MDUFA Fee Increases and FDA Small Business Certification

The FDA has recently announced the fee rates and procedures for medical device user fees for fiscal year 2018 in the Federal Register. Under the FD&C Act, as amended by the Medical Device User Fee Amendments of 2017 (MDUFA IV), FDA is authorized to collect user fees for certain medical device applications, submissions, reporting on class III devices and fees for establishments subject to registration. These fees are in effect from October 1, 2017 through September 30, 2018.

2018 MDUFA Fees

FDA user fees have increased across all categories. This increase will substantially impact larger companies. Most FDA user fees increased 33%; however the standard application fee for a 510(k) submission rose 125% to $10,566. The increase in fees is a result of inflation adjustment plus any additional increase FDA feels is necessary to reach the inflation adjusted total revenue amount the agency has identified for the year.

Qualifying for Small Business User Fees

At the same time that the FDA announced their 2018 fees, they also updated their guidance FY 2018 Medical Device User Fee Small Business Qualification and Certification. A business that is qualified as a “small business” is eligible for reduced user fees. A small business must have no more than $100 million in gross sales for the most recent tax year. If your business is only submitting the annual establishment registration fee, you will not receive any reduction in cost, as indicated in the table above. The FDA asks that FY 2018 Small Business Qualification and Certification requests not be submitted in these cases.

MDUFA Small Business Certification Requirements for US Companies

If your company is headquartered in the US and wishes to become certified, you must:

• Have gross receipts or sales of no more than $100 million for the most recent tax year. You will need to submit the company’s federal tax return for the most recent tax year.
• If you have US affiliates, you must add up their gross receipts or sales for the most recent tax year. An affiliate is a business entity that has a relationship with a second business entity and has the power to control the other business entity or both entities. You will need to submit tax returns for each US affiliate in addition to your company tax return. The total of these returns cannot exceed $100 million.
• If you have foreign affiliates, you will need to complete Form FDA 3602A for FY 2018: FY 2018 MDUFA Small Business Qualification and Certification, for a Business Headquartered Outside the United States for each.
• Complete Form FDA 3602 for FY 2018: FY 2018 MDUFA Small Business Qualification and Certification. The guidance provides instructions as to how to complete this form.

MDUFA Small Business Certification Requirements for Non-US Companies

If your business is headquartered outside the US and does not file a US Federal tax return, you must:

• Complete Sections I and II of Form FDA 3602A for FY 2018: FY 2018 MDUFA Small Business Qualification and Certification, for a Business Headquartered Outside the United States. The guidance provides instructions as to how to complete this form.
• Send your Form FDA 3602A to your National Taxing Authority, who will complete Section III and return the completed form to you.
• If your business has any foreign affiliates, you must send a separate certified Section III of Form FDA 3602A for each affiliate.
• If your business has any US affiliates, you must send a Federal US income tax return for each.
• Submit your completed Form FDA 3602A and any affiliate information to the FDA for review.

What Happens After Submitting MDUFA Small Business Qualification to FDA

If you are intending to prepare a submission before 2017 is over, you will have to act fast to attain your small business certification. Your small business qualification submission will undergo a 60-calendar-day review. Then, a letter will be sent to your company identifying if your business qualifies, and you will receive a Small Business Decision number that will be needed when you pay qualifying user fees. Your company must be granted small business status prior to submitting a submission that requires a user fee. If an application is submitted before the FDA has awarded your small business status, the full standard fee will be required. FDA will not refund the difference. If you qualify as a small business, your status will expire on Sept 30, 2018. A new MDUFA Small Business Qualification and Certification should be sent to the FDA each year.

Helpful Information for Medical Device User Fees

When completing the form for Small Business Certification, the company will need an Organization ID Number. This number uniquely identifies the business with the FDA. Obtaining an ID number can be done here.

Answers to frequently asked questions about MDUFA can be found here.

Other FDA Medical Device Regulatory Support:

• FDA 510(k), de novo or PMA submission support
• Download our FDA 510(k) Submission Action List
• Obtain necessary Quality and Product Certifications