Understanding OTC Monograph Reform: Where Do We Stand Now?

By J.P. Borneman, Ph.D. and Alvin J. Lorman, J.D.

The FDA’s Over-the-Counter Drug Review (OTC Review) has always been important to homeopathy, despite the fact that homeopathic drugs are not directly subject to the review. FDA specifically excluded them in 1972, stating that it would review them separately at the conclusion of the allopathic OTC Review. Why is the OTC Review important to homeopathy? First, the OTC Review is about the only forum where FDA sets out acceptable and unacceptable OTC claims [1]. Second, at times, FDA has found an indication acceptable, but determined that no allopathic ingredient was generally recognized as safe and effective for that indication. These instances opened new doors for homeopathy. Third, of late, and incorrectly we believe, some FDA investigators are asserting that only claims approved in (allopathic) OTC Review monographs are acceptable OTC claims.

At one point, the OTC Review consumed a large portion of FDA resources. In the last 15 years, FDA has turned its attention from the OTC Review as it has focused more and more of its attention on reviewing new drugs applications and Rx to OTC switches, for which industry pays the tab. In addition, the OTC Review is based on notice and comment rulemaking, an exercise which has become increasingly cumbersome and time-consuming because of executive branch review and for which FDA has developed a significant aversion [2].

Not completing the OTC Review has meant that a number of important monographs have never been finalized. No one is happy with the current situation. FDA does not believe it can react promptly to changes in the science. Consumer groups are concerned that safety issues take too long to resolve. Industry believes that innovation has suffered because of the monograph freeze. And Congress hears from both consumers and industry about their concerns.

Over two years ago, effectively admitting that the monograph system was broken, FDA held a public hearing to discuss possible changes to the review, most of which would require legislative approval. There was little consensus among those who spoke as to the best path forward. No official action has been taken since then. Earlier this month, FDA held another public hearing, this time to discuss the imposition of user fees to finance work on the OTC Review, although it is unclear what these user fees would finance since FDA has not stated how it plans to move forward.

The concept of FDA user fees originally arose out of frustration with the length of time it took FDA to review a new drug application. In 1992, the prescription drug industry agreed to pay new drug application user fees in exchange for specific timelines for FDA review, in addition to establishment and product listing fees. Those fees were set at $256,846 per NDA, $141,966 per establishment, and $18,591 per covered product in 1998. Today, those fees are $2,374,200 for a full NDA, $585,200 per establishment, and $114,450 per product. Since 1992, most categories of FDA-regulated products have been subjected to some sort of user fee (e.g., animal drugs, generic drugs, outsourcing facilities and mammography facilities).

The Consumer Healthcare Products Association (CHPA) has consistently urged the completion of the OTC Review. It is unlikely that FDA could convince Congress to adopt statutory changes to the system, or the imposition of user fees, without the support of CHPA. Today, it seems inevitable that changes to FDA regulatory processes involve industry acceptance of user fees inasmuch as the current Congressional appropriations received by FDA provide inadequate funding for FDA’s current operations including the completion of the OTC Review. If Congress, FDA and industry can come together on key issues of innovation, resolution of tentative final monographs, notice and comment rule making, and issues of exclusivity, user fees will be inexorable. The type, form and amount will be the key parameters for discussion. The AAHP will closely monitor the situation to assure that whatever the outcome, consideration is given to the effect on homeopathic drug products.

[1] FDA also states what is acceptable or not in approving or denying Rx-to-OTC switch applications and in Warning Letters.

[2] Notice and comment rulemaking is a multistep process defined by law that was originally designed to give the public the right to participate in the creation of the ever-growing number of rules issued by Federal agencies.