Cost Recovery Framework: Consultation

Annexe 2

Details on International Comparability of Proposed Fees

Information included in this review relates to international fees in effect in 2006.

In some cases the specific fee for a given service may be higher in Canada than in another jurisdiction, but the fee for a different service or product may be higher in that other jurisdiction than in Canada.

For example, the proposed Canadian fees for the evaluation of a New Active Substance Drug Submission ($303,480 for pharmaceuticals and $391,770 for biologics) is lower than in the US ($882,157) and comparable to the EU ($351,332 for single strength, dosage form, presentation), however higher than the fees in the UK ($200,977) and Australia ($160,830)¹. The higher Canadian fee is a result of different costing bases compared to the UK and Australia. For example, some components of policy and regulatory developments work are not included in the other jurisdictions. In addition the fee for the EU is component-based, and only the lowest component combination was used for comparison.

Although the proposed Canadian fee is higher than Australia for review of New Active Substance submissions, the Australian fee for review of prescription generic submissions ($58,730) is higher than in Canada (comparative/chemistry and manufacturing, pharmaceuticals at $43,360).

For medical device application review, Canada's proposed fees are lower than those in the other jurisdictions. The United States charges up to $298,420 for pre-market approval and Australia charges up to $23,040 but Canada's highest medical device application review fee is $20,030.

The comparisons were difficult for natural health products, given the varied international approach to their regulation. In the US there is currently no provision for regulating complementary and alternative medicine products by the FDA except for those that are covered under the existing statutory definitions (as a drug, device, food, food additives, dietary supplement, or biological product)². In the EU, there is no centralized process for regulatory approval of natural health products, and consequently no fees are charged per se. However, a scientific service fee is charged for the evaluation of traditional herbal medicinal products where there is a request for scientific advice (opinion). Herbal and homeopathic medicinal products are generally regulated under the decentralized procedure whereby the marketing authorization is granted by one Member State and then recognized by other Member States in corresponding applications.

Establishment licensing fees are more complicated to compare, given the varied fee structures and amounts. The United States charges a flat fee of $303,479, while the United Kingdom charges up to $51,355, and Australia has fees based on an hourly rate.

For annual product licensing, Canada's proposed fees are significantly lower than the majority of international fees. The annual fee to market a prescription product in the United States is $48,430 and up to $3,903 in Australia, compared to the proposed fee of $1,020 in Canada.

Service standards for drug submission evaluation are relatively comparable. For example, the standard for the evaluation of New Active Substances in the five jurisdictions are as follows: Canada: 90% within 300 calendar days; US: 90% within 10 months (approximately 304 calendar days); EU: final decision to be issued by day 300; UK: same as EU; Australia: within 255 working days (357 calendar days).

The other international jurisdictions do not provide published service standards for all of their cost-recovered regulatory activities, however Canada's service standards are internationally comparable for those service standards which are available, as follows:

Review of priority supplemental drug submissions:

Health Canada: priority clinical/chemistry & manufacturing: 90% within 180 calendar days

United States: priority efficacy supplements: 90% within six months (approx. 182 days)

Review of generic new drug submissions:

Health Canada: Chemistry & manufacturing/labeling: 90% within 180 calendar days

Great Britain: abridged application: for licensing authority determination: 100% in 150 days

Great Britain: abridged application: requiring Advisory Committee advice: 100% in 185 days

Review of Administrative submissions:

Health Canada: administrative: 90% within 45 calendar days

Australia: no clinical, preclinical, bioavailability data (administrative) 45 working days (63 calendar days)

Review of license application for highest risk Medical Devices:

Health Canada: (Class IV): 90% within 75 calendar days

United States : (Class III): 90% within 320 days (2007 standard, MDUFMA)

It is worth noting that no other jurisdiction has a penalty for not meeting performance as detailed in the User Fees Act. The closest comparison is Australia where a 25% individual fee refund to a company will be made if the evaluation of the drug submission is not completed within 255 working days (357 calendar days). The United States has a global penalty clause, in that if its performance standards are not globally met, Congress will not renew the entire cost recovery program.

¹ International fees have been converted to Canadian dollars
² "Guidance for Industry on Complementary and Alternative Medicine Products and Their Regulation by the Food and Drug Administration" December 2006, http://www.fda.gov/cber/guidelines.htm.