GDUFA – the promise and the reality

The introduction of GDUFA was meant to reduce a regulatory backlog and improve patient safety. Edward Price, President, PCI Synthesis, argues it has, in fact, had a more far-reaching impact

Edward S. Price

Since its inception, the Generic Drug User Fee Amendments (GDUFA) has offered the promise of reducing the backlog of new generic drug applications and stepping up inspections of all plants to ensure parity and consistent high quality manufacturing for every drug product sold in the United States. This new Food and Drug Administration (FDA) law tightens the focus on the production of raw materials and the manufacturing of finished drugs available for sale in the US to ensure the delivery of safe, effective medicines to Americans and good progress has been made. On the flip side, however, we have also seen the fall-out of a law that can harm small-to-medium US manufacturers, leading to less innovation and overall competition in the industry.

Don’t get me wrong: holding all manufacturers to the same high standard in generic drug manufacturing should be table-stakes in today’s world, and it is a shame this was not the reality from the get-go. Due to cultural differences and a physical distance it has been difficult to hold manufacturers in Asia to the same standards as in the US.

While there are large pockets of compliance, particularly in areas such as Canada and Europe, many other countries find it tough to meet the higher bar that has been put in place with GDUFA’s implementation. India, for example, cites the increase in the number of inspections and the approval time for new generic drug applications as burden-some, and thought leaders appealed to FDA Commissioner Margaret Hamburg when she recently visited the country.

Quality concerns have mounted as a number of generic drugs manufactured in India have not been to a standard acceptable to the FDA

Meanwhile, quality concerns have mounted as a number of generic drugs manufactured in India have not been to a standard acceptable to the FDA. As a result, the FDA has authorised several US academic and research institutions to conduct tests on the efficacy of some antidepressants, attention deficit hyperactivity disorder (ADHD) drugs, and heart and seizure medications that are made in India. While the concern is particularly with the extended release formulations of these medications, it emphasises the importance of consistent quality no matter where the drug has been manufactured.

The whole situation also points to the potential cost- and time-savings that could have been realised if the standards of admission, the identification of facilities and the implementation of risk-based inspections had been carried out right the first time.

India is not alone in its discomfort level around increased site inspections, as well as the turnaround time and fees associated with implementing GDUFA internationally. At the same time China has yet to approve additional FDA inspectors to enter the country so more facilities can be inspected. Yet it is particularly for international outsourcing partners that this law was enacted. It has taken a while for international manufacturers to digest the full meaning of GDUFA, but for those that have had a history of complying with the FDA’s evolving regulations, the impact has been manageable.

For those that have had a history of complying with the FDA’s evolving regulations, the impact has been manageable

For those that have been reluctant to embrace it, GDUFA will bring growing pains but also an attention to detail that will ultimately not only improve their bottom line but also help millions of patients lead healthier lives.

GDUFA has also had an impact here in the US, particularly for small- and medium-sized manufacturers. We have felt the long arm of the law since day one.

First, there already is a shortage of drugs needed to save lives or maintain quality of life for those who are chronically ill. At the end of March, almost 80 drugs were listed in short supply on the FDA website, for reasons primarily due to manufacturing, quality control, or delays in obtaining raw materials from suppliers. As points of comparison, the FDA reported 251 shortages in 2011 and 117 in 2012. Many of these drugs have been around for a decade or more, with well-documented benefits and side effects.

With pharmacy benefits and drug formularies adjusting insurer by insurer with the implementation of the Affordable Care Act, consumers are driving the demand for some of these ‘old faithful’ and very low cost generics. But it does no one any good if they are not even available when needed.

Why aren’t they available? While the FDA cites broad industry issues, the reality is that these older drugs are not as profitable as some of the newer medications. For-profit manufacturers need to make money and increasingly they see higher-profit drugs driving revenue and offsetting the costs of being in FDA compliance. To them, these generics are ‘old school’.

Newer drugs are attractive as long as the manufacturer can pay the fees, march to the FDA’s long time line and navigate new GDUFA processes

Newer drugs are attractive as long as the manufacturer can pay the fees, march to the FDA’s long time line and navigate new GDUFA processes. For example, free-flowing communication between the manufacturer and the FDA is now formalised, consolidated and less frequent. Feedback and comments are grouped and tallied before going back to the manufacturer, for example, eliminating concurrent responses to issues or concerns. It takes longer, but it is easier for the FDA to measure and track progress. At the end of January, the application backlog was reduced by 45%, but many manufacturers were in a holding pattern until the FDA provided feedback. The real-time communication between manufacturers and the FDA has come to a halt.

Business strategies are emerging where manufacturers are abandoning broad classes of generics and instead opting for large growth segments of the market. For example, a recent study from researchers at the University of Adelaide in South Australia found that people born between 1966 and 1980 (Generation X) are twice as likely to have diabetes as people in the Baby Boom generation. Redirecting production only to diabetes medicines, then, it could be argued, could be a more profitable strategy than multiple products for multiple ailments, especially as Generation X ages.

Change of strategy

As some manufacturers leave the generic market, others will step into their place. But it will be a balancing act for these manufacturers to dance around the drug application time line and fees, while delivering generics at cut-rate prices to smaller groups of patients.

Still others may opt for strategic partnerships, mergers and acquisitions. A drug that a large manufacturer deems no longer viable to produce might be attractive for the manufacturer’s smaller business partner, or even newly minted subsidiary.

While quality is GDUFA’s worldwide goal, in the US it has driven manufacturers out of lines of business or out of business altogether

So GDUFA is having an impact on everyone from the small- to medium-sized manufacturers in America, to outsourced manufacturers abroad. While quality is GDUFA’s worldwide goal, in the US it has driven manufacturers out of lines of business or out of business altogether. We should be looking to sustain and grow business, not removing an American economic engine. Smaller manufacturers here in the US have long delivered on the quality standard and now find themselves jockeying for survival and market share as a result of a government-inflicted regulation. Please join me in urging the FDA to take a step back to evaluate the early results of GDUFA, looking at both the direct and indirect results of a law that ultimately limits small manufacturing success.

Edward S. Price is Co-Chair of MassBio’s CRO/CMO Committee and President of PCI, a custom manufacturer of NCEs, generic APIs, and other speciality chemicals. Email: Ed.Price@pcisynthesis.com