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The FDA’s Best Case, Optimistic Scenario for FY 13

June 10, 2012

Let’s call this one “the optimistic FDA budget scenario.” It’s definitely not a prediction or even a probability, just the path that would provide the most protection and the most growth for FDA. It is the scenario that gives FDA the best chance to meet its burgeoning responsibilities in the midst of continuing budgetary strife.

This week was a good step in the right direction. For the second year in a row, the House has passed a budget resolution that incorporates a discretionary spending cap that is significantly lower than the one being used by the Senate. When there is less money for all budget accounts, then inevitably it trickles down and there is less money available in each budget account.

Last year, this led to a House position of cutting FDA by $275 million dollars for FY 12. Eventually, the aggregate spending levels were resolved in favor of the higher Senate numbers and FDA netted out a $50 million increase for FY 12. Not nearly enough in our opinion, but we can be forgiven for being relieved that the final number was positive and supported some needed FDA initiatives. And we are well aware that it required not only the Senate’s initial higher position, but also the House’s willingness to accept this number, rather than try to negotiate it downward.

This week’s House outcome — while far from the optimum — was an enormous improvement over last year. Chairman Jack Kingston and Ranking Member Sam Farr reflected the House’s greater appreciation for FDA and provided a far better bottom line than last year: proposing that FDA’s budget be cut $16 million in FY 13.

No one knows what the next step is. There is talk that the House Appropriations Committee will take the bill up later this month, but nothing is firm. Nearly everybody believes that, at some point, the entire appropriations process will grind to a halt — well short of bills becoming law. Instead, the whole process would be wrapped up as part of a grand post-election package that will roll together

  • FY 13 appropriations
  • An implementation or an alternative to the January 2013 sequester (across-the-board cut)
  • Savings from changes in mandatory (entitlement-type) programs and
  • Possible tax reform.

If that happens, there will be an FDA narrative buried somewhere inside that larger package. Optimistically, it would go like this: the House agrees with the bottom-line discretionary spending total for FY 13, freeing the House to come up as least as far as the Senate increase of $24 million.

Meantime, FDA’s need for budget growth becomes even more compelling than just these few extra dollars. In the face of the potential sequester ($150M to $250M cut in FDA), Congress:

  • Looks realistically at the new unfunded FDA responsibilities in the user fee reauthorization
  • Recognizes the degree to which globalization issues (counterfeits, national security) have become more pressing
  • Considers the consequences of not funding the Food Safety Modernization Act and
  • Acknowledges its own statements about the importance of FDA-regulated industries to job growth in America

and realizes that cuts at FDA would be disastrous. The FDA is then exempted from the sequester and maybe gains even a few more dollars in growth than under the current Senate bill.

This is the FDA’s best-case optimistic scenario. It is up to us — the Alliance and its members — to make the case for it to happen this way. To say “the deck is stacked against us” is an understatement … but the best-case is always possible as long as we keep trying.

Please continue your own efforts and support our efforts to make sure that FDA receives the taxpayer (BA) dollars it needs to carry out its responsibilities.

Note: This analysis and commentary is written by Steven Grossman, the Deputy Executive Director of the Alliance for a Stronger FDA.

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