June 20, 2006

The biggest legislative challenge facing the device industry is unreliable funding from Congress to help maintain stable user fees for medical device applications, according to an industry expert.

"The issue is how to establish a fee structure that doesn't negatively [affect] innovation," John Manthei, partner with Latham and Watkins, told attendees at the Medical Device Manufacturers Association (MDMA) annual meeting in Washington, D.C., June 14.

With current budgetary constraints, congressional appropriations have fallen short of goals included in the original funding reauthorization statute, Manthei noted. When the user fee program was changed with the FDA's Medical Device User Fee and Modernization Act (MDUFMA) of 2002, industry fears that funding would not be adequately funneled to the FDA's Center for Devices and Radiological Health (CDRH) were realized, he added.

Appropriated funds are the preferred funding method for the FDA, said legislative aides to Senate Health, Education, Labor and Pensions Committee Chairman Sen. Mike Enzi (R-Wyo.) and ranking committee member Sen. Edward Kennedy (D-Mass.). But it will be hard to sustain, much less expand, those funding levels, they added.

The agency needs a stable base of funding and industry needs a stable set of user fees, the aides said. User fees have increased performance accountability at the FDA's Center for Drug Evaluation and Research, but this has not yet happened on the device side and there is a need for improved performance at CDRH, they said.

Escalating user fees and a decline in the volume of submissions indicates that the FDA is simply charging industry more for fewer reviews, a conference attendee said.

Congress will have to start with FDA performance goals and identify ways to improve the application process, one aide said. Congress wants to keep the drug and device user-fee authorization programs separate, the aide added.

Meanwhile, nearly 70 percent of device manufacturers say MDUFMA has not improved the predictability or timeliness of device reviews, according to a survey conducted by the Lewin Group for the FDA released April 26.