Wednesday, January 17, 2007

PDUFA Payola!

The FDA says it needs 27 additional staff to review DTC TV ads and projects related user fees of $6.2 million in 2008, reports MM&M Newsbrief.

"The agency called for a separate new user fee program to cover DTC TV ad reviews in its proposed outline for reauthorization of the Prescription Drug User Fee Act [PDUFA, sounds like "P'doofah"]. The agency’s plan would raise user fees under the existing program by $87.4 million to $392.8 million annually in order to fund an expanded drug safety programming, increased screening of DTC ads and the agency’s Critical Path initiative."

You can read FDA's announcement in the Federal Register, but I have extracted the relevant paragraphs here (emphasis added):

What We Are Proposing to Recommend for Review of Direct-To-Consumer Advertising

In addition to our proposed recommendations for enhancements to the current human drug review program, we are proposing to recommend a program separate from, but related to, PFUFA assessing fees for advisory reviews of DTC television advertisements. ...
Companies recognize the benefits this advisory review mechanism offers. In fact, PhRMA recently stated in its voluntary guidance principles on DTC advertising that companies should submit all new DTC television advertisements to FDA before broadcasting them... However, although FDA's DTC advisory review workload has been steadily increasing, staffing for this activity has remained level. As a result, it is impossible for FDA to review all of the DTC television advertisement advisory submissions it receives in a timely manner. The lack of timely, predictable FDA review times for DTC television advertisements is detrimental to companies' ability to accurately set timeframes for their marketing campaigns and discourages companies from submitting these materials for advisory review.

We propose creating a separate program, not directly included under PDUFA IV, to assess, collect, and use fees for the advisory review of prescription drug television advertisements. These user fees would not be funded by application, product, or establishment fees assessed under PDUFA.
Instead, these new fees would be assessed separately and collected only from those companies that intend to seek FDA advisory reviews of DTC television advertisements. The proposed recommendation for fee funding and the estimated number of supported staff are summarized in table 2 of this document.

This program would provide for increased FDA resources to allow for the timely review of DTC television advertisement advisory submissions. To ensure stable funding for the program in case the number of advisory submissions fluctuates widely from year to year, the program would assess a onetime participation fee. The program would then charge fees each year for each advisory review requested. These new fees would provide sufficient resources for FDA to hire additional staff to review DTC television advisory submissions in a predictable, timely manner.
FDA anticipates collecting $6.25 million in annual fees during the first year of the program (and a similar amount to go into the reserve fund) to support 27 additional staff to review DTC television advertising. Advisory review fee amounts would be adjusted annually for inflation and to take into account increases in workload. As part of this program, FDA is proposing to commit to certain performance goals including review of a certain number of original advisory review submissions in 45 days and resubmissions in 30 days. The goals would be phased in over the 5 years of the program to allow for recruitment and training of staff.
In the overall scheme, $6.25 million is a crumb. But, since we are concerned only with that crumb here, let's do some math with these numbers. The analysis might be applicable to the entire PDUFA budget.

First, $6.25 million for salaries and benefits of 27 staffers (FTEs) works out to be $231,481.48 per person per year. Where's the job application? I'll sign up today.
FTE or Payola?
I doubt FDA will actually pay staffers anywhere near that amount. A substantial portion of the $6.25 million, therefore, must be pure payola -- and I mean that literally! Want your ad to play on TV? Then you got to pay, baby. Of course, "these new fees," says FDA, "would be ... collected only from those companies that intend to seek FDA advisory reviews of DTC television advertisements." Pity the fool that isn't with the program!

What about cost per TV DTC piece or campaign reviewed?

In a previous post ("Where's DDMAC's Head At?") I showed a chart of the number of DTC materials submitted to the FDA each year. In 2005 about 4,600 print and TV DTC pieces were submitted for review. Maybe 2,000 were TV-related. If FDA gets more money to review TV ads, this could increase to 3,000. The fee per piece (eg., storyboard for one ad) works out to about $2,000. Again, this seems like a lot of money to review a single piece. I could do it for $1,000!

Which leads me to make this suggestion: FDA should farm these reviews out to us bloggers or consultants. Better yet, drug companies could improve their own internal review and obey the law!
This could save the drug industry a bit of cash!

But that would eliminate the payola component.

2 comments:

  1. I read on a post on eDrugSearch.com's blog that the FDA currently has only six employees commissioned to review the incoming material. Does'nt quite seem like enough.

    ReplyDelete
  2. You got that right. But should the fox pay the farmer to protect the hens?

    ReplyDelete