FDA DTC Payola Out, You Pay In!

Recent changes to how FDA will be paid to review DTC TV ads forces us to ask: What's worse? Drug companies paying the FDA to preview TV ads for approval or you paying for it?

Instead of the FDA charging drug companies to review their ads, it will now get the money from US citizens. That's because the DTC User Fee Program authorized by the FDA Amendments Act in September, 2007 was replaced by the fiscal year 2008 omnibus appropriations legislation signed into law Dec. 26 by President Bush (read more about this here). This allocates $6.5 million for the review program for 2008. Unlike the User Fee Program, which would have guaranteed funding for the program for 5 years, there is now no guarantee that funds will be available in 2009 or thereafter.

In a previous post, I said that the User Fee Program funded by the industry was "pure payola" (see "PDUFA Payola!"). Obviously, Congress agreed:

"...user fees give the impression drug makers are buying FDA approval," according to a House staffer interviewed by the "Pink Sheet," an industry publication (July 23, 2007, p. 14).

Instead, you and I are now paying for the FDA to review the ads, which IMHO is better than having the industry pay for it.

Fate of the Get-Out-Jail-Free Card
Aside from the appearance of payola inherent in the User Fee Program, it also came with the guarantee that once the FDA "approved" an ad through the preview process, it could not request that the ad be discontinued if it later considered it violative (see "DTC Here to Stay; Pet Turtles Too!"). Now that you and I are paying for the previews, does this guarantee still stand? Or will the FDA be free to OK ads and later change its mind?

The approved PDUFA legislation, which hasn't been rescinded, states:

"(B) Upon the request of the applicant to be assessed a civil penalty, the Secretary, in determining the amount of a civil penalty, shall take into account the nature, circumstances, extent, and gravity of the violation or violations, including the following factors: Whether the applicant submitted the advertisement for prereview if required under section 505(o)(5)(D)."

and...

"Subject to subparagraph (B), no applicant shall be required to pay a civil penalty under paragraph (1) if the applicant submitted the advertisement to the Secretary and disseminated such advertisement after incorporating any comment received from the Secretary."

I guess, therefore, that the industry still has its Get-Out-of-Jail-Free card and it doesn't even have to pay for it! Sweet!

BTW, my original estimate on how much it cost to review each ad was way off. I thought FDA might have to review about 3,000 ads for $6.5 million, which works out to about $2,000 per ad.

In fact, DDMAC received commitments from industry to submit 151 ads for review at a cost of $41,390 each. Whoa! That's about 2/3 of the median annual income of a US family of 4 ($60,298) or enough to support 2.28 US citizens for a whole year!

Yet, PhRMA suggests it will be difficult for FDA now to hire reviewers -- 27 FTEs planned, which works out to $240,000 per FTE -- because job security is not assured. I dunno. Seems there would be a few good people -- eg, recent college grads -- that would like that kind of money, job security be damned! Especially since it will look very good on their resumes when they go the pharmacetical industry following their 1-year stint! I'm sure drug companies would hire these people to get an insider's view of FDA's DTC ad review process.