Providing further clarification to drug manufacturers about specific costs that can be charged for investigational drugs used in clinical and expanded access trials.


Since 1987, the U.S. Food and Drug Administration (FDA) has authorized charging for an investigational drug under a regulation that is known as the “1987 charging rule”.[1] In 2009, FDA revised the charging rule for three reasons: (1) to address circumstances concerning charging for investigational drugs in a clinical trial that were not anticipated when the rule was written[2]; (2) to specify criteria for charging for investigational drugs made available under all categories of expanded access described in the expanded access regulations that were also revised in 2009[3]; and (3) to specify the types of costs that can be recovered when charging for an investigational drug under an IND[4]. These revisions to the 1987 charging rule required sponsors of investigational drugs to justify the amount to be charged for the investigational drug, obtain prior authorization from FDA to charge for the investigational drug, provide evidence that the investigational drug has a potential clinical benefit that, if demonstrated in clinical investigations, would provide a significant advantage over available products approved to treat the disease, and demonstrate that the clinical trial could not be conducted without charging because the cost of the investigational drug is extraordinary to the sponsor. Examples of extraordinary costs included manufacturing complexity, scarcity of a natural resource, the large quantity of investigational drug needed (e.g., due to the size or duration of the trial), or some combination of these or other extraordinary circumstances (e.g., resources available to a sponsor).

Over the years, FDA received many questions from industry concerning its implementation of the revised 1987 charging rule, and in June 2016, it issued a Final Guidance, “Charging for Investigational Drugs Under IND — Questions and Answers” (the “2016 Final Guidance”).[5] In the 2016 Final Guidance, FDA set forth a series of Q&As, based upon the revisions to the 1987 charging rule, which reinforced (1) a sponsor’s obligation to request authorization for charging for an investigational drug; (2) the requirements a sponsor must satisfy to charge for the drug; (3) the definition of extraordinary cost FDA would use to assess whether a sponsor could charge for an investigational drug; and (4) the need for FDA prior authorization prior to charging for investigational drugs in a blinded, controlled clinical trial.

The 2016 Final Guidance also addressed the requirements for charging for expanded access use of investigational drugs. These requirements included (1) reasonable assurance that charging will not interfere with developing the investigational drug for marketing approval; (2) evidence of sufficient enrollment in any ongoing clinical trials; and (3) evidence of adequate progress in the development of the drug for marketing approval. FDA also confirmed that, when charging for an investigational drug, a sponsor may only recover direct costs that can be specifically and exclusively attributed to providing the drug for investigational use, such as costs per unit to manufacture the drug or costs to acquire the drug from another manufacturing source, and direct costs to ship and handle the drug. FDA further confirmed that the sponsor of an expanded access treatment IND or protocol for intermediate-size patient populations can also recover the costs of monitoring the protocol, complying with IND reporting requirements and other administrative costs directly associated with the expanded access IND.


Six years after publication of the 2016 Final Guidance, FDA has issued a draft guidance, “Charging for Investigational Drugs Under an IND – Questions and Answers Guidance for Industry, August 2022” (“2022 Draft Guidance”).[6] When finalized, it will supersede the 2016 Final Guidance and provide further clarification pertaining to new questions received from stakeholders since its publication. The 2022 Draft Guidance further clarifies how and when FDA permits charging for the investigational drug and includes new questions related to how cost recoveries must be calculated and documented, as follows:

  • Clarification that sponsors must ensure that charging for drugs does not create barriers to access that may exacerbate disparities in clinical trial participants or expanded access patients.
  • Additional requirement that independent and certified public accountants not employed by the company must be qualified to make the required determinations for charging.
  • Clarification of how manufacturing, administrative, start up or monitoring costs from the first year may be distributed over the expected duration of an intermediate IND, treatment IND or expanded access IND, given that these costs can be highest in the first year of a study.

The 2022 Draft Guidance provides no recommendation regarding how Sponsors should charge for an investigational drug or whom to charge for the investigational drug, noting that this is not within FDA purview.

The 2022 Draft Guidance should be informative to manufacturers of high cost, specialty drug products that are intended to treat serious and complex diseases. There has been significant attention paid to these types of drugs, which have been targeted by the media as driving up medical expenses while benefiting a small number of patients. At the same time, patient advocacy groups continue to call on federal and state governments to provide avenues to access investigational drugs, either via clinical trial or through expanded access programs.

Manufacturers are keenly aware of how calls for access to investigational drugs ring louder as clinical trial programs reach mature stages, especially in these difficult to treat therapeutic areas where few, if any, FDA-approved therapies exist. Manufacturers should thus consider using the 2022 Draft Guidance—in addition to FDA guidance on expanded access generally—as a way to augment research and development plans, by estimating the recoverable costs that could be charged for investigational drug use in clinical or expanded access trials and utilizing the FDA process to gain authorization to charge for investigational drug.


[1] 52 FR 19466, May 22, 1987.

[2] 21 CFR 312.8(a) and 21 CFR 312.8(b).

[3] 21 CFR 312.8(c).

[4] 21 CFR 312.8(d).