The Generic Drug User Fee Amendments: An Economic Perspective / Ernst R. Berndt, Rena M. Conti, Stephen J. Murphy.

By:

Berndt, Ernst R

Contributor(s):

Material type: Text

TextSeries: Working Paper Series (National Bureau of Economic Research) ; no. w23642.Publication details: Cambridge, Mass. National Bureau of Economic Research 2017.Description: 1 online resource: illustrations (black and white)Subject(s):

Online resources:

Available additional physical forms:

Hardcopy version available to institutional subscribers

Abstract: Regulation can influence the structure, conduct and performance of consumer product markets and the structure of product markets can influence regulation. Since the vast majority of prescription drugs consumed by Americans are generic, the structure of the U.S. generic prescription drug market is of wide interest. The supply of prescription drugs in the U.S. is also heavily regulated by the U.S. Food and Drug Administration (FDA). We describe events leading up to the passage and implementation of the Generic Drug User Fee Amendments in 2012 (GDUFA I), and compare its FDA commitments, provisions, goals and fee structure to that of the 1992 Prescription Drug User Fee Act (PDUFA) for branded drugs. Although GDUFA I expires September 30, 2017, reauthorization for GDUFA II is currently underway and is likely to shift the user fee structure away from annual facility fees to annual program fees. We explain how the fee structure of GDUFA I, and that being considered for GDUFA II, erects barriers to entry and creates scale and scope economies for incumbent manufacturers of generic drugs. Furthermore, in order to implement fees under GDUFA I, FDA required the submission of self-reported data on generic manufacturing practices including domestic and foreign active pharmaceutical ingredient (API) and finished dosage form (FDF) facilities. These data provide an unprecedented window into the recent evolution of generic drug manufacturing markets. Our analyses of these data suggest that generic drug manufacturing in 2017 is quite concentrated: a very large portion of ANDA holders have small portfolios consisting of less than five ANDAs, while a small number of very large ANDA holders have portfolios consisting of hundreds or even thousands of ANDAs. The number of API and FDF facilities have each declined by approximately 10-11% between 2013 and 2017. Furthermore, in 2017, generic manufacturing is largely foreign and has become increasingly so since 2013. We discuss the implications of the current structure of the U.S. generic prescription drug market for GDUFA II ratification and implementation.

Tags from this library: No tags from this library for this title. Log in to add tags.

Average rating: 0.0 (0 votes)

Holdings
Item type	Home library	Collection	Call number	Status	Date due	Barcode	Item holds
Working Paper	Biblioteca Digital	Colección NBER	nber w23642 (Browse shelf(Opens below))	Not For Loan

Total holds: 0

Collection: Colección NBER Close shelf browser (Hides shelf browser)

Previous	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	Next
Previous	nber w2364 On the Interpretation of Near Random-Walk Behavior in GNP /	nber w23640 The Landscape of US Generic Prescription Drug Markets, 2004-2016 /	nber w23641 Estimating the Value of Higher Education Financial Aid: Evidence from a Field Experiment /	nber w23642 The Generic Drug User Fee Amendments: An Economic Perspective /	nber w23643 Foreign Investment and Domestic Productivity: Identifying Knowledge Spillovers and Competition Effects /	nber w23644 Women, Work, and Family /	nber w23645 Addressing the Opioid Epidemic: Is There a Role for Physician Education? /	Next

August 2017.

Regulation can influence the structure, conduct and performance of consumer product markets and the structure of product markets can influence regulation. Since the vast majority of prescription drugs consumed by Americans are generic, the structure of the U.S. generic prescription drug market is of wide interest. The supply of prescription drugs in the U.S. is also heavily regulated by the U.S. Food and Drug Administration (FDA). We describe events leading up to the passage and implementation of the Generic Drug User Fee Amendments in 2012 (GDUFA I), and compare its FDA commitments, provisions, goals and fee structure to that of the 1992 Prescription Drug User Fee Act (PDUFA) for branded drugs. Although GDUFA I expires September 30, 2017, reauthorization for GDUFA II is currently underway and is likely to shift the user fee structure away from annual facility fees to annual program fees. We explain how the fee structure of GDUFA I, and that being considered for GDUFA II, erects barriers to entry and creates scale and scope economies for incumbent manufacturers of generic drugs. Furthermore, in order to implement fees under GDUFA I, FDA required the submission of self-reported data on generic manufacturing practices including domestic and foreign active pharmaceutical ingredient (API) and finished dosage form (FDF) facilities. These data provide an unprecedented window into the recent evolution of generic drug manufacturing markets. Our analyses of these data suggest that generic drug manufacturing in 2017 is quite concentrated: a very large portion of ANDA holders have small portfolios consisting of less than five ANDAs, while a small number of very large ANDA holders have portfolios consisting of hundreds or even thousands of ANDAs. The number of API and FDF facilities have each declined by approximately 10-11% between 2013 and 2017. Furthermore, in 2017, generic manufacturing is largely foreign and has become increasingly so since 2013. We discuss the implications of the current structure of the U.S. generic prescription drug market for GDUFA II ratification and implementation.