SpecialTopics/RegulatoryScience/default.htm

One of several earlier FDA Matters' columns on regulatory science:

CARS: The Vehicle for FDA's Future October 25th, 2009

Since Labor Day, Commissioner Hamburg has spoken a number of times about the importance of regulatory science. She is right. FDA must have the scientific tools and methodologies to be a 21st century regulatory agency. FDA needs to define regulatory science, develop programs to support it, and package them in a way that will quickly bring recognition and funding. Read the rest of this entry »