	Introduction

Congress is now considering legislation that would add two new Food and Drug Administration (FDA) user fee programs:
Generic Drug User Fee Amendments of 2012 (GDUFA) and Biosimilar User Fee Act of 2012 (BSUFA). PDUFA became possible when FDA, industry, and Congress agreed on two concepts: (1) performance goals —FDA would commit to performance goals it would negotiate with industry that set target completion times for various review processes; and (2) use of fees —the revenue from prescription drug user fees would be used only for activities to support the review of human drug applications and would supplement—rather than replace—funding that Congress appropriated to FDA. User fees make up 35% of the FY2012 FDA budget. Because authorization for FDA to collect fees and use the fee revenue under PDUFA and the Medical Device User Fee Act (MDUFA) expires on October 1, 2012, the bipartisan leadership of both the Senate Committee on Health, Education, Labor, and Pensions and the House Committee on Energy and Commerce have voiced the need to reauthorize those programs before then to avoid disruption of FDA drug and device application review and postmarket safety activities. Both bills include the GDUFA and BSUFA provisions (as Titles III and IV). The BSUFA provisions in S. 3187 and H.R. Generic Drugs

		What Are Generic Drugs? The FDA website describes a generic drug as "identical—or bioequivalent—to a brand name drug in dosage form, safety, strength, route of administration, quality, performance characteristics and intended use." The proposal consists of two parts: (1) the draft legislative language and (2) a goals and procedure agreement between FDA and the industry. The law specifies types of fees, amount of revenue authorized to be collected, and a broad definition of activities on which FDA may use that revenue. For the first year of the program, $50 million of the $299 million would come from a one-time backlog fee to be paid by sponsors of currently pending applications. These require that budget authority (appropriations minus fees) go no lower than the FY2009 amounts, adjusted for inflation, for (1) FDA salaries and expenses overall and (2) human generic drug activities. A biosimilar is a biological product that is highly similar to a brand-name (innovator) biological product made by a pharmaceutical or biotechnology company. A biological product, or biologic, is a preparation, such as a drug or a vaccine, that is made from living organisms. In contrast to the relatively simple structure and manufacture of chemical drugs, biosimilars, with their more complex nature and method of manufacture, will not be identical to the brand-name product, but may instead be shown to be highly similar. Both the legislative language and the performance goals document state that the agency goals are contingent on the allocation for each fiscal year of at least $20 million (inflation adjusted value) in non-user fee funds, plus user fees, to support the review of biosimilar biological product applications. Proposed BSUFA Legislative Language

The proposal to Congress for the biosimilars user fee program would require the collection of six types of fees from industry. Fee amounts would be based on inflation-adjusted PDUFA fee amounts for each fiscal year. Because there are currently no marketed biosimilar biological products, the proposal includes fees for products in the development phase to generate fee revenue for the new program and to enable companies to have meetings with FDA in the early development of biosimilar biological products.
Congress is considering two new user fee authorities to supplement funding appropriated by Congress to FDA: the Generic Drug User Fee Amendments of 2012 (GDUFA), for activities related to human generic drug review, and the Biosimilar User Fee Act of 2012 (BSUFA), for biosimilar biological product review. A generic drug is identical to a brand-name (innovator) drug in dosage form and strength, route of administration, safety, effectiveness, and intended use. A biosimilar is a biological product that is highly similar to an innovator biological product. A biological product, or biologic, is a preparation, such as a drug or a vaccine, that is made from living organisms. In contrast to the relatively simple structure and manufacture of chemical drugs, biosimilars, with their more complex nature and method of manufacture, will not be identical to the brand-name product, but may instead be shown to be highly similar.
S. 3187 and H.R. 5651 include GDUFA and BSUFA titles in legislative packages that also include the reauthorization of prescription drug (PDUFA) and medical device (MDUFA) user fee authorities, as well as other medical-product provisions. Because current PDUFA and MDUFA authorities sunset on October 1, 2012, leadership of both the Senate Committee on Health, Education, Labor, and Pensions and the House Committee on Energy and Commerce have aimed for passage of the legislation enough before then to avoid disruption of FDA drug and device application review and postmarket safety activities. The proposed five-year authorities for GDUFA and BSUFA build on the model that has evolved since 1992 with the original PDUFA. User fees make up 36% of the overall FY2012 FDA budget, with percentages varying across the agency's programs.
Each new user fee proposal consists of two parts: legislative language and an FDA-negotiated agreement with relevant industry groups. The GDUFA bill language specifies the types of fees, amount of revenue authorized to be collected, and a broad definition of activities on which FDA may use that revenue. It refers to a required FDA-industry agreement that lays out performance goals and procedures. The legislative language would authorize FDA to collect $299 million in generic drug user fees per year. For the first year of this authority, $50 million of total collections would come from fees for currently pending applications. To ensure that generic drug user fee revenue supplements, rather than replaces, congressionally appropriated funds, the bill would require that (1) each year's appropriations bill include at least the same level of non-user fee appropriations, adjusted for inflation, as in FY2009 for overall FDA salaries and expenses, and (2) the Secretary allocate at least $97 million, excluding fees and adjusted for inflation, each year for specified human generic drug activities. FDA commitments outlined in the agreement include specified timetables for the review of, and action on, the various types of submissions; risk-based inspections of foreign and domestic generic drug facilities; and regulatory science initiatives.
The BSUFA proposal would require the collection of six types of fees from the regulated industry, which is composed primarily of biotechnology and pharmaceutical companies. Fee amounts would be based on inflation-adjusted PDUFA fee amounts for each fiscal year. Because there are no currently marketed biosimilar biological products, the proposal includes fees for products in the development phase to generate fee revenue for the new program and to enable companies to have meetings with FDA in the early development of biosimilar biological products. Both the legislative language and the performance goals document state that the agency goals are contingent on, in addition to user fees, the allocation for each fiscal year of at least $20 million (inflation adjusted value) in non-user fee funds to support the review of biosimilar biological product applications.