Lawmakers will negotiate during their October recess a long-term extension for a drug-development voucher program widely supported by drug companies but opposed by the FDA, industry observers told me.

President Barack Obama recently signed into law a three-month extension for a Food and Drug Administration program that encourages development of drugs that combat certain rare pediatric diseases, such as sickle cell disease, and pediatric cancers. The new law (S. 1878) gives lawmakers until Dec. 31 to agree on a long-term extension for the program, which could be key to its success.

The FDA's priority review vouchers reward companies that develop certain drugs with a voucher that can be used to speed agency approval of a future drug. The vouchers are valuable, in part, because they can be sold—one fetched $350 million—but pharmaceutical companies and their investors won't factor that value into their development costs for a new drug if they can't count on obtaining one because the program is set to expire.

“The voucher programs will be more effective at encouraging drug development if investors have greater certainty about receiving a voucher,” David Ridley, a professor at Duke University who first proposed the drug voucher programs, told me.

A long-term extension for the FDA's Rare Pediatric Disease Priority Review Voucher Program has been a priority for lobbyists working on behalf of the pharmaceutical industry throughout the most recent Congress, according to lobbying disclosure forms. More than a dozen pharmaceutical companies listed the bill on their lobbying disclosure forms in 2016.

Supporters of the program argue that there's often little incentive for pharmaceutical companies to invest in development of treatments for rare diseases because there's little return on investment for a drug that won't be widely used.

But, FDA officials told lawmakers they have no evidence the program is effective in encouraging the development of much-needed drugs to combat rare diseases and that the vouchers unfairly strain the agency's resources, an FDA spokeswoman told me.

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