The Food and Drug Administration Safety and Innovation Act (Public Law 112-144) includes the Medical Device User Fee Amendments of 2012, or MDUFA III.  MDUFA III will take effect on October 1, 2012 and will sunset in five years on October 1, 2017.

Device user fees were first established by Congress in 2002. Medical device companies pay fees to FDA when they register their establishment and list their devices with the agency, whenever they submit an application or a notification to market a new medical device in the U.S. and for certain other types of submissions.

Ultimately, MDUFA III represents a commitment between the U.S. medical device industry and the FDA to increase the efficiency of regulatory processes in order to reduce the time it takes to bring safe and effective medical devices to the U.S. market. 

MDUFA III is the result of more than a year of public input, negotiations with industry representatives, and discussions with patient and consumer representatives.  Under MDUFA III, the FDA is authorized to collect user fees that will total approximately $595 million (plus adjustments for inflation) over five years.  With this additional funding, the FDA will be able to hire more than 200 full-time-equivalent workers over the course of MDUFA III.

In exchange, the FDA has committed to meet certain performance goals outlined in the Secretary of Health and Human Service’s letter to Congress (the MDUFA III commitment letter). For example, the FDA will issue a decision about whether or not to clear a pre-market notification or 510(k) within 90 days of active FDA review for at least 91 percent of the submissions accepted in fiscal year 2013. A 510(k) is generally the path to market for low and medium-risk devices.

Key Facts 

• User Fees: MDUFA III expands the definition of the types of manufacturers that must pay a registration fee.
• Performance Goals: The MDUFA III commitment letter includes performance goals for FDA decision-making with respect to a variety of submission types.  Certain performance goals increase each year of the MDUFA III program.
• Shared Outcome Goals: The FDA and the medical device industry agreed to a joint commitment to reduce the total elapsed time from acceptance of a submission to an FDA decision on clearance of a 510(k) or approval of a Pre-Market Approval (PMA) application (generally the path to market for a high-risk device).  The total elapsed time includes the time when the submission is actively under review by the agency, as well as the time during which the submission is not under active review because the applicant is responding to FDA requests for additional information.
• Public Reporting: As specified in the MDUFA III commitment letter, FDA will provide quarterly and annual reporting of its progress towards meeting specific performance goals, including those for decision-making.  FDA will also provide annual reports to Congress about the amount of user fees collected and how those fees are being used for the device review process.
• Improved Review Experience: The MDUFA III program is expected to result in enhanced accountability, predictability, and transparency for the medical device industry through a more structured pre-submission process, earlier interactions between the FDA and device applicants, and increased communication during the review process.
• Independent Assessment of Pre-market Review Process: An independent consulting organization will evaluate FDA’s pre-market review program and will recommend improvements to the program.

Outcome:  Process Improvements

The FDA and the medical device industry are committed to protecting and promoting public health by providing timely access to safe and effective medical devices.  The MDUFA III commitment letter outlines process improvements that will help achieve this goal by clearly delineating expectations for FDA and Industry.

• Improved Pre-Submission Process: In order to make FDA processes more predictable for industry, the FDA will introduce a more structured approach to address product-specific questions regarding review issues for PMAs, 510(k)s and Investigational Device Exemptions (IDEs) (an IDE is generally required before a device may be used in a clinical trial).  Industry will be able to request early FDA feedback on the appropriate regulatory pathway to market through this enhanced pre-submission process. 
• Submission Acceptance Criteria: To make the pre-market review process more efficient, the FDA will implement revised submission acceptance criteria through guidance.  The guidance will include objective criteria for updated “refuse to accept”/“refuse to file” checklists which will be used to evaluate submissions when they are received to ensure that FDA resources are focused on reviewing complete submissions.  These checklists will take effect once the final guidance is published. 
• Interactive Review: The FDA continues to encourage, and is committed to continuing, informal communication between FDA staff and device applicants in order to collect appropriate additional information and meet review timelines.  The MDUFA III commitment letter reaffirms FDA’s and industry’s commitment to these interactions.
• Guidance Document Development: MDUFA III user fees will support FDA’s development of guidance documents, published on FDA’s website, which represent the agency’s current thinking on a topic.  Guidance is often written to help a manufacturer prepare a pre-market submission. Under the MDUFA III program, the FDA will build an improved process for tracking guidance development and will communicate to industry and the public the agency’s priority list of topics for guidance development. 
• Third-Party Review: The third-party review program is intended to improve the efficiency and timeliness of the FDA’s 510(k) review processes for specific device types by having an accredited third party reviewer conduct the primary review of a 510(k) submission and then submit the review to the FDA for final determination.  MDUFA III reauthorizes the third-party review program.
• Patient Safety and Risk Tolerance: The FDA will fully implement final guidance on factors to consider when making benefit-risk determinations in medical device premarket review.  This guidance focuses on factors to consider in the pre-market review process, including patient tolerance for risk, magnitude of the device’s benefit, and the availability of other treatments or diagnostic tests.  Over the five-year course of MDUFA III, the FDA will meet with patient groups to better understand and characterize the patient perspective on disease severity and unmet medical needs.  In addition, FDA will increase its utilization of its Patient Representatives as Special Government Employee consultants to obtain patients’ views early in the medical product development process and ensure that those perspectives are considered in regulatory discussions.
• Emerging Diagnostics: Under the MDUFA III program, the FDA will work with industry to develop a transitional approach for the regulation of emerging diagnostics.

Outcome:  Strengthening FDA Infrastructure

The performance goals outlined in the MDUFA III commitment letter challenge the FDA to meet new milestones for pre-market review of medical devices and will require an investment in staff and technology.  User fees will provide the FDA with additional resources to recruit, train, and retain employees with the expertise needed to meet these goals, and additional resources to update the agency’s information technology systems to facilitate meeting those performance goals. 

• Staffing and Training: MDUFA III user fee revenues will help to reduce the ratio of review staff to front-line supervisors in the device pre-market review program and to enhance and supplement FDA’s scientific review capacity by hiring additional device submission reviewers and leveraging the external expertise needed to assist in the review of device applications.  In addition, the FDA will be able to provide critical training programs to certify reviewers and to further educate FDA staff on the requirements in MDUFA III. 
• Tracking: Performance goals in the MDUFA III commitment letter involve tracking of application types, review milestones, and guidance documents, in order to report out progress at specified intervals.  The FDA will continue efforts to improve its information technology systems to support future capability for reporting real-time status of submissions.