The proposed rule, if finalized, would implement the authority of FDA to destroy a device valued at $2,500 or less (or such higher amount as the Secretary of the Treasury may set by regulation), that has been offered for import and refused admission into the United States under the FD&C Act, by providing notice and opportunity to the owner or consignee to appear and introduce testimony to FDA prior to the destruction. Because our internal data show that the majority of devices offered for import, valued at $2,500 or less, and refused in FY 2022 were shipped via international mail and express couriers, FDA currently intends to implement the proposed rule, if finalized, at IMFs and express couriers. We do not, therefore, consider impacts related to shipments via commercial air, land, and seaports.

The costs and benefits of the proposed rule, if finalized, would depend on the number of administrative destructions that FDA orders each year for refused devices valued at $2,500 or less. For our primary estimates, we assume that FDA would order the destruction of 65 percent of refused devices valued at $2,500 or less. We additionally assume that FDA would contract out the act of destruction to a private firm and combine the notice and hearing process for destruction with the current notice and hearing process for refusal. 

We estimate that the annualized benefits over 10 years would range from $186,000 to $941,000 at a 7 percent discount rate and a 3 percent discount rate, with a primary estimate of $397,000. The annualized costs would range from $69,000 to $1.48 million at a 7 percent discount rate, with a primary estimate of $454,000, and from $65,000 to $1.47 million at a 3 percent discount rate, with a primary estimate of $450,000.

Over 10 years, the present value of total benefits would range from $1.31 million to $6.61 million at a 7 percent discount rate, with a primary estimate of $2.79 million, and from $1.59 million to $8.03 million at a 3 percent discount rate, with a primary estimate of $3.39 million. The present value of total costs would range from $488,000 to $10.36 million at a 7 percent discount rate, with a primary estimate of $3.19 million, and from $555,000 to $12.54 million at a 3 percent discount rate, with a primary estimate of $3.84 million.
 

Regulatory Impact Analysis

Administrative Destruction Preliminary Regulatory Impact Analysis (PDF- 413KB)

Federal Register: 87 FR 60947, October 6, 2022

Docket: FDA-2021-N-1348