FDA Is Criticized for Fees to Consultants

By ALICIA MUNDY

The Food and Drug Administration has been paying consultants millions of dollars for management help—including leadership classes held at a Civil War battlefield—amid concerns in Congress that the contracts aren't helping the agency to clear long backlogs.

International consulting firm McKinsey & Co. has signed contracts for more than $17 million for work at the FDA since 2008 including $10 million in 2010, according to the watchdog group FedSpending.org.

The agency also has entered contracts valued at $7.9 million with Colorado-based Leadership Performance Solutions Inc. over the past several years, government records say.

Both companies have worked with the FDA's office of generic drugs, which has a backlog of about 2,000 drug applications. The average waiting time for companies seeking permission to sell copycat versions of existing drugs is two years.

Under the contract with Leadership Performance Solutions, managers in the generic-drug division have visited the site of the Battle of Antietam in Maryland for leadership lessons. Dr. Feldman, a psychologist and the company's president, said Antietam was a good tool for teaching government and business leaders about the perils of backing away from "tough decisions."

In the 1862 battle, the Union side forced Confederate forces under Robert E. Lee to retreat to Virginia. But the Union's general, George McClellan, failed to pursue Lee and crush the rebels.

Dr. Feldman declined to discuss details of the FDA contract.

Helen Winkle, whose office oversees the generic-drug division, said the Antietam experience was so useful she had done it twice. The lesson was about "just trying to get people to understand better how to lead their staff here," she said.

Ms. Winkle's view of Leadership Performance Solutions's work wasn't shared by all of her colleagues in the division. Three employees who requested anonymity said they felt the seminars didn't contribute to solving specific problems in the division.

The visits to Antietam are part of a larger reliance on outside contractors. On the McKinsey contract, Ms. Winkle said the consultant had found that about half of the 2,000 pending drug applications were still sitting with companies that hadn't responded to FDA questions, Dr. Winkle said.

Before hiring McKinsey, she said, "we did not know specifically what was in the backlog, or what the reason for it being in the backlog was."

Janet Woodcock, drug-division chief at the FDA, recently said the agency had hired McKinsey for more work in the generics division.

The contracts have prompted sharp criticism in Congress.

"Why on earth are FDA managers spending money for a consultant to tell them why they have a backlog of generic drug applications?" said Rep. Joe Barton of Texas, the top Republican on the House Energy and Commerce Committee.

An FDA spokeswoman said McKinsey's work for the generic-drug office was only a small part of the firm's overall contract with the FDA set up earlier this year.

According to government documents, the goal of the contract is to "ensure that the decisions made by the FDA can be tracked through and supported by clearly communicated and documented processes."

McKinsey declined to comment, saying it doesn't discuss clients.

It isn't the first time an outside contract for FDA management training has raised concerns in Congress. In 2008, the agency held a $1.5 million seminar for 500 senior employees who were shown a slideshow comparing Dr. Woodcock with such leaders as Gandhi and Golda Meir.

Write to Alicia Mundy at alicia.mundy@wsj.com

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