Proposed Hike in User Fees Unfair Burden for Biotech Companies

WASHINGTON, D.C. – (February 8, 2002) – Biotechnology Industry Organization President Carl B. Feldbaum described the $272 million in user fees included in the proposed FY2003 Food and Drug Administration budget as unjustified.

“This current budget proposal reflects a basic misunderstanding of the economics of the biotechnology industry,” Feldbaum said. “The proposal to more than double fees on biotechnology product applications for FDA approval would impose a disproportionate burden on many small, emerging biotechnology companies.”

User fees currently constitute approximately half of FDA’s budget for review of biotechnology and pharmaceutical products.

“BIO estimates that the proposed budget for the Department of Health and Human Services would increase application fees from $300,000 to $700,000 – an increase that even the FDA has yet to justify,” said Feldbaum.

The user fee program, first enacted in 1992, has provided industry resources to the Food and Drug Administration, which improved the drug approval process. The program is slated for reauthorization this year, and negotiations for improvements are underway.

“This program originally worked well to streamline the approval process, bringing drugs and biologics to patients who need them. But recently review times have slowed, and the proposed increase in user fees is not linked to further improvements or any reduction in review times beyond those promised when the fees were last authorized in 1997,” said Feldbaum.

BIO represents more than 1,000 biotechnology companies, academic institutions, state biotechnology centers and related organizations in all 50 U.S. states and 33 other nations. BIO members are involved in the research and development of health-care, agricultural, industrial and environmental biotechnology products.

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