Pharma Feels Impact of Government Shutdown as FDA Drug Review Work Slows

Alarm clock sitting on American flag

As the partial government shutdown enters its 21st day, tying it for the longest U.S. shutdown in history, the impact is becoming more and more realized within the pharmaceutical industry.

Most noticeably for pharma and biotech, the partial shutdown has brought a halt to some of the operations of the U.S. Food and Drug Administration (FDA). Approximately 40 percent of FDA employees are not working right now due to the lack of financial funding, which means that many of the operations they oversee are not being addressed. Not only has food inspection seen a significant slow, but drug development is also impacted. Forbes noted that the agency has been using leftover prescription fee funding from the past year to pay for drug reviews. Last year, as BioPharma Dive reported, the fees under the Prescription Drug User Fee Act ranged between $1.5 million to $2.7 million. However, due to the shutdown, the agency is not accepting any new user fees set by the Prescription Drug User Fee Act. With a lack of additional funding, the FDA has suspended reviews of existing Investigational New Drug (IND) and Biologics License Application (BLA) applications not covered by user fees, Forbes noted. Also, any such applications that have been filed by companies during the shutdown will not be reviewed. That is creating a delay in the potential approval of new medications, which not only impacts patients waiting for the new medicines, but also the companies that may see some investor confidence shaken.

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Several companies have eyed early 2019 approvals for drugs, but that is unlikely to happen. Companies that had been hoping to see action taken on their medications include Exelixis, which had been expecting the FDA to make a decision on its Hepatocellular Carcinoma treatment Cabometyx next week. With the shutdown continuing, a decision could be delayed. Other companies are certainly monitoring the situation.

That holdover funding from 2018 is expected to run out in February. If the shutdown continues, the lack of funding will further delay approval of new medications.  

Another area where the FDA has also been impacted is on the development and issuance of new guidance documents for medications, biologics and medical devices. Throughout much of 2018, FDA Commissioner Scott Gottlieb had spearheaded a number of guidance proposals. Those reviews will now be delayed.

On Twitter, Gottlieb said expressed the hardships that many of his FDA colleagues are facing due to the shutdown, which includes a lack of pay. He said he regrets the hardships faced by employees who have been furloughed, as well as those who are expected to work without a paycheck.

“I admire very much their continued dedication to our special mission,” he said.

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