In September 2007, Congress reauthorized the Prescription Drug User Fee Act (PDUFA). Since 1993, the program has enabled the Food and Drug Administration (FDA) to collect and use fees from pharmaceutical manufacturers to review marketing applications concerning prescription drug and biological products. The law intends those fees to supplement direct appropriations not replace them. The Prescription Drug User Fee Act and Its Reauthorizations

		PDUFA I

Congress first authorized FDA to collect fees from pharmaceutical companies in 1992 with the Prescription Drug User Fee Act (PDUFA, P.L. PDUFA's basic goal was, each year, to reduce the time from the sponsor's submission of an application to FDA's decision regarding approval. PDUFA II

Congress reauthorized PDUFA in 1997 as Title I of the Food and Drug Administration Modernization Act (FDAMA, P.L. The reauthorization, referred to as PDUFA II: 
stated that the fees were to be used to expedite the drug development and application review process as laid out in performance goals identified in letters sent by the Secretary of the Department of Health and Human Services (HHS) to the two authorizing committees; mandated tighter performance goals, more transparency in the drug review process, and better communication with drug makers and patient advocacy groups; and allowed FDA to use PDUFA revenue to consult with manufacturers before they submitted an application. PDUFA III:
allowed FDA to adjust annual revenue targets based on changes in workload; required the agency to meet with interested public and private stakeholders when considering the reauthorization of this program before its expiration; allowed the collection, development, and review of postmarket safety information for up to three years on drugs approved after October 1, 2002, which allowed the agency to double the number of staff monitoring side effects of drugs already on the market; allowed biotechnology companies to request that FDA select an independent consultant (for which the manufacturer would pay) to participate in FDA's review of research activities; authorized two pilot programs for the continuous ("rolling") review of new drug applications for products designated for the fast track program because they would address serious or life-threatening conditions for which other treatments were not available; encouraged companies to include risk management plans in their pre-NDA/BLA meetings; allowed the use of fees to develop databases documenting drugs' use; allowed the use of fees for risk management oversight in the "peri-approval" period (i.e., two to three years post-approval); provided for "first cycle," preliminary reviews; required the HHS Secretary to note on FDA's website if a sponsor did not meet an agreed-upon deadline to complete a postmarket study, and to note if the Secretary considers the reasons given for study incompleteness to be unsatisfactory; required any sponsor who failed to complete timely studies to notify health practitioners both of this failure and of unanswered questions related to the clinical benefit and safety of the product; and added specificity to the availability and crediting of fees provision, stating that fees authorized be collected and available for obligation only to the extent and in the amount provided in advance in appropriations Acts; and that such fees are authorized to remain available until expended. PDUFA IV

The Prescription Drug User Fee Amendments of 2007 (PDUFA IV) formed Title I of the FDA Amendments Act of 2007 ( P.L. 110-85 ). FDA may, therefore, use PDUFA funding for authorized activities throughout the life of a product, rather than the three-year postapproval period that PDUFA III had allowed; expanded the list of postmarket safety activities for which the fees could be used to include developing and using adverse-event data-collection systems, including information technology systems; developing and using improved analytical tools to assess potential safety problems, including access to external data bases; implementing and enforcing new FFDCA requirements relating to postapproval studies, clinical trials, labeling changes, and risk evaluation and mitigation strategies; and managing adverse event reports; authorized the assessment and collection of fees relating to advisory review of prescription-drug television advertising. Although specific to PDUFA, these issues persist because they reflect broader questions about budget choices under limited resources, the identification and amelioration of conflicts of interest, and the tension between making new drugs available to the public and ensuring that those drugs be safe and effective. Effect on Review Time

Based on its stated goals, PDUFA has been generally viewed as a success. FDA has added review staff and now completes it reviews of NDA/BLA applications more quickly and runs less of a backlog. FDA attributes shorter approval times to PDUFA-funded staff increases. Until an amendment in PDUFA IV that requires consumer participation as well, the law directed FDA and manufacturers to meet, in preparation for each PDUFA reauthorization, to discuss workload and revenue needed. Resource History of FDA and Its Human Drug Program
This report, last updated in June 2008, provides a history of the Prescription Drug User Fee Act through its third reauthorization—as PDUFA IV—in September 2007. As the 112th Congress turns to the law's next reauthorization—PDUFA V, CRS has prepared another report that describes current law and the PDUFA V proposal (legislative language and the performance goals Agreement between FDA and industry representatives). It also explores the impact of PDUFA on FDA application review time and the agency's Human Drugs Program budget, and issues that Congress is likely to discuss as it prepares for anticipated PDUFA V reauthorization. For activity in the 112th Congress, please see CRS Report R42366, Prescription Drug User Fee Act (PDUFA): Issues for Reauthorization (PDUFA V) in 2012, by [author name scrubbed].
In 1992, Congress passed the Prescription Drug User Fee Act (PDUFA I) to give the Food and Drug Administration (FDA) a revenue source—fees paid by the pharmaceutical manufacturers—to supplement, not replace, direct appropriations. The impetus behind the 1992 law stemmed from the length of time between a manufacturer's submission of an FDA New Drug Application (NDA) or Biologics License Application (BLA) and the agency's decision on approval or licensure. FDA had attributed the delay, which affected patients and manufacturers, to constraints on its ability to hire and support review staff. Congress reauthorized the user fee program in 1997 (PDUFA II), in 2002 (PDUFA III), and, most recently, in 2007 (PDUFA IV), as Title I of the Food and Drug Administration Amendments Act of 2007 (FDAAA, P.L. 110-85).
Congress intended PDUFA to diminish the backlog of applications at FDA and increasingly shorten the time from submission to decision. PDUFA II expanded the program's scope to include activities related to the investigational phases of a new drug's development, and to increase FDA communications with industry and consumer groups. PDUFA III again expanded the scope of authorized activities to include both preclinical development and a three-year postapproval period.
In keeping with the law, FDA has worked with the drug manufacturers to set PDUFA performance goals, which the Secretary of Health and Human Services (HHS) has submitted in letters to the chairs of the relevant congressional authorizing committees. The Secretary also submits annual performance and financial reports.
In crafting PDUFA IV, the most recent reauthorization, the 110th Congress addressed workload and compensation adjustments; expanded the authorized range of safety activities to include development of data collection systems and analytic tools, and enforcement of postapproval study, labeling, and risk evaluation and mitigation strategy requirements; increased public communication requirements; and authorized a user fee for the advisory review of prescription drug television ads.
The general view is that PDUFA has succeeded. FDA has added review staff and reduced its review times. At each reauthorization, however, discussion returns to certain issues in the context of PDUFA that also reflect broader FDA concerns. These include budget choices under limited resources, including the relationship between direct appropriations and user fees; the identification and amelioration of conflicts of interest when the regulated industry is a major source of industry funding; and the tension between making new drugs available to the public and ensuring that those drugs be safe and effective.