FDA Budget Swells

Under President Barack Obama’s proposed fiscal 2011 budget, the Food & Drug Administration is slated to receive a total of $4.0 billion, an increase of 22.8% compared with 2010. The increase includes $147 million in allocated money and $601 million in industry user fees.

The total 2011 budget for FDA includes just over $1.5 billion in user fees, a 65.2% increase compared with 2010. In contrast, the budget provides about $2.5 billion in allocated money, a 6.2% increase compared with 2010.

This is the second year in a row that FDA has gotten a hefty increase, after years of being perceived as underfunded (C&EN, May 25, 2009, page 33). The extra money comes at a time when the agency’s responsibilities have gotten more complex because of threats like H1N1 influenza and bio­terrorism, as well as increased globalization of the food and drug supply. On top of these concerns, the agency was also given the job of regulating tobacco last year.

The majority of the budget increase will fund four initiatives: food safety, medical product safety, advancing regulatory science, and implementing tobacco regulation.

In 2011, food safety is set to get an increase of $318 million. The money will be spread across several centers within the agency. The Center for Food Safety & Nutrition and its field activities (shown as Foods in table), will increase by $258 million, or 32.9% compared with 2010, for a total funding of $1.0 billion. The extra funds will be used to set food safety standards, expand laboratory capacity, pilot test food-tracking technology, strengthen FDA’s import safety program, improve data collection and risk analysis, and establish an integrated food safety system with improved inspection and response capacity.

The two categories of drug safety and medical devices together will get a boost of $101 million above 2010 levels, for a total funding of $1.4 billion. FDA will use $40 million of the increased funds on generic drugs and at least $10 million on postmarket drug safety. Other areas that will get additional funding include import safety and high-risk medical products.

The 2011 budget proposes an increase of $25 million for advancing regulatory science. The increase provides $15 million for research related to the safety of nanotechnology and additional funds for updating review standards and developing regulatory pathways for generic biologic drugs. The money will also be used to provide guidance to industry on animal biotechnology products and define regulatory pathways for those products.

FDA will devote $421 million, paid for entirely through industry user fees, to implementing tobacco regulation in 2011. The agency will focus on preventing the sale of tobacco products to children, reducing their appeal to young people, getting Americans to quit smoking, and reducing tobacco-related disease.

Although more than half of the user fees are increases to established fee-based programs or mandated fees paid for by tobacco companies, the 2011 budget includes $220 million in new user fees for food facilities and $38 million in new fees on generic drug applications. It is unclear whether Congress will go along with these new fees.

Response to user fees has been tepid. For example, the Generic Pharmaceutical Association released a statement about FDA’s 2011 budget saying that “the generic pharmaceutical industry remains open to a generic user fee program.” Likewise, the Grocery Manufacturers Association has said that it doesn’t oppose user fees on food facilities provided the money is used to improve food safety science.

Food safety legislation (H.R. 2749) that passed the House of Representatives in July includes user fees to pay for increased inspections of food facilities. (C&EN, July 6, 2009, page 20) But the Senate version of the bill (S. 510), which cleared the Health, Education, Labor & Pensions Committee in November, does not include such user fees. The Senate bill has yet to come for a vote in the full Senate, taking a backseat to health care reform.

Despite the increase in FDA’s budget, some observers say it will not be enough. The Alliance for a Stronger FDA was disappointed with the 2011 funding request for FDA, saying it will not enable FDA to add new programs or personnel.

“We are grateful that the President has proposed an inflationary increase of about 6% for FDA in a year in which most domestic discretionary programs will be frozen or cut,” Wayne L. Pines, president of the alliance, said in a statement. “However, the FDA needs a real increase if it is to establish needed new programs and hire new people to carry them out.”