FDA Matters Blog
Short Takes and Updates—February 20, 2025
1 FDA At Risk on Four Fronts
All the federal public health programs are under siege. While my focus is on FDA, I want readers to know that NIH and CDC face similar (but not identical) threats.
Reduction In Force (RIF). The new Administration sent lay-off notices to…read more…
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1. FDA At Risk on Four Fronts
All the federal public health programs are under siege. While my focus is on FDA, I want readers to know that NIH and CDC face similar (but not identical) threats.
Reduction In Force (RIF). The new Administration sent lay-off notices to an unknown number of FDA staff over the holiday weekend. The common element is that they were on probationary status and thus have a lower level of job protection. I described and commented on this in my column earlier this week: If Being Mission Critical Is Not Important Enough, What Is?
The situation is still unclear as of midday on February 20. Over the last 24 hours, I have been responding to reporters with the following statement:
From watching OMB and FDA interpret these types of orders and directives in 2017, I learned there is a lack of clarity when they are first announced. Whether and how much FDA would be affected requires reading the fine print—in the overall declaration and then how it is to be applied to the massive responsibilities, different personnel systems, multiple funding sources, and wide range of skills needed at FDA.
In this case, we do not know the numerator (laid off by center/office) or the denominator (total laid off at FDA), so it is impossible to talk about either general or specific impacts. We need to let the dust settle.
For those of us who are watching, it is frustrating not to know. For FDA employees--those who are living it—it is probably closer to excruciating.
FY 2025 Appropriations/Possible Shutdown. FY 25 has been funded by Continuing Resolutions since October 1 of last year. The current CR expires on March 14 and so far, there is no deal on total spending or specific bills. According to Politico, “Republican appropriators sent a new offer to their Democratic counterparts over the weekend.”
FDA is at risk in two ways. If they reach an agreement, there is potential for FDA funding to be cut. If they do not reach an agreement, then there could be an additional CR or a shutdown.
Budget Reconciliation. Compared to the other two threats, this one is going to take longer and unwind a bit more slowly but could lead to substantially greater downward pressures on domestic discretionary programs. I did a deep dive on this last week: FDA and Budget-Reconciliation 2025: A Primer and supplemented it here. The process continues in both the House and Senate.
Impoundment of Appropriated Funds (new and a wildcard). President Trump and OMB Director Russ Voight have asserted the President’s authority to impound Congressionally-appropriated funds….notwithstanding Constitutional provisions that have always been interpreted to the contrary. It is possible that FDA funds could be impounded, and the agency drawn into this battle. (h/t to Alec Gaffney at Agency IQ. You can sign up for their daily newsletter, FDA Today, at https://www.agencyiq.com/subscribe-fda-today/).
2. FDA and the Upcoming Attempt to Gut Medicaid: Are There Any Overlapping Issues?
The status of Medicaid may seem to be in doubt[1], rather than pre-determined. However, under the pending House Budget Resolution, House Energy and Commerce committee will be expected to deliver $880 billion in savings over the next decade. There is no way to achieve that result without massive reductions in the Medicaid program. All options to do so are painful[2].
As reconciliation efforts advance in the House and Senate, the status of Medicaid is going to be grabbing headlines. On the one hand, the President’s agenda and tax cuts cannot be paid for without the Medicaid cuts. On the other hand, the traditional Republican position on the value of Medicaid is going to clash with the reality that Medicaid (including program expansions of the last dozen years) are popular in many red states.
My question to FDA Matters’s readers: do FDA and FDA stakeholders have a stake in the Medicaid battle? If so, what are the issues?
3. What I Am Listening To
Wayne Pines and Shelly Garg have launched FDA Watch (https://fdawatch.libsyn.com/), which offers podcasts about FDA. I recommend signing up.
This week’s guest is Janet Woodcock, discussing FDA’s future and the evolving regulatory landscape. You can also catch my appearance on January 20, along with Marc Scheineson of Alston & Bird, discussing the “The New-Look FDA in 2025.”
4. Pass the word: sign-up to receive FDA Matters.
Forward this e-mail to colleagues and friends and urge them to subscribe at www.fdamatters.com.
Politico has reported this morning that: “Hours after pledging that the safety net program [Medicaid] “is not going to be touched,” Trump surprised some of his own staff Wednesday when he endorsed a House budget that would gut Medicaid.”
If Being Mission-Critical Is Not Important Enough, What Is?
FDA employees--public-spirited and committed—are the heart of the agency and can proudly point to a lengthy record of accomplishment. Our country has safe food and safe and effective medical products because of their efforts. We are all affected: every American uses FDA-regulated goods and services at least several times each day…. read more…
FDA employees—public-spirited and committed—are the heart of the agency and can proudly point to a lengthy record of accomplishment. Our country has safe food and safe and effective medical products because of their efforts. We are all affected: every American uses FDA-regulated goods and services at least several times each day.
It is said that FDA’s best days are quiet ones—everything runs smoothly, nothing of public concern happens. Given the vastness of the agency’s responsibilities that is an incredibly high standard.
Although the numbers are still uncounted, the agency suffered a brutal and seemingly arbitrary purge of probationary employees over the holiday weekend. Not only were relatively new employees swept away, but also many employees who received competitive promotions in the last two years (a process by which many of them might be considered “the best of the best.”). As extensive as the Reduction in Force (RIF) seems to have been, there are likely to be more attempts to lay off FDA employees.
It is wholly appropriate for the FDA community to deeply mourn its institutional and individual losses.
Employees on probation were an arbitrary target—chosen solely because they are an easier target than employees with more job protections. As far as I can tell, there was no triage based on protecting priority FDA functions and services or assuring needed skills.
For many years past–and presumably for many years to come—a key goal of advocates has been to impress upon Congress, the Executive Branch, and the public that FDA is an extraordinarily valuable agency providing a core function of government. The explicit message: the agency needs more money so it can better fulfill its growing mission. The implicit message: if cuts need to be made in government spending, FDA’s funding should be among the last to be considered.
Government-wide, protecting the more valuable functions of the government (agencies, service and people) formed no apparent part of the employee reductions[1].
It may be crazy to do a RIF at FDA when laid-off employees are mission-critical to medical advances and food safety and play a key role in national and global commerce. But that’s no crazier than cutting FAA staff who assure safe air travel after three incidents in the last few weeks (here), or probationary FBI agents (here), or cutting (since rescinded) the jobs of personnel who maintain nuclear safety and security (here). USDA work that relates to Avian Flu also experienced frontline cutbacks (here) that are inexplicable.
If any of these agencies were told: next year you will have to function with fewer employees….it would be awful, but foreknowledge and flexibility would certainly help the agency lessen the damage by prioritizing mission-critical activities.
In assessing the current situation, I am left with an obvious question that appears to have no immediate answer: if being mission-critical is not valuable enough to save an employee, service, or program, what is?
INFORMATION FOR FDA EMPLOYEES from the FDA Alumni Association:
New resource page tailored to the needs of FDAers: Today the FDAAlumniAssociation posted a reference page outlining information sources that FDA staff might find helpful during this time of transition. The reference page is a work in progress, so if there are additional links you believe would be helpful that we should consider adding, please contact FDAAA. A huge shout out to the EPAAlumniAssociation that permitted us to poach some of their information sources. If you are planning to leave the agency or choosing to stay and would enjoy seeing familiar faces, please consider joining FDAAA. We appreciate you! https://lnkd.in/eR3bsQSA
According to one article I read, the White House has claimed that the government-wide RIF followed priorities and chose people whose jobs were less important. The article continued with a quote from a third party to the effect: if that is the case, then the people making the decisions had no understanding of the jobs people were performing.
Short Takes and Updates—February 14, 2025
1 When Will Congress Engage on the Future of FDA User Fees? Either the agency is captured by industry (Secretary Kennedy), or it is a hindrance to industry (Vivek Ramaswamy). I understand how it could be neither…but not how it can be both…read more…
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1. When Will Congress Engage on the Future of FDA User Fees?
Either the agency is captured by industry (Secretary Kennedy), or it is a hindrance to industry (Vivek Ramaswamy). I understand how it could be neither…but not how it can be both.
The lack of clarity is of concern to nervous corporate executives and many FDA employees. I have pointed out that PDUFA VII and MDUFA V and GDUFA III do not expire until September 30, 2027, with initial discussions only just starting this summer. There is time for this discussion after the new Administration has been in office for a while and taken care of more pressing issues.
I am starting to feel a bit nervous about this answer. So far, the new Administration has shown little patience for waiting on anything. If they feel strongly, they seem to want to engage immediately….contractual agreements and statutes not necessarily representing barriers.
This is not a prediction, just a lessening of my certainty that user fees are off the table until later.
2. More on FDA and Reconciliation.
My primer on FDA and reconciliation (here) was widely read and should have an extended shelf life. The point of my primer is that the deep budget cuts from reconciliation (adopted by authorizing committees) will create an appropriations funding environment that puts FDA (and NIH, etc.) at risk.
The tie between reconciliation and appropriations was reinforced at yesterday’s House Budget Committee mark-up, where cost-cutting targets were increased to accommodate the House Freedom Caucus (here). HFC members are eager for deep cuts in appropriated funding.
A couple of readers asked: is FDA also vulnerable to cuts in funding through the reconciliation process itself? Under the House reconciliation bill adopted in the Budget Committee yesterday, House Energy and Commerce Committee was directed to generate a minimum of $880 billion over ten years. At that scale, the primary target will be Medicaid.
To achieve savings from FDA, House E&C would have to adopt statutory language that had a budget impact on the agency. This seems unlikely but not out of the question.
3. What We Are Reading: Reversing Misinformation by Michael Miller, MD.
Inspired by Teddy Roosevelt’s comment that “complaining about a problem without offering a solution is called whining,” health policy analyst, Michael Miller decided that confronting rampant medical misinformation deserved a practical guide for individual action.
More about the book and about “Dr. Mike” can be found here.
4. Pass the word: sign-up to receive FDA Matters.
Forward this e-mail to colleagues and friends and urge them to subscribe at www.fdamatters.com.
“FDA Matters: The Grossman FDA Report” provides short-form analysis and commentary on FDA policy and regulatory issues.
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FDA and Budget Reconciliation 2025: A Primer
Part 1: Meaningful Deficit Reduction Requires More Than Cuts to Discretionary Spending
In FY 2024, the federal government spent $6.75 trillion and collected $4.92 trillion in revenue, resulting in a deficit. The amount…
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“A cynic knows the price of everything and the value of nothing.”—Oscar Wilde
Part 1: Meaningful Deficit Reduction Requires More Than Cuts to Discretionary Spending
In FY 2024, the federal government spent $6.75 trillion and collected $4.92 trillion in revenue, resulting in a deficit. The amount by which spending exceeds revenue, $1.83 trillion in 2024, is referred to as deficit spending[1].
There is near-universal agreement that the annual federal budget deficit must be reduced. If allowed to continue, it would add $18 trillion to the national debt over the next ten years.
“The iron triangle of deficit reduction” refers to the three ways (and only three ways) in which annual government deficits can be reduced or eliminated[2]:
discretionary spending cuts (defense and/or non-defense);
reduction in entitlement payments and other mandatory program spending; and
increases in federal revenue through economic growth or additional taxes.
All discretionary spending taken together ($1.7 trillion in FY 24) is less than the annual deficit.
Nonetheless, every year, Congress attempts to achieve meaningful deficit reduction through the appropriations process, while also supporting increases in funding for defense, homeland security, and veterans. This puts overwhelming downward pressure on all other discretionary programs, including FDA.
Meaningful deficit reduction can only be achieved by substantially increasing federal revenue and/or significantly reducing the costs of entitlements and mandatory programs.
Addressing revenue and mandatory programs can be done by stand-along bills. However, as a practical matter, major changes in revenue and/or mandatory programs are unlikely except through budget reconciliation.
Part 2: Budget Reconciliation Explained
As envisioned by the Budget and Impoundment Control Act of 1974, Congress has an obligation to develop and pass a budget resolution that determines spending, revenues, deficit or surplus, and the public debt for a fiscal year.
The appropriations committee then takes over and allocates the discretionary programs monies by subcommittee and program so as not to exceed the amount provided in the budget resolution. Most years, Congress does not pass a budget resolution and, instead, total discretionary funding is set as part of a bi-cameral leadership package that includes appropriations bills[3].
In the years that Congress has passed a budget resolution, it is usually for the purpose of creating “reconciliation instructions” that direct authorizing committee to find specific amounts of savings and/or find offsets for increases in the programs they oversee. Reconciliation directions do not go to the appropriations committees because they are already constrained by spending ceilings.
Since 2000, seven out of the eight budget resolutions/reconciliation instructions are associated with a period when the same party controlled the House, the Senate, and the Presidency and six of them increased projected deficits[4]. This reflects the procedural advantages: the budget reconciliation only requires a majority vote in the Senate and cannot be filibustered. That makes it a more desirable way to move major legislative initiatives than the ordinary legislative route.
There are two notable limitations: reconciliation can only be used to make changes that have budgetary impact; and the reconciliation process can only be used twice in every fiscal cycle.
Part 3: Complex Reconciliation Goals/Politics in 2025
Republicans in Congress are trying to achieve three primary goals in budget reconciliation in 2025:
Increase resources available to support President Trump’s agenda, notably increased funding for efforts to secure the border, bolster our military, and increase American energy independence ($342 billion over four years according to a proposal under consideration in the Senate Budget Committee. Mark-up starts on February 12, 2025).
Reduce the annual federal budget deficit from its current unsustainable levels (a 25% reduction in the annual deficit would require $4.5 trillion over 10 years; halving the annual deficit would require about $9 trillion over 10 years).
Find savings and revenue enhancers to pay for the cost ($4.7 trillion over 10 years) of extending the individual tax cuts enacted in President Trump’s first year (2017) and expiring on December 31, 2025.
In the Senate, Budget Chair Graham is trying to do program changes (bullet one) in a bill now…and deficit reduction (bullet two) and taxes (bullet three) in a bill later in the year. Speaker Johnson is trying to achieve agreement in the House for one bill to do all of this—to be moved this Spring.
The politics of this….and how it will play out…are beyond the scope of a blog focused on FDA issues and policies. However, achieving these three goals will probably require $1 trillion per year in additional revenue (tariffs?), mandatory program cuts[5], and savings from continued powerful downward pressure on domestic discretionary spending.
This is a cynical process (h/t to Oscar Wilde) in which many programs will be cut or eliminated because of their cost (price), regardless of their value.
In such an environment, FDA’s fate is not sealed, but its prospects for sustaining and increasing its budget are not promising.
The arguments for the value of FDA to public health, safety, and commerce will need to be voiced loudly by the entire FDA stakeholder community. They will need to do so repeatedly, until the value produced by FDA is seen as so great that paying the agency’s cost (price) becomes seen as a necessity….even in a dramatically smaller federal budget.
https://fiscaldata.treasury.gov/americas-finance-guide/national-deficit/
The fourth major category of budget expenses is interest payments on the national debt. These are set by market forces and cannot be reduced by law or fiat without jeopardizing the government’s ability to finance the totality of the US debt, which exceeds $36 trillion. The public holds nearly $30 trillion of that debt.
There are no consequences if Congress fails to adopt a budget resolution.
https://www.cbpp.org/research/introduction-to-budget-reconciliation
Social Security and Medicare are likely to be spared for political reasons, meaning even deeper cuts in Medicaid, SNAP, and other means-tested human services programs.
According to the 2-12-25 issue of POLITICO Inside Congress, some House Freedom Caucus members are pushing for a $2 trillion target.
Short Takes and Updates — February 6, 2025
Today is the first “Short Takes and Updates” column. For those who have not signed up to receive the FDA Matters newsletter in your email box, go to the home page to register.
Today is the first “Short Takes and Updates” column. For those who have not signed up to receive the FDA Matters newsletter in your email box, go to the home page to register.
1. US to Leave the World Health Organization—An Alternative Interpretation.
For those who followed Trump 1.0 closely and parsed Project 2025 carefully, it is not a surprise that the World Health Organization (WHO) has been targeted by the new Administration. A summary of items in dispute is here.
However, I did not expect the notice of withdrawal to be a “day one” priority nor did I expect it would be in the form of an executive order (here). Fortunately, there is some leeway–best understood as: our participation ends now, but the required notice of one year means we are, at least for now, still members.
At last week’s wide-ranging Kinexum-sponsored webinar (https://youtu.be/9GMdrZ6fdY4 and https://youtu.be/eK9dUwcLNiY), a deep bench of participants with FDA expertise, spoke eloquently about the value and continuing need for WHO. Clearly, exiting WHO would be a loss for both US and global health.
In response, I offered an alternative interpretation of what might happen next. The new Administration likes to open with an extreme position (e.g., tariffs will be imposed in three days) then use that to gain leverage in subsequent negotiations. I am hopeful—albeit far from certain—that WHO will work out that way. It may require changes at WHO—perhaps significant one—but the US will continue to belong. At least that is my hope.
2. The Time Is Ripe for Improving Food Safety.
My earlier column (Down is Good and Up Is Bad; Or is the Other Way Around?) concluded that: “There is no better time than now to create a comprehensive plan for improving food safety at the federal, state, and local levels — and push forward together as a community for its funding and implementation.”
As reported by Food Safety News (here), the General Accounting Office has issued a new report on food safety (here), which concludes that: “We previously reported on the need for a national strategy to guide federal efforts to address ongoing fragmentation and improve the federal food safety oversight system. This strategy could address our other previous matters for congressional consideration about a government-wide performance plan and sustained leadership for federal food safety. We maintain that such a strategy could create an opportunity to further strengthen federal oversight of the nation’s food supply and reduce the economic and public health effects of foodborne illness.”
To my many friends in the food stakeholder community, as well as the leaders of FDA, CDC, and FSIS: the time is now, let’s work together to make this happen!
Another voice in agreement: Frank Yiannas, former Deputy Commissioner for Food Policy and Response at FDA weighed in this morning with a column in Food Safety News (here).
3. Retirement-eligible FDA Employees Likely Key to How Many FDA Employees Accept the Proposed Buy-Out
My inaugural column on January 10, (Is a Mass Exodus From FDA Coming Soon?), urged FDA employees not to resign prematurely. Despite the subsequent “fork in the road” buy-out offer from OPM, that still seems to be the predominate advice. See analysis and recommendations: here, here, here, and here.
When numbers come out, probably soon, it is important to remember that there are many different jobs, situations, and career goals among FDA employees. As I wrote in the original column, one segment, those who are “retirement-eligible,” may “have a different calculus than those with shorter tenures in the federal government. In many cases, they do not face a significant loss of income if they leave the agency. Presumably, they also skew older and may have less interest in waiting to see how things turn out.”
“An unknown is how much of the FDA workforce is retirement-eligible. Last Fall, an FDA official told me ‘15%.’ However, it was a casual conversation, and I do not know whether his answer was actual or speculative. At the 15% level, with perhaps 25% uptake, the impact of resignations by retirement-eligible individuals would be significant, but perhaps not overwhelming.”
As a point of reference: 15% of 18,000 employees is 2700. If the uptake is 25%, as I have speculated, that would be about seven hundred retirement-eligible employees taking buy-outs. The actual percentage might be higher or lower for this group of individuals. Of course, this does not predict any particular outcome for the remaining 85% of FDA employees.
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“FDA Matters: The Grossman FDA Report” provides short-form analysis and commentary on FDA policy and regulatory issues. We intend to publish one or two columns a week. We respect your privacy, and our mailing list will never be used for any purpose other than dissemination of analysis and commentary relating to FDA.