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FDA releases plan to fund Innovation Account

On July 7, the FDA released its Work Plan and Proposed Funding Allocations of the FDA Innovation Account, the agency’s plan to spend the $500 million in new funding provided by the 21st Century Cures Act. The Cures Act, bipartisan legislation that became law in December 2016, allocates $6.3 billion to advance biomedical innovation by funding basic science research and allowing for innovation and flexibility for product regulation at the FDA. The funding is appropriated to FDA from FY 2017 to FY 2025.

The plan emphasizes, among other initiatives, the FDA’s work on:

  • Advancing new drug therapies and the development of a qualification process for drug development tools
  • Continued emphasis on patient-focused drug-development initiatives
  • Establishing a program to evaluate the use of RWE
  • Supporting medical-device innovation
  • Modernizing the review and designation of combination products

The agency submitted the plan to its Science Board this spring. The plan calls for the FDA to allocate $95.3 million – from fiscal 2018 to fiscal 2025 – to provisions in the Cures Act related to advancing new drug therapies. As part of these initiatives, the FDA will develop criteria needed to support qualification of drug-development tools, develop regulatory informatics platforms, and integrate new review processes, which the agency says is necessary in the near future to ensure it meets its obligations.

For its patient-focused drug development initiative, funding begins in fiscal 2018 with $2.3 million, which is expected to gradually increase to $4.2 million in fiscal 2025. The FDA will issue guidance to address issues, such as acceptable methodological approaches for collecting, measuring, and analyzing patient experience data. The agency will also issue reports on assessing the use of patient experience data in regulatory decision-making, and will release statements about how it uses patient experience data in the review of a drug or biologic marketing application.

FDA Commissioner Scott Gottlieb, M.D., notes in a July 7 FDA Voice blog that, as part of implementing provisions in the Cures Act, FDA has already taken steps to include use of computer modeling and simulation tools to support model-based drug development and to make clinical trials more efficient. As an example, he mentions that the FDA can model some aspects of the behavior of the placebo arm in clinical trials, and that the agency is collaborating with scientists to develop such natural history models in several different rare diseases that are more difficult to study due to the smaller patient population.

Initiatives to support medical-device innovation will largely be funded starting in fiscal year 2020. Under provisions that the Cures Act lays out for breakthrough devices, the Expedited Access Pathway program will grow at a rate as high as 20 percent per year over the next 10 years. To accommodate this growth, the FDA will also need to acquire information technology systems and issue guidance on “probable benefit” of humanitarian use devices. It also will need to train employees on the application of the “least burdensome” principle in device review, and implement a surveillance system for exempted medical software products or functions.

Analysis: As described in the Deloitte Center for Health Solutions’ recent paper, 21st Century Act: The future of product innovation and approval, the Cures Act creates an opportunity for the FDA to apply recent advances in technology and analytics, and scientific and evidentiary models, to continue evolving regulatory programs. In many ways, the drug, device, and diagnostic development and approval process of yesterday is over. Life sciences companies (biopharma, medical device, and diagnostics companies) may risk being out of date and competitively disadvantaged if they are not pursuing the newer breakthrough, priority, or accelerated pathways included in the Cures Act, and in some of the initiatives FDA has developed in the past several years. As the industry strives to meet the evolving needs of stakeholders – patients, providers, and health plans – this regulatory flexibility will likely be imperative to drive both regulatory approval and market access.

(Sources: FDA, “Work Plan and Proposed Funding Allocations of FDA Innovation Account,” June 6, 2017; Scott Gottlieb, “How FDA Plans to Help Consumers Capitalize on Advances in Science,” FDA Voice, July 7, 2017)

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Author bio

Doug leads Deloitte Consulting LLP’s Life Sciences and Health Care practice. With 24 years of experience, he works closely with multiple top health care organizations on major clinical and enterprise transformation efforts and on large-scale technology implementation projects. Doug has extensive experience in comprehensive quality and patient safety transformations, turnaround and performance improvement in academic medical centers as well as organization/workflow redesign and technology enablement. He has served as the lead on a number of enterprise transformation initiatives with some of Deloitte’s most largest and most complex clients.