As reported by the Senate Committee on Health, Education, Labor, and Pensions on May 11, 2017
S. 934 would reauthorize the Food and Drug Administration (FDA) to collect and spend fees to cover the cost of carrying out certain activities to expedite the approval process for marketing prescription drugs and medical devices and to regulate drugs after they enter the market. The bill also would:
- Reauthorize certain programs and grants administered by FDA and the National Institutes of Health (NIH),
- Require the Government Accountability Office (GAO) to report on FDA and NIH activities, and
- Provide drug sponsors the opportunity to effectively restrict competition from generic drugs for a period of time for drugs developed from a particular type of molecule called an enantiomer, by requesting five-year data exclusivity.
Implementing S. 934 would require increased funding for a variety of FDA activities, but most of the increase in FDA spending would be offset by additional fees that would be collected under the bill and used to reduce the need for discretionary appropriations. CBO estimates that net discretionary spending (primarily by FDA) would increase by about $740 million over the 2017–2022 period, assuming appropriation actions consistent with the bill.
CBO also estimates that enacting S. 934 would increase direct spending by $13 million and decrease revenues by $2 million over the 2017-2027 period; therefore, pay-as-you-go procedures apply. Taken together, CBO estimates that enacting S. 934 would increase budget deficits by $15 million over the 2017-2027 period.
CBO estimates that enacting S. 934 would not increase net direct spending or on-budget deficits by more than $5 billion in any of the four consecutive 10-year periods beginning in 2028.
S. 934 would impose intergovernmental and private-sector mandates, as defined in the Unfunded Mandates Reform Act (UMRA), on public and private manufacturers of prescription drugs and medical devices. In addition, the bill would preempt state and local laws that interfere with the distribution of over-the-counter hearing aids. CBO estimates that the cost of the mandates on public entities would be small and fall well below the annual threshold established in UMRA for intergovernmental mandates ($78 million in 2017, adjusted annually for inflation). However, in aggregate, CBO estimates that the cost of the mandates on private entities would well exceed the annual threshold established in UMRA for private-sector mandates ($156 million in 2017, adjusted annually for inflation) in each of the first five years the mandates are in effect, primarily because of the requirement to pay fees.