# Presentation: 671261

## Medical Device User Fee and Modernization Act(MDUFMA II)Legislative Recommendations

- April 30, 2007

## Purpose

- Background
- Legislative Recommendations
- Next Steps

## Objectives of MDUFMA I

- Sustainable review program with:
- Increased predictability in review times
- Increased timeliness in review process
- Overall Objective: Get safe and effective devices to patients and healthcare professionals more quickly

## FDA Standards Unchanged

- MDUFMA provides FDA with additional resources to make improvements to the ***review*** ***process***
- The ***review*** ***standards*** do not change

## Overview of MDUFMA I as Amended by MDUFSA

- Currently 83% of funding comes from appropriations and 17% from fees
- Appropriations increased 3.5% on average annually
- Fees increased 8.5% in FYs 06-07
- Small Businesses
- Waivers -- ≤ $30 million (1st PMA/BLA)
- Fee discounts -- ≤ $100 million
- Other Waivers (e.g., HDE, pediatrics)
- Triggers
- Performance goals: 77 quantitative and 8 qualitative
- Third party inspection program
- Reprocessed single-use devices
- Office of Combination Products

## MDUFMA I vs MDUFMA II

- MDUFMA I
- Increase the size of the review progam
- Improve the timeliness of review
- MDUFMA II
- Maintain a stable review program
- Continued performance improvement
- Fine tune the user fee program

## Key Challenges

- Performance goals had unintended consequences
- Third party inspection program has not been a success
- FDA lacks predictable and stable user fee funding

## Key Goals for FDA

- Simplify the performance goal structure
- Make the third party program workable
- Provide adequate and predictable funding for FDA to maintain a stable device review program

## Recommendations for Legislation

- Performance Goals
- Quantitative Goals
- Qualitative Goals
- Funding
- User Fee Revenues
- User Fee Structure
- Small Business Fee Reductions
- Third Party Inspection Program

## Benefits to Public Health

- Patients and practitioners will have access to safe and effective medical devices more quickly
- Continued improvement in device review times and greater transparency of the review process
- FDA will have the resources to maintain the cutting edge scientific expertise necessary to provide timely review and ensure the safety of the increasingly complex devices of tomorrow
- Adequate and stable funding for FDA
- FDA can better focus its inspectional resources on higher risk devices
- Enhance the third party inspection program

- Performance Goals

## Examples of Current Quantitative Goals

| Goals for PMAs, Panel-track PMA Supplements, and Premarket Reports |  | Review Time Goal | Performance Level |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  | FY 03 | FY 04 | FY 05 | FY 06 | FY 07 |
| Decision | Make an “FDA decision” | 320 days | No Goal |  |  | 80% | 90% |
| Cycle | Issue a “major deficiency”
letter as the first action | 150 days | No Goal |  | 75%  | 80% | 90% |
|  | Issue all other first actions | 180 days | No Goal |  | 75%  | 80%  | 90% |
|  | Issue a “major deficiency” letter
as the second or later action | 120 days | No Goal |  | 75% | 80% | 90% |
|  | Act on an amendment containing a complete response to a “major deficiency” or “not approvable” letter | 180 days | No Goal |  | 75% | 80% | 90% |
|  | Act on an amendment
containing a complete response to an “approvable” letter | 30 days | 90% |  |  |  |  |

## Quantitative Goals

- Proposing continued improvements with current staffing levels
- Goals
- Eliminate the cycle goals
- Two-tiered decision goals
- New goals for some application types

## Comparison of Quantitative Decision Goals in MDUFMA I and II

| MDUFMA I | MDUFMA II |
| --- | --- |
| PMA Final Decision Goals |  |
| 50% of PMAs and panel track PMA supplements in 180 days | 60% of PMAs and panel track PMA supplements in 180 days |
| 90% of PMAs, panel-track supplements, premarket reports in 320 days | 90% of PMAs and panel track PMA supplements in 295 days  |
| NA | 50% of expedited PMAs and expedited panel track PMA supplements in 180 days |
| 90% of expedited PMAs in 300 days | 90% of expedited PMAs and expedited panel track PMA supplements in 280 days |
| Modular PMA Goals |  |
| NA | 75% of PMA modules in 90 days  |
| NA | 90% of PMA modules in 120 days |
| 510 (k) Goals |  |
| 80% of 510(k)s in 90 days | 90% of 510(k)s in 90 days  |
| NA | 98% of 510(k)s in 150 days |

## Comparison of Quantitative Decision Goals in MDUFMA I and II,cont’d

| MDUFMA I | MDUFMA II |
| --- | --- |
| 180-Day PMA Supplement |  |
| 90% of 180-Day PMA supplements in 180 days | 85% of 180-Day PMA supplements in 180 days
 |
|  | 95% of 180-Day PMA supplements in 210 days
 |
| Real-Time PMA Supplements |  |
| NA | 80% of Real-Time PMA Supplements
in 60 days  |
|  | 90% of Real-Time PMA Supplements
in 90 days  |
| BLA Goals |  |
| 90% of BLAs in 10 months | Same as MDUFMA I |
| 90% of BLA supplements in 10 months |  |
| 90% of BLA resubmissions and BLA supplement resubmissions in 2 months |  |

## Qualitative Goals

- Goals for:
- Interactive review
- Maintenance of performance
- Guidance document development
- Quarterly updates
- Meetings
- Reviewer training

## Qualitative Goals, cont’d

- Imaging Devices
- Issue guidance on processes and procedures, including data that should be submitted, for review of imaging devices that use contrast agents and radiopharmaceuticals

## Qualitative Goals, cont’d

- In Vitro Diagnostics
- Issue new or revised guidance to improve review of laboratory tests—including IVDs that can address biothreats, pandemic influenza, and emerging infectious disease
- Evaluate ways to combine 510(k) review with CLIA waiver process to speed access to diagnostic tests at point of care
- Evaluate whether additional low risk IVDs could be exempted from premarket review
- Conduct a program review to determine if FDA can provide advice on clinical studies earlier in the IVD development process

- Third Party Inspection Program

## Third Party Inspections in MDUFMA I

- Accredited Persons (APs) are firms trained by FDA to conduct biennial GMP inspections
- Strong protections against conflicts of interest
- Only firms with a good track record are eligible
- FDA can still inspect firms
- Allows FDA to better focus its inspectional resources based on risk

## Challenges on Third Party Program

- Limited industry participation
- 14 medical device firms have petitioned FDA to use an AP
- 3 independent AP inspections completed
- Costly for FDA to operate
- ~$2.9 million already spent on establishing and operating the program
- Disincentives
- Current petition process is cumbersome
- Ability to use APs is limited

## Recommended Changes to the Program in MDUFMA II

- Streamline administrative burdens
- Firms would provide FDA 30 day notice of their intent to use an AP rather than petitioning FDA for clearance to use an AP
- Expand participation
- Firms may use an AP for an unlimited number of consecutive inspections without seeking a waiver, rather than only two consecutive inspections
- FDA would continue to conduct “for cause” or follow-up inspections at our discretion
- Encourage industry to provide FDA with more data
- Firms may voluntarily submit reports by third parties assessing conformance with appropriate international quality systems standards, such as ISO, which FDA would consider in setting our inspectional priorities

- Funding and Fee Structure

## Challenge—Keeping up with Costs

- Over the last 5 years the cost of an FTE at FDA has increased on average 5.8% annually
- The cost of the device review program is expected to increase on average 6.4% annually during the next 5 years—due largely to costs of the White Oak facility (7.8%, if include the cost  of the move)

## Challenge—Keeping up with Costs

- Funding through appropriations and fee revenues is not keeping pace with the increase in costs
- We estimate that FDA will need $1.249 billion in combined appropriation and user fee funding over the 5 years of MDUFMA II to maintain the current program

## MDUFMA II Funding

- Premised on appropriations for the device review program continuing to increase at 3.5% annually
- User fee expectation – $287 million
- Over the course of MDUFMA II, 77% of funding would come from appropriations and 23% from fees

## MDUFMA I Fee Structure

- User fee revenues derived solely from application fees and very volatile
- Fees for some, but not all, types of applications
- Fee revenues chronically short of expectations

## Recommended Fee Structure for MDUFMA II

- Create new fees
- New: Establishment registration fee
- New: Fee for periodic reports (annual reports)
- New: Fees for additional types of applications
- Continued: All fees provided by MDUFMA, but at lower rates
- Also provide 5 years of predictable fee levels for industry

## Small Businesses

- Continue first time PMA waiver for SBs with ≤ $30 million in annual sales or receipts
- Greater fee discounts for SBs with ≤ $100 million in annual sales or receipts
- Rates for PMAs and related supplements reduced from 38% to 25% of the full fee in MDUFMA II
- Rates for 510(k)s reduced from 80% to 50% of the full fee in MDUFMA II
- Make it easier for foreign business entities to qualify as SBs

## Triggers

- The success of MDUFMA II depends on providing increasing funding to FDA from both appropriations and user fees to meet the agency’s increasing costs
- The MDUFMA I trigger for appropriations would be extended through MDUFMA II

## Next Steps

- Public comment period closes on May 18
- FDA will review comments, modify its proposals as appropriate, and then submit its final legislative recommendations to Congress