Despite Lackluster Performance, FDA Hands Out Big BonusesJun 27, 2008 | Parker Waichman LLP
The US Food and Drug Administration (FDA) just announced that it has increased employee bonuses by a whopping 29 percent in the past year, despite earlier objections from lawmakers, its ongoing complaints over inadequate funding, and a number of embarrassing and widely publicized blunders, including one that allowed tainted heparin into the country.
For year ending April 12, the FDA paid out $35 million in staff incentives, a figure that is a significant increase from the $27.1 million it paid the prior year, according to records posted on the House Energy and Commerce Committee’s Website. Just last year, lawmakers complained that the FDA was issuing too many bonuses, especially to high-ranking officials. This recent increase, which was shown in the latest records provided by the FDA, has prompted renewed objections by Representative Bart Stupack—Democrat-Michigan—chairman of the panel's investigative subcommittee. "It is outrageous that bonuses for top officials at FDA increased by nearly 30 percent over the past year despite the agency's poor management," Stupak said "These bonuses are not going to the men and women in the field who FDA struggles to retain. They're going to top agency officials in Washington who have presided over the agency while an unprecedented number of Americans have been sickened by contaminated food and drugs."
Stupak and other lawmakers faulted the FDA's handling of food and drug safety after consumers became ill from tainted spinach in 2006, peanut butter in 2007, and the blood thinner heparin this year. In the Heparin debacle, the FDA reported that since the end of 2007, it received over 700 reports of adverse reactions associated with Baxter's multiple-dose injectable Heparin; 40 percent of these reports were deemed serious. Reactions included difficulty breathing, nausea, vomiting, excessive sweating, and rapidly falling blood pressure that—in some—led to life-threatening shock and, in 21 cases, led to death.
The investigation revealed problems over inadequate FDA inspections of oversees drug and drug component manufacturers and ingredients obtained from shoddy, unregulated factories. The inadequacies highlighted some critical problems at the FDA and led to government investigations and hearings over FDA practices. But, FDA spokeswoman, Heidi Rebello, argues that bonus payments help attract and retain employees. "The agency employs a very knowledgeable, experienced, and highly educated staff and has to compete with the private sector to attract individuals of the highest caliber to meet the growing demands on its scientific and regulatory mission both here and abroad," she said.
Some question why bonuses were paid given the caliber of work. For instance, current requirements state each foreign plant must be inspected every two years. As it stands, it would take the FDA over 13 years to inspect all foreign plants exporting prescription drugs to the US and 27 years to inspect all foreign plants exporting medical devices. Of 3,250 non-US plants subject to FDA inspections last year, only 1,445 foreign inspections occurred—in the last five years, according to a Government Accountability Office study. It’s worse in China where the FDA averaged just 15 inspections in China in each of the last five years, despite that there are 714 plants shipping drug products to the US.