Relationship Between Pharmaceutical Company User Fees and Drug Approvals in Canada and Australia: A hypothesis-generating study

Authors: 
Joel Lexchin
Research Summary: 

Background
Since the early- to mid-1990s, drug companies have paid fees for a variety of activities carried out by the Therapeutic Products Directorate in Canada and the Therapeutic Goods Administration in Australia.

Objective
To explore whether changes in approval times for new active substances and in the percentage of new drug submissions receiving positive decisions coincided with the level of user fees.

Methods
Data were collected from a range of Canadian and Australian government publications on the following topics: total funding for and workload of the regulatory agencies, the percentage of income that came from tax revenue and user fees, the percentage of new drug submissions that received a positive decision, and—for Canada only—the percent of submissions that were approved on first review.

Results
In both countries, there was a moderate-to-strong positive association between the level of industry funding and the percent of submissions that received a positive decision and a moderate-to-strong (Canada) and moderate (Australia) negative association between the level of industry funding and approval times.

Conclusions
Changes observed in both countries are favorable to the pharmaceutical industry. Other than user fees leading to a pro-industry bias in the regulatory authorities, other possible explanations include a more efficient use of resources, a smaller workload (Canada), an improvement in the quality of drug submissions (Canada), and more resources (Australia). Further research strategies are needed to either confirm or refute the hypothesis that the level of industry funding affects decisions made in drug regulatory systems.