OTC Drug Manufacturers Face New Fee Schedule: FDA Funding Extended Through 2030

This bill, the Over-the-Counter Monograph Drug User Fee Amendments, is essentially the paperwork required to keep the FDA’s oversight of your basic drugstore remedies—think Tylenol, antacids, and topical creams—funded and running smoothly for the next five years. It reauthorizes the user fee system for companies that make these Over-the-Counter (OTC) monograph drugs, covering fiscal years 2026 through 2030. If you’re a consumer, this bill ensures the regulatory machinery stays oiled; if you’re a manufacturer, it updates your annual bill from the FDA.

The Cost of Doing Business: New Fee Deadlines

The most immediate impact is on the facility fees paid by manufacturers. The bill restructures when these companies have to pay their annual fees (Sec. 4). Instead of a single, fixed date, the due dates are being staggered and slightly confusing for the first couple of years. For example, the fee for Fiscal Year 2027 will be split into two 50% installments, with the second half potentially delayed if Congress hasn’t passed the necessary appropriations act yet. This creates administrative complexity for the companies involved—they have to plan for a fee that might be due in two chunks, depending on the political calendar.

Crucially, the bill also changes the “applicable period” used to determine who pays the fee. It carves out an exception for companies that stopped all OTC monograph activities before specific dates (e.g., January 1, 2025, for FY 2026). This is an important detail for businesses that have recently downsized or exited the market, potentially saving them from unexpected fee assessments.

Quality Control Gets Official Recognition

Section 3 makes a subtle but significant change regarding how the FDA defines a “modification” to an OTC drug. Currently, if a company makes a change to its product, it might require a regulatory submission. This bill adds a new type of change that counts: the addition or change to a testing procedure that applies to one or more OTC monograph drugs, but only if that new procedure reflects a voluntary consensus standard for pharmaceutical quality (Sec. 3).

What does this mean in plain English? If a company adopts a new, industry-recognized best practice for checking the quality of its antacid, that change is now officially defined as a reportable “addition.” This is a good thing for clarity and quality, as it formally recognizes industry-led efforts to improve testing and manufacturing standards. However, the FDA retains the authority to recognize these standards through guidance—guidance that can be updated, creating a potential moving target for manufacturers.

The FDA Gets a Workload Raise

The bill sets new revenue targets for the FDA’s OTC monograph activities, adding specific dollar amounts to the fee calculations for FY 2026, 2027, and 2028 (Sec. 4). More interesting is the introduction of a One-Time Workload Adjustment the Secretary can apply for FY 2028, 2029, or 2030. This adjustment allows the FDA to collect more revenue if the average number of facilities paying fees exceeds 1,625 over the preceding three years.

This provision is a smart way to account for growth in the industry. If more companies are making OTC drugs, the FDA needs more resources to oversee them. It ties the FDA’s funding directly to its actual workload, ensuring that the regulatory body isn’t underfunded if the sector expands. Finally, the entire program authorization for OTC monograph oversight is extended through September 30, 2030, giving both the industry and consumers five years of stability under this regulatory framework (Sec. 5).