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Broad Changes to FDA in House Package

By Drew Armstrong, CQ Staff

June 25, 2007 -- Democrats sent to the House floor last week a package of FDA and drug policy legislation containing the most sweeping safety and regulatory changes to the agency in years, despite a number of compromises during the committee process that moderated parts of the bill.

The measure, still in draft form, would reauthorize the Food and Drug Administration's programs to speed approval of drugs and medical devices. It would also add new surveillance and safety regulations for drugs after they had been approved, as well as larger fines for companies that violated the new regulations.

Before voting 30–9 to combine the package of nine draft bills into a single omnibus measure and send it to the floor, members also voted to reduce fines on drug companies set by the subcommittee as part of the "Risk Evaluation and Mitigation Strategies" section of the bill, also known as REMS.

The REMS section would create a new program within the FDA to monitor the safety of drugs after they came to market. The drug safety programs would be funded largely by $225 million in new user fees assessed to drugmakers.

In the version of the bill approved by the panel's Health Subcommittee, drug or device companies would have been subject to a $20 million maximum fine for a single violation and a $100 million maximum fine for several violations. Those fines were reduced to $250,000 maximum per violation and $1 million maximum for several violations. If companies were notified of violations and they continued, the fines could go to $10 million for one violation, $50 million for several.

Under the safety sections of the bill, newly approved drugs could be subject to follow-up studies after they went to market, and the FDA would be required to revisit the drugs several years later for further analysis. In the case of some riskier drugs, there would be regulation limiting prescribing authority to trained physicians. Exceptions would be made in the case of a public health emergency.

The full committee took at least a philosophical step toward reducing the reliance on drug industry money, which funds much of the FDA's drug regulation activities.

Under a bipartisan amendment, adopted by voice vote, a mechanism would be created so that if appropriators decided to fund the drug safety program, the amount assessed to manufacturers for safety would be cut by an equal amount. The drug approval process would still be funded largely by user fees, and committee members made no promises that appropriators would provide more funds for the drug safety program.

"It's not an insignificant figure, obviously," said subcommittee ranking Republican Nathan Deal of Georgia.

Critics of the FDA's drug approval programs say the agency's reliance on drug company fees to pay for the programs undermines public confidence in the process.

Approaching Deadline
Funding for the current authorizations of the drug and device approval programs will expire on Oct. 1 of this year.

But the deadline for Congress to reauthorize them actually falls earlier than that. If the reauthorization is not signed into law 60 days before the programs expire, the FDA has to send out "reduction in force" notifications to staff, cutting its workforce in anticipation of the programs' expiration.

The House is expected to take up the legislation on the floor in July. To avoid FDA layoffs, Congress will need to send the legislation to the president before the August recess. The Senate passed a companion bill (S 1082) on May 9 with somewhat weaker regulations than many in the House package, including smaller fines and fewer limits on FDA advisory panel conflicts of interest.

Trimming and Tweaking
While committee members from both sides hailed the bipartisan effort in creating the bill, Health Subcommittee Chairman Frank Pallone Jr., D-N.J., watched his draft language be substantially revised several times during the markup in his panel June 19 and in the full committee June 21.

During the full committee markup, a group of Democrats amended the portion of the bill dealing with medical device approval over his objections. Jay Inslee, D-Wash., offered an amendment, adopted by voice vote, to strike a limit on the number of times a private inspector could be hired by the same company, a safeguard that Pallone said would prevent inspectors from returning positive inspections to get repeat business.

The subcommittee markup offered a similar result, as Republicans joined with a splintering of Democrats led by Edolphus Towns of New York to gut the bill's regulations on direct-to-consumer drug ads.

The restrictions would have given the Food and Drug Administration discretion to ban direct-to-consumer ads for a new drug for up to three years. They were largely written by California Democrat Henry A. Waxman, with Pallone's support.

Three New York lawmakers—Towns, who offered the amendment, Anthony Weiner and Eliot L. Engel—were joined by six other Democrats and voted with Republicans, 23-9, to adopt a less restrictive amendment relying on fines and voluntary ad review by the FDA.

Much of the rhetoric centered on First Amendment concerns, but the New Yorkers also had other priorities.

"These things are very important for the New York economy, quite frankly," Engel said of the television and print ads that Pallone's substitute amendment targeted. "The networks are all located in New York, the advertisers are all located in New York. It's a big hometown industry."

Under the amendment, the government would have no authority to require changes to the ads. For "false or misleading ads," there would be a maximum penalty of $250,000 for the first offense and $500,000 per day for subsequent offenses.

State–Federal Relationship
Working with Pallone, subcommittee members also decided to remove language that would have forbidden federal pre-emption of state drug law and regulation, which Republicans said would create a slew of state-level lawsuits against drugmakers and undermine the FDA's authority.

Before it was removed, the pre-emption language threatened to derail industry support for the bill. "It's extremely troubling from our perspective," said Christopher White, general counsel for AdvaMed, the industry's lobbying group.

Republicans also slammed the provisions, before they were removed. "It is a gift, if you like, to file suit in state courts," said Michael C. Burgess of Texas.

The language was initially included at the request of the American Association for Justice, a trial lawyers' lobbying group, the consumer advocacy group Public Citizen and several other groups, according to Gerie Voss, regulatory counsel for the lawyers' association.

Conflicts over the pre-emption language and several other sections delayed the subcommittee markup from its original June 14 date after Energy and Commerce ranking Republican Joe L. Barton of Texas requested postponement in a meeting with Chairman John D. Dingell, D-Mich., Pallone and Deal.

The committee also took a step to track the safety of medical devices. A manager's amendment, adopted by voice vote, would create a "unique identifier number" for all devices, allowing the FDA and providers to better track individual devices for malfunctions and safety.

While the omnibus package covers a wide range of drug policy items, House lawmakers decided in the markup to come back later in the year and revisit the issue of counterfeit drugs entering the country from abroad.

Dingell promised to work with Steve Buyer, R-Ind., on legislation to give the FDA the authority to destroy counterfeit drugs intercepted during shipment. According to Dingell and Buyer, at present many of the counterfeit drugs are simply returned to the point of origin, after which they reappear in another shipment. Buyer had originally offered an amendment on the issue at the committee markup, but withdrew it after Dingell's promise.

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