FDA Issues Device Cost Analysis Report entitled, “FY 2003 and FY 2004 Unit Costs for the Process of Medical Device Review”

FDA recently released a report, compiled by Dr. Dale Geiger that documents the unit costs that FDA incurs in reviewing selected premarket applications. Eight types of applications have been considered over the combined years of FY 2003 and 2004. Investigational Device Exemption (IDE) applications, 510(k)s for CDRH, Premarket approval (PMA) applications, PMA supplements, investigational New Drug (IND) applications, 510(k)s for CBER, Biologic License Applications (BLAs) and BLA Supplements have been used in deriving the unit costs.

The following tables summarize the findings, with $k/unit giving the cost of review (/unit) for each type of application

CDRH	$M	Final actions	$K/unit
IDE	61.1	467	131.9
510(k)	107.7	8043	13.4
PMA	71.5	127	563.0
Supplements	19.0	1291	14.7

CBER	$M	Final actions	$K/unit
IDE/IND	4.4	35	126.3
510(k)	4.2	139	30.4
PMA/BLA	16.2	13	1244.2
Supplements	3.2	877	3.7

Costs incurred due to the following activities were considered: Direct review and laboratory components, indirect review and support components, and center-wide costs. For details on the methodology used, please refer to the following link: http://www.fda.gov/cdrh/mdufma/fy2003-4costs.html

The above estimated costs are not the “true” costs and hence should only be used as a benchmark for future comparisons. FDA workloads and resources fluctuate from year to year and hence would the unit costs.

These findings confirm that the user fee program doesn’t recover the full costs associated with premarket application review. For example, in FYs 2003 and 2004, the fees for an original PMA were $154,000 and $206,811 respectively. The estimated unit cost, however, for the review of such a PMA during the FYs 03 and 04 combined time period was approximately $560,000.

If any questions on the report or comments please email us at info@mdiconsultants.com.

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