ORA’s Restructuring Plan—ORA 21

ORA refers to the plan for the proposed laboratory structure as ORA 21. Participants in the ORA senior staff meeting discussed and reviewed each option and reached a consensus to consolidate the laboratories by creating five multipurpose mega-labs and four special-purpose labs. However, we found that ORA made assumptions that may have inflated the projected costs of replacing several laboratories. ORA’s claims that its equipment and labs are obsolete are also questionable. Such inflated replacement cost figures raise questions about ORA’s estimated cost savings from ORA 21. Specifically, it believes that (1) ORA’s cost estimates (based on a space requirement of 650 square feet per analyst) are appropriate, (2) consolidation will result in efficient ORA operations, (3) the site selection for its mega-labs was based on reasonable criteria, and (4) its current equipment and facilities are obsolete. We found that ORA (1) has not demonstrated why existing space requirements in its newest facilities (which are significantly less than 650 square feet per analyst) are inadequate; (2) does not have adequate measurable data to support its claim that consolidation would achieve certain benefits and efficiencies; (3) appears to have based site selection mainly on the availability of construction funds or congressional indications that such funds would be available; and (4) has not demonstrated that its laboratories lack state-of-the-art equipment because of its current facility capability or that its schedule to replace equipment would differ if ORA consolidated its labs. We reviewed agency procedures and data governing its plan to restructure field laboratory facilities. 5. FDA provided us with documentation for obtaining such planned operational efficiencies. 18. 20. It does point out, however, that FDA may have overstated the projected monetary and efficiency gains of its proposed laboratory consolidations.
Why GAO Did This Study

Pursuant to a congressional request, GAO reviewed the Food and Drug Administration's (FDA) plan to consolidate its Office of Regulatory Affairs' (ORA) 18 field laboratories for product testing, focusing on: (1) the validity of projected cost savings and operational efficiencies; and (2) site selection criteria.

What GAO Found

GAO found that: (1) the 20-year consolidation plan, known as ORA 21, proposes to create five mega-laboratories and four special-purpose laboratories; (2) ORA based its plan on the belief that its current facilities are old, need costly repairs, and do not meet the needs for conducting regulatory science in the future; (3) ORA may have overstated the consolidation plan's projected cost savings because ORA made several assumptions about replacement costs, construction costs, and space and staffing requirements; (4) the plan's claims for achieving greater operational efficiencies are also questionable, and ORA did not substantiate claims regarding obsolete equipment, supervisor/analyst ratios, laboratory efficiency, and staff relocation; and (5) ORA conducted limited analysis of the relative efficiency of proposed laboratory sites and based its site selections on areas where it believed that it would receive congressional funding approval.