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Trump’s 2018 Budget Again Proposes $1 Billion Increase in FDA User Fees

EMERGO SUMMARY OF KEY POINTS:

  • The Trump administration is persisting in its proposal to raise FDA user fees for drug and medical device registrants to more than $2 billion for the 2018 fiscal year.
  • The proposal would make user fees the sole source of budgetary resources for the regulator.
  • Congress ultimately determines FDA user fee reauthorizations, however, making the proposed increase highly unlikely.

Trump administration wants $1 billion FDA user fee increase for medical device manufacturersThe Trump Administration’s proposed 2018 federal budget would boost Food and Drug Administration user fees from medical device and drug registrants by more than $1 billion, in contrast to ongoing Congressional user fee negotiations that do not include such steep increases.

Page 39 of Trump’s budget proposes $2.4 billion in drug and device user fees in lieu of new appropriations to fund FDA premarket review activities; this would constitute a $1.2 billion increase in such fees from 2017, and shift all premarket review costs to drug and device industries.

“Industries that directly benefit from FDA’s medical product premarket approval and administrative actions can and should pay more to support FDA’s continued capacity,” the Trump administration argues in the text of the budget.

“Regulatory efficiencies” as offsets

The Trump administration argues in its budget that various actions to promote regulatory efficiencies at the FDA will offset proposed user fee increases that would be borne by manufacturers; such actions would include utilizing the 21st Century Cures Act to improve FDA premarket review processes, reducing FDA registrants’ reporting requirements and clarifying value-based purchasing arrangements.

Whether such measures would yield enough savings for medical device manufacturers to adequately offset higher user fees remains an open and rather crucial question, especially for start-up and smaller manufacturers. As when the Trump administration first proffered the $1 billion user fee increase earlier this year in its 2018 budget blueprint, industry advocates and trade groups wasted no time denouncing the proposal as dangerous to their constituents’ ability to operate in the US.

Congress: FDA user fee reauthorizations already wrapping up

Despite the bottom-line implications of Trump’s proposed fee hikes for FDA registrants, Congress retains ultimate authority regarding FDA user fee reauthorization, and legislators have no plans to shift the agency’s budgetary requirements wholly over to industry. Still, the fact that the Trump administration persists in pushing for such a shift adds uncertainty and concern for many manufacturers operating in the US.

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