Originally Published MX September/October 2004
BUSINESS NEWS
User-Fee Increases Draw Strong Industry ReactionAlthough rate hikes were widely expected, FDA's nearly 16% increase in FY05 user fees for reviewing medical technologies has drawn swift and sharp responses from the device industry's two leading associations.
Pamela Bailey, president of AdvaMed (Washington, DC), said that "the FY 2005 increase, coupled with the significant rise in user fees sustained in FY 2004, set a pace that cannot be maintained. AdvaMed will examine all potential remedies, including legislative options." The association's response was posted several days before the rates were published in the Federal Register.
Mark Leahey, executive director of the Medical Device Manufacturers Association (MDMA; Washington, DC), also suggested that Congress might have to revisit the issue. Noting that industry absorbed a 35% increase in user fees during FY04, Leahey said that the increases for the coming year "strengthen our case that the structure of the program is inherently flawed and legislative modifications are needed to stabilize the fees."
The user-fee program for medical devices was first enacted as part of the Medical Device User Fee and Modernization Act of 2002. The fee increases for FY05 take effect on October 1, 2004 (see Table).
| Submission Type |
FY03
Fee($)
|
FY04
Fee ($)
|
Increase
(%)
|
FY05
Fee ($)
|
Increase
(%)
|
| Premarket application |
154,000
|
206,811
|
34.29
|
239,237
|
15.68
|
| 180-day supplement |
33,110
|
44,464
|
34.29
|
51,436
|
15.68
|
| Real-time supplement |
11,088
|
14,890
|
34.29
|
17,225
|
15.68
|
| Premarket notification (510(k)) |
2,187
|
3,480
|
59.12
|
3,502
|
>0.01
|
| FDA user fees for medical device submissions, FY03–FY05. Figures shown are full fees; some small businesses are eligible for fee reductions or waivers. | |||||
MDMA has recently become more receptive to the user-fee concept. But the organization was originally opposed to the idea and has continued to warn industry about the potential for runaway rates. Citing the example of the pharmaceutical industry, Leahey notes that user fees for drug product reviews have increased by 673% over the past 13 years. If device user fees were to follow a similar rate of increase, he warns, in 10 years "the application fee for a premarket application (PMA) will be $1,036,420."
AdvaMed, which had strongly urged FDA to keep any user-fee increases in the single digits, believes that the FY05 rates are predicated on the agency's "conservative estimate of full-fee paying applications that it will receive next year."
A detailed summary of FY05 medical device user fees is available from the Web site of FDA's Center for Devices and Radiological Health at www.fda.gov/cdrh/mdufma/fy2005summary.html.
Copyright ©2004 MX
