Robert F. Kennedy, Jr.—Trump’s pick for HHS secretary who endured confirmation hearings last week—has repeatedly criticized industry ties to the FDA, particularly financial links between the two, which could indicate trouble for the user-fee model.
To carry out its activities, the FDA relies on funding from both taxpayers and the industries it regulates. In exchange for the pharma industry paying user fees, the FDA makes commitments regarding the review of potential drugs, such as setting specific timeframes for the drug application process. The Prescription Drug User Fee Act (PDUFA) was implemented in 1992 to provide the agency with additional funds to speed up drug reviews, and user fees now constitute 46% of the FDA’s budget.
Every five years the FDA and industry renegotiate PDUFA and agree on performance goals for the next reauthorization cycle. This year, the process of renegotiation will begin, with the Health and Human Services (HHS) secretary due to submit user fee agreements to Congress by January 2027.
The reliance on industry-provided funds for the FDA’s operations has drawn criticism for potentially undermining the agency’s independence, and with Donald Trump back in office as president and Robert F. Kennedy, Jr., nominated to take the position of health secretary, there is a degree of uncertainty over the direction of the negotiations. RFK Jr., who was grilled by Senators last week for his anti-vaccine views, has been particularly critical of the FDA and what he refers to as “corruption” in the way it operates, calling in his “Make America Healthy Again” campaign for industry financing to be separated from politics.
“We do have a previous Trump administration to learn from,” James Valentine, director at Hyman, Phelps & McNamara, told BioSpace. “What was different then was the negotiation cycle had concluded. This time, the negotiations will begin this summer, and there will be far more time for the administration to become involved.”
Evolution or Revolution?
This leaves the pharmaceutical industry and stakeholders searching for clues about potential action Trump may take in his second term on PDUFA. During Trump’s first term, he attempted to double the fees paid by companies for the review process, claiming that this would speed up drug approvals. Eventually these plans were shelved and PDUFA was reauthorized with a more modest raise that had been agreed to earlier in negotiations.
In another area relevant to PDUFA, Valentine highlighted that the first Trump administration was supportive of the rare disease community, aligning with existing efforts by the FDA to support clinical trial programs in the area. If rare diseases continue to be a priority, the administration could implement measures in the PDUFA agenda that would help speed up the review process for these treatments—a development that would be welcomed by industry, Valentine added.
RFK Jr.’s nomination as health secretary has prompted analysis of his public positions and their possible impact on PDUFA. The potential health secretary has voiced support for emerging areas of clinical research, including psychedelics and stem cell therapies, and it is possible that commitments could be made to these areas in PDUFA, Valentine noted.
Perhaps more significantly, BGR Group, a policy and public relations firm, released a report in November detailing instances where RFK Jr., or those close to him, suggested completely cutting the user fee link between industry and the FDA.
The report also describes various ways that the Trump Administration could hinder an agreement on PDUFA. For example, the FDA commissioner could refuse to allow the agency to negotiate with industry, or an executive order could be used to influence certain FDA actions, such as limiting the agency’s ability to negotiate performance goals or fee structures. The report notes that, ultimately, such actions could still be bypassed by Congress and, more importantly, that the large budget shortfall created by a lack of user fees would be difficult for the administration to navigate.
Quid Pro Quo
On the other side of the PDUFA negotiation table will be industry and what it is likely to demand from the FDA in return for user fees. PhRMA spokesperson Andrew Powaleny highlighted to BioSpace the importance to industry of continuing to commit to patient-centric drug development in upcoming drug negotiations. Valentine said this is one area he would expect further discussions to focus on, as there has been a consistent effort by both industry and the FDA to “integrate the patient’s voice into the review and decision-making process.”
When asked about the future of PDUFA and whether the industry shared any of RFK Jr.’s doubts about the act, Powaleny stated that the industry association firmly supports user fees and believes they “play an important part in positioning the U.S. as a global leader in biopharmaceutical innovation.”
The initial introduction of PDUFA resulted in a 77% increase in the number of new drug reviews, and the median approval time for non-priority new drugs fell from 27 months to 14 months in the initial eight years of implementation, according to the General Accounting Office.
Powaleny stated that more than 70% of medicines were first approved outside of the U.S. before PDUFA, which subsequently reversed this phenomenon to make most drugs available in the U.S. before other markets. “Today, America leads the world in the introduction of new medicines,” he concluded. “This is, in large part, because of PDUFA and its role in modernizing the FDA’s independent review and approval process.”
