Due to policies regarding industry user fees, the FDA will not be able to accept any new drug applications for the duration of the government shutdown, according to Leerink Partners.
It’s official. For the first time in nearly seven years, the U.S. government has shut down after Congresspeople went home Tuesday night without a deal to continue funding business as usual.
In a note Wednesday morning, Leerink Partners referenced a statement from the FDA saying it would not be able to accept new drug applications until after the shutdown is resolved. To do so would require the agency to accept industry user fees assessed for 2026, which it is unable to do during this “lapse period,” Leerink explained. The analysts went on to list several companies that could be impacted by this reality, including AbbVie, Amgen, Bristol Myers Squibb, J&J and Pfizer.
There is positive news, however—particularly for an agency that has already been gutted this year by Health Secretary Robert F. Kennedy’s massive workforce cuts. During the shutdown, around 86% of the FDA’s staff will be retained.
“When FDA faced this situation in 2012 and 2013, a much lower portion of the workforce was retained,” Steven Grossman, policy and regulatory consultant, wrote in his blog, FDA Matters, on Tuesday. In the intervening years, he continued, FDA Commissioner Marty Makary and his predecessors “have pushed hard to have FDA positioned as a public health and public safety agency that is needed at all times, including during a shutdown.”
With its remaining employees, the FDA will continue to operate “activities necessary to address imminent threats to the safety of human life and activities funded by carryover user fee funds,” according to a statement on its website.
Original article published Sept. 30
FDA Delays Likely as Federal Government Hurtles Toward Shutdown
The federal government is heading for a shutdown at midnight if no deal is reached between Republicans and Democrats on the hill. That means the situation at the FDA, which has already been plagued by approval slowdowns caused by mass layoffs, will be exacerbated.
But the FDA will not be affected as badly as some other agencies, since at least 86% of the agency’s staff will be able to continue operations, according to a guidance document on the impending shutdown. About 66% of those staffers are covered by user fees or other carryover funds.
Lawmakers on Capitol Hill in Washington have until midnight Tuesday to reach an agreement to fund the government, but both sides remain at an impasse, NPR reported Tuesday morning. At issue is a spending bill that Democrats have refused to back in an effort to force Republicans to negotiate on supporting federal healthcare subsidies that will expire by year end without both parties’ support. Leaders from both parties met with President Donald Trump at the White House Monday in hopes of securing a deal, but none was achieved.
That leaves the government hurtling towards a shutdown. Leerink Partners spoke to former Senator Richard Burr, who previously represented North Carolina as a Republican, and another unnamed senior counsel key opinion leader (KOL) for guidance on the shutdown. The KOLs advised that a shutdown is imminent with a deal highly unlikely. The shutdown could last as long as a month if there is no resolution within a week.
“A shutdown will not affect the funding of existing FDA reviews, though resultant noise may cause some delays,” Leerink wrote.
Within the Health and Human Services umbrella, research that depends on grants from the National Institutes of Health for medical research will be most impacted, the KOLs told Leerink. But the “anecdotal” slowdown in FDA action on approval applications will be “exacerbated modestly.”
Any activities that are funded via carryover user fees and anything covered by unlapsed funding will continue. That would include “certain activities” related to regulating drugs, since user fees cover these processes. The FDA can also continue reviewing requests to conduct clinical research and work on certain guidance documents. Leerink said the FDA does not typically use all of the user fees that are collected, so those can fund the agency for longer in the event of a shutdown.
But the FDA would not be able to accept new drug or biologic applications or complete any activities that would require the payment of a user fee, if the shutdown occurs. So any company that had planned an imminent new drug application would have to wait until the shutdown is over.
The unnamed KOL told Leerink that “since Trump took office, he has noticed a slowdown in FDA review processes, characterized by frequent breakdowns in communication between the FDA and applicants.”
Some companies have reported FDA delays, too. “He predicts that the noise from a shutdown may further delay reviews and approvals to some extent,” Leerink continued.
The FDA also noted in its guidance that the agency would not be able to work to curb compounded drugs, which has been a major issue over the past few years with the best-selling GLP-1 obesity drugs. This work could only resume if “necessary to assess or address imminent threats to the safety of human life,” according to the guidance.
The last government shutdown in Trump’s first term, lasted 35 days.
