At the November meeting, Abbott senior vice president Bruce Burlington, representing PhRMA, urged further analysis of whether current user-fee revenues are wisely spent. Burlington noted that an FDA study of first-cycle reviews and a review of the impact of risk-management plans may be informative. Industry supports further development of FDA computer information systems, as well as a suggestion from the Biotechnology Industry Organization to improve drug safety through better evaluation of trade names.

The most serious danger: The whole PDUFA program could collapse if Congress tries to boost user fees without also increasing FDA appropriations. The program has a complex trigger arrangement, established in 1992, to ensure that user fees would supplement FDA appropriations and not merely replace public funding, an arrangement backed by all parties. But FDA's personnel costs rise 5 to 6 percent a year because of mandated cost-of-living increases, and FDA appropriations seldom cover those costs. While the agency has managed to make the numbers work each year, the continued squeeze on FDA's budget challenges the program's basic principle.

The long-discussed proposal to institute user fees for generic drugs has resurfaced in recent months, as prospects have dimmed for budget increases earmarked for FDA's Office of Generic Drugs. Generics makers say they're willing to discuss the idea, but application fees for abbreviated NDAs are tricky due to often lengthy delays between when FDA approves an ANDA and when the product actually comes to market.

Meanwhile, the Bush administration's $7.1 billion Pandemic Influenza Plan poses a different kind of challenge to FDA. The plan, which was released in November, includes a whopping $2.8 billion "crash program" to revitalize US vaccine manufacturing—in part by shifting from egg-based flu vaccine production to advanced cell-culture approaches able to produce a new vaccine in six months. Another $1.5 billion would buy 40 million vaccine doses by 2009, plus $1 billion to stockpile enough antivirals, such as Roche's Tamiflu (oseltamivir) and GlaxoSmithKline's Relenza (zanamivir), to treat 25 percent of the population.

Public health officials praise the administration's focus on pandemic preparedness and support for research on new vaccines and treatments. But the plan has drawn fire from politicians on both sides of the aisle.

Congressional conservatives oppose spending billions that the government doesn't have, and Democrats blast the administration for providing a paltry $100 million to support state preparedness efforts and antiviral purchases. The largess to vaccine and drug makers also faces challenges—there are still fears that government and manufacturers are too cozy. On the manufacturers' side, the prospect of compulsory licensing has put pressure on Roche to negotiate licensing arrangements with generic-drug makers to boost Tamiflu supplies, and similar responses are likely for future potentially life-saving vaccines and treatments.

Squeezing FDA

While the administration's preparedness plan acknowledges FDA's central role in ensuring access to safe and effective flu vaccines and treatments, the initiative provides only $20 million to cover a long list of added duties: evaluating new production strategies and investigational vaccine lots, as well as assessing new antivirals and diagnostic tests and devices.

The 2004 flu vaccine crisis required FDA officials to spend weeks monitoring vaccine quality and inspecting manufacturing sites in the United States and overseas, while also engineering accelerated approval for new sources of supply. A huge ramp-up of stockpiles will tax FDA's ability to monitor drug stability, while growing demand for flu treatments will require close scrutiny for counterfeit products.

FDA has assembled a Rapid Response Team to coordinate agency pandemic-preparedness activities with industry, the Centers for Disease Control and Prevention and the National Institutes of Health. The aim is to detect production roadblocks to ensure an adequate supply of antivirals and vaccines in case of a domestic pandemic outbreak. The team would have authority to allow other firms to manufacture a patented product under "emergency-use" authorization.

While every bird that catches avian flu now makes headlines, many scientists are skeptical that a pandemic will emerge in the near future. Reminders are resurfacing of the 1976 swine flu debacle, when the government wasted billions developing vaccines for a flu pandemic that never materialized.