FEES RELATING TO DRUGS.

SEC. 103. FEES RELATING TO DRUGS. Chapter VII, as amended by section 106, is amended by adding at the end of subchapter C the following: “PART 2— FEES RELATING TO DRUGS “SEC. 735. DEFINITIONS. “For purposes of this subchapter: “(1) The term ‘human drug application’ means an application for— 106 STAT. 4492 “(A) approval of a new drug submitted under section 505(b)(1), “(B) approval of a new drug submitted under section 505(b)(2) after September 30, 1992, which requests approval of— “(i) a molecular entity which is an active ingredient (including any salt or ester of an active ingredient), or “(ii) an indication for a use, that had not been approved under an application submitted under section 505(b), “(C) initial certification or initial approval of an antibiotic drug under section 507, or “(D) licensure of a biological product under section 351 of the Public Health Service Act. Such term does not include a supplement to such an application, does not include an application with respect to whole blood or a blood component for transfusion, does not include an application with respect to a bovine blood product for topical application licensed before September 1, 1992, an allergenic extract product, or an in vitro diagnostic biologic product licensed under section 351 of the Public Health Service Act, and does not include an application with respect to a large volume parenteral drug product approved before September 1, 1992. “(2) The term ‘supplement’ means a request to the Secretary to approve a change in a human drug application which has been approved. “(3) The term ‘prescription drug product’ means a specific strength or potency of a drug in final dosage form— “(A) for which a human drug application has been approved, and “(B) which may be dispensed only under prescription pursuant to section 503(b). Such term does not include whole blood or a blood component for transfusion, does not include a bovine blood product for topical application licensed before September 1, 1992, an allergenic extract product, or an in vitro diagnostic biologic product licensed under section 351 of the Public Health Service Act, and does not include a large volume parenteral drug product approved before September 1, 1992. “(4) The term ‘final dosage form’ means, with respect to a prescription drug product, a finished dosage form which is approved for administration to a patient without further manufacturing. “(5) The term ‘prescription drug establishment’ means a foreign or domestic place of business which is— “(A) at one general physical location consisting of one or more buildings all of which are within 5 miles of each other, at which one or more prescription drug products are manufactured in final dosage form, and “(B) under the management of a person that is listed as the applicant in a human drug application for a prescription drug product with respect to at least one such product. For purposes of this paragraph, the term ‘manufactured’ does not include packaging. 106 STAT. 4493 “(6) The term ‘process for the review of human drug applications’ means the following activities of the Secretary with respect to the review of human drug applications and supplements: “(A) The activities necessary for the review of human drug applications and supplements. “(B) The issuance of action letters which approve human drug applications or which set forth in detail the specific deficiencies in such applications and, where appropriate, the actions necessary to place such applications in condition for approval. “(C) The inspection of prescription drug establishments and other facilities undertaken as part of the Secretary’s review of pending human drug applications and supplements. “(D) Activities necessary for the review of applications for licensure of establishments subject to section 351 of the Public Health Service Act and for the release of lots of biologies under such section. “(E) Monitoring of research conducted in connection with the review of human drug applications. “(7) The term ‘costs of resources allocated for the process for the review of human drug applications’ means the expenses incurred in connection with the process for the review of human drug applications for— “(A) officers and employees of the Food and Drug Administration, employees under contract with the Food and Drug Administration who work in facilities owned or leased for the Food and Drug Administration, advisory committees, and costs related to such officers, employees, and committees, “(B) management of information, and the acquisition, maintenance, and repair of computer resources, “(C) leasing, maintenance, renovation, and repair of facilities and acquisition, maintenance, and repair of fixtures, furniture, scientific equipment, and other necessary materials and supplies, and “(D) collecting fees under section 736 and accounting for resources allocated for the review of human drug applications and supplements. “(8) The term ‘adjustment factor’ applicable to a fiscal year is the lower of— “(A) the Consumer Price Index for all urban consumers (all items; United States city average) for August of the preceding fiscal year divided by such Index for August 1992, or “(B) the total of discretionary budget authority provided for programs in the domestic category for the immediately preceding fiscal year (as reported in the Office of Management and Budget sequestration preview report, if available, required under section 254(d) of the Balanced Budget and Emergency Deficit Control Act of 1985) divided by such budget authority for fiscal year 1992 (as reported in the Office of Management and Budget final sequestration report submitted after the end of the 102d Congress, 2d Session). 106 STAT. 4494 The terms ‘budget authority’ and ‘category’ in subparagraph (B) are as defined in the Balanced Budget and Emergency Deficit Control Act of 1985, as in effect as of September 1, 1992. “SEC. 736. AUTHORITY TO ASSESS AND USE DRUG FEES. “(a) Types of Fees.— Beginning in fiscal year 1993, the Secretary shall assess and collect fees in accordance with this section as follows: “(1) Human drug application and supplement fee.— “(A) In general.— Each person that submits, on or after September 1, 1992, a human drug application or a supplement shall be subject to a fee as follows: “(i) A fee established in subsection (b) for a human drug application for which clinical data (other than bioavailability or bioequivalence studies) with respect to safety or effectiveness are required for approval. “(ii) A fee established in subsection (b) for a human drug application for which clinical data with respect to safety or effectiveness are not required or a supplement for which clinical data (other than bioavailability or bioequivalence studies) with respect to safety or effectiveness are required. “(B) Payment schedule.— “(i) First payment.— 50 percent of the fee required by subparagraph (A) shall be due upon submission of the application or supplement. “(ii) Final payment.— The remaining 50 percent of the fee required by subparagraph (A) shall be due upon— “(I) the expiration of 30 days from the date the Secretary sends to the applicant a letter designated by the Secretary as an action letter described in section 735(6)(B), or “(II) the withdrawal of the application or supplement after it is filed unless the Secretary waives the fee or a portion of the fee because no substantial work was performed on such application or supplement after it was filed. The designation under subclause (I) or the waiver under subclause (II) shall be solely in the discretion of the Secretary and shall not be reviewable. “(C) Exception for previously filed application or supplement.— If a human drug application or supplement was submitted by a person that paid the fee for such application or supplement, was accepted for filing, and was not approved or was withdrawn (without a waiver), the submission of a human drug application or a supplement for the same product by the same person (or the person’s licensee, assignee, or successor) shall not be subject to a fee under subparagraph (A). “(D) Refund of fee if application not accepted for filing.— The Secretary shall refund 50 percent of the fee paid under subparagraph (B)(i) for any application or supplement which is not accepted for filing. “(2) Prescription drug establishment fee.— Each person that— 106 STAT. 4495 “(A) owns a prescription drug establishment, at which is manufactured at least 1 prescription drug product which is not the, or not the same as a, product approved under an application filed under section 505(b)(2) or 505(j), and “(B) after September 1, 1992, had pending before the Secretary a human drug application or supplement, shall be subject to the annual fee established in subsection (b) for each such establishment, payable on or before January 31 of each year. “(3) Prescription drug product fee.— “(A) In general.— Except as provided in subparagraph (B), each person— “(i) who is named as the applicant in a human drug application for a prescription drug product which is listed under section 510, and “(ii) who, after September 1, 1992, had pending before the Secretary a human drug application or supplement, shall pay for each such prescription drug product the annual fee established in subsection (b). Such fee shall be payable at the time of the first such listing of such product in each calendar year. Such fee shall be paid only once each year for each listed prescription drug product irrespective of the number of times such product is listed under section 510. “(B) Exception.— The listing of a prescription drug product under section 510 shall not require the person who listed such product to pay the fee prescribed by subparagraph (A) if such product is the same product as a product approved under an application filed under section 505(b)(2) or 505(j). “(b) Fee Amounts.— “(1) Schedule.— Except as provided in paragraph (2) and subsections (c), (d), (f), and (g), the fees required under subsection (a) shall be paid in accordance with the following schedule: Fiscal Year 1993 Fiscal Year 1994 Fiscal Year 1995 Fiscal Year 1996 Fiscal Year 1997 Drug application fee: Subsection (a)(1)(A)(i) fee $100,000 $150,000 $208,000 $217,000 $233,000 Subsection (a)(1)(A)(ii) fee $50,000 $75,000 $104,000 $108,000 $116,000 Fee revenue $12.000,000 $18.000,000 $25,000,000 $26,000,000 $28,000,000 Annual establishment fee: Fee per establishment $60,000 $88,000 $126,000 $131,000 $138,000 Fee revenue $12,000,000 $18,000,000 $25,000,000 $26,000,000 $28,000,000 Annual product fee: Fee per product $6,000 $9,000 $12,500 $13,000 $14,000 Fee revenue $12,000,000 $18,000,000 $25,000,000 $26,000,000 $28,000,000 Total fee revenues $36,000,000 $54,000,000 $75,000,000 $78,000,000 $84,000,000 “(2) Small business exception.— Any business which has fewer than 500 employees, including employees of affiliates, and which does not have a prescription drug product introduced106 STAT. 4496 or delivered for introduction into interstate commerce shall pay one-half the amount of the fee for human drug applications it submits and shall pay the entire amount of the fee for supplements it submits. Such a business shall not be required to pay any portion of any fee required under subsection (a)(1)(A) until 1 year after the date of the submission of the application involved. For purposes of this paragraph, one business is an affiliate of another business when, directly or indirectly, one business controls, or has the power to control, the other business or a third party controls, or has the power to control, both businesses. “(c) Increases and Adjustments.— “(1) Revenue increase.— The total fee revenues established by the schedule in subsection (b)(1) shall be increased by the Secretary by notice, published in the Federal Register, for a fiscal year to reflect the greater of— “(A) the total percentage increase that occurred during the preceding fiscal year in the Consumer Price Index for all urban consumers (all items; U.S. city average), or “(B) the total percentage increase for such fiscal year in basic pay under the General Schedule in accordance with section 5332 of title 5, United States Code, as adjusted by any locality-based comparability payment pursuant to section 5304 of such title for Federal employees stationed in the District of Columbia. “(2) Annual fee adjustment.— Subject to the amount appropriated for a fiscal year under subsection (g), the Secretary shall, within 60 days after the end of each fiscal year beginning after October 1, 1992, adjust the fees established by the schedule in subsection (b)(1) for the following fiscal year to achieve the total fee revenues, as may be increased under paragraph (1). Such fees shall be adjusted under this paragraph to maintain the proportions established in such schedule. “(3) Limit.— The total amount of fees charged, as adjusted under paragraph (2), for a fiscal year may not exceed the total costs for such fiscal year for the resources allocated for the process for the review of human drug applications. “(d) Fee Waiver or Reduction.— The Secretary shall grant a waiver from or a reduction of 1 or more fees under subsection (a) where the Secretary finds that— “(1) such waiver or reduction is necessary to protect the public health, “(2) the assessment of the fee would present a significant barrier to innovation because of limited resources available to such person or other circumstances, “(3) the fees to be paid by such person will exceed the anticipated present and future costs incurred by the Secretary in conducting the process for the review of human drug applications for such person, or “(4) assessment of the fee for an application or a supplement filed under section 505(b)(1) pertaining to a drug containing an active ingredient would be inequitable because an application for a product containing the same active ingredient filed by another person under section 505(b)(2) could not be assessed fees under subsection (a)(1). In making the finding in paragraph (3), the Secretary may use standard costs. 106 STAT. 4497 “(e) Effect of Failure To Pay Fees.— A human drug application or supplement submitted by a person subject to fees under subsection (a) shall be considered incomplete and shall not be accepted for filing by the Secretary until all fees owed by such person have been paid. “(f) Assessment of Fees.— “(1) Limitation.— Fees may not be assessed under subsection (a) for a fiscal year beginning after fiscal year 1993 unless appropriations for salaries and expenses of the Food and Drug Administration for such fiscal year (excluding the amount of fees appropriated for such fiscal year) are equal to or greater than the amount of appropriations for the salaries and expenses of the Food and Drug Administration for the fiscal year 1992 multiplied by the adjustment factor applicable to the fiscal year involved. “(2) Authority.— If the Secretary does not assess fees under subsection (a) during any portion of a fiscal year because of paragraph (1) and if at a later date in such fiscal year the Secretary may assess such fees, the Secretary may assess and collect such fees, without any modification in the rate, for human drug applications and supplements, prescription drug establishments, and prescription drug products at any time in such fiscal year notwithstanding the provisions of subsection (a) relating to the date fees are to be paid. “(g) Crediting and Availability of Fees.— “(1) In general.— Fees collected for a fiscal year pursuant to subsection (a) shall be credited to the appropriation account for salaries and expenses of the Food and Drug Administration and shall be available in accordance with appropriation Acts until expended without fiscal year limitation. “(2) Collections and appropriation acts.— The fees authorized by this section— “(A) shall be collected in each fiscal year in an amount equal to the amount specified in appropriation Acts for such fiscal year, and “(B) shall only be collected and available to defray increases in the costs of the resources allocated for the process for the review of human drug applications (including increases in such costs for an additional number of full-time equivalent positions in the Department of Health and Human Services to be engaged in such process) over such costs for fiscal year 1992 multiplied by the adjustment factor. “(3) Authorization of appropriations.— There are authorized to be appropriated for fees under this section— “(A) $36,000,000 for fiscal year 1993, “(B) $54,000,000 for fiscal year 1994, “(C) $75,000,000 for fiscal year 1995, “(D) $78,000,000 for fiscal year 1996, and “(E) $84,000,000 for fiscal year 1997, as adjusted to reflect increases in the total fee revenues made under subsection (c)(1). “(h) Collection of Unpaid Fees.— In any case where the Secretary does not receive payment of a fee assessed under subsection (a) within 30 days after it is due, such fee shall be treated as a claim of the United States Government subject to subchapter II of chapter 37 of title 31, United States Code. 106 STAT. 4498 “(i) Construction.— This section may not be construed to require that the number of full-time equivalent positions in the Department of Health and Human Services, for officers, employers, and advisory committees not engaged in the process of the review of human drug applications, be reduced to offset the number of officers, employees, and advisory committees so engaged.”.