FDA and Industry Reach Agreement in Principle on Medical Device User Fees

February 1, 2012—The US Food and Drug Administration (FDA) announced that the agency and representatives from the medical device industry have reached an agreement in principle on proposed recommendations for the third reauthorization of a medical device user fee program. The industry associations that have reached the agreement with the FDA include the Advanced Medical Technology Association (AdvaMed), the Medical Device Manufacturers Association, and the Medical Imaging and Technology Alliance.

The recommendations would authorize the FDA to collect $595 million in user fees over 5 years plus adjustments for inflation. Details of the agreement, such as the fee structure, are expected to be finalized soon, the FDA stated.

According to the FDA, under a user fee program, industry agrees to pay fees 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.

The agency noted that the agreement in principle is the result of more than a year of negotiations between the FDA and industry and that it strikes a careful balance between what industry agreed to pay and what the FDA can accomplish with the amount of funding proposed. The FDA stated that the recommendations would result in greater accountability, predictability, and transparency through such improvements as a more structured presubmission process and earlier interactions between FDA and applicants. With the additional funding, the FDA would be able to hire more than 200 full-time equivalent workers by the end of the 5-year program. The FDA and industry expect that the agreement in principle would result in a reduction in average total review times.

The US Congress first established the user fee program with the Medical Device User Fee and Modernization Act of 2002 (MDUFA I), which was prompted by growing concerns about the capacity and performance of the medical device review program. The 5-year program was reauthorized with the Medical Device User Fee Act of 2007 (MDUFA II), which will expire on September 30, 2012.

MDUFA II authorized the FDA to collect user fees for certain medical device applications, for the registration of certain medical device establishments, and for certain other purposes FDA noted that small businesses may qualify for a waiver from fees on certain submissions or may qualify for a reduced fee.

In September 2010, before beginning negotiations with regulated industry, the FDA held a public meeting on the device user fee program that was attended by a variety of stakeholders including industry, scientific and academic experts, health care professionals, and representatives from patient and consumer advocacy groups.

Stakeholders provided their assessment of the overall performance of the MDUFA program and their opinions about which aspects of the program should be retained, changed, or discontinued to further strengthen and improve the program.

The FDA advised that when the final details of the agreement with industry are completed, FDA will develop a package of proposed recommendations and give the public an opportunity to comment before they are submitted to Congress. The date of the public meeting has yet to be determined.

Stephen J. Ubl, President and CEO of AdvaMed, commented, “The tentative new user fee agreement puts in place a framework that will benefit FDA and industry, but most importantly patients by accelerating the development and approval of safe and effective treatments and diagnostics. The improvements in the agreement provide FDA and medical technology companies the tools needed to improve the efficiency and consistency of the review process.”

AdvaMed noted that in addition to reducing in the total review time on a premarket approval (PMA) application or a 510(k) submission, the performance goals in the agreement would:

• Achieve significant performance improvements for PMA and 510(k) applications relative to current performance;
• Leave “no submission behind” by requiring the FDA to meet with companies if a performance goal on a PMA or 510(k) is missed and work out a plan for completing work on the submission;
• Provide a substantive interaction with applicants halfway through the targeted time for completion of review, thus ensuring that a company can have time to properly respond to appropriate questions; and
• Implement an analysis of FDA's management of the review process by an independent consulting organization, coupled with an FDA corrective action plan to address opportunities for improvement.

“AdvaMed looks forward to a productive working relationship with FDA under the agreement,” stated Mr. Ubl. “The user fee agreement is not self-executing. It requires consistent and efficient administration by FDA leadership. It is in the interests of patients and the American economy that this agreement functions well, and we will work with FDA to help make that happen.”