Thursday, May 23, 2002

Congress gave the FDA the gift of conflict of interest as it expanded the "user fee program" with little fanfare, as a rider on the bioterrorism bill.

The drug and biotechnology industries pay about $160 million yearly in user fees to the FDA, but that sum would jump to $260 million yearly in 2007 under the proposed expansion. The new money would not only allow the agency to hire more staff but also to upgrade its technology and improve management at FDA headquarters. In return, the FDA would commit to maintaining its speedier pace for new drug reviews and to more quickly move applications for new uses of older drugs. In addition, it would begin pilot programs to further speed review of certain fast-track drugs.

Meanwhile, Salomon Smith Barney committed to the same structural changes that Merrill Lynch announced earlier this week, in an effort to make their research analysts separate from their investment bankers. The two brokerages have more in common than that: SSB has been subpoenaed by the same NY Attorney General whose investigation and threat of criminal charges caused Merrill to make those changes. A juicy summary of ML's crimes and concessions.

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