Would lowering ANDA costs boost domestic generic drug production?

Increasing the US’s ability to manufacture medicines domestically has been a major focus of the Trump administration.

On May 5, the president issued an executive order directing the FDA to “eliminate regulatory barriers” for drugmakers to help boost their domestic manufacturing capabilities. The Trump administration also recently added around 600 generic drugs to its direct-to-consumer platform TrumpRx.

Today, nearly 80% of generic tablets and capsules in the US are imported from other countries, according to data from nonprofit research organization Brookings.

Mark Cuban recently told Healthcare Brew the cost of the application drugmakers must submit to the FDA for permission to manufacture a generic drug—called Abbreviated New Drug Applications, or ANDAs—“kills the economics” for companies like his online pharmacy Cost Plus Drugs. For FY 2026, the FDA charges drugmakers $358,247 to submit an ANDA.

“We’re working with the FDA and…if we can get that waived or significantly reduced…then within 18 months, we’d be able to make most of our generic tablets here in the US,” Cuban said.

Cost Plus currently manufactures only sterile injectables, Cuban told Healthcare Brew, adding that the company cannot manufacture generics until it figures out the ANDA costs.

Lowell Schiller, nonresident senior scholar at the University of Southern California’s Schaeffer Institute and former acting chief counsel for the FDA, told Healthcare Brew the application costs are a “drop in the bucket” compared to the total cost most drugmakers spend to bring a drug to the market and “should not be the thing that breaks the economics.”

Looking at the numbers. It costs on average about $2.4 million to bring a simple small molecule generic drug to market, according to a 2022 study from the Office of the Assistant Secretary for Planning and Evaluation (ASPE), a division of the Department of Health and Human Services. For more complex generics, it costs closer to $10 million.

Therefore, the cost of an ANDA is “marginal,” according to Schiller, who also led the FDA’s Office of Policy from 2019 to 2020.

While that may be true for most drugmakers, Cuban explained that with Cost Plus Drugs’s robotics, AI, and manufacturing pods—plus the fact that it spends no money on marketing or promotion—it costs the company close to $500,000 “and falling” to bring a generic drug to market. So, the cost of the ANDAs is a much bigger slice of the pie.

“We want to restore manufacturing in Dallas,” where Cost Plus is based, Cuban said, noting that ANDA costs for 1,000 drugs would be around $365 million. “That changes the economics.”

While the ANDA costs are “not the biggest part of the budget, by far,” for most drugmakers, Schiller said, “it all adds up, which is why the traditional model has been for these larger generic companies to fund low-margin drugs with some other drugs in the portfolio that are more profitable.”

Following the money. ANDA costs are so high because they’re used to fund the FDA, Schiller said. Those fees pay for the FDA’s reviewers, scientists who evaluate applications, inspectors to look at manufacturing facilities to make sure they’re up to code, and other costs associated with reviewing drug applications, he said.

“It’s similar to when you drive on the highway, cross the bridge—you pay a toll, and it’s the drivers on the road who are paying for maintaining the road,” he said. “A lot of FDA budget comes not from taxpayer dollars, but from application fees and program fees.”

User fees, which include application fees, made up 46% (or $2.9 billion) of the FDA’s total budget in 2022, according to ASPE.

The FDA sets the rates for each year by projecting how much it’s going to cost to run the program to review drug applications and how many applications they expect to receive, Schiller said.

Onshoring efforts. Amid pharmaceutical tariffs and the administration’s push for domestic drug production, major pharmaceutical companies have taken steps to bring more manufacturing stateside. Johnson & Johnson, for example, said in August 2025 that it’s investing $55 billion to build more manufacturing sites in the US.

Schiller said that increased US manufacturing could lead to higher drug prices because workers in the US tend to cost more than those in other countries. The benefit, he said, is related to national security, as there could be drug shortages if there were a conflict with a country the US relies on for drug imports, such as China.