Time is money for medical device makers, who have agreed to pay double the fees to the FDA in return for a speedier review process. These companies have tentatively pledged to pay $595 million over five years, plus adjustments for inflation, to increase the number of federal workers who approve devices and get these new devices on the market faster.
The FDA has just released an announcement of the agreement, which is part of the proposed recommendations for the third reauthorization of a medical device user fee program, and amounts to more than double the $287 million currently spent by these companies on “user fees,” or money paid by companies seeking to get a new device approved. Under this type of program, the industry agrees to pay certain fees that will to help fund a portion of the FDA’s device review activities, while the FDA agrees to overall performance goals such as reviewing a certain percentage of applications within a particular time frame.
Although the details of this agreement are incomplete, they are expected to soon be finalized with a fee structure. Just this basic agreement is the result of more than a year of negotiations between the FDA and medical device industry. According to the FDA press release, “it strikes a careful balance between what industry agreed to pay and what the FDA can accomplish with the amount of funding proposed. It would result in greater accountability, predictability, and transparency through such improvements as a more structured pre-submission process and earlier interactions between FDA and applicants.”
So where does all this money go? Additional funding in the new agreement will be put towards hiring over 200 full-time equivalent workers by the end of the five-year program. The FDA and industry expect that the agreement in principle would result in a reduction in average total review times.
“I want to commend my staff and representatives from industry for their tireless work and commitment to achieving an agreement in principle on medical device user fees,” said FDA Commissioner Margaret A. Hamburg, M.D. “Reauthorization of this important program is an essential component for advancing medical device innovation.” Industry associations participating in development of the agreement in principle with the FDA include the Advanced Medical Technology Association, the Medical Device Manufacturers Association and the Medical Imaging and Technology Alliance.
The user fee program was established 10 years ago with the Medical Device User Fee and Modernization Act of 2002 (MDUFA I), and then the initial five-year program was reauthorized with the Medical Device User Fee Act of 2007 (MDUFA II). New legislation is required to replace MDUFA II, as it is set to expire on Sept. 30 of this year.
Currently, MDUFA II authorizes the FDA to collect user fees for certain medical device applications, for the registration of certain medical device establishments, and for certain other purposes. Small businesses may qualify for a waiver from fees on certain submissions or may qualify for a reduced fee. According to one report, the new agreement would set goals to complete the most complex approvals in 385 days on average and abbreviated ones in 124 days on average.
It remains to be seen exactly which requirements included in MDUFA will remain, as details of the agreement have yet to be settled. The FDA will now develop a package of proposed recommendations, which will be provided to the public, along with an opportunity for comment before the recommendations are submitted to Congress.