As FDA user fee agreements make their way through Congress with largely bipartisan support, Department of Health and Human Services Secretary Tom Price has asked lawmakers to consider increasing user fees, a change that would be particularly problematic for the digital health industry.
The request references a somewhat puzzling provision of President Donald Trump’s budget blueprint, which called for the FDA to double its medical product user fees from $1 billion to $2 billion in 2018 to eliminate premarket review costs from the agency’s budget.
Industry experts previously told FierceHealthcare that doubling user fees would be particularly troublesome for digital health startups seeking FDA approval that have limited cash to spend, and could prompt companies to look for opportunities overseas. Furthermore, the FDA already generated more than $2 billion in total user fees in 2016, making it unclear exactly which user fees the administration wants to increase.
In a letter to Sen. Patty Murray (D-Wash.), Price “strongly urged” lawmakers to include the president’s user fee structure in the reauthorization bill.
“To ensure the FDA has the critical resources needed to keep pace with this field, the President's Budget Blueprint proposes to increase and restructure the medical product user fee programs at FDA to be 100% user fee supported programs, with no funding triggers that require budget authority financing,” he wrote. “This would replace the need for new budget authority to cover premarket review costs—while maintaining our commitment to speed the approval of safe and effective medical products.”
Murray quickly shot down the proposal, indicating that it would “upend our work and if implemented, leave the FDA hamstrung and without the federal investments it relies on to carry out its public health work.” FDA officials and industry representatives have been negotiating the medical device user fee agreement for the last two years.
So far, lawmakers have ignored the proposal. The user fee reauthorization bill sailed through the House Subcommittee on Health markup on Thursday as lawmakers on both sides of the aisle urged a quick passage.
The digital health industry has a lot at stake in the medical device reauthorization agreement. It would establish a central digital health unit to provide assistance with premarket submission for medical device software, interoperable devices and novel digital health technologies and create a National Evaluation System for Health Technology that would integrate real-world evidence into the approval process.
In recent testimony before the Senate, Scott Whitaker, president and CEO of the Advanced Medical Technology Association, said failure to enact the agreement would “have a devastating impact on our industry’s ability to bring innovative diagnostics, treatments and cures to patients.”