The Generic Drug User Fee Amendments (GDUFA): Background and Reauthorization

The Generic Drug User Fee Amendments (GDUFA): Background and Reauthorization

The Generic Drug User Fee Amendments
April 29, 2021
(GDUFA): Background and Reauthorization
Agata Bodie
The Food and Drug Administration (FDA) regulates the safety, effectiveness, and
Analyst in Health Policy
quality of drugs—both brand name and generic—pursuant to its authorities under the

Federal Food, Drug, and Cosmetic Act (FFDCA). Throughout this report, the term
brand-name drug refers to a drug that is approved under a new drug application (NDA)

submitted pursuant to section 505(b) of the FFDCA. The term generic drug refers to a
drug that is approved under an abbreviated new drug application (ANDA) submitted pursuant to FFDCA Section
505(j). FDA must approve an NDA or ANDA before a drug may be marketed in the United States.
FDA Regulation of Generic Drugs
When filing an ANDA, a generic drug applicant relies on FDA’s previous determination of safety and
effectiveness for the reference listed drug (RLD, typically the brand-name drug) rather than conducting its own
preclinical and clinical investigations to prove safety and effectiveness. Although a generic is considered a “copy”
of the RLD, it may differ in certain characteristics (e.g., shape, inactive ingredients, packaging). A generic that is
approved under an ANDA is presumed to be therapeutically equivalent to the RLD. Because the generic is
expected to produce the same clinical effect and has the same safety profile (when administered under the
conditions in the labeling) as the RLD, it can be substituted for the RLD without the intervention of the prescriber.
Funding of Generic Drug Regulation
FDA regulation of generic drugs is funded through a combination of annual discretionary appropriations from the
General Fund of the Treasury and user fees paid by the generic pharmaceutical industry. Prior to the enactment of
the Generic Drug User Fee Amendments (GDUFA), FDA lacked the resources to keep pace with the increasing
number of ANDAs submitted for review and foreign facilities making generic drugs, which led to a backlog of
submitted ANDAs pending FDA review.
To increase predictability and efficiency in ANDA review and to bring uniformity to inspection schedules, in
2012, GDUFA (now referred to as GDUFA I) was enacted as Title III of the FDA Safety and Innovation Act
(FDASIA; P.L. 112-144). GDUFA I gave FDA an additional source of revenue—user fees paid by generic drug
companies—to support FDA generic drug review and related activities. In exchange for fee revenue, FDA agreed
to meet certain performance goals, as negotiated by the agency and generic drug industry. GDUFA I was set to
expire on September 30, 2017, and was subsequently reauthorized as GDUFA II by Title III of the FDA
Reauthorization Act (FDARA; P.L. 115-52). GDUFA II is set to expire on September 30, 2022, unless
reauthorized.
Scope of This Report
This report describes (1) the FDA process for review and approval of generic drugs, (2) the statutory framework
that governs how FDA assesses and collects generic drug fees, (3) the impact of GDUFA on FDA application
review time and the agency’s budget, and (4) the GDUFA reauthorization process and considerations for
Congress.

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Contents
Introduction ..................................................................................................................................... 1
FDA Review and Approval of Generic Drugs ................................................................................. 2
Submission of ANDAs .............................................................................................................. 2
FDA Review of ANDAs ............................................................................................................ 3
Modification of Approved ANDAs ........................................................................................... 5
Generic Drug User Fees .................................................................................................................. 6
GDUFA Framework .................................................................................................................. 6
Covered Activities ............................................................................................................... 7
Revenue and Fee Adjustments ............................................................................................ 7
Fee Types ............................................................................................................................ 8
Conditions (“Triggers”) .................................................................................................... 10
GDUFA Impact on FDA Performance and Budget ................................................................. 10
Performance ....................................................................................................................... 11
Budget ............................................................................................................................... 13
Reauthorization and Considerations for GDUFA III ..................................................................... 15
Considerations for GDUFA III ................................................................................................ 16
Multiple Review Cycles .................................................................................................... 16
Generic Drug Quality and Manufacturing ........................................................................ 18
Concluding Comments .................................................................................................................. 19

Figures
Figure 1. ANDA Approvals Under GDUFA I and II ..................................................................... 12
Figure 2. GDUFA Program: User Fees and Appropriations .......................................................... 14
Figure 3. GDUFA Program Carryover, Actual and Forecasted ..................................................... 15

Tables
Table 1. GDUFA I Versus GDUFA II Fee Structures ...................................................................... 9

Table A-1. Review Performance Goals ......................................................................................... 21

Appendixes
Appendix A. GDUFA II Review Performance Goals .................................................................... 21
Appendix B. Acronyms Used in This Report ................................................................................ 23

Contacts
Author Information ........................................................................................................................ 23

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Introduction
The Food and Drug Administration (FDA) regulates the safety, effectiveness, and quality of
drugs—both brand name and generic—pursuant to its authorities under the Federal Food, Drug,
and Cosmetic Act (FFDCA). Throughout this report, the term brand-name drug refers to a drug
that is approved under a new drug application (NDA) submitted pursuant to section 505(b) of the
FFDCA.1 The term generic drug refers to a drug that is approved under an abbreviated new drug
application (ANDA) submitted pursuant to FFDCA Section 505(j).2 FDA must approve an NDA
or ANDA before a drug may be marketed in the United States.
A company interested in marketing a new brand-name drug in the United States must submit an
NDA to FDA for approval. Federal law and regulations specify the required contents of an NDA,
including full reports of safety and effectiveness derived from preclinical (animal) and clinical
(formally designed, conducted, and analyzed studies of human subjects) investigations.3 Clinical
investigations generally occur in three phases and can be the most expensive aspect of drug
development.
In contrast, when filing an ANDA, a generic drug applicant relies on FDA’s previous
determination of safety and effectiveness for the reference listed drug (RLD,4 typically the brand-
name drug) rather than conducting its own preclinical and clinical investigations to prove safety
and effectiveness.5 A generic drug generally contains the same active ingredient in the same
dosage form, strength, and route of administration as the RLD. While a generic is considered a
“copy” of the RLD, it may differ in certain characteristics (e.g., shape, inactive ingredients,
packaging). A generic that is approved under an ANDA is presumed to be therapeutically
equivalent to the RLD. Because the generic is expected to produce the same clinical effect and
has the same safety profile (when administered under the conditions in the labeling) as the RLD,
it can be substituted for the RLD without the intervention of the prescriber.6
FDA regulation of generic drugs is funded through a combination of annual discretionary
appropriations from the General Fund of the Treasury and user fees paid by the generic
pharmaceutical industry. Prior to the enactment of the Generic Drug User Fee Amendments
(GDUFA), FDA lacked the resources to keep pace with an increasing number of ANDAs
submitted for review and foreign facilities making generic drugs, which resulted in a backlog of
submitted ANDAs.
In 2012, GDUFA (now referred to as GDUFA I) was enacted as Title III of the FDA Safety and
Innovation Act (FDASIA; P.L. 112-144). GDUFA I gave FDA an additional source of revenue—
user fees paid by generic drug companies—to support FDA generic drug review and related

1 FFDCA §505(b) [21 U.S.C. §355(b)].
2 FFDCA §505(j) [21 U.S.C. §355(j)].
3 FFDCA §505(b) [21 U.S.C. §355(b)] and 21 C.F.R. §314.50. See also CRS Report R41983, How FDA Approves
Drugs and Regulates Their Safety and Effectiveness.
4 The reference listed drug (RLD) is typically a brand-name drug but may be a generic. It is called the RLD because an
ANDA (or a 505(b)(2) NDA) refers to the clinical data in the RLD’s approved application. 21 C.F.R. §314.3(b).
5 FDA, “Determining Whether to Submit an ANDA or a 505(b)(2) Application,” Guidance for Industry, May 2019, p.
2, https://www.fda.gov/media/124848/download.
6 21 C.F.R. §314.3(b) defines therapeutic equivalents as “approved drug products that are pharmaceutical equivalents
for which bioequivalence has been demonstrated, and that can be expected to have the same clinical effect and safety
profile when administered to patients under the conditions specified in the labeling.” See also FDA, “Determining
Whether to Submit an ANDA or a 505(b)(2) Application,” Guidance for Industry, p. 3.
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activities.7 In exchange for fee revenue, FDA agreed to meet certain performance goals, as
negotiated by the agency and generic drug industry. GDUFA I was set to expire on September 30,
2017, and was subsequently reauthorized as GDUFA II by Title III of the FDA Reauthorization
Act (FDARA; P.L. 115-52). GDUFA II is set to expire on September 30, 2022, unless
reauthorized.
This report describes (1) the FDA process for review and approval of generic drugs, (2) the
statutory framework that governs how FDA assesses and collects generic drug fees, (3) the impact
of GDUFA on FDA application review time and the agency’s budget, and (4) the GDUFA
reauthorization process and considerations for Congress.
FDA Review and Approval of Generic Drugs
FDA reviews and approves generic drugs under an abbreviated pathway created by the Drug Price
Competition and Patent Term Restoration Act of 1984 (Hatch-Waxman Act; P.L. 98-417). This
section focuses on the FDA review process and does not discuss intellectual property rights for
pharmaceutical products (i.e., patents and regulatory exclusivities), which are addressed in other
CRS reports.8
Submission of ANDAs
Federal law and regulations specify the required contents of an ANDA. Among other things, an
ANDA must include information and data demonstrating that the generic version is
pharmaceutically equivalent to the RLD (i.e., it contains the same active ingredients in the same
strength, dosage form, and route of administration) and bioequivalent to the RLD (i.e., the active
ingredient of the generic becomes available at the site of action at the same rate and to same
extent as that of the RLD).9 FDA has issued various guidance documents, both general and
product specific, that clarify expectations for demonstrating bioequivalence between a generic
drug and the RLD. An ANDA may not be submitted if new clinical investigations are necessary to
establish the generic drug’s safety and effectiveness.10
An ANDA must include proposed labeling for the generic drug, which must be the same as that
for the RLD, with some exceptions.11 The ANDA also must provide information about the
generic’s chemistry, manufacturing, and controls to ensure that the manufacturer can make the
drug correctly and consistently.12 As part of the ANDA review process, FDA typically inspects the

7 P.L. 112-144, Title III. See CRS Report R42680, The Food and Drug Administration Safety and Innovation Act
(FDASIA, P.L. 112-144).
8 See, for example, CRS Report R46679, Drug Prices: The Role of Patents and Regulatory Exclusivities.
9 FFDCA §505(j)(2) [21 U.S.C. §355(j)(2)] and 21 C.F.R. §314.94. Bioequivalence is defined as “the absence of a
significant difference in the rate and extent to which the active ingredient or active moiety in pharmaceutical
equivalents or pharmaceutical alternatives becomes available at the site of drug action when administered at the same
molar dose under similar conditions in an appropriately designed study” (21 C.F.R. §314.3). Bioequivalence testing
may be conducted in vivo (inside a living organism) or in vitro (outside a living organism), depending on the drug (21
C.F.R. §320.24(a)).
10 FDA, “Determining Whether to Submit an ANDA or a 505(b)(2) Application,” Guidance for Industry, p. 3.
11 FFDCA §505(j)(2)(A)(v) [21 U.S.C. §355(j)(2)(A)(v)].
12 21 C.F.R. §314.94(a)(9).
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facilities where the finished drug and its active pharmaceutical ingredient (API) are
manufactured.13
An applicant may submit a petitioned ANDA for a generic drug that differs from the RLD in
certain respects, such as dosage form, route of administration, strength, or active ingredient (in a
product with more than one active ingredient) and for which studies are not necessary to establish
the safety and effectiveness of the proposed generic.14 To do so, an applicant would first submit a
suitability petition to FDA requesting permission to submit an ANDA for a generic that differs
from an RLD; if FDA approves the petition, the applicant may then submit an ANDA with the
change.
FDA Review of ANDAs
ANDAs are submitted for review to the Office of Generic Drugs (OGD) and the Office of
Pharmaceutical Quality (OPQ), both of which reside within FDA’s Center for Drug Evaluation
and Research (CDER). The OGD Division of Filing Review first determines whether an ANDA is
sufficiently complete to allow FDA review. If OGD finds that the ANDA is not acceptable for
review—for example, if it contains certain deficiencies—FDA guidance states that the agency
will refuse to receive (RTR) the ANDA. The applicant may resubmit the ANDA with additional
information.15 If the deficiencies are minor and easily remedied, FDA may allow the applicant to
correct the deficiencies or amend the ANDA at the agency’s discretion.16 If the deficiencies are
not corrected within a specified amount of time (usually a week), FDA guidance indicates that the
agency will RTR the ANDA. FDA considers RTR to be an indicator of poor application quality.17
Once an ANDA is accepted for filing (i.e., “received”), the first cycle of review begins. FDA staff
in three disciplines review ANDAs:
 Bioequivalence: the OGD Office of Bioequivalence assesses whether the generic
is bioequivalent to the RLD.
 Labeling: the OGD Division of Labeling Review assesses whether the generic’s
proposed labeling matches that of the RLD.
 Quality: the CDER OPQ evaluates the chemistry, manufacturing, and controls
information to ensure drug quality.18
Within each of these disciplines, primary and secondary reviewers review an ANDA. The primary
reviewers evaluate whether the ANDA meets the regulatory requirements with respect to the
specific discipline of the office (e.g., bioequivalence), and the secondary reviewers are to “assess

13 FDA, Chapter 46—New Drug Evaluation, Program 7346.832, Pre-approval Inspections, Implementation date:
September 16, 2019, p. 9, https://www.fda.gov/media/121512/download.
14 FFDCA §505(j)(2)(C) [21 U.S.C. §355(j)(2)(C)], 21 C.F.R. §314.93. FDA. “Determining Whether to Submit an
ANDA or a 505(b)(2) Application,” Guidance for Industry, May 2019, p. 3.
15 GAO, “Generic Drug Applications: FDA Should Take Additional Steps to Address Factors That May Affect
Approval Rates in the First Review Cycle,” August 2019, GAO-19-565, p. 7, https://www.gao.gov/assets/710/
700779.pdf.
16 FDA, “ANDA Submissions –Refuse-to-Receive Standards,” Guidance for Industry, December 2016, p. 3,
https://www.fda.gov/media/86660/download.
17 FDA, “OGD UPDATE: Welcome to much more than GDUFA II,” Kathleen Uhl, Director Office of Generic Drugs,
September 7, 2017, p. 16, https://www.fda.gov/media/115887/download.
18 GAO, “Generic Drug Applications: FDA Should Take Additional Steps to Address Factors That May Affect
Approval Rates in the First Review Cycle,” pp. 7-8.
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that assessment” to ensure quality and consistency in the technical assessment and
communication with the applicant.19 Division directors serve as a resource to reviewers for
consultation on novel, complex, or high-risk products, among other things.20
As mentioned above, as part of an ANDA, applicants must demonstrate that they can consistently
produce a quality drug product. To ensure that this is the case, FDA staff conduct quality
assessments and inspections of the facilities named in the ANDA, such as those that manufacture
the API and the finished drug product. CDER, with participation from the FDA Office of
Regulatory Affairs (ORA), considers whether a preapproval inspection is needed, whereas ORA,
with CDER participation, conducts the inspections.21 In certain cases, a preapproval inspection
may not be necessary, for example, if FDA determines that the agency has sufficient information
about the facility. Upon completion of an inspection or other information review, ORA provides
to CDER’s Office of Compliance either an “approve” recommendation, if no significant issues
were identified, or a “withhold” recommendation, if there are significant issues that would affect
the ability of the facility to perform.22
FDA allows applicants to respond to deficiencies identified in an ANDA during the review
process. For example, the agency may send an information request (IR) letter to the applicant
requesting additional information or clarification to assist reviewers. In addition, FDA issues
discipline review letters (DRLs) to applicants during the mid-point of the review cycle to identify
any potential deficiencies that would affect ANDA approval.23 IRs and DRLs are intended to
promote efficiency and effectiveness in the review process, minimize the number of review
cycles, and increase FDA’s overall rate of approval. Issuance of an IR or DRL does not stop the
clock for a given review cycle. If a response to an IR or DRL contains information that requires a
more thorough review, FDA may reclassify the submission as an amendment and assign a new
goal date for that amendment.24
FDA’s goal in the first cycle is to review and act on certain priority ANDAs within 8 months of
submission and other ANDAs within 10 months of submission. These review goals have been
agreed upon between FDA and the generic drug industry under the GDUFA II Commitment
Letter.25 FDA aims to act on a priority ANDA within 8 months if the applicant has submitted a
complete and accurate Pre-Submission Facility Correspondence two months prior to ANDA
submission. This gives FDA at least 60 days to determine whether a facility inspection is
necessary and to begin inspection planning prior to receiving the ANDA.26 If the applicant has not
submitted such correspondence, the agency’s goal is to act on the priority ANDA within 10
months. FDA has issued and subsequently updated a Manual of Policies and Procedures (MAPP)

19 FDA, MAPP 5241.3, “Good Abbreviated New Drug Application Assessment Practices,” pp. 5-8,
https://www.fda.gov/media/110017/download.
20 FDA, MAPP 5241.3, “Good Abbreviated New Drug Application Assessment Practices,” p. 9.
21 FDA, Chapter 46—New Drug Evaluation, Program 7346.832, Pre-approval Inspections, p. 9.
22 Ibid., p. 28.
23 FDA, “Information Requests and Discipline Review Letters Under GDUFA” Guidance for Industry, December 2017,
p. 2, https://www.fda.gov/media/109915/download.
24 Ibid., pp. 4-5.
25 FDA, “GDUFA Reauthorization Performance Goals and Program Enhancements Fiscal Years FY2018-2022,”
https://www.fda.gov/media/101052/download.
26 FDA, “ANDAs: Pre-Submission of Facility Information Related to Prioritized Generic Drug Applications (Pre-
Submission Facility Correspondence),” Draft Guidance, November 2017, https://www.fda.gov/media/105794/
download.
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that describes which ANDAs will be prioritized for review, including ANDAs related to drug
shortages and ANDAs related to public health emergencies.27
Upon completing review of an ANDA, FDA sends one of three action letters to the applicant: an
approval letter, a tentative approval letter, or a complete response letter.28 An approval letter
signifies that FDA has approved the generic drug in the ANDA for marketing, while a tentative
approval letter means that the ANDA meets the regulatory requirements for approval but cannot
receive final approval due to unexpired patents or regulatory exclusivities.29 A complete response
letter describes the deficiencies that FDA has identified in an ANDA that must be addressed
before it can be approved.30 Following receipt of a complete response letter, an applicant may
submit an amendment that addresses the deficiencies.31 This submission would trigger a new
review cycle, during which FDA would review the changes. Subsequent review cycles can take
between 3 and 10 months each (see Table A-1), depending on whether the amendments made to
the ANDA are major or minor, designated as priority or standard, and whether an inspection is
required.32
Modification of Approved ANDAs
Generally, any modification to an approved ANDA must be reported to FDA, and certain
modifications require FDA approval prior to distribution of the generic drug with the change. The
type of regulatory submission required depends on the potential of the change “to have an adverse
effect on the identity, strength, quality, purity, or potency of the drug product as these factors may
relate to the safety or effectiveness of the drug product.”33
Major changes to an approved ANDA require submission and approval of a prior approval
supplement (PAS). More specifically, a PAS is used to request a modification to an approved
ANDA that has a substantial potential to have an adverse effect on the identity, strength, quality,
purity, or potency of the drug product as it may relate to its safety or effectiveness. This includes
changes in the API, finished drug product, production process, quality controls, equipment, or
facilities named in an approved ANDA.34 Certain manufacturing changes may trigger the need for
an FDA inspection prior to approval of a PAS.
Moderate changes—for example, a labeling modification that adds or strengthens a
contraindication, warning, or adverse reaction—require submission of a changes-being-effected

27 FDA, Manual of Policies and Procedures (MAPP) 5240.3, “Prioritization of the Review of Original ANDAs,
Amendments, and Supplements,” revised January 30, 2020, https://www.fda.gov/media/89061/download.
28 FDA, “Information Requests and Discipline Review Letters Under GDUFA,” p. 3.
29 21 C.F.R. §314.3(b).
30 Ibid.
31 FDA, “ANDA Submissions—Amendments to Abbreviated New Drug Applications Under GDUFA,” Guidance for
Industry, July 2018, p. 3, https://www.fda.gov/media/89258/download.
32 FDA, “ANDA Submissions—Amendments to Abbreviated New Drug Applications Under GDUFA,” Guidance for
Industry, July 2018, https://www.fda.gov/media/89258/download. See also GAO, “Generic Drug Applications: FDA
Should Take Additional Steps to Address Factors That May Affect Approval Rates in the First Review Cycle,” p. 2.
33 21 C.F.R. §314.70(b), (c), and (d). FDA, “ANDA Submissions –Prior Approval Supplements Under GDUFA,”
Guidance for Industry, October 2017, https://www.fda.gov/media/89263/download.
34 FFDCA §744A(11) [21 U.S.C. §379j–41(11)]. 21 C.F.R. § 314.70(b). FDA, “Changes to an Approved NDA or
ANDA,” Guidance for Industry, April 2004, p. 24, https://www.fda.gov/files/drugs/published/Changes-to-an-
Approved-NDA-or-ANDA.pdf.
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(CBE) supplement.35 A drug incorporating such labeling change may be distributed upon FDA
receipt of the CBE supplement (called a “CBE-0 supplement”).36 However, some moderate
changes, including modifications to a drug’s container closure system, require submission of a
CBE supplement at least 30 days prior to distribution of the product with the change (called a
“CBE-30 supplement”).37 Minor changes, such as editorial changes in the labeling, may be
submitted to FDA in annual reports.38
Generic Drug User Fees
Although the Hatch-Waxman Act has been considered successful in boosting generic drug
competition, the law has increased the number of ANDAs and other regulatory submissions to
FDA, thus increasing the agency’s workload. The number of manufacturing facilities has also
increased, particularly those located outside of the United States. As a result, both FDA’s review
workload and the resources needed to complete foreign facility inspections have grown.39 These
factors have resulted in delayed review and approval of generic drugs. In March 2012, the median
review time for an ANDA was approximately 31 months, and FDA had a backlog of more than
2,500 ANDAs.40 ANDAs were approved in one review cycle less than 1% of the time.41
To increase predictability and efficiency in ANDA review and bring uniformity to inspection
schedules, in 2012, GDUFA I was enacted, authorizing FDA to assess and collect user fees from
generic drug companies to support generic drug review and related activities.42 The fees enabled
FDA to hire additional scientists and support staff to facilitate ANDA review, as well as
inspectors to conduct generic facility inspections. In exchange for fee revenue, FDA agreed to
meet certain performance goals, as negotiated by the generic drug industry and agency. GDUFA I,
initially set to expire on September 30, 2017, was reauthorized as GDUFA II by the FDA
Reauthorization Act of 2017 (FDARA).43 GDUFA II is set to expire on September 30, 2022.44
GDUFA Framework
As described below, the statutory provisions governing GDUFA specify how FDA may use
generic drug fees. Each five-year authorization has set a total amount of fee revenue for the first
year, provided a formula for annual adjustments to that total based on inflation, specified the fee

35 21 C.F.R. §314.70(c). FDA, “Changes to an Approved NDA or ANDA,” Guidance for Industry, p. 25.
36 21 C.F.R. §314.70(c)(6). FDA, “ANDA Submissions –Prior Approval Supplements Under GDUFA,” p. 4.
37 21 C.F.R. §314.70(c)(3). FDA, “ANDA Submissions –Prior Approval Supplements Under GDUFA,” p. 3.
38 21 C.F.R. §314.70(d). FDA, “Changes to an Approved NDA or ANDA,” Guidance for Industry, p. 26.
39 Statement of Janet Woodcock, MD, Director, CDER, FDA, before the Senate Committee on Health, Education,
Labor, and Pensions, “FDA User Fee Agreements: Strengthening FDA and the Medical Products Industry for the
Benefit of Patients,” March 29, 2012, p. 22.
40 Ibid.
41 Statement of Janet Woodcock, MD, Director of CDER, FDA, before the House Committee on Energy and
Commerce, Subcommittee on Health, “Generic Drug User Fee Act Reauthorization (GDUFA II),” 115th Cong., 1st
sess., March 2, 2017, p. 4.
42 P.L. 112-144, Title III. See CRS Report R42680, The Food and Drug Administration Safety and Innovation Act
(FDASIA, P.L. 112-144).
43 P.L. 115-52, Title III. See CRS Report R44961, FDA Reauthorization Act of 2017 (FDARA, P.L. 115-52).
44 P.L. 115-52, §305.
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types that contribute to the total revenue, and required that certain legal conditions be satisfied in
order for FDA to collect user fees.
Covered Activities
GDUFA fees may be used for allowable activities and expenses, as specified in statute.
Specifically, FDA may use the fee revenue to fund “human generic drug activities,” which
include the following:
 review of generic drug submissions (e.g., ANDAs and drug master files
[DMFs]);45
 issuance of letters (e.g., approval and complete response letters);
 inspections of generic drug facilities;
 monitoring of research conducted in connection with review of generic drug
submissions;
 postmarket safety (e.g., activities related to adverse event reporting); and
 regulatory science activities related to generic drugs.46
The FFDCA defines “resources allocated for human generic drug activities” as expenses for FDA
officers, employees, contractors, and advisory committees; information management and
computer resources; facilities, furniture, equipment, materials and supplies;47 and the collection of
user fees and resources accounting.48
GDUFA II did not modify the definitions of “human generic drug activities” or “resources
allocated for human generic drug activities,” thus maintaining the GDUFA I scope of allowable
activities and expenses that fees could support.
Revenue and Fee Adjustments
GDUFA I set a total fee revenue amount of $299 million for the first year of the program
(FY2013) and provided a formula for annual fee adjustment based on inflation.49 The revenue
amount was based on the assumption that FDA would receive 750 ANDAs per year, with ANDAs
being the primary workload driver of the generic drugs program. However, in the first four years
of the GDUFA program, FDA received, on average, 1,000 ANDAs per year.50 In addition,
GDUFA I provided for a final year adjustment in FY2017 to increase fees to provide for up to
three months of operations.
To account for FDA’s growing workload, GDUFA II increased the total fee revenue for the first
year of the program (FY2018) to $493.6 million, to be adjusted annually for inflation, as

45 A Drug Master File (DMF) is a voluntary submission to FDA that may be used to provide confidential detailed
information about facilities, processes, or articles used in the manufacturing, processing, packaging, and storing of one
or more human drugs. The information contained in the DMF, for example, may be used to support an ANDA;
however, it cannot be used as a substitute for an ANDA.
46 FFDCA §744A(9) [21 U.S.C. §379j–41(9)].
47 Beginning October 1, 2023, the costs of resources shall include only expenditures for leasing and necessary scientific
equipment. FFDCA §744B(e)(2) [21 U.S.C. §379j–42(e)(2)].
48 FFDCA §744A(12) [21 U.S.C. §379j–41(12)].
49 P.L. 112-144, Title III. See CRS Report R42680, The Food and Drug Administration Safety and Innovation Act
(FDASIA, P.L. 112-144).
50 FDA, “GDUFA II Fee Structure Summary,” https://www.fda.gov/media/101064/download.
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specified.51 GDUFA II also provided for a final year adjustment, in FY2022, to increase fees to
provide for up to three months of operations.52
Fee Types
GDUFA I had required that the following types of fees each contribute to the fee revenue every
fiscal year:53
 ANDA/PAS fee (24%): One-time fee paid by the sponsor of an ANDA or PAS
upon submission of the application. The PAS fee was half the ANDA fee.54
 DMF fee (6%): One-time fee paid by a person that owns a Type II API DMF
when the DMF is first referenced in a generic drug submission (i.e., an ANDA,
an amendment to an ANDA, a PAS, or an amendment to a PAS). A Type II API
DMF contains information about the processes and facility making an API.
 Generic drug finished dosage form (FDF) facility fee (56%): Fee paid annually
by a person that owns a facility identified in a generic drug submission that is
either pending or approved to produce a FDF of a human generic drug.
 API facility fee (14%): Fee paid annually by a person that owns a facility that is
identified (1) in a generic drug submission that is pending or approved to produce
an API of a human generic drug, or (2) in a Type II API DMF referenced in a
generic drug submission.
Under GDUFA I, FDA was allowed to charge foreign facilities between $15,000 to $30,000 more
per facility than domestic facilities, depending on the agency’s annual calculations concerning
relative costs of foreign and domestic inspections. A facility that qualified as both an API and
FDF facility was subject to both fees.55 A contract manufacturing organization (CMO) producing
generic drugs on behalf of the ANDA sponsor was subject to the full FDF fee. In addition,
GDUFA I established a one-time backlog fee for ANDAs pending as of October 1, 2012.
GDUFA II modified the fee structure (see Table 1). In particular, GDUFA II created a new
generic drug applicant program fee, eliminated the PAS fee, and provided that fees for foreign
FDF and API facilities are $15,000 higher than for domestic facilities.56 Under GDUFA II, a
facility that qualifies as both an API and FDF facility is subject to the FDF fee only.57 A CMO

51 FFDCA §744B(b)(1) & (c)(1) [21 U.S.C. §379j–42(b)(1) & (c)(1)].
52 FFDCA §744B(c)(2) [21 U.S.C. §379j–42(c)(2)].
53 P.L. 112-144, Title III. See also FDA, “GDUFA II Fee Structure Summary,” https://www.fda.gov/media/101064/
download.
54 As an example of how FDA calculates individual fee amounts, for FY2015, FDA determined that the inflation-
adjusted target revenue was $312,224,000. As specified under GDUFA I, ANDA and PAS fees were to make up 24%
of this total (i.e., $74,934,000, rounded to the nearest thousand dollars). FDA then estimated how many full application
equivalents (FAEs) would be submitted in FY2015, assuming ANDAs count as one FAE and PASs count as one-half
an FAE. FDA determined, based on submissions from previous years, that 1,276 FAEs would be subject to the
application fee in FY2015. FDA then divided the fee revenue amount to be derived from application fees ($74,934,000)
by the 1,276 FAEs, resulting in an ANDA fee of $58,730 (rounded to the nearest ten dollars) and a PAS fee of $29,370
(i.e., half the ANDA fee).
55 P.L. 112-144, Title III. See also FDA, “GDUFA II Fee Structure Summary,” https://www.fda.gov/media/101064/
download.
56 FFDCA §744B(b)(2)(C) [21 U.S.C. §379j–42(b)(2)(C)].
57 FFDCA §744B(a)(4)(iii) [21 U.S.C. §379j–42(a)(4)(iii)].
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manufacturing generic drugs on behalf of the ANDA sponsor is subject to one third of the FDF
fee. GDUFA II specified the amount to be derived from each fee type as follows:
 Generic drug applicant program fee (35%): Annual fee paid by a person based on
the number of approved ANDAs they own.
 ANDA fee (33%): One-time fee paid by the sponsor of an ANDA (but not a PAS)
upon submission of the application.
 DMF fee (5%): same as under GDUFA I.
 Generic drug FDF facility fee (20%): Fee paid annually by a person that owns a
facility identified in a generic drug submission that is approved (but not pending)
to produce an FDF of a human generic drug.
 API facility fee (7%): Fee paid annually by a person that owns a facility that is
identified (1) in a generic drug submission that is approved (but not pending) to
produce an API of a human generic drug, or (2) in a Type II API DMF referenced
in a generic drug submission.58
This restructuring was intended to shift the burden toward annual program fees.59 (The volume of
applications fluctuates from year to year, whereas the amount of facilities and approved ANDA
holders is relatively stable over time.)
Table 1. GDUFA I Versus GDUFA II Fee Structures
Fee Type
GDUFA I (FY2013-FY2017)
GDUFA II (FY2018-FY2022)
One-Time Fees

Application fee
24%
33%
ANDA
(Full application fee)
(Full application fee)
PAS
(50% of application fee)
N/A

DMF fee
6%
5%
Annual Fees

API facility fee
14%
7%

FDF facility fee
56%
20%

CMO facility fee
Same as FDF
33% of the FDF Facility Fee

Program Fee
N/A
35%
Small (1-5 ANDAs)
N/A
(10% of program fee)
Medium (6-19 ANDAs)
N/A
(40% of program fee)
Large (20+ ANDAs)
N/A
(Full program fee)
Source: P.L. 112-144, Title III, FFDCA §744B [21 U.S.C. §379j–42], and FDA, “GDUFA II Fee Structure
Summary,” https://www.fda.gov/media/101064/download.
Notes: ANDA = abbreviated new drug application, API = active pharmaceutical ingredient, CMO = Contract
Manufacturing Organization, DMF = drug master file, FDF = Finished Dosage Form, GDUFA = Generic Drug
User Fee Amendments, N/A= not applicable, PAS = Prior Approval Supplement. An entity may not be subject to
every fee. For example, an API facility may be subject to the API facility fee and the DMF fee, but not the
program or ANDA fees.

58 FFDCA §744B(b)(2) [21 U.S.C. §379j–42(b)(2)].
59 FDA, “GDUFA II Fee Structure Summary,” https://www.fda.gov/media/101064/download.
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Conditions (“Triggers”)
A key element of GDUFA is that user fees are to supplement congressional appropriations, not
replace them. The law has included three limiting conditions, known as “triggers,” to enforce this
goal. Specifically, FDA may collect and use fees only if
 FDA’s overall Salaries and Expenses direct appropriation (excluding user fees)
equals or exceeds the agency’s FY2009 Salaries and Expenses appropriation
(excluding user fees), multiplied by the adjustment factor applicable to the fiscal
year involved;60
 the fee amounts are specified in that fiscal year’s appropriations act;61 and
 the agency spends at least $97 million (multiplied by the adjustment factor for
the applicable fiscal year) from appropriated funds (excluding user fees) for the
review of generic drug applications.62
GDUFA II did not modify these conditions.
GDUFA Impact on FDA Performance and Budget
In each fiscal year for which user fees are collected, FDA is required to submit to Congress a
performance report on the agency’s progress in meeting the performance goals specified in the
GDUFA II Commitment Letter,63 as well as a fiscal report on the use of fees collected by the
agency.64 Further, in each fiscal year for which GDUFA fees are collected, FDA must submit a
corrective action report to Congress, which includes (1) for GDUFA II, goals that have been met
and recommendations on how FDA can improve and streamline the ANDA review process, and
(2) for GDUFA II, goals that have not been met, a justification and description of the
circumstances under which ANDA review goals were missed, and a description of efforts FDA
has made to improve the agency’s ability to meet such goals.65
Further, in the GDUFA II Commitment Letter, FDA has agreed to publish quarterly and monthly
performance reports that provide various metrics, such as the number of ANDAs approved or
tentatively approved in a specific period of time and the mean and median time to approval.66
FDA also agreed to publish a GDUFA five-year financial plan no later than the second quarter of
FY2018 and to update that plan no later than the second quarter of each subsequent fiscal year.67

60 FFDCA §744B(h)(1) [21 U.S.C. §379j–42(h)(1)].
61 FFDCA §744B(i)(2)(A)(i) [21 U.S.C. §379j–42(i)(2)(A)(i)].
62 FFDCA §744B(i)(2)(A)(ii) [21 U.S.C. §379j–42(i)(2)(A)(ii)].
63 FFDCA §744C(a)(1) [21 U.S.C. §379j–43(a)(1)]. The GDUFA II Commitment Letter specifies the metrics that FDA
has agreed to publish in its annual performance reports, for example, the “number of product development, pre-
submission and mid-review cycle meetings requested, granted, denied and conducted, by face to face or in writing” and
the “number of applications received, refused to receive, and average time to receipt decision.” See “GDUFA
Reauthorization Performance Goals and Program Enhancements Fiscal Years FY2018-2022,” pp. 23-24.
64 FFDCA §744C(b) [21 U.S.C. §379j–43(b)].
65 FFDCA §744C(c) [21 U.S.C. §379j–43(c)].
66 “GDUFA Reauthorization Performance Goals and Program Enhancements Fiscal Years FY2018-2022,” p. 22.
67 Ibid. See also “User Fee Five-Year Financial Plans,” https://www.fda.gov/about-fda/user-fee-reports/user-fee-five-
year-financial-plans.
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Performance68
ANDA approval times provide a measure of GDUFA’s effectiveness in meeting its primary goal:
reducing the time between a manufacturer’s submission of an ANDA and FDA’s approval
decision. As mentioned above, FDA’s goal is to act on 90% of certain priority ANDAs within 8
months of receipt of the application and all other ANDAs within 10 months.69 As of September
30, 2019, FDA had met 100% of its FY2019 goal for 8-month review and 97% percent of the
FY2019 goal for 10-month review.70 However, these review goals apply to the first cycle of
review, and most ANDAs undergo multiple cycles of review prior to approval. Thus, as described
below, ANDA review times often exceed these timelines.
In FY2020, FDA approved or tentatively approved 909 ANDAs, 138 (15%) of which were
approved on the first cycle of review (see Figure 1).71 FDA did not consistently report on the
number of first review cycle approvals in its annual performance reports prior to FY2018.
However, FDA estimates that from FY2013 to FY2017, it took an average of three review cycles
for ANDA approval.72 In August 2019, the Government Accountability Office (GAO) reported
that 12% of the ANDAs reviewed by FDA from FY2015 through FY2017 were approved or
tentatively approved in the first cycle.73 Prior to the enactment of the GDUFA I in 2012, ANDAs
were approved in one review cycle less than 1% of the time.74

68 This section focuses on ANDAs and does not provide metrics on other regulatory submissions (e.g., PAS,
amendments, complete response letters). FDA’s annual, monthly, and quarterly reports provide additional metrics on
the agency’s workload and performance.
69 FDA, “GDUFA Reauthorization Performance Goals and Program Enhancements Fiscal Years FY2018-2022,” p. 4.
70 FDA, “FY2019 Performance Report to Congress for the Generic Drug User Fee Amendments,” https://www.fda.gov/
media/138924/download.
71 FDA, “Activities Report of the Generic Drugs Program (FY 2020) Monthly Performance,” accessed January 15,
2021, https://www.fda.gov/drugs/abbreviated-new-drug-application-anda/activities-report-generic-drugs-program-fy-
2020-monthly-performance.
72 GAO, “Generic Drug Applications: FDA Should Take Additional Steps to Address Factors That May Affect
Approval Rates in the First Review Cycle,” August 2019, p. 2, GAO-19-565, https://www.gao.gov/assets/710/
700779.pdf.
73 GAO, “Generic Drug Applications: FDA Should Take Additional Steps to Address Factors That May Affect
Approval Rates in the First Review Cycle,” p. 10.
74 Statement of Janet Woodcock, MD, Director of CDER, FDA, before the House Committee on Energy and
Commerce, Subcommittee on Health, March 2, 2017, p. 4.
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Figure 1. ANDA Approvals Under GDUFA I and II
FY2013-FY2020

Source: CRS, based on the following FDA resources: Activities Reports of the Generic Drugs Program Monthly
Performance (for each of FY2018-FY2020), Activities Report of the Generic Drug Program (for each of FY2013-
FY2017), and the Annual Performance Report to Congress for the Generic Drug User Fee Amendments (for
each of FY2013-FY2019).
In the performance report for FY2019 (the most recent year for which an annual report is
available), for ANDAs received in FY2019 (i.e., the FY2019 receipt cohort), the mean approval
time was 281 days (median 296 days) and the mean tentative approval time was 350 days
(median 350 days).75 The mean and median number of review cycles to approval and tentative
approval, respectively, was one. These numbers reflect only those ANDAs that were either
approved or tentatively approved at the time the report was prepared. As such, these numbers
reflect the earliest and fastest submissions reaching approval. More up-to-date figures for FY2019
are expected in future reports.76
FDA also publishes quarterly reports, which provide review times for each quarterly action cohort
in a fiscal year. In the second quarter of FY2021 (January 2021-March 2021), the mean ANDA
approval time was 31.55 months (median 22.80 months) and the mean tentative approval time
was 33.76 months (median 30.93 months).77
In addition to aiming to meet certain review performance goals (specified in Table A-1), in the
GDUFA II Commitment Letter, FDA indicated it would take additional actions to introduce more
predictability and timeliness to the review of generic drugs. Pursuant to the Commitment Letter,
for example, FDA has issued regulatory and product-specific guidance documents for industry,78
held public workshops to facilitate the development of generic drugs, and worked to increase

75 FDA, “FY2019 Performance Report to Congress for the Generic Drug User Fee Amendments,” p. 37.
76 Ibid.
77 Activities Report of the Generic Drugs Program | GDUFA II Quarterly Performance, current as of April 20, 2021,
https://www.fda.gov/industry/generic-drug-user-fee-amendments/activities-report-generic-drugs-program-gdufa-ii-
quarterly-performance. These numbers reflect a snapshot in time and may change based on refreshed counts in FDA’s
tracking systems.
78 FDA, “GDUFA Guidances and MAPPs,” https://www.fda.gov/industry/generic-drug-user-fee-amendments/gdufa-
guidances-and-mapps.
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communication with applicants during the review cycle. In addition, FDA has established a Pre-
ANDA program for complex generic drugs, which includes product development, presubmission,
and mid-review cycle meetings to help clarify regulatory expectations early in product
development and during ANDA review.79 FDA has issued the “Good [ANDA] Assessment
Practices” MAPP, which establishes good assessment practices for FDA staff in order to increase
operational efficiency and effectiveness.80 To complement this MAPP, FDA has issued the draft
guidance for industry “Good ANDA Submission Practices,” which identifies common, recurring
deficiencies that may lead to delay in ANDA approval and provides recommendations on how to
avoid these deficiencies. Both documents have the stated goal of decreasing the number of review
cycles.81 Moreover, FDA has taken additional policy actions intended to complement the GDUFA
II efforts; for example, issuance of the Drug Competition Action Plan, which, among other things,
aimed to reduce “gaming of regulatory requirements.”82
Budget
In FY2013, the first year generic drug user fees were collected, user fees accounted for 45% of
the GDUFA program total costs compared with 72% in FY2019 (see Figure 2).83 While most
GDUFA fee revenue supports activities managed by CDER, GDUFA revenue also contributes to
other FDA components that support the GDUFA program, including the Center for Biologics
Evaluation and Research, ORA, and FDA headquarters.84

79 FDA, “Pre-ANDA Program & Complex Generic Products,” https://www.fda.gov/industry/generic-drug-user-fee-
amendments/pre-anda-program-complex-generic-products.
80 FDA, MAPP 5241.3, “Good Abbreviated New Drug Application Assessment Practices,” effective January 3, 2018,
https://www.fda.gov/media/110017/download.
81 FDA, “Good ANDA Submission Practices,” Draft Guidance for Industry, January 2018, https://www.fda.gov/media/
110689/download.
82 FDA, “FDA Public Meeting Generic Drug User Fee Amendments (GDUFA) of 2017,” July 21, 2020, p. 40,
https://www.fda.gov/media/141309/download.
83 FDA, FY2019 GDUFA Financial Report, Table 8: Historical Generic Drug User Fee Obligations by Funding Source
as of September 30 of Each Fiscal Year, p. 16, at https://www.fda.gov/media/139343/download.
84 FDA, FY2019 GDUFA Financial Report, Table 9: Historical Trend of Total FTEs Utilized by Organization as of
September 30 of Each Fiscal Year, p. 16.
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Figure 2. GDUFA Program: User Fees and Appropriations
Total Costs, by Funding Source

Source: Created by CRS using data from FDA GDUFA Financial Reports at https://www.fda.gov/
AboutFDA/ReportsManualsForms/Reports/UserFeeReports/FinancialReports/default.htm.
Once appropriated, GDUFA fees remain available until expended and any fees not obligated in
the fiscal year for which they were appropriated and collected may be carried over into
subsequent fiscal years. According to FDA, maintaining a carryover balance helps mitigate the
risk of under collecting fees and the risk of a lapse in appropriations (e.g., a government
shutdown).85 The agency considers funding for 8 to 12 weeks of operations ($82 million to $122
million in FY2022) to be a sufficient carryover balance. Under GDUFA I, some industry
representatives reportedly expressed concern that the GDUFA carryover balance was too large
and, thus, whether the user fees too high.86 While the carryover balance fell in the first few years
of GDUFA II, the balance increased in FY2019 (see Figure 3). FDA indicated that the increase in
FY2019 was “primarily driven by challenges in hiring new staff for the program, underspending
in operations, and an increase in available non-user fee appropriations.”87

85 FDA, “Five-year Financial Plan Fiscal Years 2018-2019-2020-2021-2022,” 2021 Update for the GDUFA Program,
p. 13, https://www.fda.gov/media/147060/download.
86 Derrick Gingery, “Generic Drug User Fee Projections Complicated By Shifting Personnel Costs,” Pink Sheet,
December 4, 2020.
87 FDA, FY2019 GDUFA Financial Report, p. 14.
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Figure 3. GDUFA Program Carryover, Actual and Forecasted
Carryover Available for Use, End of Year

Source: The FY2014-FY2016 amounts are from the FY2017 GDUFA financial report, the FY2017 amount is
from the FY2019 GDUFA financial report, and FY2018-FY2022 amounts are from the “Five-year Financial Plan
Fiscal Years 2018-2019-2020-2021-2022,” 2021 update.
Notes: In addition to the carryover amounts reflected in this figure, FDA maintains a set-aside, which varies
from year to year, to provide for future year refunds. This amount generally is designated as unavailable for use.
Reauthorization and Considerations for GDUFA III
The FFDCA specifies the process for GDUFA III reauthorization, requiring FDA to consult with
specified congressional committees (i.e., the House Energy and Commerce Committee and
Senate Committee on Health, Education, Labor and Pensions), scientific and academic experts,
health care professionals, representatives of patient and consumer advocacy groups, and the
generic drug industry.88 FDA is required to hold a public meeting prior to beginning negotiations
with the generic drug industry,89 as well as to hold discussions with representatives of patient and
consumer advocacy groups at least once every month during negotiations with the generic drug
industry.90 The meeting minutes of the negotiation sessions with the generic drug industry must
be made public on the FDA website.91 After negotiations with the generic drug industry, FDA
must present the agreed-upon goals and recommendations to the abovementioned committees and
publish them in the Federal Register with a public comment period. FDA also must hold a public
meeting to present its views on the goals and recommendations and, pursuant to public comment,
revise the recommendations as necessary.92 The revised recommendations must be transmitted to
Congress by January 15, 2022, along with a summary of views and comments received on the
recommendations and changes made in response to those views and comments.93

88 FFDCA §744C(f)(1) [21 U.S.C. §379j–43(f)(1)].
89 FFDCA §744C(f)(2) [21 U.S.C. §379j–43(f)(2)].
90 FFDCA §744C(f)(3) [21 U.S.C. §379j–43(f)(3)].
91 FFDCA §744C(f)(6) [21 U.S.C. §379j–43(f)(6)].
92 FFDCA §744C(f)(4) [21 U.S.C. §379j–43(f)(4)].
93 FFDCA §744C(f)(5) [21 U.S.C. §379j–43(f)(5)].
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The GDUFA III reauthorization process began with a public meeting held in July 2020, followed
by a 30-day comment period.94 Beginning in September 2020, FDA has held negotiation sessions
with industry and meetings with patient and consumer advocacy groups; minutes of the meetings
are available on the FDA website.95
Considerations for GDUFA III96
GDUFA II was intended to facilitate faster access to generic drugs, with two major objectives: (1)
reducing the number of review cycles and (2) increasing approvals of safe, high-quality, and
lower-cost generic drugs.97 As discussed below, these objectives may remain priorities under
GDUFA III, given that most ANDAs continue to undergo multiple cycles of review prior to
approval. In addition, FDA has voiced concerns about recurring drug shortages, particularly
focusing on manufacturing disruptions and quality issues as contributing factors.98 As explained
below, certain drugs, including sterile injectable generics, may be particularly susceptible to
shortages.
Multiple Review Cycles
Available data indicate that first-cycle ANDA approvals remain low,99 although they have
increased since GDUFA I was enacted. As mentioned above, prior to the enactment of GDUFA I
in 2012, ANDAs were approved in one review cycle less than 1% of the time.100 In FY2020,
about 15% of ANDAs were approved or tentatively approved in the first cycle.
In August 2019, GAO published a report that analyzed FDA data on ANDAs that were first
submitted to and reviewed by FDA in FY2015 through FY2017. As part of its study, GAO
reviewed documentation from the first review cycle for a subset of 35 ANDAs submitted to FDA
in FY2017 and FY2018. GAO reported that 12% of ANDAs reviewed from FY2015 through
FY2017 were approved in the first cycle.101 In addition, GAO identified the following specific

94 FDA, “Public Meeting on the Reauthorization of the Generic Drug User Fee Amendments (GDUFA),”
https://www.fda.gov/drugs/public-meeting-reauthorization-generic-drug-user-fee-amendments-gdufa-07212020-
07212020.
95 FDA, “GDUFA III Reauthorization Negotiation Sessions,” https://www.fda.gov/drugs/development-approval-
process-drugs/gdufa-iii-reauthorization-negotiation-sessions, and “GDUFA Reauthorization Stakeholder Meetings,”
https://www.fda.gov/industry/generic-drug-user-fee-amendments/gdufa-reauthorization-stakeholder-meetings.
96 This is not a comprehensive discussion of all issues under considerations during GDUFA III negotiations.
97 FDA, “FDA Public Meeting Generic Drug User Fee Amendments (GDUFA) of 2017,” July 21, 2020, p. 40,
https://www.fda.gov/media/141309/download.
98 FDA, “Statement on FDA’s new report regarding root causes and potential solutions to drug shortages,” October 29,
2019, https://www.fda.gov/news-events/press-announcements/statement-fdas-new-report-regarding-root-causes-and-
potential-solutions-drug-shortages.
99 This in contrast to approval of new drug applications and biologics license applications under the Prescription Drug
User Fee Act (PDUFA). According to the FY2019 PDUFA performance report, preliminary data show that the
percentage of priority (6-month review goal) and standard (10-month review goal) applications filed in FY2018 and
approved during the first review cycle was 89% and 61%, respectively; see https://www.fda.gov/media/138325/
download.
100 Statement of Janet Woodcock, MD, Director of CDER, FDA, before the House Committee on Energy and
Commerce, Subcommittee on Health, March 2, 2017, p. 4.
101 GAO, “Generic Drug Applications: FDA Should Take Additional Steps to Address Factors That May Affect
Approval Rates in the First Review Cycle,” August 2019, GAO-19-565, https://www.gao.gov/assets/710/700779.pdf.
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factors that may have contributed to whether an application received approval in the first review
cycle:
 Sufficiency of the ANDA. This includes completeness of the application and the
applicant’s understanding of regulatory requirements. FDA will RTR an
incomplete ANDA, and ANDAs that receive RTR are less likely to receive a
first-cycle approval.102 Less experienced applicants were more likely to produce
lower-quality ANDAs compared to applicants with relatively more experience.103
 Drug quality deficiencies. Drug quality deficiencies, including those related to
manufacturing facilities, were the most common deficiencies that remained at the
end of the first review cycle, based on GAO’s review of the documentation for
the subset of 35 ANDAs, 26 of which were not approved in the first cycle.104
 Type of drug. Certain drug characteristics, including route of administration and
complexity, may affect first-cycle approval. GAO found that between FY2015
and FY2017, FDA reviewed ANDAs for 41 ophthalmic drugs (i.e., drugs
administered through the eye) and 20 transdermal drugs (i.e., drugs administered
through the skin), none of which received approval in the first cycle. In contrast,
of the 205 reviewed ANDAs for topical drugs (i.e., drugs administered to the skin
with limited systemic absorption), 25% (52 ANDAs) received first-cycle
approval.105
 Priority review designation. GAO found that first-cycle approval rates were
lower for ANDAs for first generics (typically granted priority review) than for
ANDAs with no priority designation. This may be because applicants have a
financial incentive to be the first to file an ANDA for a first generic, potentially
rushing and submitting a lower-quality application as a result.106 In contrast to
first generics, other priority-designated ANDAs—such as those responding to a
drug shortage or public health emergency—had higher first-cycle approval rates
than nonpriority ANDAs.107
GAO notes in the report that FDA has taken various actions to increase the rate of first-cycle
ANDA approvals, for example, issuing regulatory and product-specific guidance, communicating
with applicants during the review cycle, and assisting applicants with development of complex
generics. FDA has taken actions to improve consistency among agency reviewers by creating
review templates and working to increase reviewers’ and applicants’ understanding of industry

102 FDA, “OGD UPDATE: Welcome to much more than GDUFA II,” Kathleen Uhl, Director Office of Generic Drugs,
September 7, 2017, pp. 12-16, https://www.fda.gov/media/115887/download.
103 GAO, “Generic Drug Applications: FDA Should Take Additional Steps to Address Factors That May Affect
Approval Rates in the First Review Cycle,” p. 11.
104 Ibid., p. 12.
105 Ibid., pp. 12-14.
106 The first applicant to submit a substantially complete ANDA that makes a paragraph IV certification with respect to
the RLD’s unexpired patents may obtain 180 days of exclusivity (FFDCA §505(j)(5)(B)(iv) [21 U.S.C.
§355(j)(5)(B)(iv)]. For additional information, see CRS Report R46679, Drug Prices: The Role of Patents and
Regulatory Exclusivities.
107GAO, “Generic Drug Applications: FDA Should Take Additional Steps to Address Factors That May Affect
Approval Rates in the First Review Cycle,” pp. 14-15.
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practices and FDA review standards.108 However, generic applicants noted that inconsistencies
among FDA reviewers continue to exist and may influence first-cycle approvals.
Generic Drug Quality and Manufacturing
Although generic drug manufacturers must comply with current good manufacturing practices
(CGMPs), few incentives exist for drug manufacturers to engage in mature quality management
systems that go beyond CGMPs.109 FDA has indicated that quality issues are the most common
immediate causes of drug manufacturing interruptions, which can result in shortages.110 Sterile
injectable generic drugs are particularly susceptible to shortages for various reasons, including
low profitability and lack of incentive for manufacturers to invest in manufacturing quality and
redundant capacity.111 Concerns about manufacturing quality and shortages have been
compounded by the COVID-19 pandemic, which has limited FDA’s ability to conduct facility
inspections, particularly foreign inspections.112
FDA has proposed policy initiatives to improve manufacturing quality and prevent drug
shortages. For example, in July 2015, FDA had proposed a voluntary quality metrics program in
which the agency would request submission of certain quality metrics (e.g., “the number of lot
release and stability tests conducted for the product”) from owners and operators of certain
human drug establishments.113 This information was intended to be used to “further develop the
FDA’s risk-based inspection scheduling, to identify situations in which there may be a risk for
drug supply disruption, to improve the efficiency and effectiveness of establishment inspections,
and to improve FDA’s evaluation of drug manufacturing and control operations.”114 Subsequently
in November 2016, FDA issued a revised draft guidance describing the initial phase of the quality
metrics program as voluntary. However, the revised draft guidance further indicated that after
evaluating the results of the voluntary phase of the quality metrics program in 2018, the agency
intended to “initiate notice and comment rulemaking under existing statutory authority to develop
a mandatory quality metrics reporting program.”115 Several pharmaceutical industry groups
submitted comments to the docket in opposition of FDA’s proposal, calling it burdensome and
raising questions about FDA’s authority to implement such a mandatory program.116 Based on

108Ibid., pp. 16-19.
109 Mature quality management systems refers to robust manufacturing systems that go beyond compliance with
CGMPs, which FDA considers to be a minimum threshold. Such mature systems may include deploying advanced
quality control techniques to prevent quality problems and thus disruptions in manufacturing. See Testimony of Dr.
Janet Woodcock, “Securing the U.S. Drug Supply Chain: Oversight of FDA’s Foreign Inspection Program,” U.S.
Congress, House Committee on Energy and Commerce, Subcommittee on Oversight and Investigations, 116th
Congress, 1st session, December 10, 2019, https://energycommerce.house.gov/committee-activity/hearings/hearing-on-
securing-the-us-drug-supply-chain-oversight-of-fda-s-foreign.
110 FDA, “Drug Shortages: Root Causes and Potential Solutions,” published October 2019 and updated February 2020,
p. 76, https://www.fda.gov/media/131130/download.
111Ibid., pp. 21-22.
112 GAO, Statement of Mary Denigan-Macauley, Director, Health Care, “Drug Safety: FDA’s Future Inspection Plans
Need to Address Issues Presented by COVID-19 Backlog,” GAO-21-409T, March 4, 2021, https://www.gao.gov/
assets/gao-21-409t.pdf. FDA, “FDA Public Meeting Generic Drug User Fee Amendments (GDUFA) of 2017,” July 21,
2020, p. 33.
113 FDA, “Request for Quality Metrics; Notice of Draft Guidance Availability and Public Meeting; Request for
Comments,” 80 Federal Register 44973, July 28, 2015.
114 Ibid.
115 FDA, “Submission of Quality Metrics Data; Draft Guidance for Industry; Availability; Request for Comments,” 81
Federal Register, November 25, 2016.
116 See, for example, a presentation by David Gaugh, R.Ph., GPhA (the Generic Pharmaceutical Association, now the
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input from the pharmaceutical industry, in June 2018, FDA announced two voluntary programs,
the Quality Metrics Feedback Program and the Quality Metrics Site Visit Program.117 FDA has
not yet finalized its quality metrics guidance.
In addition, FDA has supported and encouraged the adoption of advanced manufacturing
technologies (i.e., technologies that may improve drug quality, reduce shortages, and speed time
to market).118 One example of an advanced manufacturing technology is continuous
manufacturing, which refers to a nonstop process that is conducted largely within the same
facility and eliminates hold times between steps. This technology differs from the traditionally
used batch manufacturing process, which involves multiple discrete steps during which a material
may be stored in and shipped to multiple facilities for further processing, requiring additional
time and equipment, and potentially degrading sensitive ingredients.119 The Association for
Accessible Medicines (AAM, the generic industry trade group), however, has indicated that
continuous manufacturing may not be practical for some generic products, particularly low-
volume products that are manufactured once or twice a year, and may require significant financial
investment.120
Concluding Comments
GDUFA II is set to expire on September 30, 2022. The GDUFA III reauthorization process began
on July 21, 2020, with a public meeting, during which FDA officials indicated that there is “still
work to be done to further enhance efficiency, transparency, and gain more first-cycle
approvals.”121 Congress may consider whether to consult with FDA and the generic drug industry
on ways to further increase efficiency and timeliness and reduce delays in the review process.
Further, user fee legislation historically has been used to address related FDA policy concerns.
GDUFA I was enacted as part of FDASIA, which made broader reforms to FDA’s regulatory
policy. While FDASIA did not directly address generic drug review (outside of GDUFA), the law
did amend FDA’s drug inspection framework, requiring the agency to conduct surveillance
inspections of both domestic and foreign manufacturing establishments on a risk-based
schedule.122 Prior to FDASIA, FDA was required to inspect domestic establishments every two

Association for Accessible Medicines), regarding the Quality Metrics Public Meeting, August 24, 2015, posted to
FDA-2015-D-2537-0036 on October 22, 2015, https://www.regulations.gov/document/FDA-2015-D-2537-0036.
117 FDA, “Modernizing Pharmaceutical Quality Systems; Studying Quality Metrics and Quality Culture; Quality
Metrics Feedback Program,” 83 Federal Register 30748, June 29, 2018, and “Quality Metrics Site Visit Program for
Center for Drug Evaluation and Research and Center for Biologics Evaluation and Research Staff; Information
Available to Industry 2018,” 83 Federal Register 30751, June 29, 2018.
118 FDA, “FDA Public Meeting Generic Drug User Fee Amendments (GDUFA) of 2017,” July 21, 2020, p. 70;
“Accelerating the Adoption of Advanced Manufacturing Technologies to Strengthen Our Public Health Infrastructure,”
current as of January 15, 2021, https://www.fda.gov/news-events/fda-voices/accelerating-adoption-advanced-
manufacturing-technologies-strengthen-our-public-health; “Advanced Manufacturing,” current as of January 16, 2021,
https://www.fda.gov/emergency-preparedness-and-response/mcm-issues/advanced-manufacturing.
119 FDA, “Modernizing the Way Drugs Are Made: A Transition to Continuous Manufacturing,” current as of May 17,
2017, https://www.fda.gov/drugs/news-events-human-drugs/modernizing-way-drugs-are-made-transition-continuous-
manufacturing.
120 Comments from the Association for Accessible Medicines (AAM) to Docket No. FDA-2017-N-3615:
Administering the Hatch-Waxman Amendments: Ensuring a Balance Between Innovation and Access; Public Meeting,
Request for Comments, November 17, 2017, pp. 18-19.
121 FDA, “GDUFA II: Overview of Goals and Accomplishments, GDUFA III Public Meeting 7/21/2020,” by Maryll
W. Toufanian, Director of the Office of Generic Drug Policy, p. 47, https://www.fda.gov/media/141309/download.
122 P.L. 112-144. §705. See also CRS Report R46507, FDA’s Role in the Medical Product Supply Chain and
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years, with no comparable requirement for foreign establishments. GDUFA II was enacted as
Title III of FDARA, which also included provisions related to ANDA prioritization, facility
reinspection, and review transparency.123 In this context, Congress may consider using user fee
reauthorization to address broader FDA-related policy concerns.

Considerations During COVID-19.
123 P.L. 115-52, Title VIII “Improving Generic Drug Access.” See CRS Report R44961, FDA Reauthorization Act of
2017 (FDARA, P.L. 115-52).
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Appendix A. GDUFA II Review Performance Goals
Table A-1. Review Performance Goals
ANDAs, ANDA amendments, PASs, and PAS amendments
Submission Type
Standard
Priority
Original ANDAs
Act on 90% within 10 months of
Act on 90% within
ANDA submission

8 months if preapproval
inspection is required and
complete and accurate PFC
is submitted 2 months prior
to submission,

10 months if preapproval
inspection is required and
PFC is not submitted 2
months prior
Major ANDA amendments
Act on 90% within
Act on 90% within

8 months if preapproval

6 months if preapproval
inspection not required,
inspection not required,

10 months if preapproval

8 months if preapproval
inspection is required
inspection is required and
complete and accurate PFC
is submitted 2 months prior
to submission,

10 months if preapproval
inspection is required and
PFC is not submitted 2
months prior
Minor ANDA amendments
Act on 90% within 3 months of
Act on 90% within 3 months of
submission date
submission date
PASs
Act on 90% within
Act on 90% within

6 months if preapproval

4 months if preapproval
inspection not required,
inspection not required,

10 months if preapproval

8 months if preapproval
inspection required.
inspection is required and
complete and accurate PFC
is submitted 2 months prior
to submission,

10 months if preapproval
inspection is required and
PFC is not submitted 2
months prior
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Submission Type
Standard
Priority
PAS major amendments
Act on 90% within
Act on 90% within

6 months if preapproval

4 months if preapproval
inspection not required,
inspection not required,

10 months if preapproval

8 months if preapproval
inspection required.
inspection is required and
complete and accurate PFC
is submitted 2 months prior
to submission,

10 months if preapproval
inspection is required and
PFC is not submitted 2
months prior
PAS minor amendments
Act on 90% within 3 months of
Act on 90% within 3 months of
submission date
submission date
Source: Table created by CRS based on the “GDUFA Reauthorization Performance Goals and Program
Enhancements Fiscal Years FY2018-2022,” https://www.fda.gov/media/101052/download.
Notes: ANDA = abbreviated new drug application, PAS = prior approval supplement, PFC = Pre-Submission
Facility Correspondence.

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Appendix B. Acronyms Used in This Report
AAM
Association for Accessible Medicines
ANDA
Abbreviated New Drug Application
API
Active Pharmaceutical Ingredient
CBE
Changes Being Effected
CDER
Center for Drug Evaluation and Research
CGMP
Current Good Manufacturing Practice
CMO
Contract Manufacturing Organization
DMF
Drug Master File
DRL
Discipline Review Letter
FDA
Food and Drug Administration
FDAAA
FDA Amendments Act of 2007
FDARA
FDA Reauthorization Act of 2017
FDASIA
FDA Safety Innovation Act of 2012
FDF
Finished Dosage Form
FFDCA
Federal Food, Drug, and Cosmetic Act
FTC
Federal Trade Commission
GAO
Government Accountability Office
GDUFA
Generic Drug User Fee Amendments
IR
Information Request
MAPP
Manual of Policies and Procedures
NDA
New Drug Application
OGD
Office of Generic Drugs
OPQ
Office of Pharmaceutical Quality
ORA
Office of Regulatory Affairs
PAS
Prior Approval Supplement
PDUFA
Prescription Drug User Fee Act
RLD
Reference Listed Drug
RTR
Refuse to Receive

Author Information

Agata Bodie

Analyst in Health Policy

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Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan
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under the direction of Congress. Information in a CRS Report should not be relied upon for purposes other
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Congressional Research Service
R46778 · VERSION 1 · NEW
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