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The Food and Drug Administration (FDA) is at the vanguard of regulating the food and drugs bought and sold in the country. Yet an agency that regulates a pharmaceutical industry valued at roughly P121 billion ($2.8 billion), with an additional P900 billion ($20 billion) in the food and beverage industries, and whose mandate covers around 75,000 licensed establishments as of 2013, has barely increased its budget over the last five years, from P214 million ($4.9 million)in 2009 to P222 million ($5 million) by 2013.
And while continued economic integration within ASEAN and with other trading partners is expected to usher in an era of lower tariffs and trade protections, this will still need to be complemented by strong regulation to protect consumers, as more products – both good and bad – flood the domestic marketplace. In this case, more trade requires better regulatory systems.
In the face of burgeoning demand for its services, the FDA has been relatively understaffed, with only around 300 technical personnel, and about 180 inspectors for the whole country. Nevertheless, important steps have been taken to strengthen the agency to carry out its role.
Will these reforms stick when these reformists eventually step down? Their strategy was crafted with that objective in mind, yet they need the public’s help if reforms are going to continue beyond 2016.
Efficiency leads to better services
Improved services in the FDA is anchored on efforts to overhaul the efficiency of what was once a slow pen-and-paper system that was subject to abuse. Recent investments in the agency’s information and communications technology (ICT) and computer systems not only aim to speed up processing time, but also to provide a way to minimize human contact, and keep various parts of the agency accountable to the new and expedited processes being introduced.
For instance, an e-dossier system now allows industry applicants to submit technical documents online, and track them as they are being processed. The move highlights an overall effort to improve services through faster processing time, and enhanced transparency in tracking and retrieving documents submitted by industry applicants. This minimizes the opportunities for fixers – more commonly knows as “hao-siaos” – from offering to “facilitate” the processing of applications (while also possibly colluding with insiders to deliberately slow these down).
And starting 2013, the agency has adopted an integrated application form (which can be downloaded from the FDA website) for licensing and registration applications, as well as for firms applying for amendments and certifications. In this case, the agency plans to extend online registration among industry applicants in other parts of the country (aside from those in National Capital Region and Calabarzon areas).
In addition, the agency’s Center for Cosmetic Regulation and Research has also instituted the Cosmetic Product Notification (CPN) which facilitates the online submission of application requirements by cosmetic industry players, thereby eliminating the manual submission previously practiced. All these measures expedite and improve the FDA’s services, facilitating trade and commerce for the country.
Transparency and sustaining reforms
The agency also initiated moves to clarify the various rules and regulations that underpin the application process to all the agency’s industry stakeholders, in an effort to communicate how to better navigate the licensing and other procedures of the FDA, as well as build stronger support around the efficiency- and transparency-minded reforms being pursued in this agency.
This is part of an effort to break from the past status quo of inordinate delays in processing, coupled with onerous and unclear requirements (often exacerbated by confused applicants submitting incomplete paperwork). That old system was haven for fixers and facilitators. Instead the FDA now pursues a strategy of greater transparency – most information relevant to the licensing processes are now available on the agency’s website where one could see the list of FDA registered products and other relevant information.
The website also contains information on the FDA registered pharmacies, distributors and manufacturers, among others; and that annual financial reports (which include statement of income and expenses and statement of cash flows) are uploaded to the website. All important documents released by the FDA (such as license to operate and certificate of product registration) are now printed on a special paper that contains more security features aside from the affixed signature/s and official logo (such as watermarks and control numbers), thereby reducing the risk of fraud. (Recall the fiasco around photocopied import permits of the NFA last year.)
Reforms pay off
Some of the agency’s efforts have already started to pay off. For instance, the CPN scheme has allowed the Center for Cosmetic Regulation and Research to issue market authorization within a shorter period of time (such as 2 weeks for some cases). In this case, some countries have expressed their interest on the program, particularly on how the agency was able to jumpstart its implementation.
In addition, the agency also posted a remarkable improvement in its numerical rating (as assessed by the Civil Service Commission) with regards to its compliance on the provisions of the Anti-Red Tape Act (from 76.32% in April 2013 to 89.49% in November 2013) and overall client satisfaction (from 65.52%to 80.74%). The agency has also earned an ISO accreditation from the TUV Rheinland Philippines which covers licensing and registration of products under its regulatory helm (such as food, drugs and cosmetic products) and a DTI-PAO ISO accreditation of its laboratory facilities.
All these gains reiterate the broad challenge to start thinking of ways to protect the reforms. While reform-minded leadership will be useful, the only real safeguard is if reform stakeholders are numerous and influential enough to rebut any attempt to regress.
The lesson here is that reformists need to work more closely with key stakeholders and the public—academe, NGOs, media, among others—so the latter will understand what was reformed and why, and in order to better act as a foil against those who would see these reforms regress.
This is the basic formula of the FDA reforms: EFFICIENCY+TRANSPARENCY=ACCOUNTABILITY. Such an era of transparency and accountability stands the best chance to bring us toward a spiral of better public services and lower corruption, even beyond 2016. – Rappler.com
Ken Hartigan Go is Acting Director General of the Food and Drug Administration. Ron Mendoza is Associate Professor of Economics with the Asian Institute of Management, and also serves as Executive Director of the AIM Policy Center. Their views do not necessarily reflect those of the AIM or the FDA.