Appeal Requests

Guidance for Industry
User Fee Waivers, Reductions,
and Refunds for Drug and
Biological Products

U.S. Department of Health and Human Services

Food and Drug Administration

Center for Drug Evaluation and Research (CDER)

Center for Biologics Evaluation and Research (CBER)

September 2011

User Fees

OMB Control No. 0910-0693

Expiration Date 8/31/2014

See additional PRA statement in section X of this guidance.

Guidance for Industry
User Fee Waivers, Reductions,
and Refunds for Drug and
Biological Products
Additional copies are available from:

Office of Communication

Division of Drug Information, WO51, Room 2201

Center for Drug Evaluation and Research

Food and Drug Administration

10903 New Hampshire Ave.

Silver Spring, MD 20993

Phone: 301-796-3400; Fax: 301-847-8714

druginfo@fda.hhs.gov

http://www.fda.gov/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/default.htm

and/or

Office of Communication, Outreach, and Development (HFM-40)

Center for Biologics Evaluation and Research

Food and Drug Administration

1401 Rockville Pike, Suite 200N

Rockville, MD 20852-1448

(Tel) 301-827-1800 or 800-835-4709

ocod@fda.hhs.gov

http://www.fda.gov/BiologicsBloodVaccines/GuidanceComplianceRegulatoryInformation/default.htm

U.S. Department of Health and Human Services

Food and Drug Administration

Center for Drug Evaluation and Research (CDER)

Center for Biologics Evaluation and Research (CBER)

September 2011

User Fees

TABLE OF CONTENTS

I.

INTRODUCTION............................................................................................................. 1

II.

BACKGROUND ............................................................................................................... 1

III.

DEFINITIONS .................................................................................................................. 2

IV.

TYPES OF WAIVERS AND REDUCTIONS................................................................ 4

A.

Public Health .................................................................................................................................. 4

B.

Barrier to Innovation..................................................................................................................... 6

C.

Financial Considerations for Public Health and Barrier-to-Innovation Waivers and

Reductions ...................................................................................................................................... 7

D.

Small Business ................................................................................................................................ 9

V.

EXEMPTIONS AND REFUNDS .................................................................................. 11

A.

Orphan Designated Products...................................................................................................... 11

B.

State or Federal Government Entity.......................................................................................... 12

C.

No Substantial Work ................................................................................................................... 12

VI.

SUBMITTING REQUESTS FOR WAIVERS, REDUCTIONS, AND REFUNDS . 13

A.

Timing of Requests ...................................................................................................................... 13

B.

Content and Format of Requests................................................................................................ 14

C.

Address for Submitting Requests ............................................................................................... 16

VII. FDA RESPONSES TO REQUESTS FOR WAIVERS AND REDUCTIONS .......... 16

VIII. RECONSIDERATIONS AND APPEALS.................................................................... 17

A.

Reconsideration Request ............................................................................................................. 17

B.

Appeal Request ............................................................................................................................ 17

IX.

DISCLOSURE OF PUBLIC INFORMATION ........................................................... 18

X.

PAPERWORK REDUCTION ACT OF 1995.............................................................. 18

Contains Nonbinding Recommendations

Guidance for Industry1

User Fee Waivers, Reductions, and Refunds

for Drug and Biological Products

This guidance represents the Food and Drug Administration's (FDA's) current thinking on this topic. It
does not create or confer any rights for or on any person and does not operate to bind FDA or the public.
You can use an alternative approach if the approach satisfies the requirements of the applicable statutes
and regulations. If you want to discuss an alternative approach, contact the FDA staff responsible for
implementing this guidance. If you cannot identify the appropriate FDA staff, call the appropriate
number listed on the title page of this guidance.

I.

INTRODUCTION

This guidance provides recommendations to applicants regarding requests for waivers, refunds,
and reductions of user fees assessed under sections 735 and 736 of the Federal Food, Drug, and
Cosmetic Act (the Act) for drugs, including biological drug products. This guidance is a revision
of the draft guidance entitled Draft Interim Guidance Document for Waivers of and Reductions
in User Fees (1993 interim guidance), issued July 16, 1993.
This revised guidance describes (1) the types of waivers, refunds, and reductions available under
the user fee provisions of the Act and (2) the procedures for requesting waivers, refunds, or
reductions, and reconsiderations and appeals of FDA decisions on such requests. The revised
guidance also provides clarification on related issues such as user fee exemptions for orphan
drugs.
FDA's guidance documents, including this guidance, do not establish legally enforceable
responsibilities. Instead, guidances describe the Agency's current thinking on a topic and should
be viewed only as recommendations, unless specific regulatory or statutory requirements are
cited. The use of the word should in Agency guidances means that something is suggested or
recommended, but not required.

II. BACKGROUND
The Prescription Drug User Fee Act of 1992 (PDUFA I) authorized FDA to assess user fees for 5
years in conjunction with the review of human drug applications. This authorization to assess
user fees was for fiscal years (FY) 1993 through FY 1997. PDUFA has been reauthorized three
times. The Food and Drug Administration Modernization Act of 1997 reauthorized the user fee
1

This guidance has been prepared by the Office of Regulatory Policy (ORP), Center for Drug Evaluation and
Research (CDER), in consultation with the Center for Biologics Evaluation and Research.

Contains Nonbinding Recommendations
provisions for 5 years, beginning in FY 1998 (PDUFA II). The Prescription Drug User Fee
Amendments of 2002 reauthorized the user fee program for another 5 years, beginning in FY
2003 (PDUFA III), and the Food and Drug Administration Amendments Act of 2007
reauthorized the user fee program for another 5 years beginning in FY 2008 (PDUFA IV). The
statute is up for reauthorization again in FY 2012.
The Act authorizes FDA to assess application fees for certain human drug and biological product
applications or supplements when those applications or supplements are submitted. In addition,
FDA can assess annual product fees for certain approved drug and biological products, and
annual establishment fees for the facilities in which those products are made in final dosage
form.2
Because of the way the program is structured in the Act, the total amount FDA collects in user
fees is independent of the number of waivers or reductions in fees that are granted. Target
revenues are established in accordance with a statutory formula, and the amount of each type of
fee (application, product, and establishment) is determined based on historical data of how many
applications, products, and establishments were assessed fees in the previous fiscal year.
Therefore, the more waivers or reductions are granted, the more fees must be increased the
following year for applications, products, and establishments subject to fees to meet the annual
statutory revenue targets. 3

III. DEFINITIONS
For purposes of this guidance:
• The term affiliate means a business entity that has a relationship with a second business
entity if, directly or indirectly, (A) one business entity controls, or has the power to
control, the other business entity; or (B) a third party controls, or has the power to
control, both of the business entities.4
• The term applicant means the owner, holder, or sponsor of a new drug application
(NDA) or biologics license application (BLA).
2

Information on product, establishment, and application fees, including fee rates, PDUFA goals, and other various
user fee related issues can be found on FDA’s PDUFA Internet site:
http://www.fda.gov/ForIndustry/UserFees/PrescriptionDrugUserFee/default.htm.
3
Under the Act, FDA sets user fee target revenue each year. For example, if the FDA is to collect $600 million in a
fiscal year, the $600 million is divided by 3 and each category — applications, products, and establishments —
would be expected to provide $200 million. FDA divides the target revenue in each category by the number of
applications, products, or establishments it expects to assess fees to determine the fee for each individual
application, product, or establishment. The more product fees FDA waives, the higher the product fee is in the
subsequent fiscal year. For example, using the target revenue of $200 million, if we assessed fees for 2500 products
for fiscal year A, the fee would be $80,000 per product. If FDA waived fees for 100 products, we would expect
2400 products to be assessed fees in the subsequent fiscal year, and the fee amount per product would increase
($200 million divided by 2400 = $83,333 per product). As a result, more companies might request waivers because
of higher fee assessments.
4
Section 735(11) of the Act.
2

Contains Nonbinding Recommendations
• The term application includes both NDAs and BLAs.
• The term drug includes drug and biologic products.
• The term final dosage form means, with respect to a prescription drug product, a finished
dosage form which is approved for administration to a patient without substantial further
manufacturing.5 Substantial further manufacturing does not include packaging.6 FDA
generally considers a product to be in final dosage form unless one or more of the
following operations is required but has yet to be performed: mixing, granulating,
milling, molding, lyophilizing, tableting, encapsulating, coating, sterilizing, and filling
sterile, aerosol, or gaseous drugs into dispensing containers.
• The term human drug application means an application for (1) approval of a new drug
submitted under section 505(b) of the Act or (2) licensure of a biological drug product
under section 351 of the Public Health Service Act (PHS Act).7 For purposes of this
guidance, the term human drug application does not include the following:
• A supplement to such an application
• An application with respect to whole blood or a blood component for transfusion
• An application with respect to a bovine blood product for topical application licensed
before September 1, 1992
• An application for an allergenic extract product
• An application for a device licensed under section 351 of the Public Health Service
Act
• An application with respect to a large volume parenteral drug product approved
before September 1, 1992
• An application for a licensure of a biological product for further manufacturing use
only
• An application submitted by a State or Federal Government entity for a drug that is
not distributed commercially8
• The term person means the person subject to fees and includes any affiliates of that
person.9 The term person includes an individual, partnership, corporation, and
association.10 This document will also use the term person when referring to an
applicant.
• The term supplement means a request to the Secretary to approve a change in a human
drug application which has been approved.11

5

Section 735(4) of the Act.

See section 735(5) of the Act.

7
Section 735(1) of the Act.

8
Id.

9
Section 735(9) of the Act.

10
Section 201(e) of the Act.

11
Section 735(2) of the Act.

6

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Contains Nonbinding Recommendations
• The term financial resources means the total gross annual worldwide revenues and other
available financial assets of an applicant and its affiliates.

IV. TYPES OF WAIVERS AND REDUCTIONS
According to section 736(d) of the Act, FDA will grant a waiver of or reduction in one or more
user fees assessed under section 736(a) of the Act where it finds that an applicant meets the
eligibility criteria under one of the following provisions:
• A waiver or reduction is necessary to protect the public health.
• The assessment of the fee would present a significant barrier to innovation because of
limited resources available to the person or other circumstances.12
• The applicant is a small business submitting its first human drug application to the
Secretary for review.
The Act also provides for waiver or reduction of user fees if the fees would exceed the
anticipated present and future costs incurred by the Secretary in conducting the process for the
review of human drug applications for the person. Fees-exceed-the-costs waivers and reductions
are not addressed in this guidance document.13
A. Public Health
Under section 736(d)(1)(A) of the Act, an applicant may qualify for a waiver of or reduction in
application, product, and/or establishment fees if the waiver or reduction is necessary to protect
the public health. Under this provision, FDA may grant a public health waiver of or reduction in
user fees if the Agency finds that the following two criteria are met:
• The product protects the public health; and
• The applicant shows that a waiver or reduction is necessary to continue an activity that
protects the public health.

12

There are two additional special circumstances that may affect eligibility for waivers or reductions under the
barrier to innovation waiver provision. Each is addressed in a separate waiver guidance. Specifically, for
companies participating in the President’s Emergency Plan for AIDS Relief, see the guidance document, User Fee
Waivers for FDC and Co-Packaged HIV Drugs for PEPFAR. For companies submitting combination products
under 21 Code of Federal Regulations 3.2(e), see the guidance for industry and FDA staff on Application User Fees
for Combination Products. We update guidances periodically. To make sure you have the most recent version of a
guidance, check the FDA Drugs guidance Web page at
http://www.fda.gov/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/default.htm.
13
There is a separate guidance document that discusses the Agency’s current thinking on the fees-exceed-the-costs
waiver provision. For more information, see the guidance document, Fees-Exceed-the-Costs Waivers Under the
Prescription Drug User Fee Act, and its addendum at the guidance Web page.
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Contains Nonbinding Recommendations
To qualify for a waiver or reduction in user fees under this provision, an applicant must meet
both criteria.
1. Does the product protect the public health?
For user fee purposes, a product that has been approved for marketing in the United States is not
automatically deemed to be a product that protects the public health. In evaluating whether a
product protects the public health, the Agency asks the following questions:
• Is the drug product a significant improvement (or does it have the potential to be a
significant improvement if the drug product is not yet approved) compared to other
marketed products, including other dosage forms or routes of administration and nondrug products or therapies?
• Are there treatment alternatives? The existence of alternatives would weigh against a
determination that a product is necessary to protect the public health.
• Is the drug product designated as a priority drug,14 has it been granted fast track status,15
or has it been determined to be a new molecular entity? Affirmative answers to these
questions usually indicate that a product protects the public health. Other questions the
Agency may consider include:
• Does the drug product demonstrate an increased effectiveness in the treatment,
prevention, or diagnosis of disease?
• Does it eliminate or substantially reduce a treatment-limiting drug reaction?
• Does the drug product enhance patient adherence to treatment?
• Has the drug product shown potential evidence of safety and effectiveness for a
new or underserved subpopulation (e.g., treatment for a drug resistant microbe or
response to a homeland security concern)?
• Is the drug product intended for the treatment of a serious or life-threatening condition?
• Does the drug product address unmet medical needs or demonstrate the potential to do
so?
• Is the product designated as a drug for a rare disease or condition under section 526 of the
Act (i.e., does it have an orphan designation)?

14

Further information regarding priority drugs can be found in the Center for Drug Evaluation and Research’s
(CDER’s) Manual of Policies and Procedures (MAPP) 6020.3R, Review Classification Policy: Priority (P) and
Standard (S). MAPP 6020.3R is available on the Internet at http://www.fda.gov, search by MAPP number.
15
Further information regarding fast track status can be found in CDER’s guidance for industry on Fast Track
Development Programs ─ Designation, Development, and Application Review.
5

Contains Nonbinding Recommendations
ƒ If the product is approved, is it available to the public? There is no benefit to the public
health if a product is not made available to the public.16
2. Is the waiver or reduction necessary to continue an activity that protects the public
health?
To determine whether a waiver of or reduction in user fees is necessary to continue an activity
that protects the public health, the Agency considers not only the benefit to the public health, but
also whether the waiver or reduction is necessary. The legislative history of PDUFA I states that
FDA may waive or reduce fees unless such a waiver or reduction is not necessary to protect the
public health, or it is apparent that the fee will not be a disincentive to innovation.17 It also
expressly notes that FDA should consider the “limited resources” of the applicant when
evaluating a request for a fee waiver or reduction under section 736(d).18 Therefore, the Agency
believes that a financial test is appropriate for the public health waiver provision. The Agency
considers the relationship between the annualized cost of user fees and the financial resources of
the applicant, including affiliates, requesting the waiver or reduction. The financial
considerations are discussed in section IV.C below.
B.

Barrier to Innovation

Under section 736(d)(1)(B) of the Act, an applicant may qualify for a waiver of or reduction in
application, product, and/or establishment fees when the assessment of the fees would present a
significant barrier to innovation because of limited resources available to the applicant or other
circumstances. Under this provision, FDA may grant a waiver of or reduction in user fees if:
• The product or other products or technologies under development by the applicant are
innovative; and
• The fee(s) would be a significant barrier to the applicant’s ability to develop,

manufacture, or market innovative products or to pursue innovative technology.

To qualify for a waiver or reduction in user fees under this provision, an applicant must meet
both criteria.
1. Is the product innovative or is the company pursuing other innovative drug products
or technologies?
A product that has been approved for marketing in the United States is not automatically deemed
to be innovative for user fee purposes. In evaluating requests for barrier-to-innovation user fee
waivers or reductions, the Agency asks the following questions:

16

We would consider products stockpiled for homeland security concerns as available to the public for user fee

waiver purposes.

17
House Report 102-895 (1992) at 17.

18
Id.

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Contains Nonbinding Recommendations
• Does the drug product or technology demonstrate advanced “breakthrough” research,
new, progressive methods, and/or forward thinking in the treatment or diagnosis of
disease, or does it have the potential to be at the forefront of new medical technology?
• Does the drug product or technology introduce a unique or superior method for

diagnosing, curing, mitigating, treating, or preventing a disease, or for affecting a

structure or function of the body?

• Is the drug product designated as a priority drug, has it been granted fast track status, or
has it been determined to be a new molecular entity?
• Does the applicant have an active investigational new drug application (IND) under
which the applicant is evaluating a unique or superior method for diagnosing, curing,
mitigating, treating, or preventing a disease, or for affecting a structure or function of the
body?
• Has the applicant recently received a Federal grant for innovation? Two examples of
such Federal grant programs that may qualify as innovative are (1) the National Institutes
of Health’s Small Business Innovative Research Program and (2) the National Institute of
Standards and Technology’s Advanced Technology Program.
2. Does the fee create a significant barrier to the applicant’s ability to develop,

manufacture, or market innovative products or to pursue innovative technology?

To determine whether a fee would be a significant barrier to an applicant’s ability to develop,
manufacture, or market innovative products or to pursue innovative technology, the Agency
considers the relationship between the annualized cost of user fees and the gross annual revenues
and financial resources of the applicant and its affiliates. The revenue considerations are
discussed below.
C. Financial Considerations for Public Health and Barrier-to-Innovation Waivers and
Reductions
1. Whose revenues are considered when evaluating a waiver or reduction request?
When evaluating requests for waivers of or reductions in user fees under the public health or
barrier to innovation provisions, the Agency considers the financial resources of the applicant
and its affiliates, regardless of who submits a request for a waiver or reduction of user fees.
Section 736(d)(2) of the Act states that, in determining whether to grant a waiver or reduction of
a user fee, FDA shall consider only the circumstances and financial resources of the applicant
and any affiliate of the applicant. Under the Act, the applicant is the person who is responsible
for payment of the fees and the person who must qualify for a waiver or reduction of user fees.
Accordingly, the statute does not allow persons other than those legally subject to user fees, such
as a distributor that is not an affiliate, to qualify for or receive waivers or reductions of user fees.

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Contains Nonbinding Recommendations
2. How does the Agency determine whether an applicant has limited financial
resources?
The limited financial resources of an applicant and its affiliates are an important indicator of
whether user fees are a barrier to innovation or a waiver or reduction is necessary to protect the
public health.19 FDA will consider the total annual revenue of an applicant and its affiliates in
determining whether the applicant has limited financial resources. Total annual revenue is an
objective measure of the resources available to the applicant and is defined by generally accepted
accounting principles. FDA does not intend to deduct marketing costs, including expenses in
foreign markets that are often incurred because of an applicant’s marketing decisions, when
calculating total annual revenue.
In addition to total annual revenue of the applicant and its affiliates, FDA considers other
available financial assets, including net proceeds, cash, and total assets. FDA may also consider
the results of recent issuances of stock and the recently available capital raised from the sales of
shares in the applicant company.
Because even a very large applicant may have operating losses, FDA does not intend to consider
lack of profitability as evidence of limited resources. The Agency also does not intend to
consider product sales figures to be evidence of limited resources, because even a large and
profitable company can have low sales figures for an individual product, but not need a waiver to
continue an activity that is necessary to protect the public health or because the fees would
present a significant barrier to innovation.
Ordinarily, beginning with fees assessed for FY 2011, the Agency expects to determine that an
applicant with financial resources, including the financial resources of affiliates, of less than $20
million has limited resources for user fee purposes.20 An applicant with $20 million or more in
financial resources, including the financial resources of affiliates, generally will not be
considered to have limited resources for user fee purposes.
FDA considers the financial resources of applicants that are State or Federal government entities
differently. The Agency will consider State or Federal government entities with less than $20
million in total annual revenues from the sale of drug to have limited resources for user fee
purposes. A government entity is able to devote only a small amount of money to drug
development activities relative to the entity’s budget and the total State or Federal budget. In
addition, government entities generally receive only a small amount of revenue, if any, from
commercial distribution of a drug, as compared with total revenues. FDA believes that Congress
intended to minimize the burden on State and Federal government entities by focusing attention

19

As noted above, the legislative history states that FDA should consider the “limited resources” of an applicant
when evaluating a request for a fee waiver or reduction under section 736(d). See House Report 102-895 (1992) at
17. FDA therefore believes that a financial test is appropriate for both the public health and barrier-to-innovation

waiver provisions.

20
For waivers regarding fees for fiscal years prior to 2011, the Agency intends to continue to use as its general

marker of limited resources the $10 million benchmark cited in the 1993 interim guidance, adjusted for inflation.

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Contains Nonbinding Recommendations
on their drug development revenues, not the overall revenues of the entity or the State or Federal
government.21
3. Why did FDA choose $20 million as a marker?
When the 1993 interim guidance was issued, the Agency used $10 million as a financial marker
for evaluating whether a waiver or reduction was necessary to protect the public health and
whether the fees were a significant barrier to innovation. Since 1993, the Agency has received
several requests to adjust the $10 million financial marker for inflation. As stated in section II,
the more fee waivers and reductions FDA grants, the more the fees for other applications,
products, and establishments must be increased to ensure that FDA obtains the total annual fee
revenues specified in the Act. However, the Agency believes that the $10 million figure is
outdated and should be adjusted. Based on almost 20 years of experience in implementing the
user fee program, FDA has determined that most applicants that have annual revenues and
financial resources of less than $20 million are those least able to pay the fees. Therefore, the
Agency intends to use $20 million as its marker for evaluating whether an applicant and its
affiliates have limited resources such that a waiver or reduction is necessary to protect the public
health and/or whether the fees are a significant barrier to innovation.22
D. Small Business
Under section 736(d)(1)(D) of the Act, an applicant is eligible for a waiver of the application fee
if the applicant is a small business submitting its first human drug application to the Agency for
review and does not have another product approved under a human drug application and
introduced or delivered for introduction into interstate commerce. An applicant is eligible for a
small business waiver when:
• The applicant employs fewer than 500 employees, including employees of affiliates;
• The applicant does not have a drug product that has been approved under a human drug
application and introduced or delivered for introduction into interstate commerce; and
• The applicant, including its affiliates, is submitting its first human drug application.
To qualify for a small business waiver, an applicant must meet all of these criteria.
To determine the size of an applicant and its affiliates, the FDA works with the Small Business
Administration (SBA). FDA asks the SBA to determine what companies are affiliates of the
applicant and the total number of employees for the applicant and its affiliates. After receiving a
request from the FDA, the SBA consults with the applicant and determines the number of
employees the applicant and its affiliates have, based on SBA regulations. According to these
21

For example, the Act exempts a State or Federal government entity from application, product, and establishment
fees for a drug product that is not distributed commercially. Sections 735(1) and (3) of the Act.
22
If the $10 million benchmark in the 1993 guidance, which was written to be used under PDUFA I, were adjusted
solely for inflation since the conclusion of the PDUFA I period in 1998, it would be less than $15 million in FY
2011 dollars, so this adjustment to $20 million would be expected to anticipate and eliminate the need for any
further adjustments for inflation for at least the next 10 years.
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Contains Nonbinding Recommendations
regulations, SBA may contact the applicant to request the following information in the
appropriate formats and detail:
• An application for size determination;
• A copy of the company’s Articles of Incorporation and Bylaws;
• The company’s last annual statement to shareholders; and
• A breakdown of the number of persons employed full time, part time, temporarily, or
otherwise during each of the pay periods for the 12 months preceding the company’s
certification.
Companies should not submit the information requested by the SBA to FDA, nor should they
submit this information to SBA until contacted. If the information is not submitted to the SBA,
the request for a small business waiver will be denied.
The SBA recognizes, as does FDA, that some information provided by companies may be
confidential. Both the SBA and FDA will treat confidential commercial or financial information
consistent with applicable federal laws and regulations (see section IX).
Once the SBA has identified and confirmed the affiliates of the applicant and determined
whether the applicant qualifies as a small business, FDA will evaluate whether the applicant
meets the other criteria for the small business waiver. Specifically, FDA searches its records to
determine whether the applicant or its affiliates have previously submitted a human drug
application or whether the applicant has a drug product that has been approved under a human
drug application and introduced or delivered for introduction into interstate commerce. If the
waiver applicant meets all the criteria for a small business waiver, then FDA will notify the
applicant that the waiver is granted.
1. Does a small business waiver have an expiration date?
If a small business waiver is granted, the applicant should submit its human drug application
within 1 year after the date of the SBA determination. The reason for the 1 year time frame is
that the circumstances supporting a small business waiver may change rapidly. For example, an
applicant could merge with a larger company and therefore no longer be considered a small
business. Similarly, an applicant could purchase an NDA from an unaffiliated company and,
therefore, would have a drug product that has been approved under a human drug application and
introduced into or delivered for introduction into interstate commerce.
FDA understands that unforeseen circumstances may delay submission of an application. If an
applicant is granted a small business waiver and is not able to submit the application within 1
year of the SBA determination, the applicant may ask FDA to extend the expiration date.
If an extension is requested, the Agency will examine its records and will work with SBA to
confirm that the applicant still meets the criteria for a small business waiver. If the criteria are
no longer met, the extension request will be denied.

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Contains Nonbinding Recommendations

2. Can a small business receive a waiver of application fees for future human drug
applications?
After an applicant or its affiliate is granted a small business waiver and submits its first human
drug application, the applicant cannot receive another small business waiver. That means that
the applicant or its affiliate is not eligible to receive a small business waiver for any subsequent
human drug application or a supplement to an application.23
After an applicant or its affiliate is granted a small business waiver and submits its first human
drug application, the applicant or affiliate is ineligible for another small business waiver even if
the application is withdrawn or refused for filing. If an applicant does not submit the application
for which it was granted a small business waiver, the applicant may qualify again for a small
business waiver.
3. Can a small business receive a waiver or reduction of product and establishment
fees?
There is no specific provision in the Act for a waiver or reduction of product and establishment
fees for small businesses. However, small businesses may apply for a waiver or reduction of
product and establishment fees through the public health or barrier-to-innovation waiver
provisions. See discussions in sections IV.A, IV.B, and IV.C above.
V. EXEMPTIONS AND REFUNDS
A.

Orphan Designated Products
1. Application Fees

Under section 736(a)(1)(F) of the Act, a human drug application for a product that has been
designated as a drug for a rare disease or condition (referred to as an orphan drug) under section
526 of the Act is not subject to an application fee unless the human drug application includes an
indication for other than a rare disease or condition. A supplement proposing to include a new
indication for a rare disease or condition in a human drug application shall not be subject to an
application fee if the drug has been designated under section 526 as a drug for a rare disease or
condition with regard to the indication proposed in the supplement.
If an application or supplement qualifies for an orphan exemption, the applicant does not need to
send FDA a written request. The applicant should simply notify FDA that it is claiming the
orphan exemption when it completes and submits the User Fee Coversheet, Form FDA 3397.24
The User Fee Coversheet should be included with the application or supplement, and a brief
statement claiming the orphan exception should be included in the cover letter.

23

Section 736(d)(4)(B) of the Act.

For more information about completion and submission of the User Fee Cover Sheets, see

http://www.fda.gov/ForIndustry/UserFees/PrescriptionDrugUserFee/ucm119184.htm.

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2. Product and Establishment Fees
Under section 736(k) of the Act, a drug product designated under section 526 of the Act for a
rare disease or condition and approved under section 505 of the Act or section 351 of the Public
Health Service Act is exempt from the product and establishment fees if it meets the public
health requirements contained in the Act as such requirements are applied to requests for waivers
of product and establishment fees. In addition, the applicant must have less than $50 million in
gross worldwide revenue during the year preceding the request for exemption. An applicant
seeking to avail itself of this exemption should submit a certification that its gross worldwide
revenues, including affiliates, did not exceed $50 million for the 12 months before the request.
See section VI for information about how to submit a request for an exemption from product and
establishment fees.
B.

State or Federal Government Entity

An application submitted by a State or Federal government entity for a drug that is not
distributed commercially is not considered a “human drug application” under section 735(1) of
the Act. If the application is not considered a human drug application, then application fees are
not assessed and product and establishment fees do not apply.
For the purposes of the State and Federal exemption from user fees under the Act, distributed
commercially means any distribution in exchange for financial reimbursement, goods, or
services, whether or not the amount of the charge covers the full costs associated with the
product. Any recovery by the applicant of all or part of the costs of manufacture or distribution
of a product makes the distribution commercial.
C.

No Substantial Work

Under section 736(a)(1)(G) of the Act, if an application or supplement is withdrawn after the
application or supplement is filed, FDA may refund the fee or a portion of the fee if no
substantial work was performed on the application or supplement after the application or
supplement was filed.

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VI. SUBMITTING REQUESTS FOR WAIVERS, REDUCTIONS, AND REFUNDS
A.

Timing of Requests
1. Is there a statutorily mandated deadline for requesting a waiver or reduction?

Yes. Under section 736(i) of the Act, to qualify for a waiver of or reduction in user fees as well
as a refund for a fee paid, an applicant must submit to FDA a written request for a user fee
waiver or reduction no later than 180 calendar days after the fee is due.
For example, if an applicant receives a product and establishment fee invoice from FDA, we
expect the invoice to be paid by the due date. The applicant can then submit a written request for
a waiver, reduction, or refund of the fee(s) within 180 days from the date when the invoice is
due. If the request is submitted within 180 days of the due date (i.e., if the request is timely),
FDA will evaluate the applicant’s request. If FDA determines that the applicant qualifies for a
waiver, reduction, or refund, the Agency will grant the applicant’s request.
To avoid having to pay a fee, an applicant can submit a request for waiver or reduction in
advance of when the product and establishment fee invoice is due to be paid, or in advance of
submitting an application (see sections VI.A.3 and 4 below).
2. Are there consequences if user fees are not paid because an applicant has not yet
submitted a waiver or reduction request or because FDA has not yet responded to a
waiver or reduction request?
Yes. According to section 736(e) of the Act, a human drug application or supplement submitted
by a person subject to fees under section 736(a) is considered incomplete and will not be
accepted for filing until all fees have been paid. That means that if the applicant submits an
application or a supplement without the application fee or is in arrears for nonpayment of an
establishment or product fee, then the submission is incomplete and FDA will not review it.
However, the review status of an application or supplement submitted before the invoice due
date would not be affected (the review would continue and there would be no effect on the
review goal date).25
3. Is there a recommended time frame to submit a waiver or reduction request if an
applicant wants to avoid paying the application fee and then seeking a refund?
Yes. FDA encourages applicants to submit a request for a waiver of or reduction in an
application fee approximately 3-4 months before submission of the application. Under normal
circumstances and depending on available resources, FDA will try to make its determination on
the waiver request before the application is submitted and the fee is due.
FDA discourages applicants from submitting application fee waiver or reduction requests more
than 4 months before the submission of an application because the circumstances that support an
25

See CDER’s MAPP 6050.1, Refusal to Accept Application for Filing From Applicants in Arrears.
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applicant’s request are subject to change, and FDA considers it unreasonable to assume that
those circumstances will continue to exist for longer than 4 months prior to the submission of an
application. For example, if an applicant submits an application fee waiver request on July 1 and
plans to submit its application on March 1 of the next year, FDA considers it unreasonable to
assume that the facts stated on July 1 will remain the same 8 months later, in the following
March. Therefore, FDA encourages sponsors to submit their waiver or reduction requests no
more than 4 months prior to the submission of the application.
4. Is there a recommended time frame to submit a waiver or reduction request if the
applicant wants to avoid paying the product and establishment fees and then seeking
a refund?
Yes. The time frame is the same as for an advance request for an application fee waiver or
reduction: an applicant seeking a waiver or reduction of product and establishment fees may
submit a request for a waiver or reduction 3 to 4 months before the fee is due. Annual product
and establishment fees are usually assessed in August and are due on October 1.26 Thus, an
applicant that wishes to obtain a waiver or reduction in advance should submit its request
between June 1 and July 1. Under normal circumstances and depending on available resources,
FDA will try to complete its evaluation of the request before the due date of the product and
establishment fees.
The Act does not provide for deferral of user fees, and FDA does not grant deferrals of user fees
based on pending waiver or reduction requests. FDA therefore expects that all product and
establishment fees will be paid without regard to a pending request for a fee waiver or reduction.
This approach will ensure that the steady funding stream Congress intended will be achieved,
and should deter the filing of frivolous waiver or reduction requests.
Ordinarily, FDA expects to grant a reduction or waiver of a product or establishment fee only for
the current year. If an applicant wishes to have a product or establishment fee waived or
reduced for assessments in future years, it should make a new request for a waiver or reduction
each year.
B.

Content and Format of Requests
1. General Information for All Requests

Requests for CDER and CBER user fee waivers, reductions, and refunds will be reviewed and
granted or denied by CDER’s Associate Director for Policy.27 However, reductions and refunds
for products regulated by CBER will be reviewed and granted or denied by CBER’s Center
Director.
FDA recommends that each waiver or reduction request be submitted in writing and that it
contain the following information:
26

The fiscal year begins October 1 and ends September 30.

Waivers and reductions under the fees-exceed-the-costs waiver provision are the responsibility of FDA’s Office

of Financial Management.

27

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• Name of applicant requesting the waiver,28 including company name, address, contact,
telephone and facsimile numbers, and e-mail address
• Identification of the specific fee(s) for which the waiver, refund, or reduction is requested
• Date on which payment was made or will be made of the fee for which a waiver or
reduction is requested
• Statutory provision under which a waiver or reduction is requested
• Information and analyses showing that the criteria for the waiver or reduction have been
met
• Rationale for why the waiver, reduction or refund request should be granted
• A list of the applicant’s affiliates
• For public health and barrier to innovation waivers, a current annual financial report for
the applicant and the applicant’s affiliates. If a current annual financial report is not
available, a report that includes total annual revenues, net proceeds, cash, and total assets.
2. Additional Specific Information for Application Fee Waiver or Reduction Requests
In addition to the general information specified above, requests for waivers of or reductions in
application fees should include the following:
• NDA number (including supplement number and type if there is one) or BLA number
• Trade and established names of products covered by the waiver request
• Date the application was or will be submitted
• Whether or not clinical data are required for approval
3. Additional Specific Information Requested for Product Fee Waiver or Reduction
Requests
In addition to the general information specified above, requests for waivers of or reductions in
product fees should include the following:
• NDA or BLA number

28

If an agent is submitting a waiver request on behalf of the waiver applicant, authorization from the waiver
applicant for the agent to act on its behalf should also be included.
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• Trade and established names of the product
• National Drug Code (NDC) number
• Name of the application holder
• Specific strength, dosage form, and route of administration
• Invoice date and number (or copy of the invoice sheet)
4. Additional Specific Information Requested for Establishment Fee Waiver and
Reduction Requests
In addition to the general information specified above, requests for waivers of or reductions in
establishment fees should include the following:
• Name of the establishment
• Address of the manufacturing site (not a business, office, or headquarters address, but the
actual address of the manufacturing site)
• Establishment number as listed on the invoice
• Invoice date and number (or a copy of the invoice sheet)
C.

Address for Submitting Requests

Original user fee waiver or reduction requests should be submitted in writing to:
Associate Director for Policy
Attention: User Fee Waiver Office, Michael D. Jones
Center for Drug Evaluation and Research
Food and Drug Administration
10903 New Hampshire Avenue
Bldg. 51, Room 6216
Silver Spring, MD 20993-0002

VII.

FDA RESPONSES TO REQUESTS FOR WAIVERS AND REDUCTIONS

FDA will review the waiver or reduction request, consulting with relevant Agency officials as
appropriate. FDA may request additional information from the applicant during the review
period. The Agency will respond to requests for waivers and reductions in a timely fashion
based on available resources and collection time for additional information.

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VIII. RECONSIDERATIONS AND APPEALS
A.

Reconsideration Request

If FDA fully or partially denies a request for a waiver or reduction of user fees, the applicant
may request reconsideration of that decision. A request for reconsideration should be made
within 30 days of the issuance of FDA’s decision to fully or partially deny a request for a waiver,
reduction or refund of user fees.
FDA recommends that requests for reconsideration state the applicant’s reasons for believing
that the decision is in error and include any additional information, including updated financial
information, that is relevant to the applicant’s position. The Agency will issue a response upon
reconsideration, setting forth the basis for the decision.
All requests for reconsiderations should be submitted in writing to:
Associate Director for Policy
Attention: User Fee Waiver Office, Michael D. Jones
Center for Drug Evaluation and Research
Food and Drug Administration
10903 New Hampshire Avenue
Bldg. 51, Room 6216
Silver Spring, MD 20993-0002
B.

Appeal Request

If a request is denied upon reconsideration, the applicant may choose to appeal the denial. A
request for an appeal should be made within 30 days of the issuance of FDA’s decision to affirm
its denial of a request for a waiver, or reduction of user fees. The following information should
be included in the appeal.
•

The original waiver request

•

The denial of the original waiver request

•

The reconsideration request

•

The denial of the reconsideration request

•

A statement of the applicant’s belief that the prior conclusions were in error

The appeal request should also contain particular references to information or analyses already
submitted to the Agency that the applicant believes is relevant to its position. No new
information should be presented in the appeal request.
All requests for appeals should be submitted in writing to:

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Chief Scientist and Deputy Commissioner for Science and Public Health
User Fee Appeals Officer
Food and Drug Administration
c/o Matthew Warren
10903 New Hampshire Avenue
Bldg. 32, Room 4210
Silver Spring, MD 20993-0002
Fax: 301-847-8617
A copy of the request for appeal should also be submitted to the CDER Associate Director for
Policy as noted in section VIII above. After FDA reviews the information submitted in the
appeal request, the Deputy Commissioner will issue a written decision on the applicant’s request.
The written decision issued by the Deputy Commissioner will constitute final Agency action on
that request.

IX. DISCLOSURE OF PUBLIC INFORMATION
FDA plans to disclose to the public information about its actions granting or denying waivers
and reductions. This disclosure will be consistent with the laws and regulations governing the
disclosure of confidential commercial or financial information.

X. PAPERWORK REDUCTION ACT OF 1995
This guidance contains information collection provisions that are subject to review by the Office
of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C.
3501-3520).
The guidance also refers to collections of information for filling out and submitting Form FDA
3397 (Prescription Drug User Fee Coversheet) previously approved under OMB control number
0910-0297, and collections of information associated with a new drug application or biologics
license application approved under OMB control numbers 0910-0001 and 0910-0338,
respectively.
The time required to complete this information collection is estimated to average 16 hours for a
request for a waiver, reduction, or refund of certain user fees; 24 hours per response for a
reconsideration of a request; and 12 hours for an appeal of a waiver, reduction, or refund
decision. These estimates include the time to review instructions, gather the data needed, and
complete and review the information collection. Send comments regarding this burden estimate
or suggestions for reducing this burden to:
Associate Director for Policy, Attention: User Fee Waiver Office, Center for Drug Evaluation
and Research, Food and Drug Administration, 10903 New Hampshire Avenue, Bldg. 51, Room
6216, Silver Spring, MD 20993-0002.

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An agency may not conduct or sponsor, and a person is not required to respond to, a collection of
information unless it displays a currently valid OMB control number. The OMB control number
for this information collection is 0910-0693 (expires 08/31/2014).

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