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Bush budget squeezes already-thin FDA, critics say

BY Michael Johnsen

WASHINGTON —The Food and Drug Administration last month was the recipient of a proposed 5.7 percent increase in its budget, representing a total dollar increase of some $129.7 million—$50.7 million in increased government funding and $79 million in increased user fees—giving the agency $2.4 billion to work with in fiscal 2009. The only problem is, it’s just not enough.

In fact, a recent FDA Science Board report detailed just how little $2.4 billion gets these days in terms of supporting the agency’s rather daunting mission to safeguard America from any and all safety concerns around foods, dietary supplements and medicines, a jurisdiction that constitutes roughly one-quarter of the nation’s gross domestic product.

According to the November 2007 Science Board report, the Coalition for a Stronger FDA (co-chaired by the last three U.S. Department of Health and Human Services secretaries and endorsed by a number of former FDA commissioners) has called for a doubling of the FDA’s budget in the next five years, with a 15 percent increase in each budget year.

By that math, this year’s budget increase should have been closer to the $400 million range. And even that might not be enough, the Science Board argued. “The subcommittee believes that these increases would still be an insufficient amount to allow the agency to initiate and support all of the changes necessary to fulfill its mission.”

“Is the FDA properly funded?” asked Steve Mister, president and chief executive officer of the Council for Responsible Nutrition. “Absolutely not. [The agency] is grossly underfunded and has been for a number of years, and each year it compounds on itself.”

Mister is particularly concerned because these have been positive times for the dietary supplement industry, with the recent passing of a serious adverse event-reporting rule and the implementation of good manufacturing practices for supplement makers. Both events are expected to improve the reputation of the industry, which has long been criticized—and unfairly so—as either unregulated or under-regulated in recent years. “If the lay press believe that [these regulations] are not funded, so that there’s no implementation, we’re not going to move that ball forward,” Mister told Drug Store News.

And according to a letter from several members of the U.S. House of Representatives, which cites the Science Board’s report, the FDA currently does not have the capacity to ensure the safety of the nation’s food supply—decreased funding has forced the agency to impose a 78 percent reduction in food inspections—and its ability to provide basic inspections, conduct key rule-making and carry out enforcement actions is severely eroded.

“We are deeply concerned that the budget submitted by the president [on Feb. 5] is grossly inadequate to meet the many challenges at the FDA as identified by the Science Board [in November],” read a letter signed by Reps. Henry Waxman, D-Calif., John Dingell, D-Mich., Bart Stupak, D-Mich., and Frank Pallone, Jr., D-N.J., that was addressed to Gail Cassell, the former head of the Science Board’s Subcommittee on Science and Technology. “It barely covers the cost of inflation and continues the trend of the inadequate budgets of previous years that have led to the current crisis at the agency.

The letter requests Cassell to reconvene the Science Board subcommittee and reevaluate the FDA’s budgetary needs versus its current allocation in plan for fiscal 2009.

In truth, the FDA workload is only growing. Mandatory adverse event reports for monographed over-the-counter medicines and dietary supplements went into effect in December 2007. And this summer, the FDA is expected to begin enforcing the new dietary supplement good manufacturing practices. Meanwhile, Congress is debating whether to add the regulation of advertisements for over-the-counter medicines to the long list of FDA’s responsibilities. The bill, sponsored by Sen. Edward Kennedy, D-Mass., in November 2007 and currently before the Senate Committee on Health, Education, Labor and Pensions, would shift this responsibility from the Federal Trade Commission to the FDA. The FDA currently regulates advertising for prescription drugs, while OTC ads traditionally have been under the FTC’s purview.

Coupling these new responsibilities upon an FDA already facing criticism for not being able to effectively execute against the directives already under its watch has some industry pundits worried. “There’s no question that the drug industry is increasingly worried about a weaker FDA,” noted Bill Hubbard, former FDA deputy commissioner and current adviser to the Alliance for a Stronger FDA. The problem is as federal budgetary appropriations fall short of FDA’s annual budgetary needs, that shortfall is made up by drug manufacturers in the form of increased user fees, which increase the cost of drug development.

Under the president’s current budget request, the FDA’s budget from the government increases 2.9 percent, while the budgeted increase from user fees increases 14.4 percent. “Consumer groups worry about that, too.” Hubbard explained. “They fear that as the user-fee proportions go up, the FDA reviewers will feel more and more pressure to approve a drug they shouldn’t approve.”

There also is plenty of concern regarding drugs already approved and on the market—not because of potential adverse events associated with any specific drugs, but that the drugs in the bottle will not match up to what’s printed on the label.

Last month Baxter International found itself in the media’s crosshairs as its blood-thinning heparin, linked to more than 300 illnesses in the United States, was traced to a Chinese manufacturer that had escaped inspection by both the FDA and China’s equivalent to the FDA. It’s the same inadequate inspections that have sparked alarm among American consumers and recalls of made-in-China toys and pet food.

“You’ve got a circumstance where there are as many as 7,000 foreign drug manufacturers sending raw ingredients or finished pharmaceuticals into the United States that go into our drug stores, and they’re almost never inspected,” Hubbard said, adding that as much as 80 percent of America’s drug supply is sourced from foreign manufacturers.

According to Hubbard, the FDA’s inspection of Chinese drug manufacturers last year numbered in the tens. The total number of Chinese drug manufacturers numbers in the hundreds, he said.

That concern also could force the dietary supplement industry into taking two giant credibility steps backward after having won the long-sought-after dietary supplement GMPs. “The concern that [the dietary supplement] industry has is that important initiatives will not get funded to the level that they should…whether it’s the implementation of the adverse event reporting law…[or] GMPs,” Mister said.

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Sturken to celebrate his fifth year at Spartan by ringing NASDAQ bell

BY Michael Johnsen

GRAND RAPIDS, Mich. Spartan Stores’ chairman and chief executive officer Craig Sturken is slated to ring the NASDAQ opening bell on March 3 in celebration of his fifth anniversary leading Spartan, the company announced Thursday.

 “It is an honor to ring the opening NASDAQ bell in celebration of our fifth successful year since transforming into a consumer-centric organization and refocusing our business on our core distribution and retail operations,” Sturken stated. “We have been in the grocery business for more than 90 years and this is our eighth year as a public company, which is marked by our ability to develop and execute successful business strategies in a highly competitive market.”

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Unilever to reorganize company structure

BY Antoinette Alexander

LONDON Unilever, whose brands include Axe, Sunsilk and Dove, has announced that it is restructuring the company and combining its home and personal care segment and food segment into a single category structure.

Ralph Kugler, president of home and personal care, will step down in May at the Annual General Meetings after 29 years of service. The roles of president of home and personal care and president of foods will be merged under the leadership of Vindi Banga, currently president of foods.

To reflect the company’s focus on growth in developing markets, Central and Eastern Europe will be managed within an enlarged region comprised of Asia, Africa and Central and Eastern Europe. Western Europe will become a standalone region.

In other moves, Kees van der Graaf will retire in May from the Unilever board and from his role as president of Europe after a 32-year career with Unilever.

Harish Manwani, currently president of Asia/Africa, will lead the new expanded region. Doug Baillie will serve as president of Western Europe, having previously served as chief executive officer of Hindustan Unilever.

“These measures build naturally on the changes of recent years and give us an organizational structure even better placed to advance our growth agenda. At the same time, I want to express my deep appreciation to Kees and Ralph for the significant contribution they have made over long and distinguished years,” stated Patrick Cescau, group chief executive.

In addition, James Lawrence, currently chief financial officer, will be proposed in May for election as an executive director of Unilever. This change will mean that the Unilever board will be comprised of two executive directors and 11 non-executives.

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