[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]


 
  REAUTHORIZATION OF THE MEDICAL DEVICE USER FEE AND MODERNIZATION ACT

=======================================================================

                                HEARING

                               BEFORE THE

                         SUBCOMMITTEE ON HEALTH

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                              MAY 16, 2007

                               __________

                           Serial No. 110-47


      Printed for the use of the Committee on Energy and Commerce

                        energycommerce.house.gov


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                    COMMITTEE ON ENERGY AND COMMERCE

    JOHN D. DINGELL, Michigan,       JOE BARTON, Texas
             Chairman                    Ranking Member
HENRY A. WAXMAN, California          RALPH M. HALL, Texas
EDWARD J. MARKEY, Massachusetts      J. DENNIS HASTERT, Illinois
RICK BOUCHER, Virginia               FRED UPTON, Michigan
EDOLPHUS TOWNS, New York             CLIFF STEARNS, Florida
FRANK PALLONE, Jr., New Jersey       NATHAN DEAL, Georgia
BART GORDON, Tennessee               ED WHITFIELD, Kentucky
BOBBY L. RUSH, Illinois              BARBARA CUBIN, Wyoming
ANNA G. ESHOO, California            JOHN SHIMKUS, Illinois
BART STUPAK, Michigan                HEATHER WILSON, New Mexico
ELIOT L. ENGEL, New York             JOHN B. SHADEGG, Arizona
ALBERT R. WYNN, Maryland             CHARLES W. ``CHIP'' PICKERING, 
GENE GREEN, Texas                        Mississippi
DIANA DeGETTE, Colorado              VITO FOSSELLA, New York
    Vice Chairman                    STEVE BUYER, Indiana
LOIS CAPPS, California               GEORGE RADANOVICH, California
MIKE DOYLE, Pennsylvania             JOSEPH R. PITTS, Pennsylvania
JANE HARMAN, California              MARY BONO, California
TOM ALLEN, Maine                     GREG WALDEN, Oregon
JAN SCHAKOWSKY, Illinois             LEE TERRY, Nebraska
HILDA L. SOLIS, California           MIKE FERGUSON, New Jersey
CHARLES A. GONZALEZ, Texas           MIKE ROGERS, Michigan
JAY INSLEE, Washington               SUE WILKINS MYRICK, North Carolina
TAMMY BALDWIN, Wisconsin             JOHN SULLIVAN, Oklahoma
MIKE ROSS, Arkansas                  TIM MURPHY, Pennsylvania
DARLENE HOOLEY, Oregon               MICHAEL C. BURGESS, Texas
ANTHONY D. WEINER, New York          MARSHA BLACKBURN, Tennessee       
JIM MATHESON, Utah                   
G.K. BUTTERFIELD, North Carolina     
CHARLIE MELANCON, Louisiana          
JOHN BARROW, Georgia                 
BARON P. HILL, Indiana               
                                     
_________________________________________________________________

                           Professional Staff

 Dennis B. Fitzgibbons, Chief of 
               Staff
Gregg A. Rothschild, Chief Counsel
   Sharon E. Davis, Chief Clerk
   Bud Albright, Minority Staff 
             Director

                                  (ii)
                         Subcommittee on Health

                FRANK PALLONE, Jr., New Jersey, Chairman
HENRY A. WAXMAN, California          NATHAN DEAL, Georgia,
EDOLPHUS TOWNS, New York                 Ranking Member
BART GORDON, Tennessee               RALPH M. HALL, Texas
ANNA G. ESHOO, California            BARBARA CUBIN, Wyoming
GENE GREEN, Texas                    HEATHER WILSON, New Mexico
    Vice Chairman                    JOHN B. SHADEGG, Arizona
DIANA DeGETTE, Colorado              STEVE BUYER, Indiana
LOIS CAPPS, California               JOSEPH R. PITTS, Pennsylvania
TOM ALLEN, Maine                     MIKE FERGUSON, New Jersey
TAMMY BALDWIN, Wisconsin             MIKE ROGERS, Michigan
ELIOT L. ENGEL, New York             SUE WILKINS MYRICK, North Carolina
JAN SCHAKOWSKY, Illinois             JOHN SULLIVAN, Oklahoma
HILDA L. SOLIS, California           TIM MURPHY, Pennsylvania
MIKE ROSS, Arkansas                  MICHAEL C. BURGESS, Texas
DARLENE HOOLEY, Oregon               MARSHA BLACKBURN, Tennessee
ANTHONY D. WEINER, New York          JOE BARTON, Texas (ex officio)
JIM MATHESON, Utah
JOHN D. DINGELL, Michigan (ex 
    officio)
  
                             C O N T E N T S

                              ----------                              
                                                                   Page
Hon. Frank Pallone, Jr., a Representative in Congress from the 
  State of New Jersey, opening statement.........................     1
Hon. Nathan Deal, a Representative in Congress from the State of 
  Georgia, opening statement.....................................     3
Hon. Henry A. Waxman, a Representative in Congress from the State 
  of California, opening statement...............................     3
Hon. Mike Ferguson, a Representative in Congress from the State 
  of New Jersey, opening statement...............................     4
Hon. Lois Capps, a Representative in Congress from the State of 
  California, opening statement..................................     5
Hon. Joseph R. Pitts, a Representative in Congress from the State 
  of Pennsylvania, opening statement.............................     5
Hon. Diana DeGette, a Representative in Congress from the State 
  of Colorado, opening statement.................................     7
Hon. Heather Wilson, a Representative in Congress from the State 
  of New Mexico, opening statement...............................     8
Hon. Darlene Hooley, a Representative in Congress from the State 
  of Oregon, opening statement...................................     9
Hon. Marsha Blackburn, a Representative in Congress from the 
  State of Tennessee, opening statement..........................    10
Hon. Tim Murphy, a Representative in Congress from the State of 
  Pennsylvania, opening statement................................    11
Hon. Gene Green, a Representative in Congress from the State of 
  Texas, opening statement.......................................    11
Hon. John D. Dingell, a Representative in Congress from the State 
  of Michigan, prepared statement................................    12

                               Witnesses

Jeffrey Shuren, M.D., J.D., Assistant Commissioner for Policy, 
  Food and Drug Administration...................................    14
    Prepared statement...........................................    16
    Accompanied by Daniel G. Schultz, M.D., Director, Center for 
      Devices and Radiological Health, Food and Drug 
      Administration
    Answers to submitted questions...............................   141
Paul Laviolette, chief operating officer, Boston Scientific 
  Corporation....................................................    50
    Prepared statement...........................................    53
Diana Zuckerman, president, National Research Center for Women 
  and Families...................................................    60
    Prepared statement...........................................    63
    Additional material..........................................   126
Kelvyn Cullimore, Jr., MDMA secretary, president and chief 
  executive officer, Dynatronics Corporation.....................    68
    Prepared statement...........................................    70
Steven A. Grossman, executive director, the FDA Alliance.........    79
    Prepared statement...........................................    81
Diane E. Dorman, vice president, public policy, National 
  Organization for Rare Disorders................................    88
    Prepared statement...........................................    91

                           Submitted Material

Premier Incorporated, submitted statement........................   117
Letter of May 7, 2007, from Members of Congress to Commissioner 
  Andrew C. Von Eschenbach.......................................   122


  REAUTHORIZATION OF THE MEDICAL DEVICE USER FEE AND MODERNIZATION ACT

                              ----------                              


                        WEDNESDAY, MAY 16, 2007

                  House of Representatives,
                            Subcommittee on Health,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 10:00 a.m., in 
room 2322 of the Rayburn House Office Building, Hon. Frank 
Pallone, Jr. (chairman) presiding.
    Members present: Representatives Pallone, Waxman, Eshoo, 
Green, DeGette, Capps, Hooley, Matheson, Deal, Shadegg, Pitts, 
Ferguson, Murphy, and Burgess.
    Staff present: John Ford, Jack Mariho, Bobby York, Virgil 
Miller, Melissa Sidman, Ryan Long, Nandan Kenkeremath, and Chad 
Grant.

OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE 
            IN CONGRESS FROM THE STATE OF NEW JERSEY

    Mr. Pallone. We will call the meeting to order. Today we 
are having a hearing on the reauthorization of the Medical 
Device User Fee and Modernization Act and I will recognize 
myself for an opening statement. First of all, good morning and 
thank you for being here today. I know we have two panels and 
you are the first one. We will start out with opening 
statements, though, and then we will go to the panel.
    Recent innovations in medical devices have provided us with 
new possibilities in treating illness and delivering healthcare 
services. Today we are witnessing medical innovations that 
would have been considered unthinkable just a few years ago but 
now are considered commonplace. New breakthroughs in medical 
device technology have empowered patients and providers to 
achieve better clinical outcomes with less invasive procedures 
and shorter recovery times. As the medical device industry 
continues to innovate, we, as policymakers, have a 
responsibility to ensure that the FDA has the financial and 
human resources necessary to provide for a timely review of the 
latest inventions in medical technology.
    In an attempt to achieve this goal, Congress passed the 
Medical Device User Fee and Modernization Act, or MDUFMA, of 
2002, which established for the first time a user fee program 
for medical devices that was modeled after the Prescription 
Drug User Fee Program, which we are also working to reauthorize 
this year. This legislation was necessary due to inadequate 
resources at the FDA. As applications began to pile up, it 
became clear that there was a need to implement a new revenue 
stream to improve the time in which new and innovative medical 
devices could be approved by FDA, and that is as true today as 
it was 5 years ago.
    While FDA has been meeting its performance goals under 
MDUFMA I, the demand on FDA to ensure that devices are safe and 
effective has grown significantly in the past few years and 
will continue to do so. Innovations in the medical device 
industry that will transform our healthcare system will 
continue to rapidly develop and will likely require even 
greater resources from the FDA. But accordingly, it is 
important that this committee reauthorize MDUFMA so that FDA 
can continue to fulfill its job of regulating medical devices 
and safeguarding the public health.
    I want to thank all of the people that worked hard to bring 
this proposal together. Having had the chance to review it, 
though, I do have some concerns. First and foremost, noticeably 
absent from the proposals appears to be any provisions relating 
to post-market surveillance of medical devices. In MDUFMA I, 
there was an authorization for appropriations for post-market 
surveillance activities. Even though these funds were never 
appropriated under the previous Republican-led Congresses, at 
least there was some recognition about the need to fund post-
market surveillance activities. There are no such provisions in 
the MDUFMA II proposal that I am aware of.
    This obviously raises some concerns for me. Most 
importantly, for anyone who has been paying attention to the 
Prescription Drug User Fee Act, PDUFA, which has been 
reauthorized a number of times, that in the first few 
reauthorizations to that program, user fees were mostly set 
aside to fund pre-market activities, largely ignoring any of 
the post-market responsibilities at FDA to ensure that drugs 
are safe once they are already on the market. Under the MDUFMA 
II proposal, I see a recurring pattern where, once again, FDA 
and the industry have managed to agree on performance goals for 
achieving expedited review of medical devices, but failed to 
address the post-market surveillance issues, which are equally 
as important, so we will have to take a long and hard look at 
this and it may be necessary to ensure some of the user fees 
collected under MDUFMA II are designated for post-market 
surveillance activities.
    On another issue, I am also concerned about the 
reprocessing of single-use devices, or SUDs. MDUFMA I attempted 
to address the potential risk of infection and device 
malfunction that might arise from the reprocessing of single-
use devices. Over the past year I have been following this 
issue closely, especially in my home State of New Jersey, and I 
continue to be alarmed about the reprocessing of SUDs and at a 
minimum believe that patients should be made aware of when a 
single-use device that has been reprocessed is being used on 
them during a procedure. As this problem persists, I am worried 
that the MDUFMA II proposal does not focus on SUDs at all, with 
the exception that SUD reprocessors pay the proposed annual 
establishment fee, and further regulation may be required.
    In closing, I just want to say that I know, during the 
first MDUFMA authorization, there was tremendous bipartisan 
support within our committee to reach an agreement on behalf of 
patients, providers and the industry. I hope that we can 
proceed in a similar fashion as we move forward with 
reauthorizing this program, because the health and wellbeing of 
many of my friends, family and constituents certainly depend 
upon it. And I would like to now recognize the ranking member, 
Mr. Deal.

  OPENING STATEMENT OF HON. NATHAN DEAL, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF GEORGIA

    Mr. Deal. Thank you, Mr. Chairman. I will be brief. The 
Medical Device User Fee Program was first enacted in 2002 to 
try to improve FDA's device review capabilities to get safe and 
effective devices to patients more quickly. Like any new 
program, it has experienced its own challenges in achieving 
that goal, some of which Congress has already had to address 
through legislation.
    As we evaluate reauthorization for the first time, I know 
some of the problems like funding adequacy and fee 
predictability have helped to form changes in the 
reauthorization proposal before us. Small businesses are a 
vital component of the medical device industry and I was 
pleased to see that the agreement reached between the FDA and 
industry sought to balance the diverse needs of both small and 
large manufacturers.
    I look forward to hearing the witnesses' thoughts on some 
of the successes and shortcomings of the program and I am sure 
their testimony will be helpful to our committee as we attempt 
to reauthorize the legislation. I yield back.
    Mr. Pallone. Thank you. Mr. Waxman.

OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. Waxman. Thank you, Mr. Chairman. Medical devices are 
certainly important and they are growing in importance and in 
complexity. We need these devices for so many different 
purposes. Contact lenses improve our vision, artificial joints 
help people walk, and pacemakers keep many alive and well. With 
this growth in medical devices, the challenges are growing as 
well for the Food and Drug Administration and FDA needs 
adequate resources to meet these challenges.
    Under the 2007 negotiated package, the Device Center would 
receive an increase in user fees, but I am concerned, however, 
that that is not nearly enough to make up for what has been 
years of underfunding. I am worried that exchange for what is 
only a modest increase in user fees, FDA is now making a 
commitment to conduct even faster reviews of medical devices. 
If the effect of these performance goals is to hinder FDA's 
ability to conduct thorough and complete reviews, it is the 
American public that will suffer from an exposure to unsafe and 
ineffective devices. Now that is before the drug is approved. 
But we also need to be aware of the fact that there must be a 
surveillance after the device--I said drug--device has been 
approved, but we need to be aware of and to deal with the post-
marketing problems in this area, as we must in the 
pharmaceutical area.
    If FDA is seeking to speed up its review of device 
applications, I think we need to examine whether there are 
adequate resources to effectively monitor and oversee the 
safety of these devices once they are on the market. The 
attention and resources directed at conducted speedier reviews 
has apparently detracted from other responsibilities like 
inspections. More than 20,000 firms now produce medical devices 
for the U.S. market and at the current rate, FDA will inspect a 
device firm only about once every 10 years on average, this 
despite the fact that FDA is required by law to conduct 
inspections once every 2 years.
    I am also troubled by the proposed changes to FDA's Third-
Party Inspection Program. Under this program companies can pay 
a fee to get an inspection by an outside person accredited by 
FDA. To date we have seen very poor results from this. FDA has 
spent $3 million implementing it and there have been a total of 
three inspections by these third parties and I am concerned 
that we are allowing outsiders to do what is essentially an FDA 
job. Yet the negotiated proposal contains provisions that would 
expand its use. Instead of putting resources into training 
outsider parties to conduct inspections, we should be getting 
those desperately needed dollars into FDA's own inspection 
program.
    We owe it to FDA and the American public to ensure FDA has 
the resources and authority it needs to guarantee our medical 
devices are safe and effective, both before they go on the 
market and throughout their lifecycle. I look forward to 
hearing from witnesses on this subject and how we can 
accomplish these goals. I wish we weren't even asking for user 
fees. We ought to pony up the appropriations necessary because 
of the essential government purpose of having an FDA. If user 
fees are going supplement those appropriations, we ought to 
make sure that there are enough appropriations to go along with 
the user fees so FDA can do the job before it. Thank you, Mr. 
Chairman.
    Mr. Pallone. Thank you, Mr. Waxman. Mr. Ferguson.

 OPENING STATEMENT OF HON. MIKE FERGUSON, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF NEW JERSEY

    Mr. Ferguson. Thank you, Mr. Chairman, and thanks for 
holding this hearing and I know we have two distinguished 
panels of witnesses today, so I too will be brief.
    I was listening to Mr. Waxman talk about the different 
devices and products that fall under this program and I am 
thinking to myself, my dad has two artificial hips, my father-
in-law has two artificial knees, I think I am a ticking time 
bomb, but I think every one of us, if we haven't in our life 
had an opportunity to use or benefit from one of these devices, 
we certainly will, probably, sometime in the future and it 
really highlights how important the Medical Device User Fee 
Program has become.
    It has been successful. It has facilitated the approval and 
the breakthrough for medical devices and allowing them to reach 
the market and to benefit patients. It is essential that we 
reauthorize this program soon, so that the FDA has the 
resources it needs to ensure that the public and our 
constituents have access to safe and effective medical devices. 
I certainly look forward to hearing from our two panels of 
witnesses today and thank you, Mr. Chairman, for holding this 
hearing and I yield back.
    Mr. Pallone. Thank you. Mrs. Capps.

   OPENING STATEMENT OF HON. LOIS CAPPS, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mrs. Capps. Thank you, Chairman Pallone, for holding this 
hearing, and to our witnesses for your testimony. I have served 
in Congress 9 years now and even during this time, we have all 
seen such an incredible jump in the number of medical devices 
being created and put out on the market. Those of us who 
represent districts in California note that our State has been 
a leader in this industry and it is not going down, it is 
continuing to advance.
    Clearly the spike in applications has created a drain on 
FDA and thus, this Congress has enacted MDUFMA, but of course, 
the formulas were unpredictable and we had to come in and 
institute last-minute fixes to ensure predictable revenues for 
the Food and Drug Administration. And I think this is really 
important to keep in mind as we move to reauthorize MDUFMA, 
because it highlights the need to place more weight on 
appropriated funding rather than on user fees.
    In my opinion, we have allowed PDUFA fees to control too 
great a percentage of the Food and Drug Administration's budget 
for drug approval and I hope our colleagues will join me in 
ensuring that we keep the user fees for device approval at a 
lower percentage so that we can better ensure integrity and 
avoid conflicts of interest. And speaking of conflicts of 
interest, I think we need to be extremely careful in how we 
address the issue of third-party inspections. Anything we can 
do to address and enhance the safety of devices is welcomed by 
all of us, but we need to make sure that we ensure that safety 
inspections are conducted by truly independent actors. And not 
be those with the financial interest in having the product out 
on the market. The consequences are way more expensive if we 
don't do that. It is basic common sense.
    Finally, I hope that we can discuss disparities in the 
medical device field. We have found that devices are being 
manufactured with adult males in mind, even though women and 
children have a need for them as well. Our committee is slated 
to discuss pediatric devices on another day, but I hope we can 
discuss the ways in which we can utilize MDUFMA reauthorization 
process to encourage innovation in devices that suit the needs 
of women. So I hope, Mr. Chairman, that you are going to be 
amenable to that and again, thank you in advance to our 
witnesses and I look forward to the discussions today and I 
yield back.
    Mr. Pallone. Thank you. Mr. Pitts.

OPENING STATEMENT OF HON. JOSEPH R. PITTS, A REPRESENTATIVE IN 
            CONGRESS FROM THE STATE OF PENNSYLVANIA

    Mr. Pitts. Thank you, Mr. Chairman, and thank you for 
convening this hearing today on MDUFMA reauthorization.
    Before 2002, the government funded the approval process for 
medical devices. It was really a mess. It significantly delayed 
FDA approval of new lifesaving medical devices and prevented 
patients from benefiting from new technologies, and to end this 
delay, as was noted, Congress unanimously passed the MDUFMA act 
in 2002 and it overcame the obstacles at the FDA that prevented 
timely approval of new lifesaving medical technologies without 
compromising the safety of consumers, and created a stable 
funding base for FDA, combining industry-paid user fees and 
congressional appropriations and as a result, the device 
approval time has been virtually cut in half.
    And as we all know, unless Congress acts to reauthorize 
this successful program, it will sunset on October 1 of this 
year. And if we do not reauthorize the program in a timely 
fashion, FDA may be forced to issue a reduction-in-force 
notices to its employees. Federal regulations mandate that FDA 
must issue these notices at least 60 days prior to the 
expiration of the current MDUFMA program and this possibility 
could lead to a loss of highly qualified staff, staff who could 
easily find more lucrative employment elsewhere.
    So on the whole, I believe the agreement reached between 
FDA and the industry is a good one and I would urge my 
colleagues to work toward a speedy reauthorization. And I would 
like to thank all of the witnesses who have come today. We look 
forward to your testimony and I hope that we don't find our 
self in the situation that I have talked about, in the future, 
and I yield back the balance of time.
    Mr. Pallone. Thank you. The gentlewoman from California, 
Ms. Eshoo.

 OPENING STATEMENT OF HON. ANNA G. ESHOO, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Ms. Eshoo. Good morning, Mr. Chairman, and to our 
witnesses. Thank you for holding this important hearing on 
reauthorizing MDUFMA. As my colleagues know, I worked very hard 
with Mr. Barton and Mr. Greenwood, our former colleague, to 
enact the first authorization of MDUFMA 5 years ago and I think 
that it has been a success. Reauthorizations are very important 
because it gives us the opportunity to strengthen legislation, 
having the opportunity of looking over our shoulders to see how 
the original legislation has worked.
    In the last 5 years, since the original authorization was 
passed, user fees have substantially increased the financial 
resources that FDA needs to review new products. FDA has been 
able to hire more employees, upgrade its equipment and increase 
its personnel expertise, which is very, very important in a 
complex area. In fact, the American people depend on that. The 
establishment of a third-party inspection program has helped 
ensure that manufacturing plants are inspected on a more 
regular basis by allowing FDA to utilize outside accredited 
inspectors to conduct inspections and provide reports to FDA. 
That was a real point of contention when we first authorized 
and it should be, because it is a very, very important 
determination to be made. So while I think that that was 
important and we did, I think, a pretty solid job in coming to 
consensus, I don't think that it is entirely safe to say that 
the program is perfect, but we have the opportunity to do that.
    So with authorization, I think that we can improve, 
overall, the operations at FDA. I think we need to take a 
careful look at the length of time it takes for new devices to 
come to market, consider ways that will expedite the approval 
process without compromising, of course, patient safety. I 
think we need to increase the industry's participation in the 
Third-Party Inspection Program and also improve the quality and 
the type of information FDA has access to regarding medical 
devices that are manufactured and marketed in our country.
    Another area, Mr. Chairman, that I have a lot of concern 
about is that of pediatric device safety and we know that 
because children are still in stages of development, that that 
presents a difficult challenge for companies developing and 
manufacturing devices to keep up with growing bones and organs. 
And children experience unique side effects that we don't see 
in adult populations. So I think Congress has made some 
progress in enacting and enforcing pediatric drug testing laws, 
which I have had my hand in, but I think that we can do better 
with regard to devices. Mr. Markey and Mr. Rogers have offered 
legislation in this area and I hope that we will address the 
pediatric device issue in our reauthorization of MDUFMA.
    So in closing, I would like reiterate my support for this. 
I have some ideas about how to make it stronger and better and 
I think that all of the stakeholders in this have done an 
initial good job of reaching some consensus and I look forward 
to working with everyone to not only reauthorize but be one of 
the real cheerleaders after we finish with it in saying job 
well done. Thank you, Mr. Chairman.
    Mr. Pallone. Thank you. I think most of you know, but I 
will just mention it again, that next Tuesday we are going to 
have a hearing on the pediatric bills that need to be 
reauthorized. That is not to suggest that you can't get into 
that today, but we are going to have a separate hearing on the 
pediatric bills that need to be reauthorized next Tuesday. Next 
is Mr. Burgess.
    Mr. Burgess. Thank you, Mr. Chairman. I will submit my 
statement for the record. I do want to thank the witnesses for 
participating in this with us this morning and I think it is 
going to be lively and instructional and I look forward to 
their testimony. I yield back.
    Mr. Pallone. Thank you. Ms. DeGette.

 OPENING STATEMENT OF HON. DIANA DEGETTE, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF COLORADO

    Ms. DeGette. Thank you very much, Mr. Chairman, for holding 
this hearing today. As the parent of a child who uses two 
medical devices every day to manage her Type I diabetes, I am 
acutely aware of how important they are to the health and 
wellbeing of millions of Americans. It is important, therefore, 
that we provide a stable source of funding to the FDA to assess 
the safety and efficacy of these devices before they can be 
marketed.
    When the committee originally authorized MDUFMA in 2002, I 
authored the language that was added to the bill requiring the 
Institute of Medicine to conduct a study to determine whether 
the FDA system for post-market surveillance of medical devices 
provides adequate safeguards for their use in pediatric 
populations. Mr. Chairman, I know we are talking about 
pediatrics next week. I won't be here because I have the honor 
of attending my elder daughter's high school graduation next 
week. So I just want to talk for a minute about my views on 
pediatrics today.
    The IOM study which was released in 2005 details a number 
of important recommendations for further protection of children 
using medical devices. Specifically, the report cited a number 
of recommendations for Congress, including requiring the FDA to 
establish a system for monitoring and publicly reporting the 
status of post-market study commitments involving medical 
devices. Permitting the FDA to order post-market studies as a 
condition of clearance for the categories of devices, for which 
section 522 post-market surveillance studies are now allowed, 
and allowing the FDA to extend those studies for those devices 
with expected high pediatric use beyond the current 3-year 
limit. I look forward to hearing from our witnesses today about 
how these recommendations are or should be incorporated into 
the reauthorization of MDUFMA.
    The report also highlighted several recommendations for the 
FDA that would not require statutory authority. These 
recommendations include collaboration with the NIH and the 
Agency for Healthcare Research and Quality to define a research 
agenda and priorities for the evaluation of the short and long-
term safety and effectiveness of medical device use with 
growing and developing children; promoting the development and 
use of standards and approaches for capturing and linking use 
in outcomes data for medical devices; collaborating with 
industry, healthcare professionals and organizations and parent 
and patient advocates to improve adverse event reporting; 
overseeing the management of high-profile medical device safety 
issues, similar to the independent Drug Safety Oversight Board 
within the FDA; and establishing a central point of 
responsibility for pediatric issues, within the Center for 
Devices and Radiological Health, to evaluate the adequacy of 
the Center's use of pediatric expertise and its attention to 
pediatric issues in all aspects of its work.
    Mr. Chairman, as we consider the reauthorization of MDUFMA, 
I look forward to hearing from witnesses about whether the FDA 
has adopted these recommendations and whether the MDUFMA 
package negotiated by the administration reflects further 
necessary changes. And with that, I yield back my time. Thank 
you.
    Mr. Pallone. Thank you. The gentlewoman from New Mexico, 
Mrs. Wilson.

 OPENING STATEMENT OF HON. HEATHER WILSON, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF NEW MEXICO

    Mrs. Wilson. Thank you, Mr. Chairman. I appreciate your 
having this hearing today. The Medical Device User Fee Program 
is really important and I think it is much less controversial 
than the Prescription Drug User Fee Program that we had 
hearings on last week, and I hope that we can very rapidly 
reauthorize this program to provide some stability for the 
folks who are work on this.
    There are two companies in my district that rely upon this 
legislation in order to get rapid approval for the devices that 
they manufacture, Johnson & Johnson, which has Ethicon Endo-
Surgery and I have visited their plant where they package and 
sterilize surgical products and medical devices, as well as, 
surprisingly for some folks, Intel Corporation, because 
anything that has a computer chip that is an implantable device 
has to get approval under MDUFMA.
    My colleague from Denver has been one of the leaders on 
childhood diabetes in the Congress and that is particularly 
important in New Mexico, where the epidemic of diabetes has a 
disproportionate effect on the people that I represent and I 
represent a city with one of the highest percentages of Native 
Americans in the country and also a very high percentage of 
Hispanic citizens, and the increases in diabetes that we are 
seeing is really overwhelming. So one of the issues that I hope 
we will be looking at is whether there is priority given to 
those devices that might have a disproportionate public health 
effect. In other words, are there ways to make sure that things 
like continuous glucose monitoring devices, and things that 
have--is there a way to concentrate approvals or attention and 
resources on those devices that have a disproportionate effect 
on public health? And the answer to that may be no, but it is 
an issue that I would like to see us at least discuss and 
address.
    I join my colleagues in agreeing that these medical 
innovations need to be kept moving forward and going through 
the pipeline so that they are brought to the market and that 
they are safe and effective, people can have confidence in them 
and they get to people who need them as quickly as possible. 
Thank you, Mr. Chairman.
    Mr. Pallone. Thank you. The gentlewoman from Oregon, Ms. 
Hooley.

 OPENING STATEMENT OF HON. DARLENE HOOLEY, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF OREGON

    Ms. Hooley. Thank you, Mr. Chairman. Although the first 
iteration of Medical Device User Fee and Modernization Act, 
MDUFMA, has encountered a number of challenges, the legislation 
has shown results. The FDA, industry, and most importantly, 
consumers benefit from a faster approval process enabled by 
MDUFMA's increased revenues. Timely approval of medical devices 
means that lifesaving devices get to patients more quickly. 
However, safety must be FDA's No. 1 priority. Increased 
resources and reauthorization of MDUFMA should enable the FDA 
to strengthen its review process to get devices to market more 
quickly and safely. More high-profile safety features have 
occurred on the drug side of FDA's review process than with 
devices. However, serious safety concerns have also arisen in 
recent years with a number of devices. We must ensure that FDA 
has the resources and authority to protect the public health. 
Investments and enhanced information technology, and hiring of 
more specialized experts enabled by MDUFMA's increased user 
fee, must be maximized to help better protect consumers.
    Although user fees have increased as a percentage of the 
Center for Devices and Radiological Health budget, the 
proportion of user fees to appropriated funds remain much lower 
for devices than for drugs. It is critical to maintain that 
appropriate balance and I believe MDUFMA accomplishes that 
objective. MDUFMA's reauthorization also takes important steps 
to stabilize user fee funding. Increased predictability in user 
fee revenues will be beneficial to both the FDA and industry, 
because regulators and industry will better be able to plan for 
their needs under the new fee structure.
    Moreover, I am glad to see MDUFMA has recognized the vital 
role small businesses play in our robust medical device 
industry. According to the Government Accountability Office, 
small businesses account for approximately 20 percent of device 
applications in 2006. Fee reduction for small medical device 
businesses will help keep that important segment of the 
industry competitive. Finally, like with PDUFA, it is important 
to pass MDUFMA in a timely manner so FDA does not lose its best 
scientists. Thank you, Mr. Chairman, and I yield back.
    Mr. Pallone. Thank you. Mrs. Blackburn.

OPENING STATEMENT OF HON. MARSHA BLACKBURN, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF TENNESSEE

    Mrs. Blackburn. Thank you, Mr. Chairman. Thank you for the 
hearing and I want to apologize to you and to our witnesses. We 
have an O&I Subcommittee hearing going on downstairs and I am 
going to need to step back to that. But I am pleased, as are my 
colleagues, to be talking about the reauthorization of MDUFMA.
    I am amazed by the innovation that is taking place in this 
industry and I have seen it firsthand in my district, and many 
of the medical technology companies in my district are, as Ms. 
Hooley was saying, they are small business companies and it is 
imperative and so very important to them that this process work 
as smoothly, that we have an expedient process when they make 
their filings, and that they receive timely answers. We have 
one Tennessee device company that created a state-of-the-art 
mobile medical device training center, equipped with six 
surgical stations, highly advanced technology to train medical 
professionals on new orthopedic devices and it is an amazing 
technology and quite frankly, I think this is one of the most 
exciting areas of science and it is important for us to act 
responsibly and to make certain that we move forward with this 
legislation quickly.
    I think that it is important for us to note that medical 
device research and development has more than doubled in terms 
of sales in the past 15 years and investment is continuing to 
grow, and what this tells me is that this is an area that 
consumers and our constituents are looking to for options to 
improve their quality of life and it is something that they are 
paying close attention to, so it is imperative that we continue 
to provide incentives for this innovation. We have seen some 
major breakthroughs due to medical devices and we must support 
initiatives such as health information technology, medical 
technology, will continue to transform our health delivery 
systems and the care that is available to our constituents.
    I appreciate that the device industry and the FDA have 
reached an agreement on a reauthorization package. I am looking 
forward to hearing more about that today. I think we all have a 
few little questions that we would like to have answered and it 
is my hope that we will move forward in an expedient manner. 
Thank you again, Mr. Chairman, and I yield back.
    Mr. Pallone. Thank you. The gentleman from Arizona.
    Mr. Shadegg. Mr. Chairman, I want to thank you for holding 
this hearing and I want to express my appreciation to our 
witnesses and with that, I will waive.
    Mr. Pallone. Thank you. The gentleman from Pennsylvania.

   OPENING STATEMENT OF HON. TIM MURPHY, A REPRESENTATIVE IN 
            CONGRESS FROM THE STATE OF PENNSYLVANIA

    Mr. Murphy. Thank you very much, Mr. Chairman, and I also 
appreciate this hearing. I too have a simultaneous hearing and 
I am going back and forth between these. But I wanted to thank 
you for an ongoing hearing that continues to deal with issues 
of patient-centered healthcare and these aspects of dealing 
with medical devices is quite important because it allows us to 
continue to focus on the issues of patient quality, patient 
safety and patient choice.
    Along these lines, my hope is that as we move forward on 
any of these issues, that one of the aspects that we address 
has to do with reprocessed and reused medical devices that are 
brought under the regulation of the FDA. One of the concerns I 
have about reusing medical devices is that these devices were 
designed for optimum performance and safety under intended 
conditions of use and not necessarily the ease of cleaning or 
secondary use, which can oftentimes make them extremely 
difficult to sterilize and I worry sometimes that reusing 
medical devices can compromise their safety, and push for some 
review of devices for which they were never intended.
    For example, a 2001 study of reuse of catheters found an 
increased risk of infection. Even after rigorous cleaning and 
sterilization, virus and bacteria were still present in the 
catheter, which, of course, can be deadly to a patient. We have 
to be reminded that some 90,000 lives are lost every year from 
infections in hospitals, some 2 million people are infected in 
hospitals and healthcare centers every year, and some $50 
billion is spent annually dealing with, in many cases, 
preventable infections. I think patients have a right to know 
and to choose whether or not a medical device was designed for 
single use and has already been used in other patients and if 
they are going to be exposed to unnecessary risks.
    One of the reasons I have introduced a bill, H.R. 1174, the 
Healthy Hospitals Act, would require all hospitals to publicly 
report their infection rates, which could easily apply to 
medical devices and in illness stemming from reuse of medical 
devices. So I look forward to hearing from the FDA and our 
witnesses today, specifically on how we can avoid unnecessary 
infections from medical devices, ways to incorporate patient 
safety and patient quality, and to this committee's efforts to 
ensure that new and existing medical devices are both effective 
and safe. And with that, I yield back my time.
    Mr. Pallone. Thank you. And I recognize our vice chairman, 
Mr. Green.

   OPENING STATEMENT OF HON. GENE GREEN, A REPRESENTATIVE IN 
                CONGRESS FROM THE STATE OF TEXAS

    Mr. Green. Thank you, Mr. Chairman, for holding this 
hearing on the reauthorization of Medical Device User Fee and 
Modernization. I apologize for being late, but we have an 
Oversight and Investigation Subcommittee hearing on British 
Petroleum downstairs and since 15 people near my district were 
killed 2 years ago, we have a real interest in that.
    Congress first authorized FDA to collect user fees for the 
review of medical devices in 2002. While we have enacted a 
couple of bills to correct and stabilize the user fee for 
medical devices, we face our first comprehensive 
reauthorization of these fees. For regulatory purposes, medical 
devices are everything from the gloves that doctors wear when 
examining a patient, to heart valves implanted in individuals 
for the rest of their lives. The wide variety of medical 
devices regulated under the system necessitates that review and 
approval of post-market surveillance be appropriate for the 
type of device under regulation, all the while ensuring that we 
balance safety with a desire to bring these lifesaving devices 
to market in a timely manner.
    In our first authorization, we sought to strike a balance 
by specifying that the FDA would utilize user fees for the pre-
market reviews and inspection, the monitoring and research and 
evaluation of post-market studies, among other things. By 
providing user fee exceptions for small business, we attempted 
to facilitate their participation in the medical device 
industry. Likewise, the user fee exemptions for pediatric 
devices and humanitarian-use devices sought to ensure that 
children and individuals with rare diseases were able to 
benefit from the innovation within the device industry.
    A perfect example is the FDA's approval of the DeBakey VAD, 
the name for renowned Houston surgeon, Dr. Michael DeBakey. His 
device, which is a miniature valveless blood pump used in 
children, was approved in February 2004 under the humanitarian-
use exemption. The next month, a 6-year-old Houston girl was 
the first pediatric patient in the world who received this 
device which helps to improve blood flow for patients awaiting 
heart transplants. The device that a Houston company 
manufactures is a lifesaving device. Its first use was in Texas 
Children's Hospital on a child from Houston. It gives me pride 
in the innovation in medical miracles taking place in our 
community.
    As we begin our work on reauthorization, we need to make 
sure that the user fee system continues to spur that 
innovation, but we also need to make sure that the pressure at 
the FDA to meet the increased performance goals doesn't create 
a culture of swift approval at the expense of safety. I would 
like to see an increased focus on post-market surveillance and 
safety at the Center and I look forward to hearing what 
resources we can provide to make sure we appropriately strike 
that balance when we bring devices to market and protecting the 
health of Americans. I look forward to hearing our witnesses. 
And Mr. Chairman, I yield back my time.
    Mr. Pallone. Thank you. I think we completed the opening 
statements of the Members. Any other statements for the record 
will be accepted at this time.
    [The prepared statement of Mr. Dingell follows:]

    Prepared Statement of Hon. John D. Dingell, a Representative in 
                  Congress from the State of Michigan

    Mr. Chairman, thank you for holding this hearing today. We 
are here to discuss the reauthorization of a very important 
piece of legislation, the Medical Device User Fee and 
Modernization Act, also known as MDUFMA. Originally passed in 
2002, this program provides valuable resources to the Food and 
Drug Administration to allow timely approval of safe and 
effective new medical devices. Additionally, MDUFMA includes 
important provisions that address standards for the reuse of 
single-use devices; that allow third-party inspections; that 
provide incentives for the industry to study the application of 
their devices on children; and that include a number of 
additional regulatory reforms.
    While MDUFMA has worked well, we have twice made 
adjustments to the program through the 2004 Medical Devices 
Technical Corrections Act and the Medical Device User Fee 
Stabilization Act of 2005 to ensure its effectiveness and 
sustainability. Under current law, FDA's authority to collect 
medical device user fees expires on October 1, 2007.
    FDA's proposal to reauthorize the medical device user fee 
program includes a variety of provisions that Congress will 
need to study. New fees would be established to provide 
sustainability and a sense of predictability; fees paid by 
small businesses would be further reduced; the third-party 
inspection program would be changed; performance goals would be 
shifted; and new innovative diagnostic tests would be 
developed.
    In addition to these proposed device program changes, we 
must also discuss the issue of device safety. According to the 
Wall Street Journal, an internal report by FDA critiqued the 
agency's practices to ensure the safety of medical devices, 
such as defibrillators and pacemakers. The agency concluded 
that the monitoring system at the Center for Devices and 
Radiological Health lacked quality information on approved 
devices. At the same time, the agency concluded that the volume 
of information received exceeded the center's ability to 
consistently enter or review data in a routine matter. While 
the medical device user fee program was created to improve 
timeliness of device approvals, timeliness must not come at the 
cost of safety.
    I understand that FDA is required to do much with limited 
resources. Because it does not receive adequate resources from 
Congress, the user fee program continues to increase as a 
percentage of FDA's resources. From fiscal year 2003 to 2008, 
MDUFMA funding has increased at a much faster rate (220.1 
percent) than FDA's program level device review budget (31.3 
percent). As a result, FDA becomes increasingly more dependent 
on the very industry it was created to regulate.
    We must ensure that adequate enforcement tools, resources, 
and processes are in place to ensure that devices are safe and 
effective. When I supported the Medical Device User Fee and 
Modernization Act in 2002, I envisioned this program providing 
a down payment on an increased level of post-market 
surveillance. The current reauthorization provides us with a 
process to increase safety and compliance activity. FDA on its 
own has taken some steps to increase post-market safety, such 
as its ``Post-market Transformation Initiative.'' We now have 
an opportunity to explore other ways to enhance safety.
    We recognize that we must act fairly quickly to prevent a 
possible exodus of qualified staff and other experienced 
medical officers at FDA whose positions are funded by user 
fees. We ran into an unusual situation in 2005 when uncertainty 
as to whether corrective legislation would be enacted before 
the October 1, 2005, appropriations ``trigger'' date, required 
FDA to impose a hiring freeze in its Center for Devices and 
Radiological Health. In response to this problem, we passed the 
Medical Device User Fee Stabilization Act of 2005.
    I appreciate the importance of this hearing. I look forward 
to the testimony of witnesses and the input of our Members as 
we discuss the MDUFMA reauthorization.
                              ----------                              

    Mr. Pallone. We will turn to our witnesses and I see our 
first panel is already seated, but welcome again. Let me 
introduce you briefly here. First, we have Dr. Jeffrey Shuren, 
who is Assistant Commissioner for Policy for the FDA, and he is 
accompanied by Dr. Daniel Schultz, who is Director of the 
Center for Devices and Radiological Health at the FDA. Thanks 
again for being here. We have 5-minute opening statements. They 
become part of the record. And if you want to, at the 
discretion of the committee, submit additional statements or 
comments, you can still do that later. So I will begin by 
recognizing Dr. Shuren.

      STATEMENTS OF JEFFREY SHUREN, M.D., J.D., ASSISTANT 
    COMMISSIONER FOR POLICY, FOOD AND DRUG ADMINISTRATION; 
 ACCOMPANIED BY DANIEL G. SCHULTZ, M.D., DIRECTOR, CENTER FOR 
 DEVICES AND RADIOLOGICAL HEALTH, FOOD AND DRUG ADMINISTRATION

    Dr. Shuren. Thank you, Mr. Chairman and members of the 
subcommittee. We are pleased to be here today to discuss the 
importance of reauthorizing the Medical Device User Fee and 
Modernization Act before it expires on October 1, 2007.
    In 2002, Congress enacted MDUFMA to improve the timeliness 
and predictability of device application review to help get 
safe and effective medical devices to patients and 
practitioners more quickly. Under MDUFMA, FDA receives user 
fees from industry, in addition to appropriated funds for the 
Medical Device Review Program, and in return for these 
additional resources, FDA is expected to meet performance goals 
that became more ambitious each year of the legislation.
    In August 2005, Congress amended MDUFMA to provide more 
predictability for industry in the amount of user fees they pay 
by statutorily locking in a fixed annual fee increase of 8\1/2\ 
percent. MDUFMA I was about growth, progressively increasing 
the size of the Device Review Program through rapidly 
increasing funding linked to progressively more aggressive 
performance goals. For MDUFMA II, we are recommending changes 
to fine-tune the program, including funding to maintain a 
stable Device Review Program, while continuing to improve 
performance as a result of investments in a seasoned review 
staff and process efficiencies.
    While my written testimony describes all of FDA's 
legislative recommendations, I would like to highlight three 
areas for refinement. First, for pre-market review performance, 
we are proposing to meet more rigorous goals that build on the 
progress we made in the first Medical Device User Fee Program. 
The result would be a shortened decision time for several types 
of applications, including those for the most innovative 
devices. In addition, we are proposing several qualitative 
goals to continue to enhance the device review process and to 
make it more transparent. For example, we are proposing 
additional steps to facilitate the informal interactions with 
manufacturers, what we call interactive review, providing 
guidance on the pathway to market for imaging devices that use 
contrast agents or radiopharmaceuticals, making public more 
information about our performance, and enhancing the review 
process for in vitro diagnostic tests, because they will play a 
critical role in personalized medicine.
    Second, to ensure financial stability for the review 
program, we are recommending a reasoned increased in user fee 
revenues in the first year, followed by annual increases of 
8\1/2\ percent for the 4 years thereafter. This will help 
ensure that we have adequate resources to maintain a stable 
device review program, while providing the predictability in 
the fees that industry pays for the duration of MDUFMA II.
    We are also proposing two new fees that will generate about 
50 percent of the total fee revenue, an annual establishment 
registration fee and an annual fee for filing period reports. 
The large number of device-making establishments that would pay 
a fee, an estimated total of about 13,000, would stabilize our 
funding as well as allow us to lower the application fees and 
provide a larger fee discount for small businesses. The fee 
proposed is modest, about $1,700 in fiscal year 2008, but it 
would reduce the fiscal year 2008 standard fee for pre-market 
approval application, and that is those for the highest risk 
devices, to 65 percent of the 2007 rate. And the 2008 for small 
businesses for pre-market approval application would be reduced 
to 43 percent of the 2007 rate.
    Third, we are recommending modest changes to the Third-
Party Inspection Program to encourage industry participation 
while maintaining the strong safeguards against conflict of 
interest, because we are concerned about that as well.
    FDA believes that reauthorization of the user fee 
legislation, with the improvements I just outlined, will result 
in benefits to public health. Continued improvement in device 
review times and greater transparency of the review process 
will mean that patients and practitioners will have access to 
safe and effective medical devices more quickly. Adequate and 
stable funding for FDA will provide FDA with the resources to 
maintain the cutting-edge expertise necessary to provide timely 
review and ensure the safety of increasingly complex devices of 
tomorrow. Finally, a successful Third-Party Inspection Program 
will enable FDA to better focus its inspectional resources on 
higher risk devices.
     We thank all of you for your commitment to the mission of 
FDA and the continued success of our Medical Device Review 
Program and we look forward to working with you on MDUFMA II 
legislation. We would be happy to answer any questions you may 
have.
    [The prepared statement of Dr. Shuren follows:]

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    Mr. Pallone. Thank you, Dr. Shuren. I understand that Dr. 
Schultz is here to accompany you and answer questions, maybe, 
but not give an opening statement, so we will just move to 
questions and I will recognize myself. I only have 5 minutes 
and I want to get in something about post-market surveillance 
and these single-use devices, so I may ask you to answer yes or 
no or get back to me on some of these questions. I expressed 
concern that there did not appear to be any post-market 
surveillance provisions included in the MDUFMA II proposal 
before the subcommittee. Yet, in MDUFMA I, there was an 
authorization for appropriations for post-market surveillance 
activities at the FDA. Was that correct? Just yes or no.
    Dr. Shuren. Yes.
    Mr. Pallone. OK. And now that money, I understand, was 
never appropriated, but can you tell me if the agency ever 
requested that money in its submission to OMB during the past 
several years, when the administration was developing its 
fiscal year budget proposals? Again, yes or no.
    Dr. Shuren. Not to my knowledge.
    Mr. Pallone. OK. And you can get back to me, if you can 
find out more. Did the President ever include it in any of this 
year's budget proposals that he submitted, do you know?
    Dr. Shuren. Yes, fiscal year 2008, to my knowledge, had 
additional funding for device safety.
    Mr. Pallone. OK. Now, could you tell me--well, you said it 
was appropriated. What types of activities did that funding go 
for?
    Dr. Shuren. Well, the scope in MDUFMA is actually very 
broad. It encompasses a lot of post-market safety activities. 
It is very different from PDUFA, so we already had a broad 
scope. The second thing that we have and which MDUFMA is very 
different from PDUFA, from post-market safety, is that we have 
a trigger in place for protecting the appropriations for the 
entire device program. So the funding we get under MDUFMA goes 
for a lot of post-market safety activities and in addition, we 
have a little bit more protection on appropriations that will 
go to the rest of the program, which will cover the other 
remaining post-market safety activities.
    Mr. Pallone. OK. Now, as for the MDUFMA II proposal 
discussions, can you tell me whether the issue of post-market 
surveillance ever came up with industry representatives? Again, 
yes or no.
    Dr. Shuren. We did not go into any specific proposals for 
post-market safety. Our sense was that if we can ensure 
adequate funding for the agency, we will be in a fairly good 
place for post-market safety.
    Mr. Pallone. OK. And then finally on this issue, if the FDA 
and the industry agreed that some funding should be authorized 
for post-market surveillance in the first MDUFMA and to date, 
none of these funds--well, you said, actually, we have had some 
funds. So let me just ask you this. If Congress were to mandate 
that some percentage of the user fees were earmarked for post-
market surveillance issues instead of pre-market activities, 
like we do with PDUFA, is that something you think that the 
administration would support?
    Dr. Shuren. Well, I think that the user fees already are 
directed at a lot of post-market safety activities. In 
addition, the funding we have gotten to bring on board experts, 
those experts are used in post-market safety activities, so now 
we have greater expertise in a variety of fields. That is then 
integrated into post-market safety.
    Mr. Pallone. So then, you wouldn't necessarily have a 
problem if we actually said in the bill that a certain 
percentage of the user fees would have to be for post-market?
    Dr. Shuren. Well, what we would prefer, the better thing 
for us is that we have the funding and then we can apply it as 
we----
    Mr. Pallone. So you would rather have the discretion rather 
than have----
    Dr. Shuren. And we think we have that already built into 
the program.
    Mr. Pallone. OK. Let me get to the single-use devices. I 
know, in the first MDUFMA authorization, this issue was dealt 
with somewhat by requiring more data that validated the safety 
and the efficacy of reprocessed devices, yet the reprocessing 
of single-use devices still raises public health concerns for 
many of us, like Mr. Murphy mentioned as well, specifically in 
regards to infection and the malfunction of devices intended to 
be used only a single time. Can you tell me what steps have 
been taken by FDA since MDUFMA I was implemented to ensure the 
safety and efficacy of single-use devices, and whether you view 
those steps as adequate or would you support stronger 
regulation?
    Dr. Shuren. Well, first off, for single-use, reprocessing 
used medical devices, MDUFMA I, as you know, put in several 
provisions to ensure the safety of those products. So many of 
those devices that were exempt from submission of 510(k), they 
now have to submit data to us. Those that had to submit a 
510(k) are now having to provide validation data regarding 
cleaning, sterility, functional performance. So we actually 
look at the fact of whether or not it is being adequately 
cleaned and there isn't bacteria present. We have also now put 
on our MedWatch form a box that if the product was actually a 
single-use device and it has been reprocessed, you think there 
was a problem with it, you can actually flag that for the 
agency. And we actually went back and we did a study. We looked 
at those reports that received through our medical device 
report regulation, through MedWatch, and from December 2005 to 
July 2006, we had about 434 reports in which people had said 
this was a reprocessed device. It turns out, out of that, only 
65 were, in fact, reprocessed. In the other cases they were not 
reprocessed. And of the 65----
    Mr. Pallone. Well, go ahead, you finish. I have to ask you 
something else, but go ahead.
    Dr. Shuren. Well, of the 65, when we looked at it, we 
didn't see that any of the adverse events that were associated 
with those products were any different from the same things we 
were getting reports on from the original use of the product. 
There was no difference.
    Mr. Pallone. All right, I just want to quickly. In the 
Medical Device User Fee Stabilization Act of 2005, it 
implemented additional regulations that mandated that a 
reprocessed device include a removable label that identifies 
the manufacturer. How is that working?
    Dr. Shuren. What happens is you are supposed to actually 
either mark on the device itself, or on a detachable label, 
either the name or some symbol for the company and for the 
device, so that, when it is being reprocessed, people would 
actually know what that device, in fact----
    Mr. Pallone. Now, would you support any additional 
regulation, some kind of labeling or notification requirement 
that alerted patients to the fact that a reprocessed device 
would be used in a procedure on them? That is my last question.
    Dr. Shuren. At this point, we are not looking for 
additional changes in the oversight of single-use reprocessed 
devices. If there are any particular proposals or things you 
want to talk about, we would be happy to discuss further.
    Mr. Pallone. All right. Thanks a lot. Mr. Deal.
    Mr. Deal. Your guidance documents that explain to device 
companies the requirements and expectations for product 
submission, of course, as a key to reducing product development 
time and improving overall review processes, with the increased 
revenues that you expect with this reauthorization, do you plan 
to improve the rate at which you develop these guidance 
documents?
    Dr. Shuren. We will always try to, with the resources we 
have, put out as many as we can. I think what we wind up doing 
is we first identify where is there the greatest need for 
guidance and where is, particularly for the guidances you were 
talking about that may help in the development or the pre-
market approval of particular guidances, a lot it depends upon 
the state of the science. So what you will see is a natural 
evolution where when we deal with a very innovative device and 
we don't know a lot about it, that is kind of our first rights 
of passage. With time, as we gain more experience and there is 
more science developed, that is when we will invest it into 
that kind of a particular guidance. So much of it depends upon 
where the needs are and the state of the science. We are always 
looking based on the resources we have available to invest in 
providing guidance, because we think it is not only good for 
the development of the devices, we have an invested interest 
ourselves, because it actually makes our work easier, too.
    Mr. Deal. Part of the user fees, you have indicated, will 
be used for further training of your employees. Obviously, I 
think we would all recognize that would be an important 
ingredient of the overall review process. What is your ability 
to retain employees? Once you have gone through this processes, 
what is your retention rate within the agency?
    Dr. Shuren. Well, our turnover rate, I guess, flip it the 
other way, our retention is about 92 percent. It depends which 
aspect of the program you look at and that is data from maybe 
about a year ago.
    Mr. Deal. That is pretty good.
    Dr. Schultz. And I think devices is actually higher.
    Mr. Deal. Mr. Pallone wants to know how that compares to 
Congress. I don't think we will get into that one.
    Dr. Shuren. We can discuss it off line.
    Mr. Deal. One of the complaints that we have heard is that 
FDA does not provide detailed explanation of how the user fees 
have actually been used in the process of reviewing the 
product. I am sure you have heard the complaint. Do you intend 
to have more transparency in explaining where the fees have 
been used and how they have actually speeded up the process of 
approving a product?
    Dr. Shuren. Yes. Actually one of the qualitative goals that 
we are putting in our commitment letter actually goes to that 
kind of transparency, where twice a year we will sit down with 
industry. There will be other information that is made 
available to the public that will talk about, from a 
qualitative standpoint, how in fact we are investing the 
dollars that we are receiving.
    Mr. Deal. One of the criticisms that we have heard and 
probably will hear again today is that FDA did not meet with 
enough interested consumer and patient groups when negotiating 
the MDUFMA II agreement. Is that a fair criticism and what did 
you do in order to reach out to these other communities?
    Dr. Shuren. Well, actually before we started, before we 
engaged in the negotiation process, we had a public meeting to 
talk about where we are and where we may be headed with MDUFMA 
and sought public comment. I will say we got very little 
interest from the public on that. We just held a public meeting 
back on April 30 and we have opened up a public docket for 
comments and we had only about, I believe, eight organizations 
that came and wanted to give oral testimony. Most of those were 
actually--seven of the eight were fully supportive of the 
MDUFMA process. And right now we are getting comments submitted 
to our docket and we have only had a handful so far.
    Mr. Deal. Would you explain to us how the Office of 
Combination Products works and how there is coordination within 
the centers, and is it effective in terms of make sure there is 
not duplication or unnecessary red tape or delay with a product 
that is going through this Office of Combination Products?
    Dr. Shuren. Do you want to talk to that?
    Dr. Schultz. Yes. I think the Office of Combination 
Products has actually been one of the most important parts of 
MDUFMA and I think that, in the past, when we saw combination 
products involving drugs and devices or devices and biologics, 
it was really sort of looked upon as almost an overwhelming 
challenge to try to merge the different legislative review 
processes that we have and cultures that we have within the 
different centers. And while the Office of Combination Products 
does not actually perform its own review, what they do is 
something that is probably even more important. What they do is 
they monitor the process and make sure that the appropriate 
expertise from each of the individual centers is appropriately 
mobilized and focused to deal with the issues, the specific 
issues related to combination products. And I think one of the 
really sort of bright examples of that has been the review of 
the drug-eluting stents which, as you know, has been one of the 
real breakthroughs of the last few years, in terms of not only 
device technology but medical therapies. And obviously, we 
still have some challenges that we are continuing to work out, 
but part of the reason we were able to accomplish what we did 
was due to the efforts of the Office of Combination Products.
    Mr. Deal. Thank you.
    Mr. Pallone. Mr. Waxman.
    Mr. Waxman. Thank you, Mr. Chairman. Dr. Shuren, there have 
been some well-publicized cases of safety problems with medical 
devices, for example, a faulty cardiac defibrillator, contact 
lens solutions associated with fungal eye disease infections, 
the dangers with cardiac stents. FDA's own budget documents 
indicate 1,550 medical device recalls were conducted last year 
and over 76 of those recalls involved dangerous or defective 
products that predictably could cause serious health problems 
or deaths, so we are talking about a serious matter. I want to 
focus on this question of user fees and how they have had an 
impact, if at all, on FDA's post-market safety of devices.
    In 2002, when we adopted this user fee bill, we asked for a 
report so that we could take a look at how the law was 
impacting and we asked for that report no later than January 10 
of this year. We wanted to look at several areas dealing with 
post-market safety; the impact of the user fee program on FDA's 
ability to conduct post-market surveillance of medical devices; 
the funding needed to conduct adequate post-market surveillance 
of these devices, in compliance with post-market surveillance 
requirements like the study commitments.
    So this is an important document that we need. We expected 
to have it so it would be useful in this reauthorization. 
January 10 was the deadline. Now it is May 16. We could spend 
the rest of the hearing talking about your answers to these 
questions, but let me ask you the question. When could we get 
this report? What is holding it up?
    Dr. Shuren. It is in final clearance right now.
    Mr. Waxman. What does that mean, final clearance? FDA has 
completed it or FDA is in the process of completing it?
    Dr. Shuren. FDA has completed it. It is now in final 
administration clearance.
    Mr. Waxman. At the Office of Management and Budget, is that 
right?
    Dr. Shuren. No.
    Mr. Waxman. It is not? Where is it?
    Dr. Shuren. It is with Health and Human Services and it 
went over there just a short time ago.
    Mr. Waxman. I see. And who is holding it up?
    Dr. Shuren. I don't think anyone is holding it up.
    Mr. Waxman. The report is completed and it is just waiting 
for the release?
    Dr. Shuren. Yes, but we also completed the report after the 
January time as well, so we are--FDA is a little late on the 
ball as well.
    Mr. Waxman. I see. Now it seems to me obvious. I hope we 
can get this soon. Do you know when we could expect to get this 
report?
    Dr. Shuren. We are expecting to get it out soon.
    Mr. Waxman. Well, I hope within the matter of a week or 
two, because we are going to reauthorize this program in this 
subcommittee and we ought to have the benefit of a report that 
Congress asked for and mandated in the legislation.
    Dr. Shuren. And I will also go back and convey those 
sentiments and push to have it put out.
    Mr. Waxman. Please do. It is obvious that we need more 
resources for FDA's inspection program. Since 2003, FDA's own 
budget documents indicate that FDA was forced to reduce the 
number of medical device field staff, primarily inspectors, 
from 482 to 413. They are charged with conducting all types of 
inspections that FDA conducts, both pre-market and post-market, 
and FDA is required under the law to conduct these inspections 
every 2 years. How many U.S. facilities are there? How many 
staff are available to conduct post-market inspections of those 
domestic facilities?
    Dr. Shuren. Well, in terms of the inspections for domestic 
facilities, I know there has been a lot of talk about this, 
that you had raised as well, the statutory requirement for the 
biennial GMP or surveillance inspections. Domestically, there 
are about 5,500 facilities that would be subject to that 
statutory requirement. Those are the manufacturers of class II/
class III devices. In 2006, we conducted about 1299 such 
inspections. That is about 23 percent. So right now, every 2 
years we are probably covering just a little bit under 50 
percent.
    Mr. Waxman. Does that mean that some of them are going as 
long as 5 to 6 years before they are inspected?
    Dr. Shuren. Some of them are certainly going the 4 years. I 
don't know if any of them are going 5 to 6.
    Mr. Waxman. And how many staff conduct foreign post-market 
inspections and how many foreign facilities are there?
    Dr. Shuren. Foreign facilities that are of the similar 
type, the class II/III, are about 4,500 facilities.
    Mr. Waxman. I see my time is almost up and I have so many 
other questions. Mr. Chairman, I would like to request that I 
submit questions and get the responses to those questions so we 
can have them for the record.
    Mr. Pallone. Absolutely. And I would also ask, following up 
on what Mr. Waxman said, we really need this report by the end 
of next week, before the recess, in order for us to utilize it 
for the reauthorization. So we need to have it by next Friday 
if it is going to be useful.
    Dr. Shuren. It is the first thing I will follow up on when 
I leave here.
    Mr. Pallone. All right. Thank you. And thank you, Mr. 
Waxman. Mr. Ferguson.
    Mr. Ferguson. Thank you, Mr. Chairman. Just a courtesy 
heads-up, Mr. Chairman, and to our witnesses. You can see Mr. 
Shadegg is here today. He is a pretty high-energy guy to begin 
with. He has two cups of coffee in front of him, so we all may 
be in for it today. He was watching the debate last night, so 
you should have had the coffee during the debate, John. I am 
using all of my time. Thank you very much for being here. He is 
not laughing, either.
    Dr. Shuren. I am laughing on the inside.
    Mr. Ferguson. Not too many people are laughing when Mr. 
Waxman finishes with them, either, so join the club. Let us 
take a step back. Tell us where the U.S. stands in terms of 
approval of medical devices, compared to other countries. I am 
trying to get at what is the impact if we don't reauthorize 
this program?
    Dr. Schultz. Well, I think the impact would be pretty 
severe. We rely on MDUFMA for about 20 percent of our budget 
and a lot of the expertise that we now have in the Center, and 
more specifically the expertise that we have hired over the 
last few years, has been directly related to MDUFMA funding. 
And what that expertise is, a lot of the Members have made 
reference to the fact that medical devices are becoming more 
complicated, the technology is changing, our ability to keep up 
with that technology and to be able to hire the appropriate 
expertise and to be able to utilize outside expertise through 
contracts and our fellowship program, all of that is directly 
related to the funding that we have gotten from MDUFMA; in 
addition, giving those people the tools that they need in order 
to perform their jobs.
    It is fine to have experts and it is fine to have 
appropriate expertise, but our IT infrastructure was woefully 
inadequate and becoming more woefully inadequate at the time 
when the first MDUFMA was authorized, and we have really been 
able to turn that around in the last 5 years and put systems 
into place that allow us to track documents so we actually know 
where they are, we can deliver reports on our performance in 
ways that we used to have to do by hand, and we have used those 
platforms.
    One of the questions I think that has come up was how is 
MDUFMA influencing our post-market? And one of the things that 
we have really, really tried to do, consciously tried to do, is 
to make sure that the expertise that we have, as well as the 
infrastructure changes that we have made, can be adapted to use 
in a post-market as well as in the pre-market review process. 
So we certainly are sensitive to the fact that we take a 
lifecycle approach to medical device regulation and we need to 
do both.
    Mr. Ferguson. Now, we have been told that there has been 
kind of a slow up-tick for the Third-Party Inspection Program. 
As you had mentioned in your testimony, the Third-Party 
Inspection Program could help U.S. companies compete in the 
international markets by allowing a single inspection to 
satisfy both U.S. and foreign requirements. Does the MDUFMA II 
agreement, will it improve third-party inspection and how will 
it do that?
    Dr. Shuren. Well, our intent is that it would actually lead 
to greater participation by manufacturers in the program and 
the way we go about it is to make some very modest changes to 
sort of streamline the process. Right now, if you want to use 
an accredited person, this third party, you need to petition 
FDA and it is set up that FDA is supposed to receive this 
petition, review it and approve it. There is a default, that if 
we haven't responded within 30 days, it is supposed to be 
approved.
    However, even manufacturers have felt that I really need to 
wait on the FDA for that approval. We would like to make that 
easier, because we have already reviewed these third parties. 
We know if they are in good standing or not. They have gone 
through rigorous training. So what we would replace that with 
is a notice that is sent to the agency and that the 
manufacturer can go ahead and use that accredited person, 
unless they have heard otherwise from us in 30 days.
    Mr. Ferguson. So if more companies used the Third-Party 
Inspection Program for routine inspections, will that allow you 
to concentrate more of your inspection resources on areas that 
pose, perhaps, greater risk?
    Dr. Shuren. That is exactly right. We are using a risk-
based approach to begin with and the third party will help us 
address those companies where they may not be as big a concern 
and we can go ahead and focus on other companies. It would 
essentially expand our inspectional power.
    Mr. Ferguson. But just to be clear, a company could still 
be subject to a for-cause inspection even if it has 
participated in the Third-Party Inspection Program?
    Dr. Shuren. That is correct and we believe that is an 
essential piece to the Third-Party Inspection Program, that the 
agency retain that ability to go in and do an inspection if it 
needs to.
    Mr. Ferguson. Thank you, Mr. Chairman.
    Mr. Pallone. Thank you. I just wanted to entertain a 
unanimous request from Mr. Doyle.
    Mr. Doyle. Thank you for this courtesy, Mr. Chairman, and 
thanks for holding this important hearing on the 
reauthorization of MDUFMA. I just want to ask for two quick 
things, first, to insert a letter into the record of today's 
hearing that was sent by myself, Congressman Pete Sessions and 
two dozen other Representatives, including some of my 
colleagues here on this committee, asking the FDA to create a 
mandatory unique device identification system.
    This is supported by the Advancing Patient Safety 
Coalition, which is comprised of prominent hospital, physician, 
nursing, research, quality and patient advocacy organizations 
such as AARP, the American Hospital Association, the American 
Nurses Association, the American Medical Association, National 
Rural Health Association, American Heart Association, American 
Association of Orthopedic Surgeons, and the Joint Commission. 
One of the members of the coalition, Premier, Incorporated, has 
prepared written testimony on this issue and I ask unanimous 
consent that it be made a part of the record of today's 
hearing.
    Mr. Pallone. Any objection? So ordered.
    Mr. Pallone. Thank you.
    Mr. Doyle. Thank you, Mr. Chairman.
    Mr. Pallone. Thank you. Next is Mrs. Capps.
    Mrs. Capps. Thank you. And again, thank you for your 
testimony, Dr. Shuren. And we all know that medical devices 
range from simple tongue depressors to hip replacements. For 
more complicated devices like hip replacements, it is certainly 
true that one size fits all isn't going to work. I think this 
is particularly true for women, who tend to be smaller and have 
different body proportions than men. Now, it is my 
understanding that, within the FDA, class II and class III 
clinical studies contain the medical devices with the highest 
risk, such as hip replacements and heart defibrillators and 
others. May I ask you what percentages of devices in these two 
classes are tested in women?
    Dr. Schultz. I don't think we have a specific number that 
we can give you today, but we can certainly look at it.
    Mrs. Capps. I would love to have an answer back, because my 
underlying question is how you stratify and report data. I mean 
how you choose your studies and do you give a balance of women 
and men and children. Increasingly, we are seeing a wide range 
of our population wanting to use and being appropriately 
prescribed devices. And so I would like to have it, with 
permission of the chairman. You don't have any of that 
information with you, on how you choose subjects to be tested 
randomly or what percentages are different ethnic groups, 
different genders and so forth?
    Dr. Schultz. Let me try to answer that.
    Mrs. Capps. Sure.
    Dr. Schultz. I think you have made reference to the fact 
that we regulate a number of different types of medical 
devices.
    Mrs. Capps. Exactly.
    Dr. Schultz. We do have a branch within our Office of 
Device Evaluation that is specifically designated for the 
regulation of OB-GYN devices and specifically for women's 
health products. So we certainly pay attention to the fact that 
there are products that are specifically designed and need to 
be--OK. With regard to other devices, obviously there are 
certain devices that have use primarily in men and those 
devices obviously would be tested. And then there are the ones 
that are multi-use, whether they be adults or children. We have 
tried to encourage more and more diversity in terms of the 
types of populations that are being tested. Again, our success 
and our ability to do that in part has rested on the size of 
the studies and the ability to recruit subjects to some of 
these studies.
    Mrs. Capps. Yes.
    Dr. Schultz. But it is certainly one of the things that we 
are becoming more and more focused on, recognizing exactly what 
you said, that there have been problems with gender, with race, 
with age and all of those things and we would like to get more 
diversity into those studies.
    Mrs. Capps. All right. I guess I would like a written 
report back on how you do that. And to your last statement, you 
would like to get more diversity. Maybe you will give a 
response about the ways in which you intend to make sure that 
that happens, because it is not going to happen automatically 
or voluntarily, necessarily. So I think it is an area that 
really needs a concerted effort.
    I do have one more question. As I understand it, device 
companies can pay a third party directly, Dr. Shuren, to 
inspect their manufacturing process. The device company then 
chooses the third-party inspector. I want to make sure I am 
correct in saying this, so I want to follow it through. Device 
companies can pay. They agree to pay a third party directly to 
inspect their process. They then choose, the device company 
itself chooses that third-party inspector and negotiates also 
the price that they are going to be paid for the inspection. I 
know that some critics believe that this creates an incentive 
for these third parties to please the device manufacturers if 
they want to stay in business.
    I mean, it is hard for me not to think that that wouldn't 
weigh into this. So my question is, what is being done at the 
FDA to ensure that these inspectors are unbiased? I mean, what 
kind of controls do you have over them? And when conducting 
inspections, how do you make sure that they are going to give 
this the highest standard?
    Dr. Shuren. Well, first off, when the manufacturer--you are 
correct that the manufacturer will select, but they are 
selected from a very limited list.
    Mrs. Capps. Who gives them the list?
    Dr. Shuren. Actually, we provide the list. We are the ones 
who accredit the individuals who can do the inspections and 
there are two parts to it. First, it is the firm. We would 
approve the firm and we go through a conflicts of interest 
check with that firm. The second is that----
    Mrs. Capps. I don't have a lot of time, but what comprises 
a conflict of interest?
    Dr. Shuren. We are actually looking for the relationship 
between that organization and also we go to the individuals. So 
the next part is we then accredit the individual inspector. You 
can't say I just want to use this firm. You actually have to 
use a particular person who we have also done a check on, who 
we have done training on, classroom training, and then they 
actually go out and they do inspections with it and then we 
have an audit program on top of it and that is why I think you 
have seen we have invested a large amount of money into the 
program because it also has the training and it has got the 
checks.
    Mrs. Capps. I am out of my time, but I can't help but say 
this is a pretty select group of people who would even be 
qualified to be inspectors.
    Dr. Shuren. That is absolutely correct.
    Mrs. Capps. I mean, this is really tough. I am really 
concerned that specific provisions in MDUFMA II proposal might 
expand the role of third-party inspectors and leave the door 
open, wider open for conflicts of interest and I would hope, 
Mr. Chairman, that as we consider this bill in committee, we 
consider potential--well, I really want to understand who these 
players are and what their interest is and how the public is 
really going to be protected through this process and I hope we 
will have an opportunity to address some of these concerns. 
Thank you.
    Mr. Pallone. Thank you. And I will mention at the end that 
you may get questions like you did from Mrs. Capps. You know, 
we would like you to get back to us, obviously.
    Dr. Shuren. Of course.
    Mr. Pallone. Mr. Pitts.
    Mr. Pitts. Thank you, Mr. Chairman, and I thank the 
witnesses for your testimony. In the past, we have heard 
complaints that FDA has not provided detailed information on 
what it costs to review an application, nor has FDA provided 
detailed information on how it has used the revenues from user 
fees. How does the FDA plan to increase the transparency of how 
it is spending user fee revenues?
    Dr. Shuren. First off, we do provide information now. We do 
actually put out an annual report, our financial report that 
talks about how, in fact, we spent the dollars. On top of that, 
in MDUFMA II, as I mentioned, we have a qualitative goal where 
we will, in fact, twice a year report from a qualitative 
standpoint where we have actually used the dollars to make 
investments in the program. So our goal in MDUFMA II is greater 
transparency, on top of the information that we already put out 
there publicly.
    Mr. Pitts. I understand that FDA has estimated the total 
revenues from fees to be collected each year and that the bill 
stipulates the revenues from fees the agency is authorized to 
collect each year. Could you please explain what happens if the 
agency's collections are higher than that authorized by the 
legislation? Will there be any fee reductions in future years? 
Would you explain how that would work?
    Dr. Shuren. There is an offset provision that we are 
proposing in this legislation, in which we would look at the 
revenues that we have collected over the first 4 years. It is 
not the full 4 years. We will estimate the last part. And if we 
have, in fact, it looks like we have collected more than we 
were supposed to for those first 4 years, we would make an 
appropriate reduction in the fees for the fifth year.
    Mr. Pitts. OK. Guidance documents that explain to device 
companies the requirements and expectations for product 
submissions is a key factor in reducing product development 
time and improving the overall review process. With the 
increased revenues expected under MDUFMA II, does the FDA plan 
to improve the rate at which it develops guidance documents?
    Dr. Shuren. With the resources we have, we are always 
looking to put out appropriate guidance documents and when it 
is appropriate to do so and we have the ability to do so, we, 
in fact, do so. One of the things we are also putting into 
MDUFMA II, in one of our goals, is that we are giving an 
additional opportunity up front to provide some guidance to us 
as to the appropriate guidances in which we should invest our 
time. So we will put out once a year, here is a list of the 
guidances that we plan to work on over the next year or so, get 
feedback from the public as to this is the right set of 
guidances. Are there other ones we should work on? Are there 
particular things we should take in account or look at when we 
develop that guidance document, and feed that into the process 
before we actually put pen to paper.
    Mr. Pitts. I understand that FDA has agreed to establish a 
more interactive review process so that FDA reviewers can 
communicate in a timely way with the device manufacturers, 
speed up the review process. What steps will FDA take to ensure 
that all reviewers will embrace this interactive review process 
so that it really does work?
    Dr. Shuren. Well, we are going to take two steps. First 
off, we will be putting out a guidance that lays out the basic 
principles for interactive review and that will come out in the 
next few months. We are under a very short timeframe to try to 
have that out around the time that MDUFMA II, in fact, would 
start. And the second is that we have a good integration with 
our staff and our management and we do a lot of training in 
terms of what are the expectations for the review and what are 
the expectations for oversight of that review, and that will be 
part of the training that we go into now for MDUFMA II. As we 
move over into this slightly modified regime for MDUFMA II, we 
are going to actually have to reprogram our systems and go 
through training with our staff as to what are the new goals 
and what are the steps we will take to achieve those goals and 
interactive review will be one of those components.
    Mr. Pitts. Doctor?
    Dr. Schultz. And I think one of the key aspects is this 
legislation, as it has removed one of the impediments to 
interactive review. Interactive review has always been a key 
component of the device review process and I think one of the 
lessons learned from MDUFMA I was that when you impose specific 
cycle goals into the review process which require things to be 
done at certain times, that, in fact--and not unintentionally, 
but certainly did have a negative effect on our ability to have 
the kind of interactive review process that, quite frankly, has 
been a hallmark of device review for the last 30 years. So I 
think we are really getting back to our roots in terms of being 
able to do this interactive review and I think we will be able 
to do it even better than we did before.
    Mr. Pitts. Thank you. My time is up. I yield back.
    Mr. Pallone. Thank you. Ms. Eshoo.
    Ms. Eshoo. Thank you, Mr. Chairman. As I mentioned in my 
opening statement, I have a real interest in the whole area of 
pediatric medical devices. On the second panel we are going to 
be hearing from patient advocates about the need for children 
to be granted access to these medical technologies. It is a 
very special area and I think it is an area where we really 
need to give really solid direction from Congress and of course 
Mr. Markey. And as I said, Mr. Markey and Mr. Rogers have 
offered legislation in this area and I am pleased to be a co-
sponsor of it. I often hear from the parents and from 
physicians at Lucile Packard Children's Hospital in my district 
about the need for devices that are appropriate for use in 
children.
    We know that doctors have had to essentially jerry-rig 
devices to use on children on the operating table just to make 
sure that the device fits or works properly. So unfortunately, 
I don't see anything in your testimony and maybe it is because 
this is the reauthorization of MDUFMA, but I looked for it and 
there isn't anything in it emphasizing pediatric device safety. 
So can you tell me what, if anything, FDA is doing in this area 
to enhance pediatric medical device safety and obviously to 
incent innovation? And do you have anything that you want to 
share with us of what direction, what would be helpful to us as 
the subcommittee that is essentially setting the table in this 
area? Dr. Schultz?
    Dr. Shuren. First let me say you are quite right. We did 
not come here today to talk about pediatrics specifically, or 
you won't see it in the legislation we are talking about, 
because we have tried to focus on the four corners of MDUFMA 
here and leave what may be any other proposals pertaining to 
pediatrics.
    Ms. Eshoo. Do you want to comment on that today or should 
we just wait?
    Dr. Shuren. We would certainly love to comment on things 
that the agency is doing currently. Let me talk about one thing 
and I will turn it to Dan.
    Ms. Eshoo. I have another question, so keep it as concise 
as possible. Just give us a flavor of what you are doing.
    Dr. Shuren. Sure. We are actually doing a number of things 
in the area of enhancing post-market safety for children. Right 
now we have a program called MedSun, which is 350 satellite 
facilities, healthcare facilities, that do enhance monitoring 
for adverse events. We are creating a subgroup under there, 
pediatric facilities that are focusing just on adverse events 
and problems that may occur with the use of the devices.
    Ms. Eshoo. Is Lucile Packard one of these 300 places? Did 
you say 300?
    Dr. Shuren. Three hundred and fifty for the whole program. 
For pediatrics, it is a smaller subset. We have 24 pediatric 
hospitals right now signed up within our program.
    Ms. Eshoo. Is Lucile Packard one of them?
    Dr. Shuren. I don't know but we can check.
    Ms. Eshoo. OK. Yes. I wasn't aware of it, that is why I am 
asking.
    Dr. Shuren. Yes.
    Ms. Eshoo. On the administration's PDUFA proposal this 
year, there is always--and I think you have heard this from 
Members on both sides of the aisle, probably more from our 
side, but you still heard this. There are tensions built into 
user fees and approval. From the outside looking in, people 
tend to look at this and say well, if a company is paying, then 
the agency is pressured to approve and where is the efficacy in 
this? Can you state for the record where the firewalls are in 
this?
    Dr. Shuren. Well, first off, the dollars that are sent to 
the agency, they are arms length from the reviewers.
    Ms. Eshoo. I think I know what the answer is, but I think 
it is still important to raise, because there are creative 
tensions there.
    Dr. Shuren. The first thing, the dollars do not go--the 
reviewers are kept out of that process completely. The dollars 
actually go to the U.S. Bank in St. Louis and are kept 
separate, so they are not aware of fees being paid or amounts 
or anything like that. The second thing is that when we design 
our business process, we actually have focused it on meeting 
the goals but in a way that also ensures that we are not 
changing our standards. MDUFMA is not about changing the 
standards at FDA. It is merely enhancing the processes we have 
for review. One thing it has helped us do is to build up an 
expertise that also feeds back into all the safety aspects that 
we need to look at for devices. So in that respect, it has 
actually been very helpful to us.
    Ms. Eshoo. On the reuse issue, how many actual inspections 
has FDA undertaken at these facilities? Is it robust?
    Dr. Shuren. To actually look at the facilities, we have 
been----
    Ms. Eshoo. Not to look at, to inspect them.
    Dr. Shuren. Right, to inspect them. The answer is yes.
    Ms. Eshoo. Because I think these reused devices, they 
terrify me, I have to tell you, and I did legislation in this 
area. People that are in the hospital don't know whether it is 
a device that is being reused and I think we need to drill down 
on this. I still think there is some work to be done, Mr. 
Chairman.
    Mr. Pallone. Thank you. I have to warn everybody that, 
apparently, the votes are already on. There are two votes and 
we have less than 10 minutes left, but our clock didn't work. 
So we are going to take a recess. You can wait for us to come 
back.
    Ms. DeGette. Mr. Chairman?
    Mr. Pallone. Yes.
    Ms. DeGette. I would like to ask unanimous consent before 
the recess, because I am not sure if I can come back and I just 
wanted--and what I was planning to do was just ask these 
gentlemen if they could submit a written response to the 
questions I asked in my opening statement. The first one is the 
recommendations that I listed, which my staff can provide to 
you, has the FDA adopted any of those recommendations with 
respect to pediatric populations? And the second question is, 
what has the impact been of those recommendations? Mr. 
Chairman, if we can just get written responses to those 
questions, then I won't have to ask this panel any questions.
    Mr. Pallone. That is fine.
    Ms. DeGette. Thank you.
    Mr. Pallone. Thank you.
    Ms. DeGette. Thank you.
    Mr. Pallone. But we still want you to wait because we have 
Mr. Shadegg and we may have others that come back about half an 
hour or so. So the subcommittee is in recess.
    [Recess]
    Mr. Pallone. We obviously had a lot more votes than we 
expected, which, of course, happens around here. And I think 
when we left off, I was going to recognize Mr. Shadegg.
    Mr. Shadegg. Thank you, Mr. Chairman, and thank you for 
being here and pardon our long delay. I want to direct a couple 
questions to the Third Party Inspection Program. I would be 
correct in understanding that when companies use the Third 
Party Inspection Program, that produces both a savings in money 
and a savings in time for your agency and for the process of 
getting a device approved, correct?
    Dr. Shuren. That is correct.
    Mr. Shadegg. And therefore it is an overall benefit to you 
and to the process and to getting this equipment into the field 
to help patients who need care, correct?
    Dr. Shuren. That is correct. The whole gist of setting up 
the Third Party Inspection Program, I think, came out of a 
recognition that the agency did not have enough resources to do 
all the routine surveillance inspections and this was a way to 
sort of supplement so that we could actually increase our 
inspectual power.
    Mr. Shadegg. As a follow-on to that, my assumption would be 
that the more companies that use that process, the more you, as 
an agency, are able to focus your resources on areas where you 
feel there is a greater risk.
    Dr. Shuren. That is correct. That will allow us to actually 
better direct our resources at the higher risk products.
    Mr. Shadegg. Dr. Schultz, would you like to expand on that?
    Dr. Schultz. No, I think you got it exactly right. That is 
the plan, is that we could get more information. I mean, we are 
always looking for more information. We like to be able to get 
into companies as frequently as we need to. Obviously, we 
haven't been doing that. If we can use the Third Party Program 
successfully and understanding that there are some concerns and 
that we need to be cognizant of those concerns, but if we can 
get better information on routine inspections, using the Third 
Party Program, and focus where we really need to focus our 
efforts, we think that that is the way to go.
    Mr. Shadegg. Thank you. It would be my observation that, at 
least from what I have seen and additionally, I have heard that 
you are handling the issue of conflict of interest fairly well 
and that this is a process that is working and serving the 
consuming public and patients who need care.
    Dr. Shuren. We agree and also, in MDUFMA II, we are not 
looking to make any changes to the conflict of interest. We are 
not looking to relax that, at all. We believe it is important 
to keep in that high level protection that is already built 
into the law.
    Mr. Shadegg. Let me ask you a question about reprocessed 
devices. As I understood your testimony earlier, you are 
watching complaints regarding reprocessed devices and at least, 
at this point, and doing inspections of reprocessing facilities 
and at this point, you do not see a disproportionate level of 
problems or infections or other concerns arising out of 
remanufactured devices as opposed to OEM devices, is that 
correct?
    Dr. Shuren. That is correct. And we also look at the 
facilities. There was a question before in terms of our looking 
at facilities. We will get the actual numbers, but we probably 
look at those facilities a lot more closely than we do for 
other device facilities more generally.
    Mr. Shadegg. Dr. Schultz, would you comment on that?
    Dr. Schultz. I think I would echo what Jeff said, but with 
the caveat that trying to tease some of this information out, 
especially some of this post-market adverse event data; looking 
at infections, looking at complications of complex procedures 
and trying to tease out the part of it related to a particular 
device is very difficult. In general, we have not seen any huge 
signals that say that there is a big difference.
    Mr. Shadegg. To follow up on that, do you believe the 
agency needs further authority to look at that issue to assure 
the consuming public that there are, in fact, no problems?
    Dr. Schultz. I am not sure that authority is going to give 
us better science. Sometimes the two do not necessarily go 
hand-in-hand. I think we are constantly looking at ways to 
develop better methods of looking at data that will allow us to 
make some of these distinctions, so I don't necessarily at this 
point see it as an authority issue.
    Mr. Shadegg. Well, if you do see a need for greater 
authority, please let us know. I think it is important to 
carefully watch that area. There was a comment earlier about a 
large number of complaints that believed the devices were 
reprocessed and you testified that only a fraction of them, in 
fact, were reprocessed devices. Is there a specific requirement 
that patients be advised that a reprocessed device is being 
used?
    Dr. Schultz. No, there is no requirement under our law for 
that.
    Mr. Shadegg. And do you think that is something that would 
be advisable?
    Dr. Schultz. It is something that we haven't considered in 
the past. It is something we can certainly think about and 
discuss with you in the future.
    Mr. Shadegg. Informed consumers, I mean, my view is if 
there is an economic use to reprocessing, that is a good thing, 
but I will also agree that informed consumers are an important 
part of a marketplace and if you do not know something about a 
device that is being used, perhaps that should be disclosed. 
Thank you, Mr. Chairman. I yield back.
    Mr. Pallone. Thank you, and thank you very much for bearing 
with us for the hour and a half or so. A half an hour that 
turned into an hour and a half. I just wanted to mention, I 
think I may have said before that Members may submit--some 
Members already asked questions that we would like you to get 
back to them. You may get additional ones within the next 10 
days or so. And I know when Mr. Waxman talked about that report 
on the post-market surveillance that I mentioned, we really 
would have to get it by a week from Friday in order for it to 
be useful for us in our reauthorization. Not this Friday, but 
the following. And then before he left, Mr. Waxman mentioned 
that there is another outstanding report in MDUFMA I where the 
FDA is supposed to report back to us no later than January 10, 
2007 on FDA's experience with third party reviews of 510(k)'s. 
Can I ask you, is that something that is also in its final 
stages or----
    Dr. Shuren. Yes, and you will have that very soon, too.
    Mr. Pallone. Yes. I mean, that is the same thing, I mean, 
for us, to be useful to us, we would need it by a week from 
Friday before the break. So with that, thank you very much. I 
appreciate your being here. And we will move to the second 
panel. Thank you.
    Dr. Shuren. Thank you.
    Mr. Pallone. I am sorry. I would ask the second panel to 
come forward. Welcome to all of you again. Let me introduce 
this panel.
    First we have Mr. Paul LaViolette, who is chief operating 
officer for Boston Scientific Corporation, and then we have Dr. 
Diana Zuckerman, who is president of the National Research 
Center for Women and Families here in DC.
    And then third we have Mr. Kelvyn Cullimore, Jr., who is 
MDMA secretary, president and CEO of Dynatronics Corporation, 
Salt Lake City, Utah. I have to tell you that Mr. Matheson 
wanted to introduce you, but he might have gotten caught up in 
all these votes and everything, so I will introduce you for 
now. And then Mr. Steven A. Grossman, who is executive director 
of the FDA Alliance in Silver Spring. And last is Ms. Diane 
Dorman, who is vice president for public policy of the National 
Organization for Rare Disorders.
    And again, we ask you to make 5 minute statements. If you 
want to add additional material, at our discretion, you can do 
that. And we will start with Mr. LaViolette.

 STATEMENT OF PAUL LAVIOLETTE, CHIEF OPERATING OFFICER, BOSTON 
                     SCIENTIFIC CORPORATION

    Mr. LaViolette. Thank you, Chairman Pallone and Congressman 
Deal. I am Paul LaViolette, chief operating officer of Boston 
Scientific and a major innovator in medical devices product 
area. I am here today in my capacity as a member of the AdvaMed 
Board of Directors and I am pleased to testify before the 
subcommittee today regarding the reauthorization of the Medical 
Device User Fee and Modernization Act, obviously referred to as 
MDUFMA II.
    The medical technology industry thanks you for convening 
this hearing about this important agreement. As a general 
matter, we believe this legislation is good for patients and 
for public health. It will facilitate the timely and effective 
review of new medical technologies and bring them to patients 
as soon as those products can be shown to meet FDA's rigorous 
requirements. I am pleased to report that FDA and industry 
support this agreement and look forward to its timely 
consideration.
    The legislation builds on experience gained from the 
implementation of the original medical device user fee program 
which was enacted, of course, in 2002. The user fee program for 
medical devices has increased the availability of important new 
medical device technologies for patients and physicians faster 
and more efficiently than prior to the program's enactment. We 
are very encouraged that the Senate has recently passed, 
overwhelmingly, a MDUFMA II bill that incorporates all the 
essential elements we agree to with the FDA. We hope that you 
also see the value of the MDUFMA agreement and work toward a 
swift resolution in the House of Representatives. I hope 
today's hearing provides you with the necessary information to 
do just that.
    Mr. Chairman, there are six key points about the MDUFMA 
agreement that I would like to highlight today.
    First, the legislation would provide FDA with stable and 
predictable funding for the device program through a 
combination of appropriations and user fees. In fact, under 
MDUFMA II, the user fee collected over 5 years would increase 
approximately 90 percent over those collected during the 
previous 5 years under MDUFMA I. Importantly, the legislation 
continues a central provision of the original MDUFMA 
legislation whereby Congress is committed to providing FDA's 
device program with an annual inflationary increase. The user 
fee that is paid by industry would be an additive to the 
appropriated congressional base.
    Under MDUFMA I, all of the FDA's revenues from user fees 
were derived from application fees. As a result, FDA's revenue 
was unpredictable and led to insufficient revenue in years in 
which fewer applications were submitted. To address this 
fluctuation in revenues, FDA and industry have agreed to a new 
fee structure that combines existing application fees with new 
facility registration and annual report fees. These fees will 
ensure that FDA has a more stable and predictable revenue 
stream.
    The legislation contains significant improvements for small 
businesses, the lifeblood of so much innovation within our 
industry, by providing further reductions in fees for small 
businesses, as compared to what larger companies would be 
required to pay.
    Quantitative performance goals for FDA's review of new 
medical device applications were an important component of 
MDUFMA I and we are pleased that FDA has agreed to continue 
performance goals under MDUFMA II. The agency is committed to 
review each application type within a specified time period. 
These performance goals have improved the overall efficiency 
and predictability of the review process that is essential to 
the industry. We are also pleased that FDA has agreed to revamp 
and simplify the performance goal structure to focus on the 
time for final decision goals rather than on intermediate cycle 
goals.
    We are pleased that FDA has agreed to a number of 
qualitative goals, as well. Most important, as has been 
testified to previously today, is the agency's commitment to an 
interactive review process. The legislation would also make 
needed procedural adjustments to the Third Party Inspection 
Program, which was authorized under MDUFMA I. These procedural 
adjustments maintain the stringent conflict of interest 
requirements for third party inspectors and the stringent 
eligibility requirements for participating companies.
    Last week, the Senate also passed legislation by Senator 
Dodd designed to address the challenges facing pediatric 
medical device development. As an industry, we support the goal 
of providing greater access to safe and effective medical 
devices for children. We look forward to working with 
Congressman Markey and Congressman Rogers on their bill, the 
Pediatric Medical Device Safety Improvement Act. We believe 
that creating incentives to encourage pediatric device 
development is critically important.
    However, it also important that legislation intended to 
encourage pediatric device development does not create 
unintended consequences or adversely impact the availability of 
safe and effective medical devices for the broader population. 
Unlike drugs, the kinds of incentives that exist in the Best 
Pharmaceuticals for Children Act are not currently available 
for the device industry. We thank Congressman Markey and Rogers 
and Congresswoman Eshoo for their leadership on pediatric 
issues and we look forward to working with the committee on 
this important priority.
    In conclusion, we believe the reauthorization of MDUFMA 
that incorporates all the essential elements industry and the 
FDA have agreed to, will enable FDA to further improve its 
performance, both in quantitative and qualitative ways, while 
creating a stable and predictable fee structure that benefits 
both FDA and the device industry. Most importantly, American 
patients will be the true beneficiaries. I want to thank both 
my industry colleagues and the FDA staff who worked so 
diligently over the past year to reach this point. Chairman 
Pallone, Mr. Deal and members of the subcommittee, I thank you 
for convening this hearing today and allowing me to share our 
perspective. We look forward to working with the committee as 
you consider the MDUFMA legislation. Thank you.
    [The prepared statement of Mr. LaViolette follows:]

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    Mr. Pallone. Thank you, but we have bad news. There are 
another two votes, and it appears that there is a pattern 
because the minority is upset. I don't know for good reason or 
not. So we will be gone about another 20 minutes or so. 
Hopefully no longer than that. Sorry. Committee is in recess.
    [Recess]
    Mr. Pallone. OK, we will reconvene. And I think we listened 
to Mr. LaViolette and now we have Dr. Zuckerman.

  STATEMENT OF DIANA ZUCKERMAN, PRESIDENT, NATIONAL RESEARCH 
                 CENTER FOR WOMEN AND FAMILIES

    Ms. Zuckerman. Thank you for inviting me to testify. MDUFMA 
is one of the most important bills to come before Congress this 
year and until today, it has received very little attention. So 
on behalf of medical researchers, patients and consumers, thank 
you very much for holding this hearing.
    I am Dr. Diana Zuckerman, president of the National 
Research Center for Women and Families, which is an independent 
think tank that focuses on health and safety issues. Our center 
is an active member of the Patient and Consumer Coalition. I 
was trained as an epidemiologist at Yale Medical School. I 
conducted research at Harvard. I worked as congressional 
investigator on FDA issues in this building and I am the author 
of several books and book chapters, including a chapter in a 
new book on medical devices that just came out.
    All of us use medical devices and baby boomers are 
increasingly relying on implanted medical devices, whether they 
are hips or heart valves or wrinkle fillers. And the bad news 
is that most of these medical devices have not been tested in 
clinical trials as part of the FDA review process. At the 
Center for Devices and Radiological Health, most devices are 
approved under an expedited process called the 510(k) process. 
This process is intended for products that are substantially 
equivalent to medical devices that are already on the market 
and sometimes that makes sense. For example, a device that has 
been modified very slightly to make it a little bit better, but 
it is still made by the same manufacturer.
    But even small changes can affect safety and can be 
dangerous. So for example, when Bausch & Lomb added MoistureLoc 
to their contact lens solution. The new product was approved 
through the 510(k) process. No clinical trials were required 
and no inspections took place. The result was eye infections 
and blindness for some of the people who used this product. I 
am sure we can agree that nobody should become blind from 
contact lens solution when there is so many safe contact lens 
solutions available. And nobody should die from a stent or a 
heart valve that wasn't adequately tested.
    I think FDA should always require clinical trials when 
potentially dangerous devices are modified. MDUFMA II should 
make sure that the approval process protects consumers. The 
performance goals of MDUFMA II would drastically speed up this 
510(k) process. 90 percent of 510(k) reviews would have to be 
completed within 90 days, 90 percent/90 days. This is not safe. 
The PMA device approval process, which is more similar to the 
drug approval process, is also faster in MDUFMA II. 60 percent 
of PMA and PMA supplements would need to be completed in just 6 
months. This is considerably faster than what is expected of 
drugs.
    So what would FDA get for speeding up the process? The user 
fees for these new reviews would actually decrease. For 
example, the user fee for a 510(k), which is already a bargain 
at about $4,000 in 2007, is reduced 18 percent to $3,400 in 
2008. And it is my understanding that that is the maximum 
amount for a 510(k). It is the amount that even a multi-billion 
dollar company would pay for a 510(k).
    FDA claims that the total user fees would increase, but 
that is only because the workload increases as each of these 
reviews is actually reimbursed--not reimbursed, has a user fee 
at a lower rate. So MDUFMA II is generous to medical device 
companies because it reduces those costs and gives faster 
reviews. What are the benefits to the American public? 
Sometimes the public benefits from faster reviews and 
innovations, but innovation is only good if a product is 
better; not if it is merely new and different. An innovative 
contact lens solution that causes blindness obviously is not 
progress.
    Dr. Donald Ostergard, a nationally respected urologist, 
recently gave a speech at a national conference explaining that 
FDA's frequent use of 510(k) reviews and their failure to 
adequately test medical devices hurts doctors and hurts 
patients. He said with no data, doctors can only guess which 
products work and which ones don't. MDUFMA II has performance 
goals for speed, but it needs performance goals for public 
health, as well.
    Instead, the FDA is making the approval process for devices 
even less cautious. So for example, in January of this year, 
the FDA held a public meeting on a new device called NeuroStar, 
which uses magnetic pulses to the brain to treat depression. 
The FDA says that NeuroStar can be approved as substantially 
equivalent to electroshock therapy, since both treat the same 
illness, which is depression, if the risk to benefit ratio is 
similar. So even though it is a completely different device 
using a completely different mechanism of treatment, they are 
saying it would be substantially equivalent if the risk to 
benefit ratio is similar.
    But how can the FDA or anybody else determine if the risk 
to benefit ratio is similar if new devices don't necessarily 
require clinical trials? If Congress does not stop this 
regulatory loophole, almost any medical device can be eligible 
for the much less rigorous 510(k) process. This will certainly 
help speed up the process, but at the risk of flooding the 
market with medical devices that either don't work or are not 
safe.
    MDUFMA II does not provide adequate user fees for the 
review of direct-to-consumer advertising to analyze adverse 
reaction reports or to make sure that post-market studies prove 
that the products are safe. So although FDA has the flexibility 
of spending the user fee money however they want, there is just 
not enough money for all of the things that they would need to 
do.
    I want to mention that direct-to-consumer ads for 
potentially dangerous implanted devices, such as gastric LAP-
BANDS, are featuring patients giving testimonials about how the 
product changed their lives and these testimonials are allowed 
to be paid for by the company in the form of free treatment.
    My final criticism is third party inspections. MDUFMA would 
weaken the restrictions that limit third party inspections. 
That was already mentioned by Congresswoman Capps and others 
and I just wanted to reiterate that, that it is really 
important that something be done about that.
    And I also just wanted to say that I share the concerns 
that were expressed by committee members about the reuse of 
single use devices and also to mention that one of the concerns 
about reuse of devices is that although they are relying on 
adverse reaction reports, we know that the adverse reaction 
report system isn't working very well and so therefore relying 
on that won't give us the information we need about whether 
single use devices are harmful.
    Overall, we are very disappointed in FDA's proposed MDUFMA 
II. Substantial improvements are needed to this legislation to 
restore America's confidence in the FDA. With your leadership 
and revisions to MDUFMA II, you can make sure that CDRH has the 
resources, the regulatory responsibilities, the enforcement 
powers and the performance goals needed to protect our 
families, your constituents and the American public. Thank you.
    [The prepared statement of Ms. Zuckerman follows:]

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    Mr. Pallone. Thank you. Mr. Cullimore.

 STATEMENT OF KELVYN CULLIMORE, JR., MDMA SECRETARY, PRESIDENT 
                AND CEO, DYNATRONICS CORPORATION

    Mr. Cullimore. Thank you, Chairman Pallone and Ranking 
Member Deal. Appreciate the opportunity to be here today and 
make my testimony to talk a little bit about the 
reauthorization of the Medical Device User Fee and 
Modernization Act.
    My name is Kelvyn Cullimore, Jr. I am the president and CEO 
of Dynatronics Corporation, a small publicly traded medical 
technology company headquartered in Cottonwood Heights, UT, 
just outside of Salt Lake City. And we also have manufacturing 
operations in Chattanooga, Tennessee. Today I am here to 
testify on behalf of the Medical Device Manufacturers 
Association, a national organization representing the 
innovative entrepreneurial sector of the medical technology 
industry. MDMA's mission is to ensure that patients have access 
to the latest advancements in medical technology, many of which 
are developed by small research-driven medical device 
companies.
    Before I discuss the specifics of the MDUFMA II proposal, I 
wish to emphasize that ideally, FDA's medical device pre-market 
review system would be funded solely by congressional 
appropriations. However, given growing budgetary constraints, 
that does seem unlikely. MDMA opposed device user fees for 
nearly a decade. However, we modified our position in 2002 when 
MDUFMA I incorporated specific protections for small companies.
    It remains essential, however, that Congress continue to 
maintain its primary role in funding FDA. As mentioned, MDUFMA 
I included important provisions that granted smaller companies 
fee relief, including an initial PMA waiver and a two-tiered 
user fee structure. These provisions have proven critical given 
the entrepreneurial nature of the medical device industry. 
Unlike the pharmaceutical industry, innovation in the medical 
device industry is primarily driven by smaller companies 
working directly with doctors and engineers. Maintaining the 
safeguards for smaller companies under MDUFMA II is crucial to 
continuing this innovative environment.
    The MDUFMA II proposal seeks to address a number of issues 
that arose under MDUFMA I. For example, under MDUFMA I, fee 
revenues were generated solely from application fees. As a 
result, in just a few years, some fees spiked as much as 60 
percent. These types of increases cannot be sustained and MDMA 
was pleased when Congress acted, under MDUFSA, to cap annual 
fees increases at 8.5 percent. These same annual caps exist 
under the MDUFMA II proposal. MDMA views these caps as critical 
to the stability of the program.
    MDUFMA II will expand the types of user fees that FDA 
collects; in addition to application fees established under 
MDUFMA I, MDUFMA II would add new annual report and 
registration fees, which would limit the fee variability 
encountered under MDUFMA I and reduce application fees for all 
companies.
    MDMA also supports the interactive review principle 
established under MDUFMA II to improve communications and 
interaction between FDA and the industry. In light of 
continuing advancements in medical technologies, it is 
increasingly important for FDA reviewers and sponsors to engage 
in open and regular dialog. MDMA believes that early and 
frequent communications with the agency will prevent 
unnecessary delays in the completion of the review, avoid 
surprises to FDA and the sponsor at the end of the review 
process, minimize the number of review cycles and ensure timely 
responses from the sponsors.
    MDMA also supports efforts to simplify the MDUFMA 
performance goals to allow FDA to better manage the overall 
review process. FDA has stated that the current MDUFMA I cycle 
goals, created inefficiencies in the review process. Therefore 
FDA and industry have agreed, under MDUFMA II, to eliminate 
dozens of intermediate cycle goals. Instead, FDA would be 
measured on performance goals for overall time to final 
decision.
    In addition to the user fee provisions, MDMA strongly 
supports modifications to the Third Party Inspection Program 
and provisions which encourage greater clarity on a variety of 
issues, including the development of additional guidance 
documents. MDMA understands that there are other issues beyond 
MDUFMA II that this committee will be considering in the coming 
weeks. Specifically, I would like to express MDMA's strong 
support for legislation that provides incentives to 
manufacturers to develop pediatric medical devices. However, 
MDMA wishes to emphasize that any legislation must be carefully 
crafted to avoid creating unintended disincentives. MDMA looks 
forward to working with the committee and other interested 
stakeholders to address these issues in a manner that 
encourages the development of pediatric products.
    In closing, I would like to thank the committee for your 
efforts on behalf of the innovative entrepreneurial medical 
technology companies and patients. Both stand to significantly 
benefit with the reauthorization of MDUFMA II. I look forward 
to answering any questions that you might have.
    [The prepared statement of Mr. Cullimore follows:]

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    Mr. Pallone. Thank you. We have another wonderful vote, but 
in the meantime I am going to try to keep going, so Mr. 
Grossman.

 STATEMENT OF STEVEN A. GROSSMAN, EXECUTIVE DIRECTOR, THE FDA 
                            ALLIANCE

    Mr. Grossman. Chairman Pallone, Representative Deal, thank 
you for the opportunity to testify. I am Steven Grossman, the 
executive director of the FDA Alliance. We are a broad-based, 
nonpartisan coalition of consumers, patients, healthcare 
professionals and industry. Since our founding a year ago, we 
have grown to more than a hundred members, including seven 
former FDA commissioners.
    Our core concern is that FDA is severely under-funded, 
relative to the vast responsibilities given it by Congress and 
the justifiable expectations of the American people. The FDA 
Alliance believes that the hardworking FDA staff cannot keep up 
with the increasingly complex and growing workload without 
additional staff, improved information technology and increased 
support for training, outreach and scientific standards.
    Second, strengthening FDA must be a priority for this and 
subsequent Congresses. The funding shortfalls affect every 
aspect and every part of the agency.
    Third, FDA should be fully funded through appropriations 
augmented by user fees. User fees cannot be allowed to 
substitute for sufficient levels of appropriated funds.
    Since 2003, the FDA has lost about 20 percent of its buying 
power and has nearly a thousand fewer employees supported by 
appropriated dollars. There are consequences. It is harder to 
maintain our Nation's economically valuable position as the 
gold standard for food, drug and device regulation. Also, it is 
difficult for FDA to recruit and retain the best and the 
brightest when the resources are inadequate.
    FDA spends more than 83 percent of its budget to support 
its workforce. It needs a 6 percent annual increase in 
appropriations just to maintain current services. CDRH, 
actually, is even needier. It needs about 7 percent. Yet annual 
appropriations to FDA never include the full costs of the 
agency of pay and benefit increases or rising non-pay costs.
    FDA is the Nation's premier consumer health and safety 
agency. But in addition, it also is vital to the Nation's 
economy. Innovative companies need a cutting edge regulator to 
prepare the way for breakthroughs in medical science and 
products that combine drugs and devices. Companies are not 
helped when they are ahead of FDA on the science. That doesn't 
work and things slow down instead of speed up as they should.
    FDA also must be strengthened to assess more sophisticated 
products and to monitor the increasingly complex safety 
parameters in drugs, food, medical devices and veterinary 
products. Congress should make a long-term commitment to 
upgrade FDA's appropriated funding. We recommend that Congress 
start providing FDA with $2 billion in appropriated budget 
authority for fiscal year 2008, an increase of about $450 
million over the current appropriation. This would restore the 
2003 agency operating capability, plus mandated programming. 
This is something of ``Back to the Future.'' Things were 
actually better 5 years ago and the agency has clearly lost 
ground.
    Adding in user fee revenue would result in the total FDA 
budget of about $2.5 billion in fiscal year 2008. Of the 
proposed $450 million increase in appropriated funding, we 
recommend that the Centers for Medical Devices and Radiological 
Health and related field activities receive an increase of $72 
million in fiscal year 2008. This would bring the Center from 
its current $230 million to $302 million, not including user 
fees.
    Because devices are cutting edge science, CDRH needs these 
non-user fee monies for additional staff to perform product 
reviews, assure pre- and post-market safety, and facilitate 
innovative technology coming to market. An updated, modernized 
IT system is also essential to support the Center and its 
staff. Most of the praise that committee members have given to 
CDRH, which is justified, point at different activities and say 
MDUFMA did this and MDUFMA did that. Most of those activities 
were funded by appropriations and many of the expectations you 
have for CDRH and for medical devices in the future will not 
happen, user fees or no user fees, without an increased 
appropriation.
    In closing, Congress appropriates $4.94 per American per 
year, excluding user fees, for the FDA. At our proposed level 
of $2 billion, we would be spending only $6.67 per American per 
year. For reference purposes, the difference is about the same 
as a package of 15 assorted Band-Aids. In closing, $2 billion 
in appropriated funds, sustained and increased over four 
subsequent fiscal years, will help FDA fulfill its mandate and 
be innovative in its approach to regulation, oversight, 
inspections and monitoring. Thank you.
    [The prepared statement of Mr. Grossman follows:]

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    Mr. Pallone. Thank you, Mr. Grossman.
    We have 5 minutes, so if you use your whole 5 minutes, we 
won't be able to stay. Thanks.

STATEMENT OF DIANE E. DORMAN, VICE PRESIDENT FOR PUBLIC POLICY, 
           NATIONAL ORGANIZATION FOR RARE DISORDERS.

    Ms. Dorman. Mr. Chairman, Mr. Deal. Thank you for giving me 
the opportunity to testify before you today regarding the 
reauthorization of MDUFMA II. I will also share my views on the 
pediatric device bill, which is very important to NORD, that is 
sponsored by Mr. Markey and Mr. Rogers.
    I am Diane Dorman, vice president of public policy for the 
National Organization for Rare Disorders. Because most patients 
with rare diseases have no or few treatments, our primary goal 
is to encourage research and development of new orphan drugs 
and biologics and humanitarian devices. I will speak only 
briefly about MDUFMA reauthorization.
    NORD believes that the FDA, in a perfect world, should be 
fully funded through appropriations, but we recognize for now 
user fees are inevitable and crucial to ensure that safe and 
effective products reach the public as quickly as possible, 
therefore we do not oppose the concept of user fees for medical 
devices. I testify before you today to express NORD's strong 
support of the Pediatric Medical Device Safety Improvement Act. 
Children need medical devices that are safe, effective and made 
just for them. Devices must take into account the small size of 
children and accommodate their growing and changing bodies and 
active lifestyles.
    Yet doctors continue to be frustrated by the lack of modern 
medical devices for children because today's devices are not 
made with these considerations in mind and some vital life 
saving devices are not made at all. Consequently, children are 
frequently denied access to the latest technologies that we 
have heard a lot about today. They don't have access to 
lifesaving devices, some that could save their lives. Doctors 
are left with only one untenable option and they are forced to 
jerry-rig existing devices in hopes of accommodating the needs 
of their young patients.
    NORD supports all the provisions of H.R. 1494, including 
the FDA's ability to track the number and type of devices 
approved specifically for children, as well as the destination 
of a contact point or office within the NIH to help innovators. 
There are two provisions that are of particular interest to me. 
First is the 6-year demonstration grant provision supporting 
nonprofit consortium to provide critically needed support to 
help innovators with pediatric devises. Perhaps had this 
nonprofit consortium existed previously, it would have not 
taken Dr. Robert Campbell 14 years to invent, develop and then 
bring to market the Vertical Titanium Rib.
    I would like to turn your attention to the screen. This is 
the titanium rib developed by Dr. Robert Campbell. He is a 
Professor of Orthopaedics and also a pediatric surgeon at the 
University of Texas Health Science Center in San Antonio. Next 
slide.
    [Slide]
    This is Devon prior to the surgery insertion of the 
titanium rib. Next one, please.
    [Slide]
    This is the surgery after.
    Mr. Pallone. Ms. Dorman, you know what I am going to do? I 
am just going to take a recess because I only have 2 minutes, 
all right?
    Ms. Zuckerman. OK.
    Mr. Pallone. And then we will come back and finish with 
your statement and then we will take questions.
    Ms. Zuckerman. OK.
    Mr. Pallone. Thank you. Sorry to do that to you, but I 
don't think we have enough time.
    Ms. Zuckerman. It is all right.
    Mr. Pallone. We will stand in recess.
    [Recess]
    Mr. Pallone. OK, Ms. Dorman, what happened to the titanium 
rib? Wherever you left off.
    Ms. Zuckerman. Yes, I think I left off just showing these 
pictures. This is Devon, who was born without nine ribs and 
scoliosis. He was not expected to live at all.
    [Slide]
    And the next picture is after surgery. And the next 
picture.
    [Slide]
    And this is today. He is playing baseball. It is an 
incredible device. That is it. Thank you.
    I would also like to talk about the Humanitarian Device 
Exemption to allow companies to make profit on HDE approved 
humanitarian devices. The HDE pathway is a tool used to approve 
devices intended to very small patient populations, which often 
include children, and those with very rare conditions. It was 
originally thought that the restriction on profit would force 
device manufacturers to conduct full clinical trials and seek 
pre-market approval from the FDA. That scenario never played 
out. Instead, the restriction on profits proved to be a barrier 
to innovation, especially for children.
    Of the 39 humanitarian devices currently on the market, 
only seven are specifically intended for the use in the 
pediatric population. By eliminating the cap for children, the 
likelihood that companies will manufacture pediatric devices 
will increase, especially the small manufacturers, who are 
likely to embrace an affordable pediatric device development 
pathway.
    I would now like to address an issue not specific to H.R. 
1494, but of great importance to the rare disease community. 
FDA has been very sensitive to the value of humanitarian 
devices and has made clear that they are legally marketed 
products and not experimental. I have attached a page to my 
written testimony that illustrates the lengths the FDA has gone 
to to clearly establish that HUDs are legally marketed. 
Nonetheless, insurers and government programs often will not 
reimburse the use of humanitarian devices because they view 
them as experimental. In effect, they ignore FDA's regulations 
on the status of these devices.
    We believe that the situation could be improved if the 
current FDA regulatory policy would be codified in statute. 
This would make it more difficult for reimbursement to be 
denied by making clear that FDA's position is backed by 
Congress. NORD would welcome the opportunity to accomplish this 
by working with committee staff and FDA to draft appropriate 
language to address this terrible problem.
    I want to thank the committee for allowing me the 
opportunity to share my views on the reauthorization of MDUFMA 
and most importantly, the Pediatric Medical Device Safety 
Improvement Act. Thank you.
    [The prepared statement of Ms. Dorman follows:]

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    Mr. Pallone. Thank you. And now we will take some questions 
and I will start with myself.
    I was going to ask Mr. LaViolette, what is your view of the 
legal status of the performance goals mutually agreed upon by 
FDA and industry for the Medical Device Review Program? 
Specifically, do you believe these goals are binding or does 
FDA reserve the right to ignore or miss them?
    Mr. LaViolette. The goals, as I understand it, are 
definitely not binding. They are attached, if you will, to the 
legislation. They are guidelines. They are intended to keep 
everyone focused on accountability and on process improvements, 
but they are absolutely not binding.
    Mr. Pallone. OK. And then I wanted to ask Ms. Dorman, you 
mentioned the need for additional incentives that would 
encourage manufacturers to develop and manufacture devices for 
the pediatric population. But specifically, what incentives not 
already in place would foster the development of additional 
lifesaving pediatric devices?
    Ms. Dorman. The one that I talked to you about is removing 
the cap on profits for humanitarian devices. I have spoken with 
FDA, with all the stakeholders, including industry, and they 
feel that this is a real roadblock when they are not able to 
make any type of profit at all. And we feel as if taking that 
cap would provide, hopefully, an incentive for companies, 
especially the smaller companies, to develop these devices for 
children.
    Mr. Pallone. And then Mr. Grossman, the President's budget 
for fiscal year 2008 requests for FDA's Medical Device Program, 
well, his budget request is $285 million. The FDA Alliance 
believes the agency will need $302 million for the fiscal year 
2008 Medical Device Program. Why do you think there is such a 
discrepancy?
    Mr. Grossman. In general, the President's budget request 
for most of the agency is just barely above the level needed to 
continue the same staff. We feel that that is inadequate for 
the demands that are being placed on FDA and as I indicated, 
the fiscal year 2003 budget was better than the current one, so 
the agency has gone backwards. We believe that the additional 
money is needed for a variety of things; shorter application 
review times, more meetings and opportunities for interaction.
    These are things you have heard. More guidance, development 
standards, more participation in industry workshops, maintain 
and expand combination products, international programs and 
most of all, information technology is something that has to be 
invested and you just can't throw a couple of million at it 
each year and expect that you are going to get the databases 
that actually add value.
    Mr. Pallone. OK. I was listening to Dr. Zuckerman's 
statement where she basically was very critical of the 510(k) 
process. She explained in some detail about why she thought it 
was kind of out of control. I just wondered if anybody wanted 
to respond to that because it seemed kind of--I mean, I hadn't 
heard it criticized so drastically, not to take away. I am glad 
you are here to say what you think is important. Did anybody 
else want to comment on what she said in that respect? Go 
ahead.
    Mr. LaViolette. I will make at least one comment, which is 
that first of all, the number of 510(k)'s is probably in the 
4,000 per year range in comparison to some limited hundreds of 
PMAs, so it is the majority of devices that obviously the 
resource intensity, if we were to apply the same standards to 
those, would swamp the system, No. 1. Number 2, by definition, 
they are lower risk devices. That is how they were categorized 
at the class 2 level to begin with. Despite their lower risk 
category, while many of them are not associated with clinical 
data, they are often associated with extensive mechanical bench 
testing data, so they are very highly tested, just not 
necessarily in randomized controlled trials. And despite that, 
at any point the FDA has the right to impose a clinical data 
generation requirement on the device.
    Mr. Pallone. They can do it; they can impose----
    Mr. LaViolette. They absolutely can, any time they choose, 
and my company has clinical trials underway today on class 2 
devices, so clinical data can be generated any time, as needed.
    Mr. Pallone. Mr. Cullimore, did you want to say something?
    Mr. Cullimore. We are very pleased with the goals that are 
being set by the FDA under MDUFMA II, but I would point out 
that even if we achieve the goals that are being set, they 
still fall short of the statutory obligations under the 
original medical device amendment. And so without commenting on 
the adequacy of the original medical device amendment, I will 
just point out that the goals that are being set here, the 
acceleration, as minimal as it may seem, still does not return 
us to the statutory requirements set under the original medical 
device amendment.
    Mr. Pallone. OK. Anybody else? All right.
    Ms. Zuckerman. Mr. Chairman.
    Mr. Pallone. Yes, you can respond again, if you want. I 
will let you come back again.
    Ms. Zuckerman. I just wanted to mention that although the 
idea of a 510(k) was for less--well, for devices that were less 
potentially dangerous, it is not always clear what that would 
be and so contact lens solution, I think the perfect example 
where we take it for granted that contact lens solution is safe 
and who of us who uses it, who ever worries about it? But 
because this particular contact lens solution was changed, no 
clinical trials were done and no inspections were done, it 
ended up to have something in it that made it easier for 
bacteria to grow and to harm vision.
    Mr. Pallone. Well, would you advocate reclassifying what 
comes under 510(k) or I mean, it seemed like you were just 
saying scrap it altogether.
    Ms. Zuckerman. Oh, I didn't mean that, no.
    Mr. Pallone. Maybe I misunderstood.
    Ms. Zuckerman. No. I think there are plenty of devices that 
could be approved under a 510(k), but they are supposed to be, 
at least traditionally, they were substantially equivalent to 
something else on the market. That used to mean for the same 
purpose and a very similar device that had just been changed in 
some minor way. But that definition of substantially equivalent 
has changed so dramatically that now they are approving, 
sometimes, implanted devices and sometimes completely new 
technologies, and the NeuroStar that I mentioned is a 
completely new technology, different from anything else.
    Mr. Pallone. Well, let me ask you this. Did you, either in 
your oral or written testimony, come up with a new definition 
or some way of redefining it? I mean, I tried to listen, but 
did you suggest that?
    Ms. Zuckerman. No, the FDA has redefined it. It used to be 
substantially equivalent meant similar materials, same purpose. 
But now it means similar purpose, which doesn't necessarily 
mean the same. It is like depression, which you are treating 
depression, but there is a lot of different ways to treat it. 
Similar purpose and it can be a completely different material, 
completely different technology, as long as the risks and 
benefits are similar, but that opens up Pandora's box, because 
you are not--assuming that this product is similar to something 
else that has already been through some kind of rigorous 
review.
    You are just picking anything to try to figure out whether 
the risks and benefits are similar and without clinical trials, 
you can't determine if the risks and benefits are similar. So 
although it is correct that testing has been done, if the 
testing is not done on human beings with a particular treatment 
need, you don't necessarily know how it is going to affect them 
without those clinical trials.
    Mr. Pallone. OK. Thank you. Mr. Deal.
    Mr. Deal. Mr. Grossman, I understand that your alliance 
obviously supports additional budget funding for FDA. What is 
your take on the restructuring of the fee schedules? Are you 
satisfied with that restructuring, even though it may minimize 
or reduce the application fee, it makes up for it in other 
areas? Are you satisfied with that arrangement?
    Mr. Grossman. Our position goes to the aggregate resources 
and so we--I have 108 members. I would say we don't have a 
position on the specifics of whether it comes from facility 
fees or applications.
    Mr. Deal. OK. We heard the testimony of Ms. Dorman on the 
humanitarian device exemption. I suppose, from the two industry 
people, what is your position? I understand that the profit cap 
be removed and also that--what was the second part of your 
recommendation?
    Ms. Dorman. Initially, it was somewhat different. It was 
regarding the reimbursement for humanitarian devices, so it is 
outside the purview of this----
    Mr. Deal. And you were suggesting that the policy of FDA be 
put into statute so that the question of whether or not it is 
approved rather than experimental is removed, that was part of 
your suggestion?
    Ms. Dorman. That is correct.
    Mr. Deal. OK. What is the reaction of the two industry 
representatives to that?
    Mr. LaViolette. Just speaking on our behalf, representing 
AdvaMed and Boston Scientific, I would favor that. I think that 
is a smart move. It is one small step. I think if we really 
want to encourage device development for pediatric 
applications, we have to take many more steps. We support the 
Markey-Rogers initiative and it contains a number of efforts 
that begin to identify the needs and I think one of the issues 
with pediatric applications is that the needs are not clearly 
identified and then ultimately build some series of incentives 
to drive innovation in that direction. HDE is one route, but 
not by any means the sole route. Devices are very different 
than drugs. We need, I think, a different set of mechanisms to 
encourage innovation for pediatric patients.
    Mr. Cullimore. Our position is not any different. We agree 
with that. We do have some concerns about how the bill is being 
crafted as far as language that has FDA, section 522 where FDA 
would have the option of requiring post-market surveillance as 
a condition of approval. We have concerns that that particular 
provision may actually have a contrary effect to what is 
intended because if someone views that as a potential 
additional cost, it could inhibit the interest in pursuing that 
course, so with that caveat, we also support this.
    Mr. Deal. Mr. Cullimore, while you are at the microphone, 
could I get you to address the issue of trying to down-class 
devices that may originally be classified in one area of 
classification, the process of down-classifying those. What, if 
anything, needs to be addressed in this legislation with regard 
to that?
    Mr. Cullimore. I don't know that this particular 
legislation is the place for that, but the concept is not new. 
Back in the 1990s, when FDA was facing a very large backlog of 
applications, probably the worst in their history, one of the 
innovative approaches that was taken was to significantly down-
classify devices that required applications and I think, like 
any business, you have to continue to innovate. You have to 
reevaluate and if there are products that can be down-
classified, thus reducing the workload without jeopardizing the 
safety of products on the market, I would think that should 
certainly be considered.
    Mr. Deal. OK. Mr. LaViolette.
    Mr. LaViolette. I agree fully. I think the FDA 
Modernization Act dealt with this. It is do-able within FDA 
auspices today. From my perspective, it is something that 
happens quite infrequently and should be done under careful 
review, but I am not sure that it needs to be changed that 
dramatically.
    Mr. Deal. OK. I believe that is all I have, Mr. Chairman.
    Mr. Pallone. I see the gentleman from Massachusetts has 
entered the room, but he didn't come alone. Would you like to 
tell us who accompanied you here today?
    Mr. Markey. I would like to introduce St. Anthony's of 
Everett. And I would like you to know that when I was in the 
CYO and I played against St. Anthony's of Everett, that the 
star of their team scored 34 points against me and I think, as 
a result, was destined for a scholarship in college and that is 
how I have been helping kids from St. Anthony's to advance 
themselves ever since I became a defenseless opponent of them 
when I was a boy. So I wanted to have them here with us.
    Mr. Pallone. I would like to know if they speak like people 
from Medford?
    Mr. Markey. Medford and Everett are arch rivals, actually.
    Mr. Pallone. The gentleman is recognized.
    Mr. Markey. Thank you. I appreciate it. First, I want to 
welcome Mr. LaViolette, who is testifying on behalf of Boston 
Scientific, which is headquartered in my district in Natick, 
Massachusetts. And I would like to ask you to explain why it is 
important to increase access and encourage development of 
medical devices specifically for children and how you think the 
Markey-Rogers bill will help to do that?
    Mr. LaViolette. Thank you for that question and it is a 
pleasure to address the issue. First of all, my company, as an 
example, makes 650 different families of medical technology and 
we are one of the largest companies in the industry. We do not 
address pediatric needs that specifically and I think that is 
actually somewhat of a shame. And we really do need to start 
with basic, a more basic understanding of pediatric 
requirements.
    We have to assess precisely what the differences are in the 
device field as compared to the drug field because, indeed, in 
drug development a slightly lower dose or a slightly extended 
patent protection might act as an appropriate incentive for 
development for pediatric applications that is not sufficient 
in the device world. So we need to start with an identification 
of the way to fill those gaps. We need to integrate pediatric, 
the Academy of Pediatrics in that process and then ultimately 
stimulate investment in this area. It is a grossly underserved 
need. We support your legislation. We think it is a very strong 
move in that direction.
    Mr. Markey. Thank you, sir, very much. Ms. Dorman, I thank 
you for your testimony, as well. Can you explain why the 
combination of incentives to industry for the development of 
devices specifically for kids and increased FDA authority that 
is in the legislation that I have introduced with Mr. Rogers is 
so important?
    Ms. Dorman. I think it is terribly important because 
children are not second class citizens. And this goes to the 
rare disease community with whom I have worked for, for many, 
many years, and they feel disenfranchised. They are denied 
treatments. They must wait years before they even are 
diagnosed, so this is kind of near and dear to my heart, since 
I do have two grandchildren, myself, and I would be loathe to 
think that if they became ill, there would not be a device that 
would be available to my grandchildren.
    Mr. Markey. So the Institute of Medicine has recommended 
that Congress expand FDA's authority to monitor devices for 
kids after they are approved. Why is this expanded monitoring 
authority important?
    Ms. Dorman. I think it is very important because children 
grow, they change, they are active. And without very close 
monitoring of the devices after they have been inserted in the 
children, it could pose a real danger to the children, so we do 
very wholeheartedly agree with the IOM recommendation.
    Mr. Markey. Thank you. And can you explain why, any of the 
other witnesses, why it is important to increase access and 
encourage development of these medical devices? Do any of the 
others of you wish to comment on that?
    Ms. Dorman. Mr. Markey, could I make one comment? Back in 
1983, the nay sayers said why should we bother even passing an 
orphan drug act? What good is it going to do if we don't know 
what the problem is? And today the Orphan Drug Act is 
considered probably one of the most important healthcare pieces 
of legislation in the 20th century and I think that will 
probably most definitely apply to this, as well, for children.
    Mr. Markey. OK, great. Thank you. Any of the other 
witnesses?
    Ms. Zuckerman. I would like to add something. I just wanted 
to say that of course what you have now is a situation where 
many physicians are trying to modify devices so that they work 
with kids and some are going to be more successful than others. 
If you have a rigorous program that encourages the development 
of devices that can be tested so you know which ones work best, 
that is just going to be so much better, for all of the health 
professionals involved and obviously, for all of the children 
because you have some kind of standards that you can compare to 
and you will have a much better idea of what is going to work.
    Mr. Markey. OK, great. Thank you. Yes, sir.
    Mr. LaViolette. Just, if I may, one closing comment. From 
my perspective, neither the typical device nor the typical 
regulatory approval process for devices is really designed for 
children. Children's needs are different and that relates both 
to the devices, but also to the approval process and what we 
have here is a marketplace and the marketplace is not focused 
on kids' needs because they are very hard to identify and very 
difficult to justify, so we really do need to encourage that 
development and I think your legislation heads very much in 
that right direction.
    Mr. Markey. Thank you very much and Mr. Chairman, I thank 
you.
    Mr. Pallone. Thank you. And thank you all. We just made it, 
another vote, so we will conclude here. Thank you for bearing 
with us, really. I know this coming in and out has been tough. 
Let me just remind you that Members may submit additional 
questions within the next 10 days for you to respond to, so 
within the next 10 days we will notify you, if that is the 
case. And other than that----
    Mr. Grossman. Mr. Pallone?
    Mr. Pallone. Yes.
    Mr. Grossman. Could I take 10 seconds and clarify one thing 
that I had said? The number you quoted me for the 
administration request included user fees.
    Mr. Pallone. Right.
    Mr. Grossman. So that the comparable number that we are 
recommending is about $350 million. The $302 million, which 
would be budget authority and I think it is approximately $48 
million or $49 million in user fees.
    Mr. Pallone. OK.
    Mr. Grossman. So there is a significant difference between 
the two figures.
    Mr. Pallone. In response to the question I asked, you mean? 
Right.
    Mr. Grossman. Right.
    Mr. Pallone. Right.
    Mr. Grossman. And the answer would still be the same, that 
we need a lot more of a lot of things that the money would buy.
    Mr. Pallone. OK. All right. Thank you very much, really. We 
appreciate it. This meeting is adjourned.
    [Whereupon, at 3:06 p.m., the subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]

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