User Fee Hikes Hit Small Device Firms Most: Consultants

An Emergo Group online post says that proposed Trump administration user fee increases “would disproportionately impact smaller medical device companies, as these firms make up the majority of the U.S. medical device industry.” The post notes that Congress must approve fees and thus companies may not have to face the problem. It also suggests that companies consider pursuing FDA registration before any fee increases take effect.

The budget blueprint released by the White House would adjust FDA user fees for 2018 to more than $2 billion, the post says, some $1 billion over the 2017 annualized level. The blueprint says the increases would be offset by administrative initiatives to boost regulatory efficiencies and speed market authorization times.

“Although the proposal lacks specifics in terms of how these increases would apply to manufacturers of drugs, devices, and other health products under FDA’s purview,” Emergo says, “any such increase would clearly have a more significant effect on smaller FDA registrants. Based on data from the U.S. Department of Commerce, more than 80% of the roughly 6,500 medical device companies in the country have 50 or fewer employees, and many such firms have little or no revenue. Thus, the Trump administration’s proposed fee hike would most directly affect these smaller firms, making it essentially more expensive to sell their devices and maintain FDA registration in the U.S. Would the budget blueprint’s proposed administrative actions to allow faster market access be enough to offset higher FDA user fees? Or would more expensive market access continue to drive down U.S. FDA registration among U.S. companies?”