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Where We’re at Now and What’s Coming Next

September 23, 2017

With much of the health policy world focused on health reform, it seemed like a good week to step back and look at the resource challenges FDA will face over the next year.

First, FDA must survive the FY 18 appropriations process. Given where we started the year — 15% to 20% cuts proposed for HHS and USDA — it is a relief that level funding is proposed under the House omnibus and the Senate committee versions. In addition, the bills would transfer $60 million made available to FDA for specific activities under the terms of the 21st Century Cures Act.

However, the process has not been completed and several concerns still remain. For example, even though FDA’s funding level under the CR is the same as under the House and Senate appropriations bills, there are a number of disadvantages to FDA if the agency is funded under a CR for the whole year. Another concern is that level funding doesn’t address the agency’s growing responsibilities and expanding mission. Just within the last 12 months, 21st Century Cures and FDARA have assigned new projects and programs to FDA that must be supported by BA appropriations dollars.

Finally, under either an omnibus or a year-long CR, FDA “supposedly level” funding is subject to across-the-board spending reductions. Sequestration is one way this can occur; the CR (which reduces all spending by 0.6791% until December 8) could be another.

Second, FDA Need to Continue Fixing Its Recruitment, Hiring and Retention Process. Over 80% of FDA funds (BA and user fee monies) are spent on staff needs (salary, benefits, training, IT, travel, rent, etc.). This reflects and reinforces that FDA’s workforce is its most important resource. FDA’s effectiveness is dependent on the agency surmounting a number of long-term challenges to recruitment, hiring, and retention. A number of provisions in 21st Century Cures should help. Further, Commissioner Gottlieb is making it a priority to speed up hiring and make the system work. There is a lot of progress being made, but it still rates as one of FDA’s most significant resource challenges over the next year.

Third, FDA Faces a Dual Threat in the Upcoming FY 19 Funding Cycle.  The FY 19 appropriations cycle starts in February with the President submitting his request to Congress. It is certain to be another tough year, combined with a further widening in the  gap between FDA’s responsibilities and sufficient BA funding. Further, it is highly likely that the Administration will again propose substantial increases in user fees, while proposing substantial cuts in BA funds. The Alliance was at the forefront this year in stressing the importance of BA funding because taxpayers are the primary beneficiary of FDA’s activities and need to have a substantial stake in how the agency is paid for.

A final thought: the Alliance is proud that over a 10-year period we have helped push FDA’s BA funding from $1.5 billion to $2.7 billion. However, as reflected above, our efforts are needed now, more than ever. Help us in the coming year to lead the stakeholder community in preserving and expanding the funding that FDA needs.

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