White House budget

The White House budget proposal nearly always sees the light of day in February of each year, but this year the release came on April 10. The late release came with good news for the United States Patent and Trademark Office (USPTO), bad news for big pharma, and a mixed bag for everyone else.

This is, of course, if theoretical news is news at all, since the proposed budget doesn’t typically get passed as is. Congress has called for the budget to end sequestration, and this one would. However, it is in excess of $160 billion, not only over the limit set by the Congressional Budget Office but also higher than the budget resolutions of the House and Senate. (See BioWorld Today, March 22, 2013.)

Here is a recap of the White House budget proposal for 2014.

Big pharma will take a hit if Obama gets his budgetary way in 2014. Medicare would be able to pay lower Medicaid rates for some drugs and “Part D” manufacturer discounts for brand name drugs would increase by 50%. Generic drugs would receive heavy promotion over brand name drugs for low-income patients. Biologics would no longer be eligible for “evergreening,” and their exclusivity would be limited to 7 years rather than the current 12 year limit. Finally, “pay for delay” agreements would be banned under this White House budget proposal.

The USPTO would be authorized under the budget to spend up to $ 3.071 billion. The office would also gain control over its revenues by retaining access to all user fees it collects in 2014. The issue of fee retention has been a point of contention in the past, so this would be victory for the USPTO. According to the Intellectual Property Owners Association (IPO) the budget explicitly states that ongoing “aggressive” patent pendency efforts will remain central to the USPTO mission.

The medical countermeasure (MCM) industry would receive a notable boost from the 2014 budget as proposed by the White House. Between FDA funding and funding for the NIH Concept Acceleration Program, the 2014 plan budgets $415 million for development of MCMs. This is not including the $250 million budgeted for the BioShield Special Reserve Fund or the $140 million set aside to support various vaccine programs.

For the Food and Drug Administration (FDA), there is a proposed budget increase of $821 million from 2012. $10 million of that increase is earmarked for agency inspections in China. However, despite the budget boost the budget decreases FDA spending for biologics, drugs and medical devices by $15 million.

The White House Office of Science and Technology Policy indicates that overall there would be more than a one per cent increase in R&D funding which would receive in excess of $140 billion.

See the Commerce Department (including USPTO) budget proposal here.

See the full White House budget proposal here.

About Author Karla Lant


Karla Lant is an Adjunct Professor for Northern Arizona University and a freelance writer. A former trial attorney in major felony criminal defense, her areas of legal expertise include forensic science, intellectual property, biotechnology, and constitutional law. Lant also focuses on tech trends, science and education in her work.

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