Performance Improvement 1995. Food and Drug Administration

02/01/1995

MISSION: To protect and promote public health through food, drug, medical device, and cosmetic regulation.

FDA Evaluation Program Systemic changes in the government management environment are strongly influencing the setting, conduct, and use of evaluation activities in the Food and Drug Administration (FDA). Three forces--all related to the mandates of the Government Performance and Results Act (GPRA) of 1993--are reshaping the evaluation function in the FDA.

1. Performance management. The reorientation of all government managers toward performance management has shifted the responsibility for program evaluation from specialized staff offices and contractor studies to day-to-day line managers. Picking appropriate program goals, establishing valid measures toward those goals, and collecting management information to record measured progress are now integral parts of the government manager's responsibility. Relearning the role of management with regard to these shifted responsibilities is a key priority. The old order--evaluation as a proprietary domain of staff offices--is a bygone luxury to FDA programs in the era of streamlined government.

2. Customer participation. Most of FDA's management measures of its own performance are also measures of the performance of the regulated industries. Thus, while the beneficiary of FDA's performance is ultimately the general public, the Agency operates in such a manner that it supplies industry with an essential component of commercial success. FDA's approval of a new drug, for example, not only satisfies a legal requirement but also assures the public of the safety and efficacy of the drug. Collaboration between the FDA and its regulated customers regarding the design and coordination of the joint responsibilities to ensure effective, high-quality products has been a revolutionary concept, but it is becoming the norm under the customer-conscious GPRA directives.

3. Increasing rigor of the rulemaking process. The FDA establishes standards of safety and efficacy through rules published in the Federal Register. Many safety and efficacy standards are also performance standards that industry is obliged to meet. Examples are the Good Manufacturing Practices regulations. Today, virtually every FDA final rule of significant magnitude includes elements found in classic program evaluations: a critique of the existing system, alternatives for better performance, performance and cost tradeoffs, reactions and suggestions of customers, and conclusions, with an action timetable for implementation. New directives from the Administration as well as possible legislative action by Congress will make the rulemaking process of the future even more like the classic evaluation process.

In sum, FDA's evaluation efforts are driven by the mandates of GPRA and its corollaries, are carried out by line managers rather than specialized evaluation staffs, and are focused in the areas of performance management, customer participation, and more rigorous rulemaking. Because it receives its funds from Agriculture appropriations rather than Public Health appropriations, the FDA does not manage a 1 percent evaluation set-aside.

Summary of FY 1994 Evaluations Fiscal year 1994 was an important test period for the new evaluation paradigm. The following examples show how evaluation has been integrated into the line manager responsibilities and interlocked with the affected customer.

Implementation of the Prescription Drug User Fee Act (PDUFA). In FY 1994, the more than 1,000 full-time employees involved in FDA's drug and biologic review process completed their first full year using the performance management goals jointly established by the FDA and industry. Line managers developed measures for evaluating progress toward these performance measures, reported the results to Congress and the several hundred industry customers of this program, and used the resulting management information to self-manage the program toward higher FY 1995 performance goals. Line managers have also focused on streamlining, achieving other review efficiencies, and reducing the regulatory burden while maintaining the high quality and standards associated with FDA decisionmaking.

The negotiation process toward medical device user fees. During FY 1994, the FDA and representatives of the medical device industry engaged in a series of meetings that constituted a joint evaluation of each other's performance in the device development process. Current performance of both parties was assessed quantitatively; new alternatives were modeled, critiqued, and cost-audited by independent accountants; and the specifications for a new program based on shared performance expectations were translated into a framework for multiyear performance goals. While the culminating legislative step was not realized in 1994, the joint effort stands as a model of a customer-oriented, performance-based program evaluation.

Harmonization of international regulatory requirements. While benchmarking has long been an important evaluation technique in the private sector, it has not been widely used in the Federal sector--and especially in regulatory agencies--because of the perceived uniqueness in function and process of the Government Agencies. At the international level, of course, benchmarking--especially for regulators--is not only possible but highly desirable. Global forums such as the International Committee on Harmonization invite such benchmarking. Their efforts are maturing and reaching the point at which specific components of the regulatory process in different countries have been compared and assessed by the managers of regulatory programs. The initial successes suggest that regulatory benchmarking in the context of international forums will be an increasingly important way for regulators to evaluate and improve their performance.

Evaluations in Progress The following evaluation objectives will influence line managers during FY 1995:

Performance management. Managers of all FDA programs are evaluating their performance measures in light of GPRA standards. Broad-based training of managers to enable them to evaluate the performance design of their responsibilities is under way. The first phase of this multiyear process toward a new standard of performance measure will end with the formulation of FDA's FY 1997 budget.

Additional user fee programs. FDA managers will finalize measures for two performance--oriented user fee programs identified in the President's budget. One is a culmination of efforts by FDA managers and industry representatives for a medical device user fee act; the other involves developing with import brokers shared expectations and performance goals for a user fee-supported electronic processing system for imports.

Commencement of negotiated rulemaking. In FY 1995, the FDA will add a new customer-sensitive dimension to its increasingly rigorous rulemaking function by beginning to implement the President's directive to promote negotiated, consensual rulemaking. This marriage of customer participation and rigorous rulemaking will receive serious attention from FDA managers.

Two major projects are currently under way:

PDUFA management. During FY 1995--the middle year of the 5-year user fee program--the FDA will use the performance data from this GPRA-style program to generate the resource alignment needed to achieve the high performance goals for FY 1997--the final year of the current user fee legislation.

Mammography Quality Standards Act of 1992 (MQSA) assessment. The FDA's second major user fee program, MQSA, is also a performance-oriented, GPRA-style program. Although it is similar in design to PDUFA, much of the data on its performance are more external to the agency. The FDA is therefore using a contract study to gather data from affected facility sites to gauge the effects of the standards on the availability of mammography facilities.

New Directions for Evaluation Changes in government management are creating systemic changes in the FDA's evaluation function. A new paradigm driven by line managers' performance responsibilities, by the imperatives for involving customers, and by directives for analytically rigorous rulemaking has replaced the traditional practice of evaluation studies guided by specialized evaluation staffs or third party consultants.

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