The Trump administration’s proposed budget, released today, would double the user fees medical device companies pay to have the FDA review the safety and efficacy of their products.
The budget proposal would set user fees at $2 billion for 2018, about $1 billion more than the fee schedule for this year (annualized to correspond to the calendar year). In return, the budget would contain “a package of administrative actions designed to achieve regulatory efficiency and speed the development of safe and effective medical products.”
“In a constrained budget environment, industries that benefit from FDA’s approval can and should pay for their share,” the administration said.
The proposal also would “[replace] the need for new budget authority to cover pre-market review costs.”
In a preamble introducing the proposal, the president wrote that the budget’s aim is to “meet the simple, but crucial demand of our citizens—a Government that puts the needs of its own people first.”
“A budget that puts America first must make the safety of our people its number one priority— because without safety, there can be no prosperity,” he wrote. “To keep Americans safe, we have made tough choices that have been put off for too long. But we have also made necessary investments that are long overdue.
“Many other Government agencies and departments will also experience cuts. These cuts are sensible and rational. Every agency and department will be driven to achieve greater efficiency and to eliminate wasteful spending in carrying out their honorable service to the American people,” Trump wrote.
Scott Whitaker, president & CEO of AdvaMed, told MassDevice.com via email that the group is seeking further details on the proposal from the White House “before we can assess its impact on the agency’s appropriations or user fee funds.”
“The medical technology industry has long recognized the benefits of a well-resourced FDA, and would be concerned if the agency were to face significant budget cuts that would negatively impact the approval process. Additionally, with respect to the medical device user fee program, we remain committed to the medical device user fee agreement as negotiated, which represents a substantial increase over current fee levels and will help speed new medical technologies to patients in need,” Whitaker said.
Medtech investors reacted to the proposed changes, including an 18% haircut for the National Institutes of Health, by sending medical device stock prices down today.
The budget would cut the NIH budget by $5.8 billion, to $25.9 billion – an 18.3% cut. The proposal would also introduce “a major reorganization of NIH’s Institutes and Centers to help focus resources on the highest priority research and training activities.”
The proposal would eliminate the Fogarty International Center, a global health-focused organization, and consolidate the Agency for Healthcare Research & Quality. It also includes “other consolidations and structural changes across NIH organizations and activities” and “reduces administrative costs and rebalance[s] Federal contributions to research funding.”