Generic Drug User Fee Rates for Fiscal Year 2018, 41026-41029 [2017-18377]

Download as PDF 41026 Federal Register / Vol. 82, No. 166 / Tuesday, August 29, 2017 / Notices Designees under 45 CFR 400.301(c), and Wilson-Fish Grantees (State 2 Agencies) administering or supervising the administration of programs under Title IV of the Act. ANNUAL BURDEN ESTIMATES Instrument Number of respondents Number of responses per respondent Average burden hours per response Total burden hours ORR–1, Cash and Medical Assistance Program Estimates ........................... 55 1 0.60 33 Estimated Total Annual Burden Hours: 33. Copies of the proposed collection may be obtained by writing to the Administration for Children and Families, Office of Planning, Research and Evaluation, 330 C Street SW., Washington, DC 20201. Attention Reports Clearance Officer. All requests should be identified by the title of the information collection. Email address: infocollection@acf.hhs.gov. OMB Comment: OMB is required to make a decision concerning the collection of information between 30 and 60 days after publication of this document in the Federal Register. Therefore, a comment is best assured of having its full effect if OMB receives it within 30 days of publication. Written comments and recommendations for the proposed information collection should be sent directly to the following: Office of Management and Budget, Paperwork Reduction Project, Email: OIRA_ SUBMISSION@OMB.EOP.GOV, Attn: Desk Officer for the Administration for Children and Families. Robert Sargis, Reports Clearance Officer. [FR Doc. 2017–18254 Filed 8–28–17; 8:45 am] BILLING CODE 4184–45–P DEPARTMENT OF HEALTH AND HUMAN SERVICES Food and Drug Administration [Docket No. FDA–2016–N–0007] Generic Drug User Fee Rates for Fiscal Year 2018 AGENCY: Food and Drug Administration, HHS. sradovich on DSK3GMQ082PROD with NOTICES ACTION: Notice. SUMMARY: The Federal Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the Generic Drug User Fee Amendments of 2017 (GDUFA II), authorizes FDA to assess and collect fees for abbreviated new drug applications (ANDAs), drug master files (DMFs), generic drug active pharmaceutical ingredient (API) VerDate Sep<11>2014 18:45 Aug 28, 2017 Jkt 241001 facilities, finished dosage form (FDF) facilities, contract manufacturing organization (CMO) facilities, and generic drug applicant program user fees. In this document the Food and Drug Administration (FDA or Agency) is announcing fiscal year (FY) 2018 rates for GDUFA fees. FOR FURTHER INFORMATION CONTACT: David Haas, Office of Financial Management, Food and Drug Administration, 8455 Colesville Rd., COLE–14202I, Silver Spring, MD 20993–0002, 240–402–9845. SUPPLEMENTARY INFORMATION: ($47,829), domestic API facility ($45,367), foreign API facility ($60,367), domestic FDF facility ($211,087), foreign FDF facility ($226,087), domestic CMO facility ($70,362), foreign CMO facility ($85,362), large size operation generic drug applicant program ($1,590,792), medium size operation drug applicant program ($636,317), and small business generic drug applicant program ($159,079). These fees are effective on October 1, 2017, and will remain in effect through September 30, 2018. I. Background Sections 744A and 744B of the FD&C Act (21 U.S.C. 379j–41 and 379j–42) establish fees associated with human generic drug products. Fees are assessed on: (1) Certain types of applications for human generic drug products; (2) certain facilities where APIs and FDFs are produced; (3) certain DMFs associated with human generic drug products; and (4) the generic drug applicant program (see section 744B(a)(1)–(5) of the FD&C Act). GDUFA II fees vary greatly from those in GDUFA I because of two fundamental adjustments to the fee structure: (1) The revenue base for GDUFA II is $493.6 million versus $323 million in the final year of GDUFA I—ANDAs are the primary workload driver of the program. GDUFA I was built on the assumption that FDA would receive 750 ANDAs per year. Over the first 4 years of GDUFA I, ANDA receipts have averaged approximately 1,000 per year. To address the increased workload, FDA hired additional staff and is projected to spend about $430 million in the final year of GDUFA I. To maintain FDA’s current productivity and implement negotiated improvements, GDUFA II stipulates that user fees should total $493.6 million annually adjusted each year for inflation. (2) GDUFA II will for the first time rely on annual program fees—GDUFA II shifts the fee burden somewhat from facility fees. For FY 2018, the generic drug fee rates are: ANDA ($171,823), DMF The base revenue amount for FY 2018 is $493,600,000, as set in the statute (see section 744B(b)(1) of the FD&C Act). GDUFA II directs FDA to use the yearly revenue amount as a starting point to set the fee rates for each fee type. For more information about GDUFA II, please refer to the FDA Web site (https:// www.fda.gov/gdufa). The ANDA, DMF, API facility, FDF facility, CMO facility, and generic drug applicant program fee (GDUFA Program Fee) calculations for FY 2018 are described in this document. GDUFA II specifies that the $493,600,000 is to be adjusted for inflation increases for FY 2019 through FY 2022 using two separate adjustments—one for personnel compensation and benefits (PC&B) and one for non-PC&B costs (see section 744B(c)(1) of the FD&C Act). Because the adjustment for inflation does not take effect until FY 2019, FDA will not adjust the base revenue amount for inflation in FY 2018. PO 00000 Frm 00045 Fmt 4703 Sfmt 4703 II. Fee Revenue Amount for FY 2018 III. ANDA Fee Under GDUFA II, the FY 2018 ANDA fee is owed by each applicant that submits an ANDA on or after October 1, 2017. This fee is due on the receipt date of the ANDA. Section 744B(b)(2)(B) specifies that the ANDA fee will make up 33 percent of the $493,600,000, which is $162,888,000. To calculate the ANDA fee, FDA estimated the number of full application equivalents (FAEs) that will be submitted in FY 2018. An ANDA counts as one FAE; however, 75 percent of the E:\FR\FM\29AUN1.SGM 29AUN1 Federal Register / Vol. 82, No. 166 / Tuesday, August 29, 2017 / Notices sradovich on DSK3GMQ082PROD with NOTICES fee paid for an ANDA shall be refunded according to GDUFA II if (1) the ANDA is refused for a cause other than failure to pay fees or (2) the ANDA has been withdrawn prior to receipt (section 744B(a)(2)(D)(i) of the FD&C Act). Therefore, an ANDA that is considered not to have been received by FDA due to reasons other than failure to pay fees or withdrawn prior to receipt counts as one-fourth of an FAE if the applicant initially paid a full application fee. One hundred percent of the fee paid for an ANDA shall be refunded if FDA initially receives the ANDA and subsequent to initial receipt, FDA determines that exclusivity should have prevented receipt of the ANDA, and thus FDA determines that the ANDA is no longer received (section 744B(a)(2)(D))(ii) of the FD&C Act). FDA utilized data from ANDAs submitted from October 1, 2013, to April 30, 2017, to estimate the number of new original ANDAs that will incur filing fees in FY 2018. For FY 2018, the Agency estimates that approximately 938 new original ANDAs will be submitted and incur filing fees. Not all of the new original ANDAs will be received by the Agency and some of those not received will be resubmitted in the same fiscal year. Therefore, the Agency expects that the FAE count for ANDAs will be 948 for FY 2018. The FY 2018 application fee is estimated by dividing the number of FAEs that will pay the fee in FY 2018 (948) into the fee revenue amount to be derived from ANDA application fees in FY 2018 ($162,888,000). The result, rounded to the nearest dollar, is a fee of $171,823 per ANDA. The statute provides that those ANDAs that include information about the production of active pharmaceutical ingredients other than by reference to a DMF will pay an additional fee that is based on the number of such active pharmaceutical ingredients and the number of facilities proposed to produce those ingredients (see section 744B(a)(3)(F) of the FD&C Act). FDA considers that this additional fee is unlikely to be assessed often; therefore, FDA has not included projections concerning the amount of this fee in calculating the fees for ANDAs. IV. DMF Fee Under GDUFA II, the DMF fee is owed by each person that owns a type II active pharmaceutical ingredient DMF that is referenced, on or after October 1, 2012, in a generic drug submission by an initial letter of authorization. This is a one-time fee for each DMF. This fee is due on the earlier of the date on which the first generic drug submission is VerDate Sep<11>2014 18:45 Aug 28, 2017 Jkt 241001 submitted that references the associated DMF or the date on which the drug master file holder requests the initial completeness assessment. Under section 744B(a)(2)(D)(iii) of the FD&C Act, if a DMF has successfully undergone an initial completeness assessment and the fee is paid, the DMF will be placed on a publicly available list documenting DMFs available for reference. To calculate the DMF fee, FDA assessed the volume of DMF submissions over time. The Agency assessed DMFs from October 1, 2015, to April 30, 2017, and concluded that averaging the number of fee-paying DMFs provided the most accurate model for predicting fee-paying DMFs for FY 2018. FDA is estimating 516 fee-paying DMFs for FY 2018. The FY 2018 DMF fee is determined by dividing the DMF target revenue by the estimated number of fee-paying DMFs in FY 2018. Section 744B(b)(2)(A) specifies that the DMF fees will make up five percent of the $493,600,000, which is $24,680,000. Dividing the DMF revenue amount ($24,680,000) by the estimated fee-paying DMFs (516), and rounding to the nearest dollar, yields a DMF fee of $47,829 for FY 2018. V. Foreign Facility Fee Differential Under GDUFA II, the fee for a facility located outside the United States and its territories and possessions shall be $15,000 higher than the amount of the fee for a facility located in the United States and its territories and possessions. The basis for this differential is the extra cost incurred by conducting an inspection outside the United States and its territories and possessions. VI. FDF and CMO Facility Fees Under GDUFA II, the annual FDF facility fee is owed by each person who owns an FDF facility that is identified in at least one approved generic drug submission owned by that person or his affiliates. The CMO facility fee is owed by each person who owns an FDF facility that is identified in at least one approved ANDA but is not identified in an approved ANDA held by the owner of that facility or its affiliates. These fees are due no later than the first business day on or after October 1 of each such year. Section 744B(b)(2)(C) of the FD&C Act specifies that the FDF and CMO facility fee revenue will make up 20 percent of the $493,600,000, which is $98,720,000. To calculate the fees, data from FDA’s Integrity Services (IS) were utilized as the primary source of facility information for determining the denominators of each facility fee type. PO 00000 Frm 00046 Fmt 4703 Sfmt 4703 41027 IS is the master data steward for all facility information provided in generic drug submissions received by FDA. A facility’s reference status in an approved generic drug submission is extracted directly from submission data rather than relying on data from selfidentification. This information provided the number of facilities referenced as FDF manufacturers in at least one approved generic drug submission. Based on FDA’s IS data for FY 2018, the FDF and CMO facility denominators are 182 FDF domestic, 208 FDF foreign, 71 CMO domestic, and 97 CMO foreign facilities. GDUFA II specifies that the CMO facility fee is to be equal to one-third the amount of the FDF facility fee. Therefore, to generate the target collection revenue amount from FDF and CMO facility fees ($98,720,000), FDA must weight a CMO facility as onethird of an FDF facility. FDA set fees based on the estimate of 182 FDF domestic, 208 FDF foreign, 23.67 CMO domestic (71 multiplied by one-third), and 32.33 CMO foreign facilities (97 multiplied by one-third), which equals 446 total weighted FDF and CMO facilities for FY 2018. To calculate the fee for domestic facilities, FDA first determines the total fee revenue that will result from the foreign facility differential by subtracting the fee revenue resulting from the foreign facility fee differential from the target collection revenue amount ($98,720,000) as follows. The foreign facility fee differential revenue equals the foreign facility fee differential ($15,000) multiplied by the number of FDF foreign facilities (208) plus the foreign facility fee differential ($15,000) multiplied by the number of CMO foreign facilities (97), totaling $4,575,000. This results in foreign fee differential revenue of $4,575,000 from the total FDF and CMO facility fee target collection revenue. Subtracting the foreign facility differential fee revenue ($4,575,000) from the total FDF and CMO facility target collection revenue ($98,720,000) results in a remaining facility fee revenue balance of $94,145,000. To determine the domestic FDF facility fee, FDA divides the $94,145,000 by the total weighted number of FDF and CMO facilities (446), which results in a domestic FDF facility fee of $211,087. The foreign FDF facility fee is $15,000 more than the domestic FDF facility fee, or $226,087. CMO fees are as follows. According to GDUFA II, the domestic CMO fee is calculated as one-third the amount of the domestic FDF facility fee. Therefore, the domestic CMO fee is $70,362, rounded to the nearest dollar. The E:\FR\FM\29AUN1.SGM 29AUN1 41028 Federal Register / Vol. 82, No. 166 / Tuesday, August 29, 2017 / Notices sradovich on DSK3GMQ082PROD with NOTICES foreign CMO fee is calculated as the domestic CMO fee plus the foreign fee differential of $15,000. Therefore, the foreign CMO fee is $85,362. VII. API Facility Fee Under GDUFA II, the annual API facility fee is owed by each person who owns a facility that is identified in (1) at least one approved generic drug submission or (2) in a Type II API DMF referenced in at least one approved generic drug submission. These fees are due no later than the first business day on or after October 1 of each such year. Section 744B(b)(2)(D) of the FD&C Act specifies the API facility fee will make up seven percent of $493,600,000 in fee revenue, which is $34,552,000. To calculate the API facility fee, data from FDA’s IS were utilized as the primary source of facility information for determining the denominator. As stated above, IS is the master data steward for all facility information provided in generic drug submissions received by FDA. A facility’s reference status in an approved generic drug submission is extracted directly from submission data rather than relying on data from self-identification. This information provided the number of facilities referenced as API manufacturers in at least one approved generic drug submission. The total number of API facilities identified was 592. Of the total facilities identified as API facilities, there were 79 domestic facilities and 513 foreign facilities. The foreign facility differential is $15,000. To calculate the fee for domestic facilities, FDA must first subtract the fee revenue that will result from the foreign facility fee differential. FDA takes the foreign facility differential ($15,000) and multiplies it by the number of foreign facilities (513) to determine the total fee revenue that will result from the foreign facility differential. As a result of that calculation, the foreign fee differential revenue will make up $7,695,000 of the total API fee revenue. Subtracting the foreign facility differential fee revenue ($7,695,000) from the total API facility target revenue ($34,552,000) results in a remaining balance of $26,857,000. To determine the domestic API facility fee, we divide the $26,857,000 by the total number of facilities (592), which gives us a domestic API facility fee of $45,367. The foreign API facility fee is $15,000 more than the domestic API facility fee, or $60,367. VIII. Generic Drug Applicant Program Fee Under GDUFA II, if a person and its affiliates own at least one but not more VerDate Sep<11>2014 18:45 Aug 28, 2017 Jkt 241001 than five approved ANDAs on October 1, 2017, the person and its affiliates shall owe a small business GDUFA Program Fee. If a person and its affiliates own at least 6 but not more than 19 approved ANDAs, the person and its affiliates shall owe a medium size operation GDUFA Program Fee. If a person and its affiliates own at least 20 approved ANDAs, the person and its affiliates shall owe a large size operation GDUFA Program Fee. These fees are due no later than the first business day on or after October 1 of each such year. Section 744B(b)(2)(E) of the FD&C Act specifies the GDUFA Program Fee will make up 35 percent of $493,600,000 in fee revenue, which is $172,760,000. To determine the appropriate number of applicants for each tier, the Agency has posted lists of approved ANDAs on the FDA Web site (https://www.fda.gov/ gdufa) and asked applicants on the list to claim which ANDAs and affiliates belong to the parent company. The original list of approved ANDAs came from the Agency’s Document Archiving, Reporting, and Regulatory Tracking System (DARRTS), which included all ANDAs with the status of ‘‘approved’’ as of April 30, 2017. In determining the appropriate number of approved ANDAs, the Agency has factored in a number of variables that could affect the collection of the target revenue: (1) Inactive ANDAs—applicants who have not submitted an annual report for one or more of their approved applications within the past 2 years; (2) unclaimed affiliations—a risk of undercollecting the target revenue if companies do not claim their ANDAs and their affiliates before the Program Fee is calculated; and (3) potential portfolio adjustment— applicants may choose to withdraw some of their approved ANDAs in order to move to a lower tier and reduce their fee exposure. The list of original approved ANDAs from the DARRTS database as of April 30, 2017, shows 339 applicants in the small business tier, 74 applicants in the medium size tier, and 65 applicants in the large size tier. This list also takes into account all the withdrawals, consolidations, and transfer of ownerships from industry as of April 30, 2017. Factoring in all the variables for the first year of GDUFA II, the Agency estimates there will be 258 applicants in the small business tier, 52 applicants in the medium size tier, and 62 applicants in the large size tier for FY 2018. To calculate the GDUFA Program Fee, GDUFA II provides that large size operation generic drug applicants pay the full fee, medium size operation applicants pay two-fifths of the full fee, PO 00000 Frm 00047 Fmt 4703 Sfmt 4703 and small business applicants pay onetenth of the full fee. To generate the target collection revenue amount from GDUFA Program Fees ($172,760,000), we must weigh medium and small tiered applicants as a subset of a large size operation generic drug applicant. FDA will set fees based on the weighted estimate of 25.8 applicants in the small business tier (258 multiplied by 10 percent), 20.8 applicants in the medium size tier (52 multiplied by 40 percent), and 62 applicants in the large size tier, arriving at 108.6 total weighted applicants for FY 2018. To generate the large size operation GDUFA Program Fee, FDA divides the target revenue amount of $172,760,000 by 108.6, which equals $1,590,792. The medium size operation GDUFA Program Fee is 40 percent of the full fee ($636,317), and the small business operation GDUFA Program Fee is 10 percent of the full fee ($159,079). IX. Fee Schedule for FY 2018 The fee rates for FY 2018 are set out in table 1. TABLE 1—FEE SCHEDULE FOR FY 2018 Fee category Applications: Abbreviated New Drug Application (ANDA) ......................................... Drug Master File (DMF) ................... Facilities: Active Pharmaceutical Ingredient (API)—Domestic .......................... API—Foreign ................................... Finished Dosage Form (FDF)—Domestic ........................................... FDF—Foreign .................................. Contract Manufacturing Organization (CMO)—Domestic ................. CMO—Foreign ................................. GDUFA Program: Large size operation generic drug applicant ....................................... Medium size operation generic drug applicant ....................................... Small business operation generic drug applicant .............................. Fee rates for FY 2018 $171,823 47,829 45,367 60,367 211,087 226,087 70,362 85,362 1,590,792 636,317 159,079 X. Fee Payment Options and Procedures The new fee rates are effective October 1, 2017. To pay the ANDA, DMF, API facility, FDF facility, CMO facility, and GDUFA Program Fee, you must complete a Generic Drug User Fee Cover Sheet, available through https:// www.fda.gov/gdufa and at https:// userfees.fda.gov/OA_HTML/gdufaCAcd Login.jsp, and generate a user fee identification (ID) number. Payment must be made in U.S. currency drawn on a U.S. bank by electronic check, check, bank draft, U.S. postal money order, credit card, or wire transfer. The E:\FR\FM\29AUN1.SGM 29AUN1 sradovich on DSK3GMQ082PROD with NOTICES Federal Register / Vol. 82, No. 166 / Tuesday, August 29, 2017 / Notices preferred payment method is online using electronic check (Automated Clearing House (ACH) also known as eCheck) or credit card (Discover, VISA, MasterCard, American Express). Secure electronic payments can be submitted using the User Fees Payment Portal at https://userfees.fda.gov/pay (Note: Only full payments are accepted. No partial payments can be made online.) Once you search for your invoice, select ‘‘Pay Now’’ to be redirected to Pay.gov. Note that electronic payment options are based on the balance due. Payment by credit card is available for balances less than $25,000. If the balance exceeds this amount, only the ACH option is available. Payments must be made using U.S. bank accounts as well as U.S. credit cards. FDA has partnered with the U.S. Department of the Treasury to utilize Pay.gov, a web-based payment application, for online electronic payment. The Pay.gov feature is available on the FDA Web site after completing the Generic Drug User Fee Cover Sheet and generating the user fee ID number. Please include the user fee ID number on your check, bank draft, or postal money order and make payable to the order of the Food and Drug Administration. Your payment can be mailed to: Food and Drug Administration, P.O. Box 979108, St. Louis, MO 63197–9000. If checks are to be sent by a courier that requests a street address, the courier can deliver checks to: U.S. Bank, Attention: Government Lockbox 979108, 1005 Convention Plaza, St. Louis, MO 63101. (Note: This U.S. Bank address is for courier delivery only. If you have any questions concerning courier delivery, contact the U.S. Bank at 314–418–4013. This telephone number is only for questions about courier delivery). Please make sure that the FDA post office box number (P.O. Box 979108) is written on the check, bank draft, or postal money order. If paying by wire transfer, please reference your unique user fee ID number when completing your transfer. Without your unique user fee ID number, the payment may not be applied. If the payment amount is not applied, the invoice amount would be referred to collections. The originating financial institution may charge a wire transfer fee. Please ask your financial institution about the wire transfer fee and include it with your payment to ensure that your fee is fully paid. Use the following account information when sending a payment by wire transfer: U.S. Department of Treasury, TREAS NYC, 33 Liberty St., New York, NY 10045, VerDate Sep<11>2014 18:45 Aug 28, 2017 Jkt 241001 account number: 75060099, routing number: 021030004, SWIFT: FRNYUS33, Beneficiary: FDA, 8455 Colesville Rd., 14th Floor, Silver Spring, MD 20993–0002. If needed, FDA’s tax identification number is 53–0196965. Dated: August 24, 2017. Anna K. Abram, Deputy Commissioner for Policy, Planning, Legislation, and Analysis. [FR Doc. 2017–18377 Filed 8–28–17; 8:45 am] BILLING CODE 4164–01–P DEPARTMENT OF HEALTH AND HUMAN SERVICES Food and Drug Administration [Docket No. FDA–2017–N–0007] Medical Device User Fee Rates for Fiscal Year 2018 AGENCY: Food and Drug Administration, HHS. ACTION: Notice. SUMMARY: The Food and Drug Administration (FDA) is announcing the fee rates and payment procedures for medical device user fees for fiscal year (FY) 2018. The Federal Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the Medical Device User Fee Amendments of 2017 (MDUFA IV), authorizes FDA to collect user fees for certain medical device submissions and annual fees both for certain periodic reports and for establishments subject to registration. This notice establishes the fee rates for FY 2018, which apply from October 1, 2017, through September 30, 2018. To avoid delay in the review of your application, you should pay the application fee before or at the time you submit your application to FDA. The fee you must pay is the fee that is in effect on the later of the date that your application is received by FDA or the date your fee payment is recognized by the U.S. Treasury. If you want to pay a reduced small business fee, you must qualify as a small business before making your submission to FDA; if you do not qualify as a small business before making your submission to FDA, you will have to pay the higher standard fee. Please note that the establishment registration fee is not eligible for a reduced small business fee. As a result, if the establishment registration fee is the only medical device user fee that you will pay in FY 2018, you should not submit a FY 2018 Small Business Qualification and Certification request. This document provides information on how the fees for FY 2018 were determined, the payment procedures PO 00000 Frm 00048 Fmt 4703 Sfmt 4703 41029 you should follow, and how you may qualify for reduced small business fees. FOR FURTHER INFORMATION CONTACT: For information on Medical Device User Fees: Visit FDA’s Web site at https://www.fda.gov/ForIndustry/ UserFees/MedicalDeviceUserFee/ ucm20081521.htm. For questions relating to this notice: Robert Marcarelli, Office of Financial Management, Food and Drug Administration, 8455 Colesville Rd. (COLE–14202F), Silver Spring, MD 20993–0002, 301–796–7223. SUPPLEMENTARY INFORMATION: I. Background Section 738 of the FD&C Act (21 U.S.C. 379j) establishes fees for certain medical device applications, submissions, supplements, notices, and requests (for simplicity, this document refers to these collectively as ‘‘submissions’’ or ‘‘applications’’); for periodic reporting on class III devices; and for the registration of certain establishments. Under statutorilydefined conditions, a qualified applicant may receive a fee waiver or may pay a lower small business fee (see 21 U.S.C. 379j(d) and (e)). Under the FD&C Act, the fee rate for each type of submission is set at a specified percentage of the standard fee for a premarket application (a premarket application is a premarket approval application (PMA), a product development protocol (PDP), or a biologics license application (BLA)). The FD&C Act specifies the base fee for a premarket application for each year from FY 2018 through FY 2022; the base fee for a premarket application received by FDA during FY 2018 is $294,000. From this starting point, this document establishes FY 2018 fee rates for certain types of submissions, and for periodic reporting, by applying criteria specified in the FD&C Act. The FD&C Act specifies the base fee for establishment registration for each year from FY 2018 through FY 2022; the base fee for an establishment registration in FY 2018 is $4,375. There is no reduction in the registration fee for small businesses. Each establishment that is registered (or is required to register) with the Secretary of Health and Human Services under section 510 of the FD&C Act (21 U.S.C. 360) because such establishment is engaged in the manufacture, preparation, propagation, compounding, or processing of a device is required to pay the annual fee for establishment registration. II. Revenue Amount for FY 2018 The total revenue amount for FY 2018 is $183,280,756, as set forth in the E:\FR\FM\29AUN1.SGM 29AUN1

Agencies

[Federal Register Volume 82, Number 166 (Tuesday, August 29, 2017)]
[Notices]
[Pages 41026-41029]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-18377]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2016-N-0007]

Generic Drug User Fee Rates for Fiscal Year 2018

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: The Federal Food, Drug, and Cosmetic Act (the FD&C Act), as
amended by the Generic Drug User Fee Amendments of 2017 (GDUFA II),
authorizes FDA to assess and collect fees for abbreviated new drug
applications (ANDAs), drug master files (DMFs), generic drug active
pharmaceutical ingredient (API) facilities, finished dosage form (FDF)
facilities, contract manufacturing organization (CMO) facilities, and
generic drug applicant program user fees. In this document the Food and
Drug Administration (FDA or Agency) is announcing fiscal year (FY) 2018
rates for GDUFA fees.

FOR FURTHER INFORMATION CONTACT: David Haas, Office of Financial
Management, Food and Drug Administration, 8455 Colesville Rd., COLE-
14202I, Silver Spring, MD 20993-0002, 240-402-9845.

SUPPLEMENTARY INFORMATION:

I. Background

Sections 744A and 744B of the FD&C Act (21 U.S.C. 379j-41 and 379j-
42) establish fees associated with human generic drug products. Fees
are assessed on: (1) Certain types of applications for human generic
drug products; (2) certain facilities where APIs and FDFs are produced;
(3) certain DMFs associated with human generic drug products; and (4)
the generic drug applicant program (see section 744B(a)(1)-(5) of the
FD&C Act).
GDUFA II fees vary greatly from those in GDUFA I because of two
fundamental adjustments to the fee structure:
(1) The revenue base for GDUFA II is $493.6 million versus $323
million in the final year of GDUFA I--ANDAs are the primary workload
driver of the program. GDUFA I was built on the assumption that FDA
would receive 750 ANDAs per year. Over the first 4 years of GDUFA I,
ANDA receipts have averaged approximately 1,000 per year. To address
the increased workload, FDA hired additional staff and is projected to
spend about $430 million in the final year of GDUFA I. To maintain
FDA's current productivity and implement negotiated improvements, GDUFA
II stipulates that user fees should total $493.6 million annually
adjusted each year for inflation.
(2) GDUFA II will for the first time rely on annual program fees--
GDUFA II shifts the fee burden somewhat from facility fees.
For FY 2018, the generic drug fee rates are: ANDA ($171,823), DMF
($47,829), domestic API facility ($45,367), foreign API facility
($60,367), domestic FDF facility ($211,087), foreign FDF facility
($226,087), domestic CMO facility ($70,362), foreign CMO facility
($85,362), large size operation generic drug applicant program
($1,590,792), medium size operation drug applicant program ($636,317),
and small business generic drug applicant program ($159,079). These
fees are effective on October 1, 2017, and will remain in effect
through September 30, 2018.

II. Fee Revenue Amount for FY 2018

The base revenue amount for FY 2018 is $493,600,000, as set in the
statute (see section 744B(b)(1) of the FD&C Act). GDUFA II directs FDA
to use the yearly revenue amount as a starting point to set the fee
rates for each fee type. For more information about GDUFA II, please
refer to the FDA Web site (https://www.fda.gov/gdufa). The ANDA, DMF,
API facility, FDF facility, CMO facility, and generic drug applicant
program fee (GDUFA Program Fee) calculations for FY 2018 are described
in this document.
GDUFA II specifies that the $493,600,000 is to be adjusted for
inflation increases for FY 2019 through FY 2022 using two separate
adjustments--one for personnel compensation and benefits (PC&B) and one
for non-PC&B costs (see section 744B(c)(1) of the FD&C Act). Because
the adjustment for inflation does not take effect until FY 2019, FDA
will not adjust the base revenue amount for inflation in FY 2018.

III. ANDA Fee

Under GDUFA II, the FY 2018 ANDA fee is owed by each applicant that
submits an ANDA on or after October 1, 2017. This fee is due on the
receipt date of the ANDA. Section 744B(b)(2)(B) specifies that the ANDA
fee will make up 33 percent of the $493,600,000, which is $162,888,000.
To calculate the ANDA fee, FDA estimated the number of full
application equivalents (FAEs) that will be submitted in FY 2018. An
ANDA counts as one FAE; however, 75 percent of the

[[Page 41027]]

fee paid for an ANDA shall be refunded according to GDUFA II if (1) the
ANDA is refused for a cause other than failure to pay fees or (2) the
ANDA has been withdrawn prior to receipt (section 744B(a)(2)(D)(i) of
the FD&C Act). Therefore, an ANDA that is considered not to have been
received by FDA due to reasons other than failure to pay fees or
withdrawn prior to receipt counts as one-fourth of an FAE if the
applicant initially paid a full application fee. One hundred percent of
the fee paid for an ANDA shall be refunded if FDA initially receives
the ANDA and subsequent to initial receipt, FDA determines that
exclusivity should have prevented receipt of the ANDA, and thus FDA
determines that the ANDA is no longer received (section
744B(a)(2)(D))(ii) of the FD&C Act).
FDA utilized data from ANDAs submitted from October 1, 2013, to
April 30, 2017, to estimate the number of new original ANDAs that will
incur filing fees in FY 2018. For FY 2018, the Agency estimates that
approximately 938 new original ANDAs will be submitted and incur filing
fees. Not all of the new original ANDAs will be received by the Agency
and some of those not received will be resubmitted in the same fiscal
year. Therefore, the Agency expects that the FAE count for ANDAs will
be 948 for FY 2018.
The FY 2018 application fee is estimated by dividing the number of
FAEs that will pay the fee in FY 2018 (948) into the fee revenue amount
to be derived from ANDA application fees in FY 2018 ($162,888,000). The
result, rounded to the nearest dollar, is a fee of $171,823 per ANDA.
The statute provides that those ANDAs that include information
about the production of active pharmaceutical ingredients other than by
reference to a DMF will pay an additional fee that is based on the
number of such active pharmaceutical ingredients and the number of
facilities proposed to produce those ingredients (see section
744B(a)(3)(F) of the FD&C Act). FDA considers that this additional fee
is unlikely to be assessed often; therefore, FDA has not included
projections concerning the amount of this fee in calculating the fees
for ANDAs.

IV. DMF Fee

Under GDUFA II, the DMF fee is owed by each person that owns a type
II active pharmaceutical ingredient DMF that is referenced, on or after
October 1, 2012, in a generic drug submission by an initial letter of
authorization. This is a one-time fee for each DMF. This fee is due on
the earlier of the date on which the first generic drug submission is
submitted that references the associated DMF or the date on which the
drug master file holder requests the initial completeness assessment.
Under section 744B(a)(2)(D)(iii) of the FD&C Act, if a DMF has
successfully undergone an initial completeness assessment and the fee
is paid, the DMF will be placed on a publicly available list
documenting DMFs available for reference.
To calculate the DMF fee, FDA assessed the volume of DMF
submissions over time. The Agency assessed DMFs from October 1, 2015,
to April 30, 2017, and concluded that averaging the number of fee-
paying DMFs provided the most accurate model for predicting fee-paying
DMFs for FY 2018. FDA is estimating 516 fee-paying DMFs for FY 2018.
The FY 2018 DMF fee is determined by dividing the DMF target
revenue by the estimated number of fee-paying DMFs in FY 2018. Section
744B(b)(2)(A) specifies that the DMF fees will make up five percent of
the $493,600,000, which is $24,680,000. Dividing the DMF revenue amount
($24,680,000) by the estimated fee-paying DMFs (516), and rounding to
the nearest dollar, yields a DMF fee of $47,829 for FY 2018.

V. Foreign Facility Fee Differential

Under GDUFA II, the fee for a facility located outside the United
States and its territories and possessions shall be $15,000 higher than
the amount of the fee for a facility located in the United States and
its territories and possessions. The basis for this differential is the
extra cost incurred by conducting an inspection outside the United
States and its territories and possessions.

VI. FDF and CMO Facility Fees

Under GDUFA II, the annual FDF facility fee is owed by each person
who owns an FDF facility that is identified in at least one approved
generic drug submission owned by that person or his affiliates. The CMO
facility fee is owed by each person who owns an FDF facility that is
identified in at least one approved ANDA but is not identified in an
approved ANDA held by the owner of that facility or its affiliates.
These fees are due no later than the first business day on or after
October 1 of each such year. Section 744B(b)(2)(C) of the FD&C Act
specifies that the FDF and CMO facility fee revenue will make up 20
percent of the $493,600,000, which is $98,720,000.
To calculate the fees, data from FDA's Integrity Services (IS) were
utilized as the primary source of facility information for determining
the denominators of each facility fee type. IS is the master data
steward for all facility information provided in generic drug
submissions received by FDA. A facility's reference status in an
approved generic drug submission is extracted directly from submission
data rather than relying on data from self-identification. This
information provided the number of facilities referenced as FDF
manufacturers in at least one approved generic drug submission. Based
on FDA's IS data for FY 2018, the FDF and CMO facility denominators are
182 FDF domestic, 208 FDF foreign, 71 CMO domestic, and 97 CMO foreign
facilities.
GDUFA II specifies that the CMO facility fee is to be equal to one-
third the amount of the FDF facility fee. Therefore, to generate the
target collection revenue amount from FDF and CMO facility fees
($98,720,000), FDA must weight a CMO facility as one-third of an FDF
facility. FDA set fees based on the estimate of 182 FDF domestic, 208
FDF foreign, 23.67 CMO domestic (71 multiplied by one-third), and 32.33
CMO foreign facilities (97 multiplied by one-third), which equals 446
total weighted FDF and CMO facilities for FY 2018.
To calculate the fee for domestic facilities, FDA first determines
the total fee revenue that will result from the foreign facility
differential by subtracting the fee revenue resulting from the foreign
facility fee differential from the target collection revenue amount
($98,720,000) as follows. The foreign facility fee differential revenue
equals the foreign facility fee differential ($15,000) multiplied by
the number of FDF foreign facilities (208) plus the foreign facility
fee differential ($15,000) multiplied by the number of CMO foreign
facilities (97), totaling $4,575,000. This results in foreign fee
differential revenue of $4,575,000 from the total FDF and CMO facility
fee target collection revenue. Subtracting the foreign facility
differential fee revenue ($4,575,000) from the total FDF and CMO
facility target collection revenue ($98,720,000) results in a remaining
facility fee revenue balance of $94,145,000. To determine the domestic
FDF facility fee, FDA divides the $94,145,000 by the total weighted
number of FDF and CMO facilities (446), which results in a domestic FDF
facility fee of $211,087. The foreign FDF facility fee is $15,000 more
than the domestic FDF facility fee, or $226,087.
CMO fees are as follows. According to GDUFA II, the domestic CMO
fee is calculated as one-third the amount of the domestic FDF facility
fee. Therefore, the domestic CMO fee is $70,362, rounded to the nearest
dollar. The

[[Page 41028]]

foreign CMO fee is calculated as the domestic CMO fee plus the foreign
fee differential of $15,000. Therefore, the foreign CMO fee is $85,362.

VII. API Facility Fee

Under GDUFA II, the annual API facility fee is owed by each person
who owns a facility that is identified in (1) at least one approved
generic drug submission or (2) in a Type II API DMF referenced in at
least one approved generic drug submission. These fees are due no later
than the first business day on or after October 1 of each such year.
Section 744B(b)(2)(D) of the FD&C Act specifies the API facility fee
will make up seven percent of $493,600,000 in fee revenue, which is
$34,552,000.
To calculate the API facility fee, data from FDA's IS were utilized
as the primary source of facility information for determining the
denominator. As stated above, IS is the master data steward for all
facility information provided in generic drug submissions received by
FDA. A facility's reference status in an approved generic drug
submission is extracted directly from submission data rather than
relying on data from self-identification. This information provided the
number of facilities referenced as API manufacturers in at least one
approved generic drug submission.
The total number of API facilities identified was 592. Of the total
facilities identified as API facilities, there were 79 domestic
facilities and 513 foreign facilities. The foreign facility
differential is $15,000. To calculate the fee for domestic facilities,
FDA must first subtract the fee revenue that will result from the
foreign facility fee differential. FDA takes the foreign facility
differential ($15,000) and multiplies it by the number of foreign
facilities (513) to determine the total fee revenue that will result
from the foreign facility differential. As a result of that
calculation, the foreign fee differential revenue will make up
$7,695,000 of the total API fee revenue. Subtracting the foreign
facility differential fee revenue ($7,695,000) from the total API
facility target revenue ($34,552,000) results in a remaining balance of
$26,857,000. To determine the domestic API facility fee, we divide the
$26,857,000 by the total number of facilities (592), which gives us a
domestic API facility fee of $45,367. The foreign API facility fee is
$15,000 more than the domestic API facility fee, or $60,367.

VIII. Generic Drug Applicant Program Fee

Under GDUFA II, if a person and its affiliates own at least one but
not more than five approved ANDAs on October 1, 2017, the person and
its affiliates shall owe a small business GDUFA Program Fee. If a
person and its affiliates own at least 6 but not more than 19 approved
ANDAs, the person and its affiliates shall owe a medium size operation
GDUFA Program Fee. If a person and its affiliates own at least 20
approved ANDAs, the person and its affiliates shall owe a large size
operation GDUFA Program Fee. These fees are due no later than the first
business day on or after October 1 of each such year. Section
744B(b)(2)(E) of the FD&C Act specifies the GDUFA Program Fee will make
up 35 percent of $493,600,000 in fee revenue, which is $172,760,000.
To determine the appropriate number of applicants for each tier,
the Agency has posted lists of approved ANDAs on the FDA Web site
(https://www.fda.gov/gdufa) and asked applicants on the list to claim
which ANDAs and affiliates belong to the parent company. The original
list of approved ANDAs came from the Agency's Document Archiving,
Reporting, and Regulatory Tracking System (DARRTS), which included all
ANDAs with the status of ``approved'' as of April 30, 2017.
In determining the appropriate number of approved ANDAs, the Agency
has factored in a number of variables that could affect the collection
of the target revenue: (1) Inactive ANDAs--applicants who have not
submitted an annual report for one or more of their approved
applications within the past 2 years; (2) unclaimed affiliations--a
risk of undercollecting the target revenue if companies do not claim
their ANDAs and their affiliates before the Program Fee is calculated;
and (3) potential portfolio adjustment--applicants may choose to
withdraw some of their approved ANDAs in order to move to a lower tier
and reduce their fee exposure. The list of original approved ANDAs from
the DARRTS database as of April 30, 2017, shows 339 applicants in the
small business tier, 74 applicants in the medium size tier, and 65
applicants in the large size tier. This list also takes into account
all the withdrawals, consolidations, and transfer of ownerships from
industry as of April 30, 2017. Factoring in all the variables for the
first year of GDUFA II, the Agency estimates there will be 258
applicants in the small business tier, 52 applicants in the medium size
tier, and 62 applicants in the large size tier for FY 2018.
To calculate the GDUFA Program Fee, GDUFA II provides that large
size operation generic drug applicants pay the full fee, medium size
operation applicants pay two-fifths of the full fee, and small business
applicants pay one-tenth of the full fee. To generate the target
collection revenue amount from GDUFA Program Fees ($172,760,000), we
must weigh medium and small tiered applicants as a subset of a large
size operation generic drug applicant. FDA will set fees based on the
weighted estimate of 25.8 applicants in the small business tier (258
multiplied by 10 percent), 20.8 applicants in the medium size tier (52
multiplied by 40 percent), and 62 applicants in the large size tier,
arriving at 108.6 total weighted applicants for FY 2018.
To generate the large size operation GDUFA Program Fee, FDA divides
the target revenue amount of $172,760,000 by 108.6, which equals
$1,590,792. The medium size operation GDUFA Program Fee is 40 percent
of the full fee ($636,317), and the small business operation GDUFA
Program Fee is 10 percent of the full fee ($159,079).

IX. Fee Schedule for FY 2018

The fee rates for FY 2018 are set out in table 1.

Table 1--Fee Schedule for FY 2018
------------------------------------------------------------------------
Fee rates
Fee category for FY 2018
------------------------------------------------------------------------
Applications:
Abbreviated New Drug Application (ANDA).................. $171,823
Drug Master File (DMF)................................... 47,829
Facilities:
Active Pharmaceutical Ingredient (API)--Domestic......... 45,367
API--Foreign............................................. 60,367
Finished Dosage Form (FDF)--Domestic..................... 211,087
FDF--Foreign............................................. 226,087
Contract Manufacturing Organization (CMO)--Domestic...... 70,362
CMO--Foreign............................................. 85,362
GDUFA Program:
Large size operation generic drug applicant.............. 1,590,792
Medium size operation generic drug applicant............. 636,317
Small business operation generic drug applicant.......... 159,079
------------------------------------------------------------------------

X. Fee Payment Options and Procedures

The new fee rates are effective October 1, 2017. To pay the ANDA,
DMF, API facility, FDF facility, CMO facility, and GDUFA Program Fee,
you must complete a Generic Drug User Fee Cover Sheet, available
through https://www.fda.gov/gdufa and at https://userfees.fda.gov/OA_HTML/gdufaCAcdLogin.jsp, and generate a user fee identification (ID)
number. Payment must be made in U.S. currency drawn on a U.S. bank by
electronic check, check, bank draft, U.S. postal money order, credit
card, or wire transfer. The

[[Page 41029]]

preferred payment method is online using electronic check (Automated
Clearing House (ACH) also known as eCheck) or credit card (Discover,
VISA, MasterCard, American Express). Secure electronic payments can be
submitted using the User Fees Payment Portal at https://userfees.fda.gov/pay (Note: Only full payments are accepted. No partial
payments can be made online.) Once you search for your invoice, select
``Pay Now'' to be redirected to Pay.gov. Note that electronic payment
options are based on the balance due. Payment by credit card is
available for balances less than $25,000. If the balance exceeds this
amount, only the ACH option is available. Payments must be made using
U.S. bank accounts as well as U.S. credit cards.
FDA has partnered with the U.S. Department of the Treasury to
utilize Pay.gov, a web-based payment application, for online electronic
payment. The Pay.gov feature is available on the FDA Web site after
completing the Generic Drug User Fee Cover Sheet and generating the
user fee ID number.
Please include the user fee ID number on your check, bank draft, or
postal money order and make payable to the order of the Food and Drug
Administration. Your payment can be mailed to: Food and Drug
Administration, P.O. Box 979108, St. Louis, MO 63197-9000. If checks
are to be sent by a courier that requests a street address, the courier
can deliver checks to: U.S. Bank, Attention: Government Lockbox 979108,
1005 Convention Plaza, St. Louis, MO 63101. (Note: This U.S. Bank
address is for courier delivery only. If you have any questions
concerning courier delivery, contact the U.S. Bank at 314-418-4013.
This telephone number is only for questions about courier delivery).
Please make sure that the FDA post office box number (P.O. Box 979108)
is written on the check, bank draft, or postal money order.
If paying by wire transfer, please reference your unique user fee
ID number when completing your transfer. Without your unique user fee
ID number, the payment may not be applied. If the payment amount is not
applied, the invoice amount would be referred to collections. The
originating financial institution may charge a wire transfer fee.
Please ask your financial institution about the wire transfer fee and
include it with your payment to ensure that your fee is fully paid. Use
the following account information when sending a payment by wire
transfer: U.S. Department of Treasury, TREAS NYC, 33 Liberty St., New
York, NY 10045, account number: 75060099, routing number: 021030004,
SWIFT: FRNYUS33, Beneficiary: FDA, 8455 Colesville Rd., 14th Floor,
Silver Spring, MD 20993-0002. If needed, FDA's tax identification
number is 53-0196965.

Dated: August 24, 2017.
Anna K. Abram,
Deputy Commissioner for Policy, Planning, Legislation, and Analysis.
[FR Doc. 2017-18377 Filed 8-28-17; 8:45 am]
BILLING CODE 4164-01-P

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