Brakke Viewpoint July 29, 2022

Do high FDA Animal Drug Users Fees slow innovation in animal drugs?

Each year the FDA ADUFA/AGDUFA fees change due to inflation, workload, and prior year excesses or shortfalls in collections.  Starting in October, New Animal Drug Applications will require a $659,364 check and a supplemental application will need a $329,682 check, 13.5% more than last year.  A generic drug ANADA will need a $494,983 check in 2023, down from $548,628 in 2022 due primarily to excess collections in 2021.  That’s a lot of money and it must impact innovation.

Some interesting information on innovation comes from the workload calculation.  The average number of NADAs submitted over the last 5 years (ending May 2022) is 12.8, which is down 22% compared to the 5 years ending September 2018, which had an average of 16.4 applications.  The FDA expects 5.25 NADAs in 2023.  Comparing these same 5-year periods to each other, supplemental applications are down 22% also, investigational study submissions are down 7%, manufacturing supplements are up 4% and investigational protocol submissions are up 1%.  This all leads to an overall 4.5% reduction in workload, which doesn’t reflect well on innovation.

However, the workload for Generic Animal Drugs is booming – it’s up 77%. Over these same two 5-year periods, ANADAs are up 12.5% (27 vs 24), generic investigational study submissions are up 125%, generic investigational protocol submissions are 77% and manufacturing supplements are up 30%.  The FDA estimates that in 2023, there will be 11.6 full fee ANADAs filed, double the NADAs filed.

So, less risky, cheaper generic drug development has replaced more risky, expensive new drug development.  There are provisions for fees to be waived or reduced if the product is deemed to be innovative and that the fee would be a significant barrier to bringing the product to market.  The number of NADAs that were filed with the FDA and had the fees waived is not published by the FDA – we assume it is insignificant.

This is the last year of ADUFA IV and negotiations are underway now for ADUFA V, which would begin in FY2024.  Let’s hope its structured to drive more innovation.

Bob Jones