The U.S. Food & Drug Administration will drop user fees for medical device companies by about 7 percent across the board in 2012, the agency said today.
“Because of the requirement to give back to industry any funds received in excess of the total fee amount enacted by Congress for the first four years of the MDUFA II, we are lowering user fees in FY 2012 in order to give back to industry about $9.5 million rather than spend those funds to improve our premarket review programs,” FDA spokeswoman Karen Riley said in an email to MassDevice.
In documents released by the agency, the annual user fee for medical device companies will be $2,029 in 2012, compared to $2,179 in 2011. Any company wishing to market a medical device in the United States must pay the fee, regardless of size.
For 510(k) premarket submissions, companies will be required to pay $4,049 per submission, compared to the $4,348 they paid in 2011. Companies with less than $100 million in annual sales qualify for a small business discount and will pay $2,024 in 2012, compared to the $2,174 they paid in 2011.
For Premarket Applications, companies will pay $220,050 per submission, compared to $236,298 last year. Small businesses, meanwhile, will pay $55,013 in 2012, compared to the $59,075 they paid in 2011.
Companies which have less than $30 million in sales qualify for a waiver of the fee for the first PMA. The rates will go into effect in October of this year.
The discount for medical device companies comes as a result of excess user fees the FDA collected in 2011, which are expected to be more than $18 million higher than the $61.86 million appropriated to the agency by MDUFMA II. Of that $18 million, about $8.5 million is classified as unearned revenue, leaving $9.5 million that the agency says it is giving back to the industry in the form of cuts to the user fees.
The current medical device user fee act is set to expire in 2012. The agency first won the authority to collect user fees under the 2002 Medical Device User Fee and Modernization Act. The program was reauthorized in 2007 under MDUFMA II. The user fees are supposed to make up for the FDA’s resource shortfall to help it review device applications more quickly and, ultimately, speed devices to market. In return for receiving industry funding, the FDA was tasked with meeting performance goals under MDUFMA, which set benchmarks for measuring improvements in the agency’s review times.
While representatives from both sides have met several times over the year in order to hammer out an agreement, there has been significant tension in trying to come to an arrangement that will please both sides.
For example, the agency has asked for an increase in user fees to continue 2010 levels of operations, which would amount to a roughly 17 percent increase from current levels. The FDA is also requesting more funding to increase its total headcount by another 254 employees in addition to its 1,230 employees. The gulf between the two parties appears to be the agency’s contention that the total workload for the FDA has increased.
For its part, the med-tech industry maintains that workloads have remained at the same levels in recent years. Further, industry contends that the FDA has essentially doubled the user fees over the lifetime of the program and has not met performance goals. During an early June meeting, industry proposed a two year stay at current levels (adjusted for inflation) because the agency had “not yet achieved” some of the qualitative and quantitative goals set when the user fee program was reauthorized in 2007.