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March 16, 2017

Trump Proposes Slicing NIH Budget 18%, Doubling FDA User Fees

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    Source: National Cancer Institute

    President Donald Trump has proposed cutting the budget of the NIH by 18%—as well as doubling the amount in fees that the FDA would collect from drug and diagnostic developers to review their applications—in the spending outline his administration unveiled today for the 2018 federal fiscal year.

    According to the administration’s “America First: A Budget Blueprint to Make America Great Again,” NIH spending would be chopped by $5.8 billion, to $25.9 billion, and the agency restructured in a “major reorganization” of its 27 institutes and centers designed to “help focus resources on the highest priority research and training activities.”

    That reorganization will include eliminating the Fogarty International Center, whose activities include facilitating global health research by U.S. and international investigators and training scientists to address global health needs.

    The proposed spending cut contrasts with the FY 2017 increases of up to $2 billion discussed for the NIH by senators and representatives last year—increases that were never enacted, forcing the agency, like all other federal agencies, to operate under FY 2016 spending levels through a “continuing resolution.” NIH enjoyed a $2 billion spending hike for FY2016, following roughly a decade of yo-yo budgets for the agency, though Barack Obama’s final spending plan as president, proposed last year, alarmed advocates of greater research spending by proposing a 3% increase for the NIH.

    The Trump administration’s budget outline also calls for consolidating within NIH the Agency for Healthcare Research and Quality, whose functions include generating measures and data toward tracking performance and evaluating progress of the U.S. healthcare system—as well as what the administration said will be unspecified “other consolidations and structural changes across NIH organizations and activities.”

  • Doubling FDA User Fee Collections

    For FDA, the budget outline proposes that the agency collect $2 billion in user fees in FY2018, double the current fiscal year.

    “In a constrained budget environment, industries that benefit from FDA’s approval can and should pay for their share,” the budget outline stated.

    According to the outline, the budget will also include “a package of administrative actions designed to achieve regulatory efficiency and speed the development of safe and effective medical products.”

    While no details were offered, Trump has repeatedly promised to cut red tape for drug and diagnostic developers in order to speed up decisions on new products, while criticizing the FDA’s approach to reviewing new drugs—most notably during his February 28 address to Congress.

    The user fees are required under the fifth and current 5-year authorization of the Prescription Drug User Fees Act (PDUFA), which took effect as part of the Food and Drug Administration Safety and Innovation Act (FDASIA) of 2012. FDASIA will expire on September 30, and is expected to be succeeded by a sixth authorization.

    Overseeing PDUFA reauthorization is expected to be among priorities for Scott Gottlieb, M.D., who President Trump said last week he intends to nominate for FDA commissioner.

    Another expected priority is implementing the 21st Century Cures Act, enacted last year by Trump’s predecessor, Barack Obama, after it passed Congress by lopsided bipartisan majorities. The administration said it will include unspecified “additional funds” toward implementing the Cures Act in the budget of the parent agency for NIH and FDA, the U.S. Department of Health and Human Services (HHS).

    HHS faces a year-over-year 17.9% ($15.1 billion) budget cut in the Trump administration’s budget proposal, to $69 billion, according to the outline.

    The FDA is now led by acting commissioner Stephen Ostroff, M.D., pending U.S. Senate confirmation of Dr. Gottlieb. If confirmed as expected, he would be permanent successor to Robert M. Califf, M.D., who was nominated by Trump’s predecessor Barack Obama and left office the day Trump was sworn in.

    Other highlights of the budget outline:

    • CDC—The outline calls for a new $500 million block grant “to increase State flexibility and focus on the leading public health challenges specific to each State.”
    • Public health—The administration proposes to restructure HHS programs to offer preparedness grants “to reduce overlap and administrative costs and directs resources to States with the greatest need;” as well as create a new Federal Emergency Response Fund of unspecified amount, with the goal of rapidly responding to public health outbreaks.

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