What Is a PDUFA Date? Everything You Need to Know

An infographic defining and explaining the term "PDUFA date" for pharmaceutical companies. — Image source: The Motley Fool

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For pharmaceutical companies hoping to win regulatory approval for a drug, time really does mean money. The longer it takes for the U.S. Food and Drug Administration (FDA) to make an approval decision, the longer it is before a drugmaker can begin making money to recover the cost of its investment to develop the therapy.

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The good news for these companies, and their investors, is that the FDA has a clear process in place with an established timeline for making decisions. That process exists thanks to the Prescription Drug User Fee Act (PDUFA), which the U.S. Congress passed in 1992. The PDUFA must be reauthorized by Congress every five years.

The PDUFA's primary goal was to authorize the FDA to collect fees from drugmakers to help pay for the FDA staff needed to review regulatory filings for drugs. But the pharmaceutical industry objected to paying money to the FDA without anything guaranteed in return. The PDUFA helps the FDA by providing the agency with a way to generate money and establishes a set timeline for the agency to make approval decisions.

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About the Author

Keith Speights is a contributing Motley Fool healthcare analyst covering publicly traded companies across pharmaceuticals, biotechnology, medical devices, technology, and marijuana. Prior to The Motley Fool, Keith was CEO of Constant Care Technology, a healthcare technology company; vice president of American HealthTech, a healthcare software company; and a director of operations for Blue Cross Blue Shield of Mississippi, a health insurer. He holds a B.S. in Industrial Engineering from Mississippi State University.

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