GDUFA II negotiations: CMOs to pay one third of facility fees

By Dan Stanton contact

- Last updated on GMT

Image: iStock/Robert Pernell
Image: iStock/Robert Pernell

Related tags: Active pharmaceutical ingredients, Food and drug administration

The Pharma & Biopharma Outsourcing Association (PBOA) has helped negotiate reduced fees for CMOs in the FDA’s proposed reauthorisation of the Generic Drug User Fee Amendment (GDUFA).

Originally enacted as part of the Food and Drug Administration Safety and Innovation Act (FDASIA) in May 2012​, the Amendment requires manufacturers of active pharmaceutical ingredients (APIs) and finished generic drugs to pay user fees to supplement the costs of reviewing drug applications and inspecting facilities.

For over a year​, industry has been negotiating the programme – known as GDUFA II - with the US Food and Drug Administration (FDA) ready for when GDUFA expires at the end of September 2017.

But in details of the proposed reauthorisation published in the Federal Register on September 26, the Agency is reducing fees for contract manufacturing organisations (CMOs) due to such third-party firms being “generally small businesses that are hired by ANDA sponsors to manufacture their generic drugs.”

The FDA said: “Under the GDUFA II fee structure, CMOs will pay one-third the annual fee paid by firms that manufacture under ANDAs which they or their affiliates own.”

Furthermore, the FDA intends to no longer charge a facility or ANDA sponsor an annual fee “until an ANDA in which it is listed is approved.”

ANDA-vocacy Group?

From a CMO standpoint, one of the major differences between the GDUFA and GDUFA II negotiations was the presence of an advocacy group.

The PBOA – a non-profit trade organisation – was formed in 2014, and according to founder and president Gil Roth was fundamental in negotiating a better deal for third-party drug and ingredient manufacturers in this reauthorisation.

“We were one of several industry groups that helped negotiate the proposed GDUFA reauthorization with FDA and worked hard to protect the interests of our industry, especially since the first GDUFA iteration was negotiated without CMO/CDMO participation,”​ he told

“Now that the proposed model for GDUFA II has been released, I think you can see that we had a significant impact on that portion of the reauthorization.

“In addition, we learned a great deal about working with the FDA, and built relationships there that are going to last beyond GDUFA and help the CMO/CDMO sector for years to come.”

Roth will be present at CPhI Worldwide in Barcelona next week, chairing the contract service track at the pre-connect congress on Monday, and presenting a report on the CDMO industry during a media debate on Tuesday.

With several new CMOs joining up over the past year, PBOA has over 20 members​ and - according to Roth - will continue to talk to potential companies about getting involved during the four day event.

“Now that we've finished the GDUFA II reauthorization proposal with FDA, CMO/CDMOs are getting an idea about the impact we can have when our industry works together.”

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