Every five years since 2002, the FDA has presented an updated user fee structure to Congress for approval. It’s widely regarded as a piece of must-pass legislation because it determines the amount of revenue the FDA can collect from medical device companies, which includes manufacturers of IVDs, for its submission and review process. This time, the process was pushed to the wire, being packaged into a Continuing Resolution bill, and passed on 30 September 2022 – the day the previous MDUFA expired. Peter Weems, director of policy and strategy at Medical Imaging and Technology Alliance (MITA), was a part of the discussions leading up to the agreement. “Negotiations unfolded over a year to a year and a half and happened under very unusual circumstances given the ongoing Covid-19 public health emergency,” he says. “During the pandemic there have been resource challenges for the FDA and as we move beyond and hopefully find ourselves at the tail end, we want to make sure the agency has what it needs to recover its operations and get back on track.”
It stands to reason that Weems and the manufacturers of medical imaging equipment and software he represents would want to see the FDA get back on its feet; after all, a well-resourced FDA means shorter review times – theoretically at least. The reason this could be difficult to achieve in practice is that the agency has historically struggled to retain, let alone recruit staff and this situation was exacerbated as the Emergency Use Authorisation (EUA) programme led to an influx of submissions, mostly from IVD manufacturers, which tested the resolve of employees to stay in their jobs and risk burnout. In the summer of 2021, a slowdown in approvals occurred, and Dr Jeffrey Shuren, director of the FDA Center for Devices and Radiological Health (CDRH) gave an impassioned speech about the agency’s lack of funding at a briefing sponsored by the Alliance for a Stronger FDA. In the speech, which was reported by MedPage Today, he said: “Many in the public, some in industry, some elsewhere, are just used to us being underfunded and somehow always pulling off a miracle. I will tell you that after having gone through the pandemic and where we are, there are essentially no more rabbits to pull from our hat. That’s the bottom line.”
Speed to market
During the negotiations with industry groups, which included MITA, as well as other advocates like AdvaMed and Medical Device Manufacturers Association (MDMA), it became clear that the CDRH had spent its congressional appropriation funding – the main source of its income – instead of the roughly 35% of its financial resources that comes from user fees, on staffing and other costs associated with the review and approval of devices. It did this to build up a reserve of carryover user fee funding to be ringfenced for updating its IT capabilities and bringing much of its activity onto the cloud – an ambition, it believes, would result in more efficient reviewing. “FDA had accrued a very significant carryover balance,” says Weems.
“During the pandemic there have been resource challenges for the FDA and as we move beyond and hopefully find ourselves at the tail end, we want to make sure the agency has what it needs to recover its operations and get back on track.”
“That’s money that we want to be invested in the programme, because we all need it to be properly resourced and staffed.” This was the opinion echoed by the industry groups at large, especially given that MDUFA V represents a significant uptick in funding for the FDA – $1.7bn over the next five years, compared to $1.1bn over the five-year period governed by MDUFA IV. According to Weems, that’s why the new agreement includes new commitments for CDRH to meet. “That number could go up to $1.9bn if certain targets are met,” he says. “What this agreement has is funding for bringing new staff on board, but if [the] FDA is not able to meet the targets, then the funding that would have gone towards hiring is essentially credited forward to offset future fees, or there will be a discussion between [the] FDA and industry about how best to invest those funds back into the programme.” The minimum hiring goals in the MDUFA V commitment letter are 144 hires in 2023, 42 in 2024 and 24 in 2025.
Another accountability measure will be a cap on the amount of user fee funding CDRH can accrue, forcing it to discount registration fees for new device companies if it has more than 13 weeks of operating reserves in the carryover balance. To put that into perspective, prior to the passing of MDUFA V, CDRH had said in the event that an agreement wasn’t reached in Congress, it had enough carryover funding to take it into the new year. Now that an agreement has been passed, Weems believes the measures will help to “ensure that products are getting reviewed for their safety and effectiveness in a timely manner”.
A new pathway
For its part, the FDA may have made several concessions, but it also managed to convince the industry groups to fund a pilot of its total product lifecycle advisory committee programme – an initiative referred to by the loose acronym TAP. “There was a lot of discussion about this during the negotiations and it was a big priority for FDA,” he says. “At the onset, industry was somewhat sceptical of it, but ultimately we decided that we would provide the FDA with some funding to test it out.” The long-term goal of TAP is to bring devices to market faster, especially those designated as ‘Breakthrough Devices’ for their potential to serve an unmet medical need. To do this, the agency proposes, among other things, more timely pre-market interactions and the involvement of patients, healthcare providers, and payers. The benefit for CDRH would be a more predictable submissions process due to the ability to gather evidence throughout a product’s life cycle, while manufacturers of devices get to learn from TAP advisors and their own product stakeholders how best to adapt devices for the most effective product-market fit. Only products designated Breakthrough Devices will be included until 2025, at which point the agency will consider those with a request for inclusion in the Safer Technologies Program (STeP) –a pathway for accelerated approval on the basis that a device improves the safety of a current treatment. “The TAP programme will scale up over the next five years and create new opportunities for enhanced early communication, collaboration and engagement between the agency and innovative medical device manufacturers,” says Weems. “We’re always interested in collaborating with the agency to test out new regulatory pathways and models that support access to safe and effective medical devices and we’ve seen the Breakthrough Devices programme as a cornerstone of that.”
Mutual ambitions
Outside of the discussion around fees and pathway improvements, a mutual long-term ambition of CDRH and of the industry groups involved in the discussions has been preparing for the arrival of devices and Software as a Medical Device products that have AI capabilities at their core. “For us, digital health in medical imaging is a huge priority, including advances in AI and machine learning technologies,” says Weems. MITA develops standards for medical imaging products, both in-house under the auspices of parent company the National Electrical Manufacturers Association (NEMA) and in collaboration with international standards development organisations, such as the International Electrotechnical Commission (IEC) and the International Organisation for Standardisation (ISO). For this reason, Weems adds that “ongoing investment in the use of standards for pre-market regulatory decisions was a priority [for MITA]”. Another shared priority Weems identifies is “continuing the drive towards the harmonisation of international medical device regulatory activities”. “Ongoing investment in that under MDUFA V is something we’re very glad to see.”
Despite the back and forth with the FDA over its spending plans, Weems believes MDUFA V is a good deal for the industry and that will become evident between now and 2027. “Over the last several years, our member companies have introduced a number of innovative technologies to market,” he says. “Things like low-dose CT scans, high tesla MRIs, advanced ultrasound applications and some AI and machine learning algorithms. We’ve had good success bringing these technologies to market under the user fee programme. In the next five years under MDUFA V we’ll see a lot more exciting innovation.”
“The TAP programme will scale up over the next five years and create new opportunities for enhanced early communication, collaboration and engagement between the agency and innovative medical device manufacturers.”
$1.7bn
The amount the FDA is guaranteed in user fees over the next five years, but this number could rise to $1.9bn if it meets certain objectives
FDA
