FDA Proposes $1.9 Billion Budget to Expand Food Defense Effort, Increase Drug Safety and Medical Device Review

The Food and Drug Administration (FDA) released highlights of its fiscal year (FY) 2006 budget request to Congress totaling $1.9 billion. This overall amount includes $1.5 billion in budget authority and $382 million in Congressionally authorized industry user fees. This request is 50 percent higher than the appropriations in FY 2001 and represents a 4.5 percent increase over the FY 2005 level.


More than ever, Americans expect FDA to protect them from risky products and potential terrorist threats, and the FY 2006 budget request will equip FDA to do that. At the same time, Americans increasingly rely on FDA's innovation and expertise to make significant new medical products available as soon as possible. This budget provides resources that FDA must have for patients to enjoy the fruits of medical innovation, while maintaining FDA as a gold standard for consumer protection.


Submitted in a climate of budgetary constraints, the proposal testifies to the Administration's commitment to protect the health of Americans and its confidence in the FDA's ability to carry out this vital mission with creativity and vigor.


"The Administration is under great pressure from Congress and the public to maintain fiscal discipline and reduce the federal deficit," said FDA acting commissioner Dr. Lester M. Crawford. "However, the White House recognizes the critical nature of the FDA's work, and our agency's need for adequate resources.

"Despite that vote of confidence, FDA clearly understands that the current budget situation requires innovation and creativity. FDA must leverage its resources through increased cooperation and collaboration with stakeholders. And this we are pledged to do," Crawford added.


The net budget authority increase totals $50 million and includes increases for select programs as well as savings from administrative efficiencies and deferred expenditures on information technology upgrades.

The agency's major request, an increase of $30.1 million for food defense, is part of a collaborative effort by FDA, the U.S. Department of Agriculture's (USDA) Food Safety & Inspection Service (FSIS), the Department of Homeland Security (DHS) and the White House Homeland Security Council to defend the U.S. food supply from terrorist attacks. This brings the total budget authority for food defense related items to $180 million from $150 million, or an increase of 20 percent.


In addition to building upon FDA's counterterrorism program, the budget request includes increases for premarket reviews of medical devices, enhanced surveillance and response to potential safety issues associated with marketed drugs, and additional resources to manage the agency's infrastructure. The latter category of projects includes restoration of the facilities maintenance account and continued consolidation of the agency's facilities in a single location in White Oak, Md.


The proposed increase for the food counter-terrorism program -- a top -- Administration priority -- includes funds for the following long-range projects by FDA and FSIS: Expansion of the joint FDA-FSIS Food Emergency Response Network (FERN - $20 million of the $30 million requested) of laboratories capable of analyzing thousands of food samples for biological, chemical and radiological threat agents, which Congress funded in FY2005. The FY 2006 request will add an estimated 19 FDA-funded state labs;

-- Targeted research in those areas posing the greatest perceived threat to the food supply, based in part on the most recent intelligence. The increase in funding will support research related to prevention/mitigation technologies, tamper proof packaging, rapid test methods, and/or agent sensor technologies;

-- Continued coordination and sharing of data with the Department of Homeland Security as part of the government-wide Bio-Surveillance Initiative; and,


-- Sustained development of the agency's vital crisis- and incident-management infrastructure required to manage emergencies involving FDA-regulated products.


This budget clearly calls on FDA to reap the benefits of information technology to increase productivity and improve its processes and business practices.


The request also includes the following major budgetary increases:

-- $5,996,000 in additional budget authority to advance FDA's medical device review process as conceived under the Medical Device User Fee and Modernization Act (MDUFMA). Appropriated funds will supplement FDA's collection of user fees from the medical device industry, and the joint funding mechanism is expected to advance safe and timely review of premarket device applications, certain application supplements, and premarket notifications of devices entering the marketplace. This budget increase will be augmented by $6,362,000 in additional user fees authorized for the Devices and Biologics programs.


-- $5,000,000 in Budget Authority and 1.5 million in user fee (total 6.5 million) for the Center for Drug Evaluation's Office of Drug Safety (ODS) to increase the agency's ability to more rapidly survey, identify, and respond to potential safety concerns regarding marketed drugs. Despite FDA's extraordinary success in approving life-saving and life-enhancing drugs, their use by large and diverse populations may reveal problems not shown even in lengthy premarket drug trials. As the Agency awaits the recommendations of an Institute of Medicine report on the United States system for drug safety surveillance, the agency's Office of Drug Safety will strengthen its scientific and medical staff. The requested funds will also support greater FDA access to data on health care and drug usage an increase of 24 percent over 2005.


-- $4,128,000 in new budget authority to fund the additional relocation needs that are not covered by the General Services Administration's design and construction budget for the Center for Devices and Radiological Health's Engineering and Physics laboratory, and the new Shared Data Center at the White Oak campus. The total FDA FY 2006 cost of the project is $21,974,000, the remainder of which will be covered by $17,846,000 in base funding. Upon its completion, the consolidated campus-which is part of the President's Management Agenda - is expected to accommodate almost 8,000 FDA employees who are now scattered in more than 40 buildings throughout Washington, D.C. and its suburbs.

-- $11,100,000 for facilities expenditures, including $7,000,000 to restore FDA's account supporting facilities maintenance and repair, and $4,100,000 for increased rent costs associated with both general inflation and the additional field facilities needed for counterterrorism related activities.


-- $31,320,000 in authorized user fee increases consisting of $20,938,000 to be collected under the Prescription Drug User Fee Act (PDUFA); $6,362,000 for medical device review; $2,964,000 for animal drug review program under the Animal Drug User Fee Act; $254,000 for the recently re-authorized mammography inspections program; $24,000 for export certification; and $778,000 for color certification.


Lastly, this proposal calls for budgetary savings of $1,554,000 to be achieved through FDA's multi-year effort to find additional administrative efficiencies. To fully embrace the President's Management Agenda and the Secretarial priorities, FDA will also seek savings of $5,116,000 through continued consolidation and/or postponement of information technology expenditures.


Full funding of FDA's FY 2006 budget will provide the agency with the necessary resources to address the agency's public health priorities and support regulatory decisions ensuring the safety and quality of products representing almost 25 percent of all consumer spending by Americans.

Source: FDA