The drug industry should never be allowed to have its way with the Food and Drug Administration (FDA) by way of its funding of agency programs. Yet, that has happened on a continuing basis for at least the past ten years. Now, the FDA is bargaining with the industry for an increase in fees, giving the industry an even greater role in shaping the priorities of its supposed regulator. If this isn’t the tail wagging the dog, I don’t know what is. Such negotiations between the industry and the FDA date to the introduction of “user fees” in the early 1990s.

I believe that they public would be surprised to learn that the steadily rising payments by drug makers — $232 million in fiscal 2004 — now fund more than half the FDA’s critical drug review process. Even though any deal agreed to will be subject to congressional approval, this sort of thing can’t be good for the consuming public. The health and safety issues relating to drugs approved by the FDA and monitored after being put on the market aren’t served well by the current arrangement. Congress should adequately fund the FDA and eliminate the need by the agency for drug company money. The FDA needs more personnel and funding for independent studies.

Regulators usually don’t negotiate their budgets with the industries they oversee. For most of its history, the FDA was funded entirely by Congress. But in the early 1990s, companies unhappy with the pace of drug approvals agreed to pay the FDA millions of dollars in annual fees to help speed its performance. Because the industry and the agency renegotiate every five years over the size of fees — and what they can be used for — drug makers can have considerable input into which programs receive funding. Each time the arrangement has been renewed, the FDA has gained new funding. In return, industry has wrung concessions.

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