# The Food and Drug Administration: Budget and Statutory History, FY1980-FY2007

> Briefs, arguments, decisions, and more.

URL: https://www.frixlaw.com/law-library/documents/crs%3ARL34334

## Record

- **Collection:** Congressional research report
- **Document type:** CRS Report
- **Published:** January 29, 2008
- **Citation:** RL34334

## Text

The Food and Drug Administration: Budget
and Statutory History, FY1980-FY2007
-name redacted-, Coordinator
Specialist in Biomedical Policy
-name redactedSpecialist in Nutrition and Food Safety
-name redactedSpecialist in Drug Safety and Effectiveness
-name redactedSpecialist in Public Health and Bioethics
January 29, 2008

Congressional Research Service
7-....
www.crs.gov
RL34334

CRS Report for Congress
Prepared for Members and Committees of Congress

The Food and Drug Administration: Budget and Statutory History, FY1980-FY2007

Summary
Considerable attention has been focused on the ability of the Food and Drug Administration
(FDA) to accomplish its mission with the funds provided by congressional appropriations and
user fees. FDA regulates a wide range of products valued at more than $1 trillion in the U.S.
economy. The agency plays a key public health role. FDA is responsible for the safety of most
foods (human and animal) and cosmetics, and it regulates both the safety and the effectiveness of
human drugs, biologics (e.g., vaccines), medical devices, and animal drugs.
In congressional hearing testimony and at other public venues, former FDA Commissioners,
interest group representatives, and former high-ranking individuals in the agency or in the
Department of Health and Human Services have argued that FDA is underfunded and at risk of
being unable to fulfill all the statutory responsibilities assigned by Congress. Reports by the
Institute of Medicine, the Government Accountability Office, and the FDA Science Board have
made similar observations. The main voices in support of FDA budget levels, past and present,
have been representatives of the various presidential administrations. Calls for cutting the FDA
budget or maintaining it at the current level come from organizations, such as CATO and the
Hoover Institute, that propose limitations on the agency’s authority and, therefore, its need for
funding. Some agency critics have expressed concerns about inefficiencies within FDA and its
ability to manage its resources.
In order to inform the ongoing discussion about FDA, this report presents FDA’s appropriations
history and traces the evolution of the agency’s statutory responsibility. It first provides a 28-year
budget history for the agency along with personnel levels as shown by the number of full-time
equivalent employees (FTEs). This report found that direct congressional inflation-adjusted
appropriations (budget authority) to FDA doubled, and that the contribution of other funds,
mostly user fees, increased more than 12-fold, resulting in an overall budget in FY2007 almost
2½ times that in FY1980. Between FY1980 and FY2006, the latest year with final FTE data, the
agency’s FTE level increased 19% overall, from a less than 1% increase in budget authorityfunded FTEs and an almost fourfold increase in FTEs funded by other sources (mostly user fees).
The report also provides a more detailed examination of the budget and personnel levels for each
of FDA’s major activity areas: Foods, Human Drugs, Biologics, Animal Drugs and Feeds, and
Devices and Radiological Health. Findings include the relationship of user fees to budget
authority, declining funding of research, and summaries of the major laws enacted since FY1980.

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The Food and Drug Administration: Budget and Statutory History, FY1980-FY2007

Contents
Introduction ................................................................................................................................1
Agency Scope and Congressional Jurisdiction.............................................................................2
FDA Budget and Personnel .........................................................................................................4
Overall FDA Budget .............................................................................................................4
Comparison of FDA Budget with Other Agency Budgets ......................................................7
FDA Activity-Area Budgets ................................................................................................ 12
Impact of New Statutory Authorities on FDA Budget .......................................................... 14
FDA Regulatory Research................................................................................................... 15
FDA Science Board Report ................................................................................................. 17
Major Activity Areas: Budget and FTEs .................................................................................... 19
Foods.................................................................................................................................. 19
Human Drugs...................................................................................................................... 23
Biologics ............................................................................................................................ 27
Animal Drugs and Feeds ..................................................................................................... 30
Devices and Radiological Health......................................................................................... 34
Other Activities and Responsibilities ................................................................................... 37
Toxicological Research ................................................................................................. 37
Headquarters and Office of the Commissioner............................................................... 38
Field Activities: The Office of Regulatory Affairs.......................................................... 38
Concluding Comments.............................................................................................................. 38

Figures
Figure 1. FDA: Budget and FTEs................................................................................................6
Figure 2. Budget Authority for FDA, CDC, and NIH...................................................................8
Figure 3. FDA Budgets for FY1980 and FY2006, by Major Activity Area and Type of
Funding ................................................................................................................................. 14
Figure 4. FDA Research in Five Activity Areas (Constant FY2000 $) ........................................ 16
Figure 5. Foods: Budget and FTEs(Constant FY2000 $)............................................................ 23
Figure 6. Human Drugs: Budget and FTEs (Constant FY2000 $)............................................... 24
Figure 7. Biologics: Budget and FTEs (Constant FY2000 $)...................................................... 29
Figure 8. Animal Drugs and Feeds: Budget and FTEs(Constant FY2000 $) ............................... 32
Figure 9. Devices and Radiological Health: Budget and FTEs (Constant FY2000 $).................. 36

Tables
Table 1. Summary of Increase in Total Budget and FTEs, FY1980 and FY2006 (Constant
FY2000 $) ............................................................................................................................. 13
Table 2. Foods Statutory Authorities in 1980 and 2007 .............................................................. 21
Table 3. Human Drugs Statutory Authorities in 1980 and 2007 .................................................. 26

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The Food and Drug Administration: Budget and Statutory History, FY1980-FY2007

Table 4. Biologics Statutory Authorities in 1980 and 2007......................................................... 30
Table 5. Animal Drugs and Feeds Statutory Authorities in 1980 and 2007................................. 33
Table 6. Devices and Radiological Health Statutory Authorities in 1980 and 2007 ..................... 37
Table A-1. Actions Taken to Address FDA Budget Data Limitations .......................................... 44
Table A-2. FDA Appropriations, Overall and by Major Program, Budget Authority and
Other Funding, FY1980 through FY2008, Unadjusted for Inflation ........................................ 46
Table A-3. Full-time Equivalents, Overall and by Major Program, Budget AuthorityFunded and Other-Funded, FY1980 through FY2008 ............................................................. 48
Table A-4. Selected Public Laws Since 1848 Significantly Affecting FDA Activities ................. 50

Appendixes
Appendix. Methodology............................................................................................................ 42

Contacts
Author Contact Information ...................................................................................................... 57

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The Food and Drug Administration: Budget and Statutory History, FY1980-FY2007

Introduction
There is growing debate about whether the Food and Drug Administration (FDA) has the ability
to accomplish its mission with the resources provided by congressional appropriations and
industry user fees. FDA plays a central role in protecting the public health in the United States by
regulating most of the food supply and vitally important medical products, including drugs,
devices, and biologics that affect American lives on a daily basis. A 2006 report on drug safety by
the Institute of Medicine (IOM) made the following observation in a chapter devoted to FDA
resources:
The Food and Drug Administration lacks the resources needed to accomplish its large and
complex mission today, let alone to position itself for an increasingly challenging future....
There is little dispute that FDA in general is ... severely underfunded.1

Several individuals who previously held high-ranking positions in FDA or the Department of
Health and Human Services (HHS) have organized advocacy groups to lobby for increased
funding for the entire agency.2 These groups present data to support their position that FDA has
fallen behind in overall funding in the last 25 years. They warn that the agency is at risk of being
unable to adequately fulfill the many statutory responsibilities that Congress has assigned it.
While the call for more resources has been heard from many quarters, including some in
Congress, some agency critics are concerned about inefficiencies within FDA and that it needs to
do a better job managing what resources it does have.3
In general, former FDA Commissioners and interest groups argue that FDA is underfunded for its
mission. Calls for cutting the FDA budget or maintaining it at the current level come from
organizations, like CATO and the Hoover Institute, that propose limitations on FDA’s authority
and, therefore, the need for funding. The main voices in support of FDA budget levels, past and
present, have been representatives of the various presidential administrations. Over the last 25
years, incumbent FDA Commissioners, when asked during congressional hearings about the
adequacy of the FDA budget, have testified that the budget is sufficient to accomplish the job
before the agency. However, in non-congressional venues, those same Commissioners have
expressed concerns about the constraints on FDA resources and that the agency’s core budget has
not increased in concert with its rising responsibilities. They have expressed concern about
whether the agency can continue to be considered the world’s premier consumer protection
agency when it is forced to focus its priorities based on the current level of resources that it
receives. 4

1
Institute of Medicine (IOM), The Future of Drug Safety: Promoting and Protecting the Health of the Public, Alina
Baciu, Kathleen Stratton, Sheila P. Burke, Editors, Committee on the Assessment of the US Drug Safety System, Board
on Population Health and Public Health Practice (Washington, DC: National Academies Press, 2006), p. 193.
2
The Coalition for a Stronger FDA, at http://www.fdacoalition.org/the-coalition-for-a-stronger-fda, and the FDA
Alliance, at http://www.StrengthenFDA.org. In December 2007 the boards of these two groups announced their
intention to merge; details of the merger have not been finalized (“Coalitions Lobbying for More FDA Money Are
Merging,” FDA Week, vol. 13, December 14, 2007).
3
IOM, The Future of Drug Safety, 2006, p. 81; and Representative Rosa DeLauro, “Statement on FDA Science Board
Report,” December 3, 2007, at http://delauro.house.gov/release.cfm?id=697.
4
Andrew C. von Eschenbach, “State of the FDA,” Food and Drug Law Journal, vol. 62, 2007, pp. 423-427; and Jane
E. Henney, “Remarks of the Commissioner of Food and Drugs,” Food and Drug Law Journal, vol. 54, 1999.

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The Food and Drug Administration: Budget and Statutory History, FY1980-FY2007

This report examines FDA’s appropriations history and traces the evolution of the agency’s
statutory responsibilities. The information is presented to help inform the ongoing discussion
about FDA. CRS takes no position on whether the agency has the necessary resources to meet its
statutory responsibilities.
The report first provides an overview of FDA’s budget and personnel levels from FY1980 through
FY2007.5 That is followed by a more detailed examination of the budget and personnel level over
the same period in each of the agency’s major activity areas. For each activity area, the report also
summarizes the major pieces of legislation that have been enacted since FY1980. Unless noted
otherwise, all budget data have been adjusted for inflation to permit comparison across the 28year period under investigation. The information presented in this report is intended to facilitate
an examination of the impact that administrations’ budget requests and congressional decision
making have had on the ability of FDA to accomplish its public health mission.

Agency Scope and Congressional Jurisdiction
FDA regulates a wide range of products valued at more than $1 trillion in the U.S. economy.
About 25% of American consumer dollars are spent on these FDA-regulated products.6 As one of
the agencies within HHS that comprise the Public Health Service, 7 FDA is responsible for the
safety of most foods (human and animal) and cosmetics. FDA also regulates both the safety and
the effectiveness of human drugs, biologics (e.g., vaccines), medical devices, and animal drugs.
The Federal Food, Drug, and Cosmetic Act (FFDCA), as amended, is the principal source of
FDA’s authority. 8 The agency also derives some of its authority from certain provisions in other
laws, most notably the Public Health Service (PHS) Act. Under the PHS Act, FDA licenses
biological products9 and performs other activities, such as setting standards for mammography
quality. 10 An extensive list of the public laws that significantly affect FDA activities is in Table A4 in the Appendix.
In addition to statutory responsibilities that directly involve product regulation, the FDA must
also comply with statutory requirements affecting all or most federal executive agencies,
regarding such matters as information management, strategic planning, performance
measurement, financial management, property management, and human resources management.11
Additional requirements apply only to those agencies, including FDA, that have regulatory

5
Congress had not acted on FDA appropriations for FY2008 at the time this report was being prepared. Except for
Figure 4, the figures in this report do not include FY2008 budget or FTE levels.
6
Food and Drug Administration (FDA), “Frequently Asked Questions (FAQs),” at http://www.fda.gov/opacom/faqs/
faqs.html.
7
CRS Report RL34098, Public Health Service (PHS) Agencies: Background and Funding, by (name redacted),
coordinator.
8
P.L. 75-717, 1938, currently 21 U.S.C. § 301 et seq.
9
PHS Act § 351, 42 U.S.C. § 262.
10
PHS Act § 354, 42 U.S.C. § 263b.
11
For a listing of these laws, see CRS Report RL30795, General Management Laws: A Compendium, by (name redac
ted). Examples of general management laws with which FDA must comply include the Government Performance and
Results Act of 1993 and the Data Quality Act.

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The Food and Drug Administration: Budget and Statutory History, FY1980-FY2007

responsibilities. 12 FDA’s role in implementing provisions of some general federal management
laws is substantial. For example, the agency supports more than 50 advisory committees, most of
which are mandated in statute and are subject to requirements of the Federal Advisory Committee
Act. 13 Also, the agency reports that in FY2006 it processed more than 20,000 information
requests pursuant to requirements of the Freedom of Information Act.14
The congressional authorizing committees that oversee FDA activities are those with jurisdiction
over public health issues: the Senate Committee on Health, Education, Labor, and Pensions, and
the House Committee on Energy and Commerce. Because Medicare pays for FDA-regulated
products, the agency also falls under the jurisdiction of the Senate Committee on Finance and the
House Committee on Ways and Means. Other committees that exercise oversight roles regarding
FDA include the House Committee on Oversight and Government Reform, and the Senate
Committees on Aging, Homeland Security and Governmental Affairs, and the Judiciary.
The House and Senate Appropriations subcommittees on agriculture have jurisdiction over FDA’s
appropriations. This arrangement reflects, in part, the agency’s origin within the Department of
Agriculture as the Bureau of Chemistry in 1862. Since 1940, FDA has administratively been part
of federal health agencies, specifically HHS and its predecessors.15
Advocates for increasing FDA funding point to this jurisdictional separation of FDA
appropriations decisions from the rest of PHS and HHS as a contributing factor to what they see
as underfunding. In 2002, former Acting FDA Commissioner Michael Friedman recommended
moving the FDA budget process from the purview of the agriculture appropriations
subcommittees to the Labor, Health and Human Services, Education and Related Agencies
subcommittees.16 Five years later, former FDA Commissioner Frank Young raised the same
concern and made the same recommendation in congressional testimony. 17 Former FDA
Commissioner Jane Henney made a similar observation in February 2007:
[T]here are other things Congress can do that directly impact this agency’s resources ... if
they really wanted to look long and hard, FDA would no longer be under the purview of the
Agriculture Appropriations Committees. Those people that serve on those committees do it
with honor, but they do it primarily because of their interest in agricultural issues. By the
time the allocations come out and the interest of the agriculture areas are satisfied, there are
very limited resources that the agency [FDA] can ever hope to receive out of that process. If
somebody wanted to do something bold ... it would be looking at appropriations in an area
that is more compatible ... with the interests of the members of that committee particularly
the ones that oversee health issues.18

12
Examples of regulatory management laws with which FDA must comply include the Administrative Procedure Act
and the Regulatory Flexibility Act of 1980.
13
5 U.S.C. Appendix. For more information, see “FDA Advisory Committees” at http://www.fda.gov/oc/advisory/
default.htm.
14
For more information, see FDA, “Freedom of Information Annual Report—FY2006,” at
http://www.fda.gov/foi/default.htm, and 5 U.S.C. § 552.
15
For histories of FDA and USDA, see their respective websites, at http://www.fda.gov/opacom/backgrounders/
miles.html and http://www.fsis.usda.gov/About_FSIS/Agency_History/index.asp.
16
Michael A. Friedman, “Strengthening the FDA,” Science, vol. 298, December 20, 2002, p. 2332.
17
Frank E. Young, statement before the Committee on Oversight and Government Reform, U.S. House of
Representatives, May 1, 2007, p. 5, at http://oversight.house.gov/documents/20070501193917.pdf.
18
Policy Workshop on Strengthening the FDA, Project on Scientific Knowledge and Public Policy, George
(continued...)

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The Food and Drug Administration: Budget and Statutory History, FY1980-FY2007

FDA Budget and Personnel
Overall FDA Budget
The primary indicator of FDA resources is its budget. The agency’s FY2007 total budget is
approximately $2 billion. 19 The total FDA budget, also called the program level, consists of (1)
direct appropriations and (2) other funds (i.e., funding from other sources that are acknowledged
in the appropriations acts). Direct appropriations are the amount of funds that Congress assigns to
the agency from the annual total available for appropriations as set by the budget committees.
Other funds include reimbursables, cooperative research and development agreement (CRADA)
resources, intra- and inter-agency services (such as the Parklawn Computer Center),
mammography fees, color certification fees, export certification fees, prescription drug user fees,
medical device user fees, and animal drug user fees.
FDA annually prepares budget data for Congress that it presents in the Justification of Estimates
for Appropriations Committees (Justification) documents. FDA transmits its draft through HHS to
the White House Office of Management and Budget (OMB). The final Justification documents,
reflecting any HHS and OMB adjustments, are published with the President’s annual budget
request to Congress. The final Justifications are the major source of FDA budget figures and
tables in this report. Like most federal agencies, FDA has, over time, reorganized its structure,
activities, and budget accounting, which makes historical budget analysis a difficult endeavor. For
further information on the difficulties in compiling a budget history of the agency, and the steps
taken to address those problems for this report, see the Methodology section in the Appendix.
Until FY1992, direct appropriations formed over 95% of FDA’s total program level, with other
funds contributing the small remainder. A shift began in FY1992 when Congress authorized: (1)
the assessment and collection of user fees from pharmaceutical manufacturers for the review of
human drug and biologics applications, and (2) fees for the inspection of mammography
facilities. Congress subsequently authorized the collection of user fees for the review of medical
device applications in FY2002 and animal drug applications in FY2004. By FY2007, other funds,
primarily user fees, accounted for almost a quarter of FDA’s total program level budget.
Another indicator of agency resources is personnel, available in the Justification documents as the
number of full-time equivalent employees (FTEs). This is, however, an imperfect measure of
personnel strength because it is not weighted by type of position, pay grade, or responsibility,
each of which would provide a different measure of the agency’s human resources. FDA has
described how adjusting salaries for standard measures of inflation is inadequate because of the
unique elements of its staff expenses, such as higher than average employee salaries, cost of
health and retirement benefits, and resources required for recruitment and retention.20 FTE
numbers do not include contractors and, therefore, provide only a partial measure of workforce
(...continued)
Washington University School of Public Health and Health Services, Washington DC, February 21, 2007, transcript at
http://www.kaisernetwork.org/health_cast/uploaded_files/022107_gwu_workshop_transcript2.pdf.
19
FDA Operating Plan for FY2007 (March 2007), reflecting final funding levels under P.L. 110-5, Revised Continuing
Appropriations Resolution, 2007.
20
FDA, PDUFA IV proposal, and “PDUFA Fact Sheet,” January 11, 2007, at http://www.fda.gov/oc/pdufa4/
factsheet011107.html.

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The Food and Drug Administration: Budget and Statutory History, FY1980-FY2007

strength. If FDA’s use of non-employee workers has changed during the 28-year period covered
in this report, the numbers of FTEs may be an inaccurate measure of agency personnel strength.
Figure 1 shows the total FDA budget (i.e., program level) for FY1980 through FY2007, all
adjusted to FY2000 dollars.21 The FDA program level is composed of direct congressional
appropriations, what FDA calls budget authority, and other funds.22 Using constant FY2000
dollars allows comparisons of purchasing power over the 28-year period. The stacked bars of the
figure show the two broad sources of budget dollars: direct appropriations and other funds
(primarily user fees). The figure also provides FTE data over the same fiscal years: FTEs funded
by budget authority and total FTEs funded at program level (budget authority plus other funds,
primarily user fees).
As can be seen in Figure 1, inflation-adjusted budget authority was relatively flat from FY1980
to FY1988, began to increase from FY1989 until FY1993 when it leveled off, coincident with the
introduction of user fees in 1993. Figure 1 also shows a decline in budget authority FTEs from
FY1993 to FY2001, although the total FTEs remained relatively constant due to positions funded
by user fees.
Congressional intent in authorizing user fees was that these fees would supplement—rather than
replace—resources provided by Congress to FDA. Level funding from Congress—without
adequate allowances for inflation, mandatory salary and health insurance increases, as well as
other workload-related unfunded mandates—has resulted in declines in FTEs in areas of the
agency that do not receive user fees. A 2002 Government Accountability Office (GAO) report on
the impact of user fees resulting from the Prescription Drug User Fee Act (PDUFA) states that:
According to FDA officials, the agency reduced staffing levels ... to cover the costs of
unfunded pay raises. From fiscal years 1994 through 2001, FDA paid about $250 million to
cover mandatory federal pay raises for which it did not receive increases in its
appropriations. ... [T]his situation reduced the agency’s ability to support activities not
funded by PDUFA. FDA reduced the staffing levels for non-PDUFA activities each year,
leaving the agency fewer resources to perform its other responsibilities. For example, in its
budget justification for fiscal year 2002, FDA reported that inspection of medical device
manufacturers has decreased and the agency does not routinely inspect the manufacturers of
lower-risk products. Although FDA staffing in fiscal year 2001 was about the same as in
fiscal year 1992, about 1,000 more FTEs were allotted to drug and biologic review activities
in fiscal year 2001 and about 1,000 fewer FTEs were allotted to other FDA programs that
ensure food safety, approve new medical devices such as heart valves and pacemakers, and
monitor devices once on the market.23

21
“Total Non-Defense” deflators were used from Table 10.1, Gross Domestic Product and Deflators Used in the
Historical Tables: 1940-2012, found in Historical Tables, Budget of the United States, Fiscal Year 2008, pp. 192-193.
22
Direct congressional appropriations and funds from user fees (often called offsetting collections) both provide budget
authority to FDA. The agency, however, refers to congressional appropriations as budget authority, but not user feerelated sources of funding (which also provide budget authority but are referred to as user fees by FDA).
23
U.S. General Accounting Office, Food and Drug Administration Effect of User Fees on Drug Approval Times,
Withdrawals, and Other Agency Activities, GAO-02-958, September 2002, pp. 17-18.

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The Food and Drug Administration: Budget and Statutory History, FY1980-FY2007

Figure 1. FDA: Budget and FTEs
(Constant FY2000 $)

Sources: For FY1980-FY2006, FDA Justification of Estimates for Appropriations Committees documents. FY2007
FTE data are based on an interim continuing resolution used in the FY2008 Justification and therefore do not
reflect final action by Congress. FY2007 budget data reflect the Operating Plan developed after passage of P.L.
110-5, Revised Continuing Appropriations Resolution, 2007.
Notes: Total FTEs = Budget Authority FTEs + User Fee FTEs. Program Level $ = Budget Authority $ + User
Fees $.

Figure 1 also shows that budget authority and FTEs increased markedly between FY2001 and
FY2002, coincident with increased emergency funding following the domestic terrorist attacks.
However, during the FY2002 through FY2007 period, while budget authority remained flat and
other funds increased, FTEs once again declined.
In a related matter, the 2002 GAO report expressed concern about attrition among FDA staff
which it found to be noticeably greater than in similar disciplines at the National Institutes of
Health (NIH) and the Centers for Disease Control and Prevention (CDC).24 The 2002 GAO report
states that:
[T]he agency continues to experience high turnover for reviewers because of the high
demand for regulatory review personnel in the pharmaceutical industry and the higher
salaries that experienced FDA reviewers can obtain in the private sector.... FDA officials
24

Ibid., pp. 21-23.

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reported that to retain experienced staff with certain skills, they have increased the pay for
approximately 250 [product] reviewers. Specifically, FDA conducted studies of staff
turnover and found that toxicologists, pharmacologists, pharmacokinetists, and mathematical
statisticians were leaving FDA to work in private industry and academia for higher salaries.
Under [federal personnel] regulations, FDA is authorized to pay retention allowance of up to
10 percent of an employee’s basic pay to a group or category of employees in such
circumstances.25

The GAO report also found that “FDA reviewers, particularly those in CBER [Center for
Biologics Evaluation and Research], did not participate in training and professional development
activities ... to ensure that the agency meets PDUFA goals.”26 The 2006 IOM report commented
on the attrition of FDA personnel by stating that “although one explanation for the turnover is that
FDA staff leave for promising opportunities in industry ... it is possible that turnover is indicative
of a less-than-ideal organizational culture that requires attention.”27
A potential indicator of the difficulty FDA has in keeping experienced staff is the agency’s
issuance of retention bonuses to some employees. This practice is controversial and is under
investigation by the House Committee on Energy and Commerce:
The payments ... attracted bipartisan criticism from lawmakers ... [who] say that at the FDA
many of the bonuses went to the highest-paid officials rather than the scientists, inspectors
and doctors most at risk of jumping to the private sector. To critics, the payments bore little
relationship to the agency’s performance and reputation or to the likelihood that someone
might depart. Agency officials disagree and call the program a success.... In 2002, the FDA
lost 12 to 13 percent of its employees, while in 2006, with the bonus program in place, it lost
5 percent.... The bonuses—which are funded in part with fees paid by industry for product
reviews—bring no guarantee of retention.28

Comparison of FDA Budget with Other Agency Budgets
Figure 2 compares the funding, over time, for FDA, NIH, and CDC, the primary federal agencies
with public health duties. In FY1980, CDC and FDA had similar funding and NIH funding was
sevenfold greater than the other two agencies, as shown in Figure 2. Since FY1980, Congress has
increased the budget ninefold for CDC, almost fourfold for NIH and about twofold for FDA (in
FY2000 adjusted dollars). Other regulatory agencies similar to FDA, in that they are sciencebased and health-related, such as the Environmental Protection Agency (EPA), the Occupational
Safety and Health Administration (OSHA), and the Consumer Products Safety Commission
(CPSC), have received flat or declining budgets (adjusted for inflation) over this same time
period. 29

25

Ibid., pp. 21-22.
Ibid., p. 23.
27
IOM, The Future of Drug Safety, 2006, p. 81.
28
John Solomon and Marc Kaufman, “FDA’s Retention Bonuses Rise to the Top,” The Washington Post, August 2,
2007, p. A1.
29
For EPA, see Figure 1 in CRS Report RL32856, Environmental Protection Agency: Appropriations for FY2006, by
(name redacted) and (name redacted); for OSHA and CPSC, see budget data available on the OMB website at
http://www.whitehouse.gov/omb/budget/fy2008/db.html.
26

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Figure 2. Budget Authority for FDA, CDC, and NIH
(Constant FY2000 $)

Source: Office of Management and Budget, Budget Authority file, Public Budget Database, Budget of the United
States Government, Fiscal Year 2008. Data available on the OMB website at http://www.whitehouse.gov/omb/
budget/fy2008/db.html.
Note: Does not include FDA offsetting collections (user fees), which have provided an additional 20% to 25% to
the FDA budget in recent years.

Concerns raised in the late 1970s about the cumulative effects of federal regulations on business
resulted in the substantial changes made by the Reagan Administration in the 1980s in “how
federal agencies develop and publish rules, and the degree to which federal regulations were
overseen by the Executive Office of the President.”30 The relatively flat funding experienced by
FDA and other regulatory agencies may in part be due to the Reagan regulatory reform efforts
combined with attempts to control federal spending and shrink the overall size of government.
Former FDA Commissioners, speaking on various public panels, have addressed FDA funding.31
In prepared testimony for a May 1, 2007 hearing before the House Committee on Oversight and
30

CRS Report RL32356, Federal Regulatory Reform: An Overview, by (name redacted).

31

Remarks by former FDA Commissioners Jane Henney, Donald Kennedy, and Frank Young at the Policy Workshop
on Strengthening the FDA, the SKAPP Project on Scientific Knowledge and Public Policy, George Washington
University School of Public Health and Health Services, Washington DC, February 21, 2007, transcript at
http://www.kaisernetwork.org/health_cast/uploaded_files/022107_gwu_workshop_transcript2.pdf; and Remarks by
former FDA Commissioners David Kessler and Mark McClellan at “Public Policy Implications of the Food and Drug
Administration Revitalization Act (FDARA),” Center for Congressional and Presidential Studies, American University
(continued...)

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Government Reform, four former FDA Commissioners, Donald Kennedy, Frank Young, David
Kessler, and Jane Henney, all agreed that FDA is underfunded. Dr. Kessler made the following
observations on the funding Congress has provided for NIH, CDC, and FDA.
While Congress has attempted to provide resources for burgeoning public health needs on
other fronts, support for the FDA has faltered in comparison. In 1986, FDA’s budget was
comparable to 97% of the budget for CDC and 8% of the NIH’s budget. By [2006], it had
dropped to 28% of CDC’s budget and 5% of NIH’s. Significantly, while the NIH’s budget to
fund the research that leads to discoveries that ultimately fill the FDA’s drug pipeline has
doubled over the last five years, FDA’s budget has not grown.32

On this same point, former Acting FDA Commissioner Michael Friedman made the following
observations:
It is myopic to fund a minimal FDA when we have doubled the NIH budget roughly every
10 years for the past 40 years ... or when the pharmaceutical industry annually invests more
than $30 billion in research and development. Because regulatory review is the final
common pathway for all translational medicine, this lack of resources is rate-limiting. I
cannot predict everything that our citizens demand from FDA, but I am sure they are not
currently getting it. The issue is not what the FDA “needs;” it is rather what the American
public deserves.33

The 2006 IOM drug safety report notes that over the years various groups have examined the
same questions about the FDA and its budget and have made a variety of proposals and
recommendations to improve the agency that have not been fully implemented. The IOM report
goes on to state that:
A primary obstacle ... may be the chronic underfunding of core FDA activities owing to
inadequate attention to resource needs by Congress and the Office of Management and
Budget.34

Some Members of Congress also have expressed concern over the FDA funding level, and have
voiced their frustration at the inability to obtain clarification from the agency on the adequacy of
the FDA budget. A source of apparent frustration to those Members, including some who serve on
the appropriations subcommittees and have indicated their willingness to increase appropriations
to the agency, are the FDA officials who, year after year, neither ask for increased funding in their
testimony, nor, in response to Members’ questions, acknowledge what some observers perceive to
be the agency’s needs for additional resources. For example, in written testimony regarding the
FY2004 proposed budget, FDA Commissioner Mark McClellan stated:
We believe our budget request will allow FDA to fund ongoing operations at the current
level and also support more than 1,000 recently hired investigators and analytical staff to
fight counterrorism [sic].... The President’s 2004 Budget was developed within a framework
(...continued)
School of Public Affairs and FORA.tv, Washington DC, September 12, 2007.
32
David Kessler, “FDA’s Critical Mission and Challenges for the Future,” testimony before the U.S. House of
Representatives, Committee on Oversight and Government Reform, May 1, 2007, p. 2, at http://oversight.house.gov/
documents/20070501193354.pdf.
33
Friedman, “Strengthening the FDA,” 2002, p. 2332.
34
IOM, The Future of Drug Safety, p. 18.

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that set a proposed total for discretionary spending in 2004, and each agency and program
request reflects the [George W. Bush] Administration’s relative priority for that operation,
activity or program.35

In contrast to the above testimony which occurred when he was Commissioner, former FDA
Commissioner Mark McClellan made the following statement at a March 2007 hearing of the
Senate Committee on Health, Education, Labor, and Pensions:
First, the FDA will need significantly greater appropriations to improve post-market safety.
The FDA is over-stretched, and a lack of trained staff and technical capabilities to perform
the oversight necessary on thousands of prescription drugs is an even more pressing issue
than providing the FDA with new regulatory authorities.36

Current FDA Commissioner Andrew von Eschenbach provided the following statement when
commenting on the adequacy of the FY2008 budget at a Senate Appropriations Committee
hearing:
These resources are an essential step in building a 21st century FDA that responds to the new
opportunities and new challenges of science and technology. Our budget allows FDA to
strengthen the tools we use to ensure the safety of foods, evaluate new products, and better
predict—earlier and more accurately—the safety and efficacy of drugs, biologics and
medical devices. With these resources, we will work to ensure that Americans enjoy the
benefits of personalized medicine, a safe and wholesome food supply, and the promise of a
better, healthier future.37

The IOM committee that worked on the 2006 drug safety report also was not able to ascertain the
agency’s funding requirements:
Convention dictates that federal agencies do not publicly articulate resource needs that differ
from those offered in the President’s budget, so the [IOM] committee was unable to
understand fully what ... FDA leadership estimate[s] is needed to meet current objectives, let
alone the expanded responsibilities the committee envisions for the future.38

In his May 1, 2007 testimony, former Commissioner Donald Kennedy confirmed this point:
I hope you and your staff will be diligent about pursuing FDA resource needs. But you may
have to rely on grizzled veterans like me, because budget authorities at HHS and OMB
specifically prohibit present officials in the agency from speaking out publicly about the
need for more funding.... [I]t is important that Americans know, when they hear FDA

35
Written testimony of Mark McClellan, Commissioner of the Food and Drug Administration, in U.S. Congress, House
Committee on Appropriations, Subcommittee on Agriculture, Rural Development, FDA, and Related Agencies,
FY2004 FDA Budget Request, hearing, 108th Cong., 1st sess., March 6, 2003, at http://www.fda.gov/ola/2003/
fy2004budget.html.
36
Testimony of Mark McClellan, former FDA Commissioner, in U.S. Congress, Senate Committee on Health,
Education, Labor and Pensions, Prescription Drug Safety and User Fees, hearing, 110th Cong., 1st sess., March 14,
2007.
37
Statement of Andrew von Eschenbach, Commissioner of the Food and Drug Administration, in U.S. Congress,
Senate Committee on Appropriations, Subcommittee on Agriculture, Rural Development, FDA, and Related Agencies,
hearing, 110th Cong., 1st sess., February 27, 2007, at http://www.fda.gov/ola/2007/budget0227.html.
38
Ibid., p. 199.

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officials say they are satisfied with their budget allocations, that they have their fingers
crossed underneath the witness table.39

Like all federal agencies, FDA’s budget history reflects both Administration requests and
congressional decisions on appropriations. In general, previous Administrations have not argued
before Congress for increased FDA funding over the years. In some situations, however,
Congress has decided to grant additional funds to agencies above an Administration’s request. For
example, the relevant House and Senate appropriations bill reports demonstrate that Congress has
often chosen to increase NIH funding when an Administration has not requested additional
appropriations. Congress is supported and encouraged in its efforts to increase the NIH budget by
various health and research advocacy groups which promote their individual causes.
Some agencies are able to bypass budget adjustments made by HHS and OMB via alternative
mechanisms. For example, the National Cancer Institute (NCI) at NIH is mandated by the
National Cancer Act of 1971 (P.L. 92-218) “to prepare and submit, directly to the President for
review and transmittal to Congress, an annual budget estimate (including an estimate of the
number and type of personnel needs for the Institute) for the National Cancer Program, after
reasonable opportunity for comment (but without change) by the Secretary, the Director of NIH,
and the Institute’s advisory council.”40 The so-called NCI Bypass Budget received by Congress
describes the increase required to maintain NCI’s present level of operations and the increases
required to expand existing initiatives. 41 Similarly, CDC has prepared a “Professional Judgment”
budget in response to requests from a congressional appropriations committee. 42
A regulatory agency, such as the FDA, may be perceived as an impediment to achieving the goals
of advocacy groups concerned with the expeditious approval of new drugs or devices for the
treatment of specific diseases. However, when drug or device adverse events occur, there is
heightened concern about FDA’s approval process. In general, attention to FDA’s state of affairs
seems to be dependent on reaction to crisis. The public and Congress tend to focus on the agency
when its regulatory processes fail to meet their expectations. This phenomenon is perhaps best
exemplified by the thalidomide episode in 1962.43 However, even significant legislative solutions,
such as the Kefauver-Harris Drug Amendments of 1962 (which required demonstration of
effectiveness prior to drug approval), were not accompanied by an increase in funding for FDA.
In his history of FDA and its regulation of the pharmaceutical industry, Philip J. Hilts, referring to
passage of Kefauver-Harris, reported that:
Unfortunately, when Congress took this step forward, getting serious about science and
testing to protect the public, it did what it had often done before: it voted to give the agency
new duties and responsibilities while failing to provide the money to allow the agency to

39
Donald Kennedy, testimony before the U.S. House of Representatives, Committee on Oversight and Government
Reform, May 1, 2007, p. 4, at http://oversight.house.gov/documents/20070502110032.pdf.
40
PHS Act, Section 413(b)(9).
41
U.S. Department of Health and Human Services, National Institutes of Health, National Cancer Institute, The
Nation’s Investment in Cancer Research: A Plan and Budget Proposal for Fiscal Year 2008, October 2006, NIH
Publication Number 06-6090, p. 40, at http://plan2008.cancer.gov/pdf/nci_2008_plan.pdf.
42
Centers for Disease Control and Prevention, Professional Judgment for Fiscal Year 2008, April 20, 2007, at
http://www.fundcdc.org/documents/CDCFY2008PJ_000.pdf.
43
Philip J. Hilts, Protecting America’s Health: the FDA, Business, and One Hundred Years of Regulation, Alfred A.
Knopf, New York, 2003.

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carry them out. The error would cause years of dissension and trouble, and would not be
remedied for three decades.44

Presumably, the remedy Hilts is referring to is PDUFA and the implementation of user fees by
FDA in 1993. Some critics argue that user fees have not solved FDA’s funding problems and have
led to additional complications for the agency.45 Critics also suggest that the way the agency has
been managed and the resource structure imposed by statute contribute to the agency’s perceived
problems in accomplishing its mission.

FDA Activity-Area Budgets
FDA is organized into six centers, which cover the broad activity areas for which the agency has
responsibility, and two offices that perform agency-wide functions.46 The traditional activity areas
are somewhat parallel to the current centers. FDA’s major activity areas are: Foods; Human
Drugs; Biologics; Animal Drugs and Feeds; and Medical Devices and Radiological Health. This
report focuses on the activity areas rather than the centers, to be consistent with the presentation
in the historical Justification documents. Center names and their activity area responsibilities
have changed over time to reflect shifts in agency organization, but the agency’s activity areas
have stayed fairly constant over the past 25 years.
Although FDA consistently reports its budget recommendations broken out by activity areas, it is
not possible, using the publicly available Justifications, to determine whether these categories
have always included the same activities. Therefore, as with other federal agencies, it is not
always possible to accurately compare categories of budget or staffing over long periods of time.
An example of this, as discussed below, is the changing placement of Biologics in the agency’s
budget. Biologics was encompassed for a time within the Human Drug budget, and FDA’s
Justifications provide no means of separating the two activities. This report contains the most
consistent accounting that was possible from the information provided in the FDA
Justifications.47 For further information on the difficulties in compiling a budget history of the
agency, and the steps taken to address those problems in this report, see the Methodology section
in the Appendix.
The Office of the Commissioner and the National Center for Toxicological Research do not have
direct regulatory responsibilities and, therefore, are only described briefly in this report. Their
funding and personnel are included, however, in the FDA totals. The Office of Regulatory Affairs
(ORA) conducts FDA’s compliance activities, including inspection and enforcement, across all
activity areas. The agency’s budget justification documents allocate ORA funding to each activity
area as “field activities.”
44

Ibid., p. 165.
Frank E. Young, testimony before the U.S. House of Representatives, Committee on Oversight and Government
Reform, May 1, 2007, p. 4, at http://oversight.house.gov/documents/20070501193917.pdf; and Rena Steinzor and
Margaret Clune, “The Hidden Lesson of the Vioxx Fiasco: Reviving a Hollow FDA,” Center for Progressive Reform,
October 2005, at http://www.progressivereform.org/articles/Vioxx_514.pdf.
46
The Center for Biologics Evaluation and Research (CBER), Center for Devices and Radiological Health (CDRH),
Center for Drug Evaluation and Research (CDER), Center for Food Safety and Applied Nutrition (CFSAN), Center for
Veterinary Medicine (CVM), National Center for Toxicological Research (NCTR), Office of the Commissioner (OC)
and the Office of Regulatory Affairs (ORA). The organization tables of FDA overall and its components are available
at http://www.fda.gov/opacom/7org.html.
47
FDA cited constraints on its staff time and indicated that it would only be able to provide data for recent years.
45

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Table 1. Summary of Increase in Total Budget and FTEs, FY1980 and FY2006
(Constant FY2000 $)
Activity Area
Food

Measure

FY1980

FY2006

Budget

$188,967,000

$376,262,000

99.1%

2,408

2,774

15.2%

$143,292,000

$436,454,000

204.6%

2,102

2,947

40.2%

$44,004,000

$169,562,000

285.3%

507

979

93.1%

$46,688,000

$83,914,000

79.7%

516

592

14.7%

$97,427,000

$218,732,000

124.5%

1,399

1,498

7.1%

$675,271,000

$1,597,508,000

136.6%

8,182

9,698

18.5%

FTEs

Human Drugs

Budget
FTEs
Budget

Biologics

FTEs

Animal Drugs & Feeds
Devices & Radiological Health
FDA Totala

Budget
FTEs
Budget
FTEs
Budget
FTEs

% Increase

Source: FDA Justification of Estimates for Appropriations Committees documents.
Note: Detailed unadjusted budget amounts and FTE numbers can be found in this report’s Appendix, Table
A-2, and Table A-3.
a.

Activity area numbers do not add to FDA totals because not all FDA functions are listed in the table.

After adjusting for inflation, FDA’s total budget increased by 136.6% between FY1980 and
FY2006 (see Table 1). Over the same period, total FTEs increased by 18.5%. Each activity area
within the agency reflects a greater increase in budget than in FTEs during the period. As noted
above, tracking FTEs is typically an imperfect measure of changes in an agency’s level of effort
over time. 48 A variety of factors might account for the differing rates of growth of FDA’s budget
and staffing. A precise accounting of the possible causes of these differences was not available in
FDA budget Justifications.49 Further exploration of the reasons for the differing rates of growth in
budget and FTEs is, however, beyond the scope of this report.
Figure 3 compares the FDA budgets for FY1980 and FY2006, displaying the major activity area
budgets relative to each other and to the whole agency. The figure also illustrates the relative
proportions of the activity-area budgets that user fees finance. In FY2006, user fees comprised
41% of the Human Drugs budget, 30% of Biologics, 14% of Devices and Radiological Health,
8% of Animal Drugs and Feeds, and 0% of Foods. The proportion of the total FDA budget
provided in direct appropriations as budget authority was 96% in FY1980 and 80% in FY2006.

48
49

See discussion of FTEs beginning on p. 5.
The authors requested further information from FDA which, as of the date of this report, has not been provided.

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Figure 3. FDA Budgets for FY1980 and FY2006, by Major Activity Area and Type of
Funding

Source: FDA Justification of Estimates for Appropriations Committees documents.
Notes: Total FDA budget without adjustment for inflation was $340 million in FY1980 and $1,863 million in
FY2006. “Animal Drugs” is Animal Drugs and Feeds, and “Devices” is Devices and Radiological Health.

Impact of New Statutory Authorities on FDA Budget
New statutory authorities, assigned to specific FDA activity areas, frequently mandate initiatives
without resources for implementation. The implementation of major new initiatives requires
adequate time and resources to meet congressional intent. Former FDA Commissioner Frank
Young indicated that, while he was Commissioner, there were “mandates for 22 new activities
without accompanying appropriations,” which he categorized as unfunded mandates. 50 He also
attested to the difficulty for the agency in the implementation of new statutory language. In the
case of implementing the Hatch-Waxman Act for the expeditious evaluation of generic drug
products, he stated the following:
[T]here were major problems in the development of procedures within FDA, inadequate
resources available for crafting the regulations, and difficulties in the implementation of the
initial ANDA [Abbreviated New Drug Application] processes. Similarly, there were
50

Frank E. Young, testimony before the U.S. House of Representatives, Committee on Oversight and Government
Reform, May 1, 2007, p. 6, at http://oversight.house.gov/documents/20070501193917.pdf.

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substantial budgetary needs for adequate enforcement of procedures, for approval of
products developed by industry during the initial implementation of the act. The agency was
in uncharted water.51

Likewise, implementation of the FDA Modernization Act of 1997 (FDAMA), required the agency
to “develop 42 new regulations, 23 guidances and numerous reports and studies,” many within a
year.52 At the time, HHS Secretary Shalala commented on the complications and costs of carrying
out the effort, which she estimated to be $50 million.53
The $1.58 billion that FDA has collected in prescription drug user fees since FY1993 has helped
the agency improve the timeliness of its drug review process. These benefits may mask what
some FDA advocates see as PDUFA’s distorting effects on within-activity-area budgeting.
Congress included in PDUFA an important limitation, often referred to as a trigger, to ensure that
the user fees would supplement rather than supplant appropriated funds. To collect and spend the
drug user fees, FDA must maintain at least the same level of effort on activities related to human
drug review as it had before PDUFA. That limitation would not affect other parts of the FDA
budget if other funding were to keep pace with both inflation and the needs of the agency.
However, according to FDA documents and the observations of external experts, FDA’s financial
situation has changed over the 15 years since PDUFA began. FDA has had to use directly
appropriated funds to keep the PDUFA-related activities at least constant over time, thereby
diverting those funds from other uses. FDA financial reports, required under PDUFA, have
claimed that this unanticipated PDUFA effect has resulted in “an erosion of core FDA
programs.”54

FDA Regulatory Research
The research program at FDA provides scientific support for regulatory issues addressed by the
agency. Research has been a part of the agency almost from the time of its inception in 1906.55
All five FDA activity areas support research with Foods conducting the largest program in
FY2006, followed by Biologics, Devices and Radiological Health, Animal Drugs and Feeds, and
Human Drugs, which has a very small research program. Research performed in the five FDA
activity areas comprises about 50% of the FY2006 FDA research budget. Other entities within
FDA that perform research are the National Center for Toxicological Research (33%), Office of
Orphan Products (11%), Program Management (3%), and Buildings and Facilities (3%).56 Figure
51

Ibid.
Jill Wechsler, “The ‘R’ in CDER and CBER,” Pharmaceutical Technology, April 1998, p. 14.
53
Ibid.
54
See discussion of “triggers” in “Human Drugs“ section of this report, as well as the FDA White Paper Prescription
Drug User Fee Act (PDUFA): Adding Resources and Improving Performance in FDA Review of New Drug
Applications, at http://www.fda.gov/oc/pdufa/whitepaper11-10/whitepaper11-10.html, and the FY2001 PDUFA
Financial Report, at http://www.fda.gov/oc/pdufa/finreport2001/financial-fy2001.htm, and the FY2000 PDUFA
Financial Report, at http://www.fda.gov/cder/pdufa/financial-fy2000.htm, and the FY1999 PDUFA Financial Report,
at http://www.fda.gov/oc/oms/ofm/accounting/pdufa/1999Report.htm.
55
The Bureau of Chemistry established a Food Research Laboratory shortly after it was created within the Department
of Agriculture. See the Science Board Subcommittee on FDA Research, “Recommendations to the Science Board of
the Food and Drug Administration,” Final Draft Report, March 13, 1997, Appendix D, “An Abbreviated History of at
Least Four Decades of Efforts to Upgrade the Quality of Science in the FDA,” at http://www.cfsan.fda.gov/~frf/
sxsbrd.html.
56
FDA research budget data from RAND Corporation RaDiUS database, November 7, 2007. RaDiUS, which stands
(continued...)
52

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4 shows the amount of support for research within the five FDA activity areas from FY1993
through FY2008.
Figure 4. FDA Research in Five Activity Areas (Constant FY2000 $)
$180,000

Dollars (in thousands)

$160,000
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$0
1993

1995

1997

1999

2001

2003

2005

2007

Fiscal Year
Foods

Human Drugs

Biologics

Animal Drugs

Devices

Sources: FDA research budget data was provided by Donna Fossum of the RAND Corporation using the
RaDiUS database on November 7, 2007. Data collection for RaDiUS began with FY1993. FDA data collected for
FY2006 through FY2008 were received by RAND from FDA Office of Budget Formulation and Presentation
(OBFP) via Edward King, HHS Office of the Assistant Secretary for Management and Budget, in March 2007.
Amounts for Foods for FY2006 through FY2008 were adjusted per personal communication with Robert Miller,
FDA-OBFP, on November 19, 2007.

The appropriate role of research in fulfilling FDA’s mandate to license and approve safe and
effective products has been a contentious issue at least since the early 1970s.57 At the request of
former Deputy Commissioner for Operations Michael Friedman, a review of FDA research was
conducted in 1996 by a subcommittee of the FDA Science Board. The Chairman of the
subcommittee, Dr. David Korn, stated that “Congress has not been asked to support research
explicitly; [research] has always been buried in the agency’s budget.”58 Dr. Korn suggested that it
would require a major educational effort by industry to convince Congress that research is
essential to the function of FDA because “industry is, in a sense, the FDA’s customer,” and “if the

(...continued)
for “Research and Development in the United States,” tracked all research and development activities and resources of
the government from FY1993 through FY2008. The contract for RaDiUS operations and maintenance has ended and
the database is no longer available. See https://radius.rand.org/.
57
Charles Marwick, “FDA Funding Problems Imperil Safety of Biological Products in the United States,” Journal of
the American Medical Association, March 25, 1998, pp. 899-901.
58
Ibid., p. 900.

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thrust came from industry, it would carry weight with the Congress.”59 The final report of the
subcommittee, dated March 1997, stated that:
The decreasing agency [research] budget is of overarching concern. Although there is
general appreciation of the fact that in times of constrained resources the agency must take
particular care that its mandated regulatory responsibilities are competently discharged, there
is a widely held perception among agency scientists that the research programs do not have
strong advocacy at the highest levels of agency leadership and are front-line targets for
curtailment or elimination as discretionary resources decline. The subcommittee believes
strongly that starving the agency’s base of intramural scientific expertise must inevitably
compromise the quality of review and regulatory activities.60

The role of FDA research and the level of resources required for its support continues to be
identified as an issue for the agency. During the May 1, 2007, congressional hearing, the former
Commissioners specified the lack of financial support for the research program at FDA as a major
concern. Former commissioner Frank Young stated that “research at CBER has been eviscerated
through a recent reorganization and is almost non-existent in CDER. To maintain the expertise
necessary for expeditious but highly competent decisions on new breakthrough products,... it is
essential to have a well trained scientific staff that is given the time to not only maintain scientific
expertise but to pursue career development in their chosen field of science.”61 On this same point,
former commissioner David Kessler stated that:
The erosion of funding has struck hard at the Agency’s ability to support its proud tradition
of groundbreaking research in regulatory science. While in the past, the Agency led the way
in developing new scientific paradigms for approving biologics and assessing food
contaminants—to the benefit of both industry and consumers—resources for FDA to lend its
intellectual firepower to addressing key regulatory questions are increasingly scarce.62

FDA Science Board Report
A report that assessed “whether science and technology at the FDA can support current and future
regulatory needs” was released in November 2007.63 The report was requested by FDA
Commissioner Andrew von Eschenbach in December 2006 and was prepared by the FDA Science
Board, a group of independent advisors. It found that FDA “suffers from serious scientific
deficiencies and is not positioned to meet current or emerging regulatory responsibilities.”64 The
report points at two reasons for the deficiency: the demands on FDA have soared, and resources
have not increased in proportion to the demands. It states that “due to constrained resources and
59

Ibid., p. 901.
The Science Board Subcommittee on FDA Research, “Recommendations to the Science Board of the Food and Drug
Administration,” Final Draft Report, March 13, 1997, at http://www.cfsan.fda.gov/~frf/sxsbr.html.
61
Frank E. Young, testimony before the U.S. House of Representatives, Committee on Oversight and Government
Reform, May 1, 2007, p. 3, at http://oversight.house.gov/documents/20070501193917.pdf.
62
David Kessler, “FDA’s Critical Mission and Challenges for the Future,” testimony before the U.S. House of
Representatives, Committee on Oversight and Government Reform, May 1, 2007, p. 3, at http://oversight.house.gov/
documents/20070501193354.pdf.
63
FDA Science Board, Subcommittee on Science and Technology, FDA Science and Mission at Risk, November 2007,
at http://www.fda.gov/ohrms/dockets/ac/07/briefing/20074329b_02_01_FDA%20Report%20on%20Science%20and%20Technology.pdf.
64
Ibid., p. 2.
60

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lack of adequate staff, FDA is engaged in reactive regulatory priority setting or a fire-fighting
regulatory posture instead of pursuing a culture of proactive regulatory science.”65
The FDA Science Board was specifically asked to review the status of science and technology at
FDA, and not to evaluate the available resources. However, the report states that the status of
science and technology was “so intertwined with two decades of inadequate funding that it was
impossible to assess technology without also assessing resources.”66 The Science Board also
looked at reports on FDA issued by previous review committees, each given a similar charge over
the past 50 years. It found that the concerns outlined in past reports were the same as those in the
present and that FDA has consistently been unable to implement the needed changes. An advisor
to the Science Board, Garret A. FitzGerald, blamed a faction of “congressional majorities and
presidential administrations that has serially stripped the agency of assets.”67
Representative Rosa DeLauro, who in the 110th Congress was appointed chair of the House
Appropriations Subcommittee on Agriculture, Rural Development, FDA, and Related Agencies,
stated that the November 2007 report confirms facts that she believes have been apparent to
Congress and FDA for some time. “[S]cience at the FDA is deteriorating and the agency lacks the
planning, management structure, and resources to restore their scientific capabilities.”68 She
further states that although her subcommittee is working on providing additional funds for the
agency, “money alone will not resolve the problems at FDA—these additional funds need to be
supported by an adequate management structure and a sound plan on how these funds will be
used to ensure that they are not wasted.”69
The FDA Science Board report concluded that “FDA can no longer fulfill its mission without
substantial and sustained additional appropriations,” and that the agency is in danger of “losing its
remaining dedicated staff” if the “chronic underfunding of the agency” is “not addressed
immediately.”70 The report stated that there is “insufficient investment in professional
development [for FDA staff], which means that the workforce does not keep up with scientific
advances.... Inadequately trained scientists are generally risk-averse, and tend to give no decision,
a slow decision or, even worse, the wrong decision on regulatory approval or disapproval.”71 The
report also concluded that funding increases recommended by other groups, such as IOM and the
Coalition for a Stronger FDA, are insufficient to allow all the changes necessary for the agency to
fulfill its mission. “Without a substantial increase in resources, the agency is powerless to
improve its performance, will fall further behind, and will be unable to meet either the mandates
of Congress or the expectations of the American public. This will damage not only the health of
the population of the U.S., but also the health of the economy.”72

65

Ibid., p. 4.
Ibid., p. 6.
67
Gardiner Harris, “Advisers Say FDA’s Flaws Put Lives at Risk,” The New York Times, December 1, 2007.
68
DeLauro Statement on FDA Science Board Report, December 3, 2007, at
http://delauro.house.gov/release.cfm?id=697.
69
Ibid.
70
FDA Science Board, Subcommittee on Science and Technology, FDA Science and Mission at Risk, p. 7.
71
Ibid., pp. 4-5.
72
Ibid., p. 8.
66

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Major Activity Areas: Budget and FTEs
The next sections of this report provide, for each FDA major activity area, a brief description of
the statutory responsibilities in 1980 and an overview of how the agency’s responsibilities have
expanded over the years up through 2007. Juxtaposed with the presentation of increasing
responsibilities for the activity area is a presentation and analysis of the budget and number of
FTEs for the period FY1980 through FY2007.73 The descriptions of FDA’s responsibilities and
resources provide a background against which to examine FDA funding needs. Other CRS reports
examine the particulars of many FDA activities and their funding.74

Foods75
FDA is responsible for promoting and protecting the public’s health in part by ensuring that the
food supply is safe, sanitary, wholesome, and accurately labeled. The agency regulates all foods,
except for meat and poultry which are regulated by the U.S. Department of Agriculture
(USDA). 76 It is also responsible for assuring that cosmetic products are safe and properly labeled.
The agency regulated $417 billion worth of domestic food, $49 billion worth of imported food,
and $60 billion worth of cosmetics in 2001.77 These numbers encompass the economic activity of
about 50,000 food establishments (manufacturers, processors, and food warehouses) and 3,500
cosmetic firms. 78 Not included in these figures are the roughly 600,000 restaurants and
institutional food service establishments and 235,000 supermarkets, grocery stores, and other
food outlets that are regulated by state and local authorities, for which FDA provides guidance,
model codes, and other technical assistance.
Although FDA is responsible for ensuring the safety of the food supply, its role is primarily
reactive since most foods and their ingredients are not subject to prior approval or even review
before they enter interstate commerce. The agency does have responsibility over some product
ingredients that require premarket approval, such as food and color additives. FDA also performs
postmarket monitoring of food labels and investigates food safety problems that arise. The
agency’s surveillance program tests food samples to determine if pesticide residues or heavy
metals are present in unacceptable amounts. It also sets standards for label information to assist
consumers in determining the ingredient and nutrient content of the foods that they are
purchasing. The agency’s current activities related to foods are primarily conducted by the Center
for Food Safety and Applied Nutrition (CFSAN).
The Pure Food and Drug Act of 1906 gave the agency its initial authority to prohibit the interstate
commerce of adulterated or misbranded food products, along with the authority to assess criminal
penalties for violations and seize offending products. The Federal Food, Drug, and Cosmetic Act
73

Budget size varies across the activity areas within FDA. The budget range shown in each figure reflects a scale
appropriate to allow clear illustrations of the within-activity area budget variation across years.
74
See listings of CRS products relating to FDA-regulated foods, human drugs, biologics, devices, animal drugs, and
cross-cutting issues at http://apps.crs.gov/cli/cli.aspx?PRDS_CLI_ITEM_ID=2678 and http://apps.crs.gov/cli/
cli.aspx?PRDS_CLI_ITEM_ID=2621.
75
This section was prepared by (name redacted), Specialist in Food Safety and Nutrition.
76
CRS Report RS22600, The Federal Food Safety System: A Primer, by (name redacted) and (name redacted).
77
FDA Science Board, Subcommittee on Science and Technology, FDA Science and Mission at Risk, 2007, p. 11.
78
See http://www.cfsan.fda.gov/~lrd/cfsan4.html.

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of 1938 (FFDCA), building on the provisions of the 1906 Act, required the agency to promulgate
definitions and standards for foods and informative labeling. It also prohibited false advertising
and the addition of substances that would render the food adulterated. Over the years, several
amendments to the act added authorities that required FDA to establish (1) tolerances (safe levels)
for pesticides on agricultural commodities; (2) premarket approval systems for food and color
additives, and packaging substances; (3) rules for labels to facilitate price comparisons; and (4)
rules to assure that packages contain the amount of product the label claims.
By FY2007, Congress had added a number of new FDA authorities to those that existed before
FY1980 (see Table 2). Under the Infant Formula Act of 1980 (P.L. 96-359) FDA established
requirements for the manufacturing, labeling, and nutrient standards for these products. The
Nutrition Labeling and Education Act of 1990 (NLEA, P.L. 101-535) provided authority for (1)
mandating nutrition labels on most food products, and (2) following the agency’s review,
allowing nutrient content and health claims. In addition, NLEA preempted most state and local
requirements for labeling, giving FDA responsibility for regulating all aspects of nutrition
labeling information. NLEA resulted in the promulgation of a significant number of new
regulations and revisions of old rules for consistency with the new authorities. The Dietary
Supplement Health and Education Act of 1994 (DSHEA, P.L. 103-417), provided specific
authority for the regulation of supplements and placed the burden of proof on the agency to
demonstrate that a supplement already on the market was unsafe and needed to be removed.
The Food Quality Protection Act of 1996 (P.L. 104-170) established a single health-based
standard for pesticides in all foods and provided special safety provisions for infants and children.
After FFDCA provisions were amended by the FQPA of 1996, FDA continued to monitor
pesticide residue levels in food in interstate commerce (which it does through its total diet study)
and enforce tolerances through its food inspection programs, while EPA remains the lead agency
on setting tolerances and related issues. The Food and Drug Administration Modernization Act of
1997 (P.L. 105-115) eliminated premarket approval of food-contact substances (i.e., packaging
materials), replacing it with a notification process, along with expanding procedures for FDA
authorization of health and nutrient content claims under the NLEA statutory standard.
The Public Health Security and Bioterrorism Preparedness and Response Act of 2002 (P.L. 107188) required all domestic and foreign facilities that manufacture, process, pack, or hold food for
U.S. consumption to register with FDA and maintain records for agency inspection. The act also
required prior notice to FDA of products being imported into the United States and provided the
agency with administrative detention authority and penalties.
The Food Allergen Labeling and Consumer Protection Act of 2004 (P.L. 108-282) required that a
specific statement appear on a food label when any of the most common allergens are present in a
food. In 2006, the Dietary Supplement and Nonprescription Drug Consumer Protection Act (P.L.
109-462) was enacted, which created a system for reporting to FDA any serious adverse events
associated with the use of a dietary supplement, as well as record keeping and inspection
authority that may be necessary in cases of a reported adverse event.
Food safety provisions within the Food and Drug Administration Amendments Act of 2007 (P.L.
110-85) required the creation of a registry for reportable information on foods with safety
problems. It also allowed for the identification of the supply chain of the questionable food item.
Adjusted for inflation, FDA’s foods budget doubled between FY1980 and FY2007; the number of
FTEs increased by 15.2% during the same period. Despite substantial increases in statutory

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authority during the period, FDA’s Foods activity did not gain the authority to collect user fees,
unlike the other activity areas (discussed below).
Table 2. Foods Statutory Authorities in 1980 and 2007
Authorities in 1980
Prohibited interstate commerce in adulterated or misbranded products; provided criminal penalties for violations and authorized
seizures of offending products (P.L. 59-384).
Defined filled milk and considered it adulterated, injurious to health and a fraud (P.L. 67-513).
Required the issuing of valid permits for importation of milk and cream (P.L. 67-625).
Required definitions and standards for foods and informative labeling; prohibited false advertising and the addition of substances that
rendered the food adulterated (P.L. 75-717).
Established premarket approval system for new food additive and packaging substances (P.L. 85-929).
Established premarket approval system for colors used in food, drugs, and cosmetics (P.L. 86-618).
Required rules to prevent non-functional fill of packages and to require legible, prominent label statements for net quantity of
contents (P.L. 89-755).
Required inspection of egg products and established uniform standards for grading eggs (P.L. 91-597).
Limited authority to regulate the composition and promotion of dietary supplements (P.L. 94-278).
Authorities Added Between 1980 and 2007
Required rules for reporting, quality control, recall, exemption labeling and nutrient content for infant formulas; amended for
additional recall, microbiological testing and record retention requirements (P.L. 96-359).
Required assistance with food transportation inspections (P.L. 101-500).
Mandated nutrition labeling and review of nutrient content and health claims; preempted state and local requirements, transferring
to FDA the regulation of all aspects of nutrition labeling information (P.L. 101-535).
Provided specific authority to regulate dietary supplements and placed the burden of proof for safety on FDA for products already
on the market; required rules for notification for statements of nutritional support, ingredient and nutrition information, petition
process and review of new dietary ingredients, and good manufacturing practices (P.L. 103-417).
Required a single health-based standard for all pesticides in raw and processed foods; provided special pesticide safety standards for
infants and children; limited consideration of benefits and allowed civil penalties for tolerance violations; required tolerance levels
reevaluation in a decade; required endocrine testing, the right to know, and national uniformity of tolerances. Required FDA to
monitor pesticide residue levels on foods it regulated in interstate commerce and enforce tolerance levels through its inspection
programs (P.L. 104-170).
Eliminated premarket approval of food contact substances and substituted a notification process contingent on funding to cover
FDA’s cost; expanded procedures for authorizing health and nutrient content claims without reducing the statutory standards (P.L.
105-115).
Required all domestic and foreign facilities that manufacture, process, pack or hold food for U.S. consumption to register and
maintain records for inspection for any product believed to be adulterated; required prior notice of products being imported into
the United States; provided administrative detention authority and penalties for credible evidence that a product presents a threat of
serious adverse health consequences or death to humans or animals (P.L. 107-188).
Required a specific statement about most frequent allergens to appear on the label when any of those allergens are present in a food
(P.L. 108-282).
Reclassified as controlled substances any product containing an anabolic steroid or a precursor that would be converted to a steroid
in the body (P.L. 108-358).
Required the reporting to FDA of any serious adverse events that result from the use of a dietary supplement or nonprescription
drug; provided record keeping requirements and inspection authority needed for an investigation (P.L. 109-462).
Required the creation of a registry for reportable information on foods with safety problems that allows for identification of the
supply chain of the reportable food (P.L. 110-85).

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In Figure 5, changes in the foods budget and FTEs reflect certain events and policy initiatives
during the 28-year period. The budget was relatively flat through the 1980s with requests
primarily for mandatory costs and no program increases. The increase in budget and FTEs in the
early 1990s reflect the considerable amount of work required to implement NLEA and the
simultaneous CFSAN reorganization. Food safety activities also contributed to the modest
increase in FTEs and funding. The subsequent drop off of FTEs from FY1992 to FY1997
represents both deficit reduction efforts and a shift in FTEs to elsewhere in the agency as noted in
the 2002 GAO report. The new CFSAN building opened in College Park, MD, in 2001;
construction costs were part of the budget increases from 1997 until 2001. Increases in both
funding and FTEs in the late 1990s also signaled President Clinton’s food safety initiative.
Increases in the FY2002 budget and FY2003 FTEs represent increased agency attention to the
food supply following the domestic terrorist attacks and subsequent passage of the Public Health
Security and Bioterrorism Preparedness and Response Act of 2002. However, the increases did
not continue. The foods budget has remained flat, while the number of FTEs has decreased since
FY2002. Another reorganization of the foods portion of the agency occurred after 9/11 as a result
of a reordering of the Center’s work and priorities. Recent concerns about food safety problems
have drawn attention to both the foods budget and FTEs.79

79

For more information, CRS Report RS22779, Food Safety: Provisions in the Food and Drug Administration
Amendments Act of 2007, by (name redacted).

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Figure 5. Foods: Budget and FTEs(Constant FY2000 $)

Sources: For FY1980-FY2006, FDA Justification of Estimates for Appropriations Committees documents. FY2007
FTE data are based on an interim continuing resolution used in the FY2008 Justification and therefore do not
reflect final action by Congress. FY2007 budget data reflect the Operating Plan developed after passage of P.L.
110-5, Revised Continuing Appropriations Resolution, 2007.
Notes: Total FTEs = Budget Authority FTEs. Program Level $ = Budget Authority $.

Human Drugs80
No manufacturer may offer a prescription or over-the-counter drug for sale in the United States
without first obtaining FDA’s approval. The agency’s Center for Drug Evaluation and Research
(CDER) works with a manufacturer throughout the application process, from permitting human
clinical trials of an Investigational New Drug (IND), to evaluating for evidence of safety and
effectiveness the data from those trials that are part of a New Drug Application (NDA). Up to a
drug’s approval, CDER wields tremendous influence, as the law authorizes, on required studies
for the decision to grant marketing approval (hence, known as “premarket approval” or
“premarket review”), wording and layout of materials for the prescribing clinician and the patient,
and other aspects of the drug’s labeling.
Once a drug is on the market—a period known as both “postmarket” and “postapproval”—FDA
continues its activities to ensure the product’s safety and effectiveness, although the law does not
80

This section was prepared by (name redacted), Specialist in Drug Safety and Effectiveness.

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provide the agency with postapproval authority equivalent to its preapproval function. FDA staff
examine the results of studies conducted and submitted by manufacturers; review adverse event
reports from manufacturers, clinicians, and consumers; follow the scientific literature regarding
other drugs with similar mechanisms of action; and review labeling, packaging, and promotional
items to both consumers and clinicians. CDER staff also analyze data that the manufacturer
submits and look for trends in large databases of pharmaceutical use. 81
Figure 6 illustrates the resource history of the FDA Human Drugs program from FY1980 through
FY2007. Between FY1980 and FY2007, the total inflation-adjusted funding available for FDA
human drug activities increased 234% (that is, it more than tripled) and the number of FTEs
increased 34%.82
Figure 6. Human Drugs: Budget and FTEs (Constant FY2000 $)

Sources: For FY1980-FY2006, FDA Justification of Estimates for Appropriations Committees documents. FY2007
FTE data are based on an interim continuing resolution used in the FY2008 Justification and therefore do not
reflect final action by Congress. FY2007 budget data reflect the Operating Plan developed after passage of P.L.
110-5, Revised Continuing Appropriations Resolution, 2007.
Notes: From FY1983 through FY1987, the appropriations acts and the FDA-produced budget justifications
included funding for biologics activities in the human drug activities totals. Therefore, Figure 6 shows a peak in
those years and Figure 7 shows a concomitant trough for biologics. Total FTEs = Budget Authority FTEs + User
Fee FTEs. Program Level $ = Budget Authority $ + User Fees $.
81
For further information, see CRS Report RL32797, Drug Safety and Effectiveness: Issues and Action Options After
FDA Approval, by (name redacted).
82
Table A-2 in the Appendix displays the actual numbers (not adjusted for inflation). Using the unadjusted numbers,
FDA’s budget increased almost eightfold (690%) between FY1980 and FY2007. When the dollar figures are adjusted
to indicate comparable purchasing value, the increase diminishes to more than threefold (234%).

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Beginning in FY1994, user fees have made up an increasing proportion of FDA’s budget for
human drug activities. While total funding has increased over the period, this has been entirely
due to the increase in user fees. Congressional appropriations have remained essentially flat.
Separating FTEs by funding source shows that the overall increase in personnel comes solely
from the user fees first collected in FY1993 and that the overall increase in FTEs obscures a 19%
decrease in congressionally funded (budget authority) personnel from FY1992 to FY2007.
The 1992 Prescription Drug User Fee Act, in providing FDA with an additional source of
funding, explicitly stated that the funds were to supplement, not supplant congressional
appropriations. The law included complex formulas, known as “triggers,” to enforce that goal.
FDA may collect and use fees only if the direct appropriations for the activities involved in the
review of human drug applications and for FDA activities overall remain funded at a level at least
equal to the pre-PDUFA budget, adjusted for inflation as specified in the statute.83
These triggers, in particular, and the relative contributions of appropriations and user fees to
FDA’s budget for human drugs have implications for budget planning both within the human
drugs activity area and in agency-level decisions across all activities.
The drug-related tasks for which FDA is responsible have evolved along with the social,
economic, scientific, and technologic developments in the United States. Even before there was a
Bureau of Chemistry in the Department of Agriculture (established in 1862, the ancestral origin
of the current FDA), Congress passed legislation to “prevent the importation of adulterated and
spurious drugs and medicines.” The 1906 Food and Drugs Act heralded the future influence of the
federal government on drug (and food) regulation to protect the public’s health. Many laws
followed (see brief descriptions in the Appendix, Table A-4). Among the most significant are:
the 1938 FFDCA, which required that drugs be safe; and the 1962 Kefauver-Harris Amendments
to the FFDCA, which required that drugs also be effective.
Subsequent laws addressed many issues for FDA, such as aiming to boost pharmaceutical
research and development; to speed the approval of new medicines, including by supplementing
FDA resources with user fee revenue; and to encourage research in pediatric drugs.84 Between
FY1980 and FY2007, Congress added to FDA’s responsibilities new areas (or expanded existing
ones) that involved scientific, legal, and enforcement expertise (see Table 3). Most recently, the
FDA Amendments Act of 2007 (P.L. 110-85) amended dozens of FFDCA sections. These
included human drugs provisions to reauthorize certain programs (such as the assessment,
collection, and use of prescription drug user fees); to enhance FDA’s authority in ensuring safety
and effectiveness over a product’s life (both pre- and postapproval). It required the Secretary to
maintain an Internet website with extensive drug safety information. New authorities include civil
monetary penalties for failure to comply with certain postmarket study, labeling, and television
advertisement requirements; mandates and incentives for pediatric drug research and labeling;
and requirements for making available to the public material such as minutes of agency-industry
performance goal negotiations, pediatric assessment findings and reviews, reviews of adverse
event reports, and advisory committee recommendations on action.
83

For further information, see CRS Report RL33914, The Prescription Drug User Fee Act (PDUFA): History,
Reauthorization in 2007, and Effect on FDA, by (name redacted).
84
For further information, see CRS Report RL33986, FDA’s Authority to Ensure That Drugs Prescribed to Children
Are Safe and Effective, by (name redacted).

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Table 3. Human Drugs Statutory Authorities in 1980 and 2007
Authorities in 1980
Inspect drugs from abroad for quality, purity, and fitness for medical purposes (30th Congress; predates use of the
current public law numbering format).
Regulate interstate commerce in food, drink, and drug products; prohibit adulteration and misbranding (P.L. 59-384),
including false statements of curative or therapeutic effect (P.L. 62-301).
Review evidence of safety (P.L. 75-717) and effectiveness (P.L. 87-781) before approving a drug for interstate
commerce.
Require records of shipments; inspect manufacturing, processing, packing, or holding facilities, including equipment,
materials, containers, and labeling (P.L. 75-717, expanded by P.L. 83-217).
Certify batches of color additives (P.L. 75-717); promulgate regulations for the listing of color additives in or on drugs
(or other FDA-regulated products) based on conditions, uses, and labeling to assure safe use (P.L. 86-618).
Enforce enhanced labeling and packaging requirements (P.L. 75-717).
Test and certify each batch of insulin (P.L. 77-366) and penicillin (P.L. 79-139) for strength, quality, and purity;
promulgate regulations covering, among other things, standards and tests.
Regulate certain drugs as prescription-only (P.L. 82-215).
Regulate prescription drug advertising (P.L. 87-781).
Regulate all antibiotics (P.L. 87-781).
Enforce enhanced regulations covering manufacture, recordkeeping, inspections, prescription refills, of depressant and
stimulant drugs; authorized to appoint expert advisory committees (P.L. 89-74).
Enforce enhanced labeling requirements (P.L. 89-755).
Notify Attorney General when a submitted new drug application involves a drug with an abuse potential (P.L. 91-513).
Authorities Added Between 1980 and 2007
Provide incentives for pharmaceutical manufacturers to develop drugs, biotechnology products, and medical devices
for the treatment of rare diseases and conditions (P.L. 97-414).
Investigate tampering with packaged consumer products (P.L. 98-127).
Review generic drug applications (P.L. 98-417).
Promulgate and enforce enhanced regulations on the distribution of drug samples (P.L. 100-293, expanded by P.L.
102-282).
Assess and collect fees from the pharmaceutical manufacturers and use the resulting revenue to support its review of
new drug applications (P.L. 102-571, P.L. 105-115, P.L. 107-188, P.L. 110-85).
Establish fast track approval process for drugs that would treat life-threatening conditions (P.L. 105-115).
Streamline the drug review process and provide a means for resolving controversial scientific issues (P.L. 105-115).
Enforce refined requirements regarding the dissemination of information about “off-label” uses of drugs or devices
not yet approved by the FDA, patient access to investigational therapies, international harmonization and national
uniformity in the regulation of nonprescription drugs and cosmetics (P.L. 105-115).
Conduct regulatory functions under a mission statement that will obligate it to maintain a public health protection
role while seeking to expedite the marketing of regulated products (P.L. 105-115).
Grant a manufacturer an additional six months of marketing exclusivity in exchange for completing FDA-requested
studies of use in children (P.L. 105-115; expanded by P.L. 107-109, P.L. 110-85).
Establish program allowing pharmacists and drug wholesalers to import lower-priced prescription drugs from specific
countries. [Not implemented due to trigger requirement.] (P.L. 106-387, P.L. 108-173).
Require a pediatric assessment of safety and effectiveness as part of an application to market a new active ingredient,

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new indication, new dosage form, new dosing regimen, or new route of administration for a drug or biologic, or, if
the Secretary considers it necessary, for an approved drug or licensed biologic (P.L. 108-155, expanded by P.L. 11085).
Study the use of technologies to provide prescription drug information to the blind and visually impaired (P.L. 108173).
Expedite review of countermeasures to chemical, biological, and nuclear agents that may be used in a terrorist attack
(P.L. 108-276).

Biologics85
Biologics are medical preparations made from living organisms. Examples of such products
include traditional biologics (such as vaccines, blood, blood products, antitoxins, and
allergenics86) and human therapeutic agents produced by the biotechnology industry (such as
insulin, interferon, growth hormone, and epoetin). FDA ensures the purity and effectiveness of
biologics by (1) issuing a license for each new product that is shown to be safe, pure, and potent
and (2) inspecting manufacturing facilities to assure the product continues to be safe, pure, and
potent. Unlike most chemically synthesized drugs (e.g., aspirin) with a known structure, biologics
are often complex mixtures that are not easily identified or characterized. Biologics might also be
living entities, such as cells and tissues. Biologics may be isolated from a variety of natural
sources (human, animal, or microorganism) or may be produced by biotechnology methods and
other cutting-edge technologies. FDA is also responsible for the safety of the nation’s blood
supply and routinely examines blood bank operations for record keeping and testing of donations
for contaminants.
Regulatory responsibility for biologics was first delegated in the early 1900s to the Hygienic
Laboratory, a precursor of the National Institutes of Health (NIH). 87 In 1972, regulatory authority
for biologics was transferred from the NIH Division of Biological Standards to the FDA Bureau
of Biologics. 88 During the early 1980s, the FDA merged the Bureau of Drugs and the Bureau of
Biologics to form the National Center for Drugs and Biologics. In 1984, all of the “National
Centers” within FDA were redesignated simply as “Centers.” In 1987, the FDA’s Center for
Drugs and Biologics was split into the Center for Drug Evaluation and Research (CDER) and the
Center for Biologics Evaluation and Research (CBER). CBER continues to use NIH facilities and
buildings until the expected move in 2012 to the new FDA headquarters in White Oak, MD.
Because biotechnology products frequently cross the conventional boundaries between biologics,
drugs, and devices, determining the jurisdictional status of these new products has been difficult
for both the FDA and industry. Some products have had characteristics that met multiple statutory
and scientific definitions. In 1991, the FDA published an Intercenter Agreement between CBER
and CDER. In general, the agreement stated that traditional biologics as well as most
biotechnology products, would be regulated by CBER.89 In 2002, however, the FDA announced
85
86

This section was prepared by (name redacted), Specialist in Biomedical Policy.
Allergenics are extracts used to diagnose and treat allergic reactions such as hay fever.

87

The NIH Almanac—Historical Data: Chronology of Events, at http://www.nih.gov/about/almanac/historical/
chronology_of_events.htm.
88
Donna Hamilton, “A Brief History of the Center for Drug Evaluation and Research,” FDA History Office, November
1997, at http://www.fda.gov/cder/about/history/Histext.htm.
89
Except for a small set of biologics (hormones, such as insulin, human growth hormone, and a few medical enzymes)
that would continue to be regulated by CDER. These biologics have historically been regulated as drugs under the
(continued...)

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its intention to reorganize review responsibilities, consolidating review of new pharmaceutical
products under CDER; CBER retains review responsibility for vaccines, blood safety, gene
therapy, and tissue transplantation. 90 On June 30, 2003, responsibility for most therapeutic
biologics was transferred from CBER to CDER.91 Remaining at CBER are traditional biologics
such as vaccines, allergenic products, antitoxins, antivenins, venoms, and blood and blood
products, including recombinant versions of plasma derivatives (clotting factors produced via
biotechnology).
Figure 7 shows the total FDA budget for Biologics, composed of budget authority and user fees,
for FY1980 through FY2007, adjusted to FY2000 dollars. It also provides FTE data over the
same years: FTEs funded by budget authority; and total FTEs funded at program level (budget
authority plus user fees). The impact on funding and FTEs of the FDA reorganization in the 1980s
can be clearly seen in Figure 7. Although budget authority and FTEs for biologics were rising in
the late 1980s and early 1990s, the graph shows that both decline and then remain flat coincident
with the introduction of user fees in 1993. Budget authority and FTEs increased between FY2001
and FY2003, coincident with increased emergency funding following the domestic terrorist
attacks. The drop in biologics funding and FTEs from FY2003 to FY2004 is due to the
reorganization of review responsibilities for therapeutic biologics. Following the reorganization,
budget authority and FTEs for biologics have remained relatively flat.

(...continued)
Federal Food, Drug, and Cosmetic Act rather than licensed under the Public Health Service Act.
90
FDA Press Release, “FDA to Consolidate Review Responsibilities for New Pharmaceutical Products,” September 6,
2002, at http://www.fda.gov/bbs/topics/NEWS/2002/NEW00834.html.
91
Federal Register, vol. 68, no. 123, June 26, 2003, pp. 38067-38068. Examples of products transferred to CDER
include monoclonal antibodies; proteins intended for therapeutic use (interferons, thrombolytic enzymes);
immunomodulators (other than vaccines and allergenic products); and growth factors, cytokines, and monoclonal
antibodies intended to alter production of blood cells. See Transfer of Therapeutic Products to the Center for Drug
Evaluation and Research http://www.fda.gov/cber/transfer/transfer.htm; Approved Products Transferring to CDER
http://www.fda.gov/cber/transfer/transfprods.htm; and Therapeutic Biological Products http://www.fda.gov/cder/
biologics/default.htm.

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Figure 7. Biologics: Budget and FTEs (Constant FY2000 $)

Sources: For FY1980-FY2006, FDA Justification of Estimates for Appropriations Committees documents. FY2007
FTE data are based on an interim continuing resolution used in the FY2008 Justification and therefore do not
reflect final action by Congress. FY2007 budget data reflect the Operating Plan developed after passage of P.L.
110-5, Revised Continuing Appropriations Resolution, 2007.
Notes: For FY1983 through FY1987, FDA managed Biologics activities and Human Drugs activities in one
Center. The Justifications for those years provide only combined dollar and FTE numbers, which are included in
Figure 6(Human Drugs) and not in Figure 7 (Biologics). Total FTEs = Budget Authority FTEs + User Fee FTEs.
Program Level $ = Budget Authority $ + User Fees $.

FDA’s responsibilities related to the approval and regulation of biological products have changed
somewhat between 1980 and 2007 (see
Table 4). In 1980, FDA’s authority with respect to the approval of biological products was
governed primarily by Section 351 of the Public Health Service Act (P.L. 78-410). In addition,
because most biological products also meet the definition of “drugs,” they are subject to
regulation under the FFDCA (P.L. 59-384). FDA also regulates medical devices involving
biologics under various medical device laws. Examples include devices used in blood banks to
produce various blood products, such as automated cell separators, empty plastic containers and
transfer sets, and blood storage refrigerators and freezers.
By 2007, the passage of additional laws had created more responsibilities and authorities for FDA
in the area of biologics. The Pediatric Research Equity Act of 2003 (P.L. 108-155) requires a
pediatric assessment of safety and effectiveness as part of an application to license a new
biologic, or, if the Secretary considers it necessary, for an already licensed biologic. The Project

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Bioshield Act of 2004 (P.L. 108-276) requires FDA to provide an expedited review of vaccines
and other countermeasures to bioterrorism agents.
Congress is also currently considering proposed legislation that would expand the agency’s
regulatory activities by opening a pathway for the approval of so-called follow-on biologics,
which are similar, but not identical, to the brand-name products made by the pharmaceutical or
biotechnology industry.92 The new regulatory pathway would be analogous to the FDA’s authority
for approving generic chemical drugs under the Drug Price Competition and Patent Term
Restoration Act of 1984 (P.L. 84-417), often referred to as the Hatch-Waxman Act. FDA
personnel have been actively involved for some time in working with Congress on this potential
new responsibility.
Table 4. Biologics Statutory Authorities in 1980 and 2007
Authorities in 1980
Licenses new biological products that are shown to be safe, pure, and potent and inspects manufacturing facilities to
assure the product continues to be safe, pure, and potent (P.L. 78-410).
Regulates medical devices involving blood products or other biologics (P.L. 75-717).
Regulates biological products (P.L. 87-781).
Regulates advertising of biological products (P.L. 87-781).
Authorities Added Between 1980 and 2007
Assesses and collects fees from biologics manufacturers and uses the resulting revenue to support the review of new
biologic products (P.L. 102-571, P.L. 105-115, P.L. 107-188).
Collect user fees for premarket device review (P.L. 107-250, P.L. 108-214, P.L. 109-43).
Requires a pediatric assessment of safety and effectiveness as part of an application to license a new biologic, or, if the
Secretary considers it necessary, for a licensed biologic (P.L. 108-155).
Expedites review of countermeasures to agents that may be used in a terrorist attack (P.L. 108-276).

Animal Drugs and Feeds93
The FDA Center for Veterinary Medicine (CVM) regulates animal feeds (such as livestock feeds
and pet foods), and veterinary drugs and devices. 94 CVM is responsible for premarket approval of
veterinary drugs, based on a sponsor’s demonstration of safety and effectiveness. CVM regulates
veterinary devices, but does not require their premarket approval.95 Veterinary biologics are
regulated by the USDA. 96 Much of CVM’s authority is based in FDA’s general authorities in the
FFDCA, such as the authority to take enforcement actions if a regulated product is adulterated, to
92

For further information, see CRS Report RL34045, FDA Regulation of Follow-On Biologics, by (name redacted).
This section was prepared by (name redacted), Specialist in Public Health and Epidemiology.
94
See http://www.fda.gov/cvm/.
93

95
FDA can take appropriate regulatory action if a veterinary device is misbranded, mislabeled or adulterated. Also,
firms that manufacture radiation-emitting veterinary devices must register their products under the radiological health
regulations, administered by the FDA Center for Devices and Radiological Health (CDRH). See FDA CVM, “How
FDA Regulates Veterinary Devices,” May 2003, at http://www.fda.gov/cvm/regofdevices.htm.
96
Veterinary biologics, such as vaccines and clinical laboratory tests, are regulated by the USDA, Animal and Plant
Health Inspection Service, Center for Veterinary Biologics. See http://www.aphis.usda.gov/animal_health/
vet_biologics/.

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require facility registration, and to conduct inspections. For example, animal feed is included in
the definition of “food” in Section 201 of the FFDCA, and must meet the same general standards
of safety as human food, pursuant to Sections 401 et seq. of the act. Additional specific
requirements may also be applied to CVM-regulated products.
Though USDA and FDA-CFSAN have primary responsibility for the safety of products intended
for human food, 97 CVM is responsible for some specific aspects of the safety of human foods
derived from animals, such as determining tolerances (safe levels) of certain chemicals in meat
and poultry, and evaluating the food safety aspects of animal clones and their offspring. Also,
before CVM approves an animal drug, its use in animals must be shown to be safe for humans as
well. Drug sponsors must demonstrate that a method is available to detect and measure any drug
residues left in edible tissues of food-producing animals. Farmers and veterinarians who use
drugs on food-producing animals must adhere to guidelines about how much time must elapse
before a treated animal can be slaughtered, or before its milk can be marketed, and any other
constraints or warnings that are stated on the drug label.
Figure 8 shows the total FDA budget for animal drugs and feeds, composed of budget authority
and user fees, for FY1980 through FY2007, adjusted to FY2000 dollars.98 Figure 8 also provides
FTE data over the same period: FTEs funded by budget authority; and total FTEs funded at
program level (budget authority plus user fees). During that time, the budget in adjusted dollars
increased from $46.7 million in FY1980 to $87.6 million in FY2007. FTEs totaled 516 in
FY1980, and 619 in FY2007, though there were fewer than 500 FTEs for most of the intervening
years. Drug user fees provided a small portion of CVM’s overall budget between FY2004 and
FY2007, and made up about 11% of the FY2007 total. (FDA did not have authority to collect user
fees for new animal drug reviews until FY2004.)
The budget for animal drugs and feeds, in adjusted dollars, almost doubled in the three-year
period from FY1999 to FY2002, from $44.3 million to $82.4 million. FTEs increased from 393 to
570 in the same period. (The budget was relatively stable in the years before and after this period
of growth, when adjusted for inflation.) The funding increases largely paralleled increasing
budget requests for those years. Increases were requested to support new statutory requirements
as well as several initiatives, some of which were agency-wide. These initiatives included
activities in food safety, antimicrobial resistance, and postmarket surveillance of drug safety, as
well as efforts to reduce drug review times. They also included a bioterrorism preparedness
initiative, and the expansion of feed safety programs to protect against Bovine Spongiform
Encephalopathy (BSE, or “Mad Cow disease”). In each case, funding was expanded prior to a
related high-profile incident, namely the 2001 anthrax attacks, and the 2003 emergence of BSE in
North America.
Prior to 1980, CVM was responsible for evaluating veterinary drugs for approval based on
demonstrations of safety and efficacy, and for assuring the safety of animal feeds and feed
additives. Several laws enacted since 1980 were aimed at improving the availability of veterinary
drugs (which are typically not as lucrative for sponsors as are human drugs), clarifying the use of
human drugs in animals, or streamlining the drug approval process. FDA’s authority for animal
97

See CRS Report RS22600, The Federal Food Safety System: A Primer, by (name redacted) and (name redacted).

98

Though CVM was called the Bureau of Veterinary Medicine prior to 1984, the Center and the Animal Drugs and
Feeds budget line have, for practical purposes, encompassed the same activities for several decades, and references to
each are used interchangeably.

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products generally begins with the same statutes as those that regulate human drugs and foods
(see Table 2 and Table 3), with additional specific requirements applied in some cases.99 This is
consistent with FDA’s long-standing obligation to assure that veterinary drugs and animal feeds
are manufactured and used in ways that are safe for both animals and humans.
Figure 8. Animal Drugs and Feeds: Budget and FTEs(Constant FY2000 $)

Sources: For FY1980-FY2006, FDA Justification of Estimates for Appropriations Committees documents. FY2007
FTE data are based on an interim continuing resolution used in the FY2008 Justification and therefore do not
reflect final action by Congress. FY2007 budget data reflect the Operating Plan developed after passage of P.L.
110-5, Revised Continuing Appropriations Resolution, 2007.
Notes: Total FTEs = Budget Authority FTEs + User Fee FTEs. Program Level $ = Budget Authority $ + User
Fees $.

Major laws affecting CVM’s regulation of animal drugs and feeds are summarized in Table 5.100
In 1988, the Generic Animal Drug and Patent Term Restoration Act (P.L. 100-670) authorized
abbreviated applications for generic new animal drugs. In 1994, the Animal Medicinal Drug Use
99
An exception to this general rule is the Dietary Supplement and Health Education Act (DSHEA) of 1994, which
requires that FDA not designate substances added to “food for humans” as food additives or drugs if the product meets
the definition of a dietary supplement. FDA has interpreted that DSHEA does not apply to products added to animal
feeds. Consequently, CVM regulates any animal feed supplement as either a food, food additive, or animal drug,
depending on the intended use, and does not apply the additional dietary supplement category.
100
The Center’s statutory authorities are discussed in greater detail on a public website, “Chronological History of
CVM,” at http://www.fda.gov/cvm/chronological.htm.

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Clarification Act (P.L. 103-396) permitted veterinarians to prescribe, for animals, extra-label uses
of certain approved animal and human drugs, under certain conditions. In 1996, the Animal Drug
Availability Act (P.L. 104-250) granted FDA more flexibility in evaluating and approving new
animal drugs by amending the definition of substantial evidence of effectiveness. Among other
provisions, the law also permitted the use of veterinary drugs in animal feeds, with veterinary
prescription.
In 2002, the Public Health Security and Bioterrorism Preparedness and Response Act (P.L. 107188) required the registration of all domestic and foreign facilities that manufactured, processed,
packed or held animal feeds. 101 In 2003, the Animal Drug User Fee Act (P.L. 108-130) authorized
FDA to collect fees for the review of certain animal drug applications.102 In 2004, the Minor Use
and Minor Species Animal Health Act (P.L. 108-282) authorized, along with other approaches and
incentives for limited-market drugs, the conditional approval for drugs to treat minor animal
species and uncommon diseases in major animal species,103 which allows the sponsor to make a
drug available before collecting all necessary effectiveness data, but after proving that the drug is
safe. In 2007, the FDAAA (P.L. 110-85) required, for pet foods, the development of ingredient,
processing and labeling standards, and a surveillance system to detect disease outbreaks.
Additional provisions that apply to both human foods and animal feeds require, among other
things, that FDA establish a reportable food registry, and that persons in charge of FDA-registered
food facilities report any instances of tainted foods that may harm humans or animals.
Table 5. Animal Drugs and Feeds Statutory Authorities in 1980 and 2007
Authorities in 1980
Prohibits interstate commerce in adulterated and misbranded feeds; provides criminal penalties for violations and authorizes seizures
of offending products (P.L. 59-384).
Review evidence of safety (P.L. 75-717) and effectiveness (P.L. 87-781) before approving an animal drug.
Review safety and effectiveness of animal drugs for intended use, including safety for use in food-producing animals (P.L. 90-399).
Authorities Added Between 1980 and 2007
Authority for abbreviated applications for generic animal drugs (P.L. 100-670).
Authority for veterinarians to prescribe, for animals, extra-label uses of certain approved animal and human drugs, under certain
conditions (P.L. 103-396).
Added flexibility in approving new animal drugs, including an amended definition of substantial evidence of effectiveness. Granted
authority for the use of veterinary drugs in animal feeds, with veterinary prescription (P.L. 104-250).
Requirements for facilities that manufacture, process, pack, or hold animal feed for domestic consumption to register and maintain
records (P.L. 107-188).
Authority to collect user fees for certain animal drug applications (P.L. 108-130).
Conditional approval of veterinary drugs for minor uses or minor species, based on demonstration of safety without all necessary
effectiveness data (P.L. 108-282).
Required, for pet foods, the development of ingredient, processing and labeling standards, and a surveillance system to detect
disease outbreaks. Required, for both human foods and animal feeds, the establishment of a reportable food registry, and mandatory
reporting of instances of tainted foods (P.L. 110-85).

101

The law applied similarly to human food facilities.

102

The law is similar to the Prescription Drug User Fee Act (PDUFA) and the Medical Device User Fee and
Modernization Act (MDUFMA) for human products.
103
For more information on minor uses and minor species, see http://www.fda.gov/cvm/minortoc.htm.

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Devices and Radiological Health104
FDA is responsible for ensuring the safety and effectiveness of medical devices and eliminating
unnecessary human exposure to man-made radiation from medical, occupational, and consumer
products.105 There are thousands of types of medical devices, from heart pacemakers to contact
lenses. Radiation-emitting products regulated by the agency include microwave ovens, video
display terminals, and medical ultrasound and x-ray machines. FDA reviews requests to research
or market medical devices; collects, analyzes, and acts on information about injuries and other
experiences in the use of medical devices and radiation-emitting electronic products; sets and
enforces good manufacturing practice regulations and performance standards for radiationemitting electronic products and medical devices; monitors compliance and surveillance
programs for medical devices and radiation-emitting electronic products; and provides technical
and other nonfinancial assistance to small manufacturers of medical devices. The agency’s current
activities related to devices and radiological health (DRH) are primarily conducted by its Center
for Devices and Radiological Health. As previously noted, CBER regulates some devices—
specifically those associated with blood collection and processing procedures, as well as with
cellular therapies (e.g., stem cell treatments).
In FY1980, after adjusting for inflation, FDA’s DRH budget was $97,427,000, which supported
1,399 FTEs (see Figure 9). At that time, the agency’s responsibilities with respect to devices were
governed primarily by the Medical Device Amendments of 1976 (MDMA, P.L. 94-295). MDMA
was the first major legislation passed to ensure the safety and effectiveness of medical devices,
including diagnostic products, before they could be marketed. The amendments required
manufacturers to register with FDA and follow quality control procedures in their manufacturing
processes. They also required FDA to conduct premarket review of some products, and to
generate performance standards that devices had to meet before they could be marketed.
Between FY1980 and FY2007, several major pieces of device legislation were passed (see Table
6). Some of these added new types of responsibilities. In 1990, Congress gave FDA the authority
to enforce postmarket requirements for devices, to act on postmarket adverse event reports, and to
recall unsafe devices (P.L. 101-629). In 1992, Congress gave FDA the authority to require that
manufacturers of defective products implement certain consumer accommodations and pursue
penalties for postmarket surveillance noncompliance (P.L. 102-300). In 1997, Congress passed
the Food and Drug Administration Modernization Act (FDAMA), major FDA reform legislation
that tasked the agency with accelerating its premarket review and regulating unapproved uses of
approved devices (P.L. 105-115).
Other legislation contained provisions that could reduce or minimize, rather than simply increase,
the regulatory burden on FDA. For example, while the Mammography Quality Standards Act
(MQSA) added the responsibility of requiring the agency to certify mammography facilities, it
also provided the authority to collect associated certification fees, creating a new revenue stream
(P.L. 102-539). MQSA also allowed certain accredited third-parties to conduct inspections in
order to relieve FDA of some of that responsibility.

104

This section was prepared by (name redacted), Specialist in Public Health and Bioethics.
For further information, see CRS Report RL32826, The Medical Device Approval Process and Related Legislative
Issues, by (name redacted).
105

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In 2002, Congress passed the largest revenue-generating, non-appropriations legislation for
FDA’s DRH-related activities in the 28-year period under examination: the Medical Device User
Fee and Modernization Act (MDUFMA, P.L. 107-250).106 The law gave FDA the authority to
collect user fees for premarket device review, creating another significant source of revenue. It
also accredited third-parties to conduct inspections, a measure designed to reduce FDA’s
regulatory burden. To preclude user fees from supplanting direct appropriations, MDUFMA
contained a “trigger,” requiring a certain amount of DRH-related direct appropriations for the
collection of user fees to continue. In 200

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/crs%3ARL34334. Public record. Not legal advice.