FDA Does Well as House, Senate Pass FY13 CR

Both the Senate and House have passed the FY13 Continuing Resolution, and it has been sent to the President for signature. The FDA was singled out for special treatment in the process.As was written about in more detail in last Friday’s report, there was a 2.5 percent Across-the-Board Rescission in the Senate bill that was ultimately passed by both houses. The rescission applies to FDA, along with many agencies. It is a mechanism to make sure spending was underneath the statutory caps set by the Budget Control Act (BCA). It is separate and apart from sequestration. The rescission does not apply to user fees.Thankfully, because appropriators decided to prioritize the FDA and add money before the 2.5% Across-the-Board (ATB) Rescission was applied, FDA did better in FY13 than under FY12 by about $9 million. While this number is relatively modest, it is important to point out that most agencies in the Agriculture spending bill received a cut because of the ATB Rescission. On a relative scale, FDA did much better than most other Federal agencies.While FDA did relatively well in the FY13 CR, keep in mind that the impact of the sequester still needs to be factored in. We will have a full explanation of this in the Friday report tomorrow.Please see the chart below to understand the impact.

FunctionBudget authority only	FY 12Final	FY 13 OmnibusAppropriationsPendingPresident’ssignature	Less 2.513% “Across-the-Board” Rescission(applies at the Centerlevel and to Office ofthe Commissioner)
FY 13 -- FDA Salariesand Expenses	$2.497 billion	$2.524 billion
“No-year” SupplementalAppropriations	None	$50 million
Building & Facilities Repair	$ 9 million	$ 5.3 million
All BA appropriationsTotal (no user fees)	$2.506 billion	$2.580 billion(rounded)	$2.515 billion (rounded)(+$9 million over FY 12)
-------------------------------------The FY 13 Omnibus Appropriations also allows FDA to spend the higher user fee levels in FDASIA (+$18M for PDUFA and +$40M for MDUFDA), assures full implementation of the new generic user fee program (+$300M) and permits collection and expenditure of the new biosimilars user fees (+$20M). -------------------------------------FY 13 Omnibus Appropriations does NOT have any effect on the Balanced Budget Act sequester. Thus, as with all non-defense discretionary programs, all FY 13 FDA numbers -- including about $1.6 billion in user fees -- will be reduced by 5% on their FY 13 total. Flexibility will exist within each Center and the Commissioner’s office as to where reductions are taken but there is no flexibility between and among Centers.