FDA Clarifies Regulations Regarding How Patients May Be Charged for Investigational Drugs

June 14, 2016

On Thursday, June 2nd the FDA issued a final guidance, entitled “Charging for Investigational Drugs Under an IND — Questions and Answers.”  The guidance provides information concerning the implementation of the Agency’s “regulation on charging for investigational drugs under an investigational new drug application (IND) for the purpose of either clinical trials or expanded access for treatment use (21 CFR 312.8).”


Title 21 of the Code of Federal Regulation Section 312.8 took effect in October 2009, replacing the FDA’s 1987 rule that authorized the Agency to charge for an investigational drug.  The revisions that were made in 2009 include:

  • General criteria for authorizing charging for an investigational drug (21 CFR 312.8(a))
  • Criteria for charging for an investigational drug in a clinical trial (21 CFR 312.8(b))
  • Criteria for charging for an investigational drug for an expanded access use under 21 CFR part 312, subpart I (21 CFR 312.8(c))
  • Criteria for determining what costs can be recovered when charging for an investigational drug (21 CFR 312.8(d))

Since 2009, the FDA has received numerous questions regarding the implementation of its charging regulation.  These inquiries are the driving force behind FDA’s recent guidance document, which “guidance in a question and answer format, addressing the most frequently asked questions.”

Q & A

In the recent final guidance, FDA organized the questions and their respective answers into four distinct categories, including:

  1. General Questions
  2. Charging in Clinical Trials
  3. Charging for Expanded Access
  4. Cost Recovery Calculations

General Questions

Among these questions, the FDA includes information concerning the time frame for reviewing and responding to a request, as well as details regarding who requests authorization and is charged by the sponsor.  In this subsection of questions, the following information is provided:

  • Although 21 CFR 312.8 does not specify a time frame, FDA states that it intends to respond to charging requests within 30 days of receipt when possible.
  • “Section 312.8 permits only the sponsor of the IND to request FDA’s authorization to charge for an investigational drug for use under the IND.” Additionally, it is important to note that the drug’s sponsor is not always the manufacturer.
  • The FDA does determine whether or not a sponsor may charge for expanded access, but it does not decide how that charging is to be done. In addition, FDA notes that it has not authority to require or dictate reimbursement for investigational drugs for which it has authorized charging.

Charging in Clinical Trials

The guidance document touches on various topics involving clinical trials, providing the following information:

  • If using its own investigational drug (including an investigational use of its approved drug, in a clinical trial), FDA states that a sponsor must provide the Agency with a variety of information and data in order to obtain consent to charge for the drug. Details on exactly what must be completed is available in the full guidance document.
  • Sponsors must demonstrate that the clinical trial could not be conducted without charging for the investigational drug because the cost of the drug is extraordinary to the sponsor.
    • FDA states that “the cost of a drug may be considered extraordinary to a sponsor because of manufacturing complexity, scarcity of a natural resource, the large quantity of the drug needed (e.g., based on the size or duration of the trial), or some combination of these or other extraordinary circumstances (e.g., resources available to a sponsor).”
  • In determining whether or not the cost of providing the drug is extraordinary to a sponsor, the Agency does consider the financial resources that are available to the sponsor. For example, FDA states a cost that may be considered extraordinary to a small start-up company may not be considered extraordinary to a larger, more established company.
  • “An independent certified public accountant is a certified public accountant who is not an employee of the company seeking to charge for an investigational drug.”
  • Sponsors are still required to obtain approval to charge for an investigational drug when conducting a clinical trial to evaluate an unapproved use of its approved drug.
  • If a sponsor purchases an approved drug from the company that markets or distributes the product for use in a clinical trial, the sponsor does not need FDA authorization to charge for the approved drug.
  • Unless a shorter duration has been specified by the FDA, sponsors may charge for an investigational drug for the entire length of the clinical trial.

In addition to the information listed above, FDA provides answers to a number of additional questions that it receives frequently.  For more on these questions and answers, view the full guidance document.

Charging for Expanded Access Use

With regard to charging for expanded access use, the Agency provides the following:

  • The sponsor of an expanded access IND or protocol must prove that charging will not interfere with the drug’s development, and “provide documentation in its charging request submission to show that its calculation of the amount to be charged is consistent with the requirements in § 312.8(d).” Additionally, the sponsor must also include a testimonial stating that an independent certified public accountant has reviewed and approved the calculation.
  • After receiving FDA authorization, a sponsor may charge for an investigational drug for expanded access use may continue for one year (unless a shorter time period has been specified by the Agency).
  • “If a sponsor wishes to continue charging beyond the duration of its existing charging authorization, the sponsor must submit a request to FDA for reauthorization to charge for the investigational drug (21 CFR 312.8(c)(4)).”

Cost Recovery Calculations

The final category of questions included in the guidance document addresses topics relating to cost recovery, including the following:

  • When charging for an investigational drug in a clinical trial, a sponsor is only permitted to recover “the direct costs of making a drug available to subjects in a clinical trial,” or the costs that are incurred specifically from providing the drug to clinical trial subjects.
  • When charging for an investigational drug for expanded access, a sponsor may only recover the costs that are directly associated with providing the drug to the patient. Furthermore, sponsors may recover the cost of monitoring the expanded access IND or protocol; complying with IND reporting requirements; and other administrative costs directly associated with the expanded access use.  Sponsors may not charge for indirect costs, including (but not limited to):
    • “Costs associated with developing the treatment protocol and informed consent document
    • Costs associated with corresponding with the IRB, FDA, and/or the drug manufacturer
    • Costs associated with reporting to the IRB and/or FDA
    • IRB fees and expenses.”
  • Expanded access IND or protocol sponsors are able to recover the fees that it pays to a “third party for administering an intermediate-size patient population expanded access IND or protocol or a treatment IND or protocol.”
  • Sponsors do not need permission to charge for the costs of drug delivery (i.e., the costs associated with formulation, packaging, instrumentation, monitoring, disposables, setup, and nursing care).

The Agency provides additional details on the information that a sponsor must submit to FDA in support of its cost calculation(s).  To learn more, view the FDA’s full guidance document.

Are you seeking approval of a compassionate use request?  We can help with this or any other type of FDA submission.  To learn more about our services and how we can help you obtain FDA approval, contact us today.


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