[Federal Register Volume 67, Number 225 (Thursday, November 21, 2002)]
[Notices]
[Pages 70228-70229]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-29572]


-----------------------------------------------------------------------

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration


Establishment of Medical Device User Fee Rates for Fiscal Year 
2003 and Interim Procedures

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: The Food and Drug Administration (FDA) is announcing the rates 
and interim procedures for medical device user fees for fiscal year 
(FY) 2003. The Federal Food, Drug, and Cosmetic Act (the act), as 
amended by the Medical Device User Fee and Modernization Act of 2002 
(MDUFMA) (Public Law 107-250), authorizes FDA to collect user fees for 
certain medical device applications. This notice establishes fee rates 
for FY 2003. These fees are effective for applications submitted on 
October 1, 2002, and will remain in effect through September 30, 2003. 
However, FDA may not begin to collect these fees until enabling 
appropriations are enacted. FDA will issue invoices for all fees 
payable for applications submitted between October 1, 2002, and 30 days 
after the date of the Federal Register notice the agency will issue 
after enactment of enabling appropriations. Those invoices will be due 
and payable within 30 days of issuance. Subsequently, fees must be 
submitted to FDA at the time that applications are submitted.

ADDRESSES: Visit the FDA Web site that provides further information on 
MDUFMA at http://www.fda.gov/cdrh/mdufma/index.html.

FOR FURTHER INFORMATION CONTACT: Frank Claunts, Office of Management 
and Systems (HFA-20), Food and Drug Administration, 5600 Fishers Lane, 
Rockville, MD 20857, 301-827-4427.

SUPPLEMENTARY INFORMATION:

I. Background

    The act establishes fees in sections 737 and 738 (21 U.S.C. 379i 
and j) for different kinds of medical device applications. Fees are 
assessed on certain types of medical device applications and 
supplements. When certain conditions are met, FDA may waive or reduce 
fees (21 U.S.C. 379j(d) and (e)).
    For FY 2003 through FY 2007, MDUFMA establishes revenue amounts for 
the aggregate of all application fee revenues. Revenue amounts 
established for years after FY 2003 are subject to adjustment for 
inflation, workload, and revenue shortfalls from previous years. Fees 
for applications are to be established each year by FDA so that 
revenues will approximate the levels established in the statute, after 
those amounts have first been adjusted for inflation, workload, and, if 
required, revenue shortfalls from previous years.
    This notice establishes fee rates for FY 2003. These fees are 
effective on October 1, 2002, and will remain in effect through 
September 30, 2003.

II. Inflation, Workload, and Compensating Adjustment Process

    MDUFMA provides that fee revenue amounts for each FY after 2003 
shall be adjusted for inflation. The adjustment must reflect the 
greater of: (1) The total percentage change that occurred in the 
Consumer Price Index (all items, U.S. city average) during the 12-month 
period ending on June 30 preceding the FY for which fees are being set, 
or (2) the total percentage pay change for the previous FY for Federal 
employees stationed in the Washington, DC metropolitan area. MDUFMA 
provides for this annual adjustment to be cumulative and compounded 
annually after 2003 (21 U.S.C. 379j(c)(1)). No inflation adjustment is 
to be made with respect to fee revenue amounts established in the 
statute for FY 2003.
    For each FY beginning in FY 2004, MDUFMA provides that fee revenue 
amounts, after they have been adjusted for inflation, shall be further 
adjusted to reflect changes in workload for the process for the review 
of medical device applications (21 U.S.C. 379j(c)(2)). No workload 
adjustment is to made be with respect to fee revenue amounts 
established in the statute for FY 2003.
    For each FY beginning in FY 2004, MDUFMA provides that fee revenue 
amounts, after they have been adjusted for inflation and workload, 
shall be further adjusted, if necessary, to compensate for any 
shortfall in fee revenue from previous years (21 U.S.C. 379j(c)(3)). No 
compensating adjustment is to be made with respect to fee revenue 
amounts established in the statute for FY 2003.
    Inflation, workload, and compensating adjustments do not apply to 
the revenue amounts established in MDUFMA for FY 2003.

III. Fee Calculations for FY 2003

    MDUFMA establishes the fee for a premarket application (PMA) at 
$154,000 in FY 2003. All other fees are set as a percent of this fee. 
At these rates, the medical device user fees are expected to generate 
$25,125,000 in FY 2003. The applications subject to fees, the rate of 
each fee as a percent of a premarket application, and the FY 2003

[[Page 70229]]

fee rate are set out in table 1 of this document. For all applications 
other than premarket notification submissions, the small business rate 
is 38 percent of the full fee rate. For premarket notification 
submissions, there is no small business rate in FY 2003. In FY 2004 and 
subsequent fiscal years, fees for premarket notification submissions 
will be set so that a small business fee will be 80 percent of a full 
application fee.

                         Table 1.--Fee Types, Percent of PMA Fee, and FY 2003 Fee Rates
----------------------------------------------------------------------------------------------------------------
                                                                                  Full Fee
                                                                                 Amount as              FY 2003
                                                                                 a Percent   FY 2003     Small
                              Application Fee Type                                 of PMA    Full Fee   Business
                                                                                    Fee     (dollars)     Fee
                                                                                 (percent)             (dollars)
----------------------------------------------------------------------------------------------------------------
PMA (submitted under section 515(c)(1) or 515(f) of the act or section 351 of    .........  154,000    58,520
 the Public Health Service Act (PHS Act))
----------------------------------------------------------------------------------------------------------------
Premarket Report (PMR) (submitted under section 515(c)(2) of the act)               100     154,000    58,520
----------------------------------------------------------------------------------------------------------------
Panel Track Supplement (to an approved PMA or PMR that requests a significant       100     154,000    58,520
 change in design or performance of the device, or a new indication for use of
 the device, and for which clinical data are generally necessary to provide
 reasonable assurance of safety and effectiveness)
----------------------------------------------------------------------------------------------------------------
Efficacy Supplement (to an approved PMA under section 351 of the PHS Act)           100     154,000    58,520
----------------------------------------------------------------------------------------------------------------
180-Day Supplement (to an approved PMA or PMR that is not a panel track            21.5     33,110     12,582
 supplement and requests a significant change in components, materials, design,
 specification, software, color additives, or labeling)
----------------------------------------------------------------------------------------------------------------
Real Time Supplement (to an approved PMA or PMR that is not a panel track           7.2     11,088     4,213
 supplement and requests a minor change to the device, such as a minor change
 to the design of the device, software, manufacturing, sterilization, or
 labeling, and for which the applicant has requested and the agency has granted
 a meeting or similar forum to jointly review and determine the status of the
 supplement)
----------------------------------------------------------------------------------------------------------------
Premarket Notification (submitted under section 510(k) of the act)                 1.42     2,187      None in
                                                                                                       FY 2003
----------------------------------------------------------------------------------------------------------------

IV. Adjustment for Excess Collections in Previous Years

    Under the provisions of MDUFMA, if the agency collects more fees 
than were provided for in appropriations in any year, FDA is required 
to reduce its anticipated fee collections in a subsequent year by that 
amount (21 U.S.C. 379j(h)(4)). No adjustments under this provision are 
required for fees assessed in FY 2003.

V. Implementation of Fee Collections

A. No Fees May Be Collected Until Enabling Appropriations are Enacted

    Under section 738(h) of the act, fees authorized by MDUFMA may 
neither be collected nor available for obligation unless they are first 
provided for in appropriation acts. For this reason FDA is not able to 
accept or deposit any fee revenues until such appropriations are 
enacted for FY 2003. Therefore, no fees are to be submitted until such 
appropriations are enacted. After the enactment of enabling 
appropriations, FDA will publish another notice in the Federal Register 
with detailed payment instructions.

B. Procedures for Firms Seeking to Qualify for Small Business Exemption 
for First PMA or for Lower Fees for Subsequent Applications.

    Firms with gross sales and revenues of $30 million or less, 
including gross sales and revenues of all affiliate, partner, and 
parent firms, may qualify for a waiver of the fee for their first PMA, 
and for lower rates for subsequent PMAs, PMRs, and supplements. Such 
firms may also qualify for lower rates for premarket notification 
submissions in FY 2004 and subsequent years. To qualify, these firms 
will have to submit certified copies of their Federal income tax return 
for the most recent taxable year, including certified copies of the 
income tax returns of their affiliate, partner, and parent firms. More 
detailed procedures for qualifying for small business first-time PMA 
waiver and lower rates will also be included in the Federal Register 
notice published after the date of enabling appropriations.

C. Subsequent Payment of Fees

    Any application or supplement subject to fees under MDUFMA that is 
submitted after September 30, 2002, is subject to the fee set out in 
table 1 of this document. FDA will issue invoices for all fees payable 
for applications submitted between October 1, 2002, and 30 days after 
the date of the Federal Register notice the agency will issue after 
enactment of enabling appropriations. Those invoices will be due and 
payable within 30 days of issuance. Subsequently, fees must be 
submitted to FDA at the time that applications are submitted.
    Payment, when due, must be made in U.S. currency by check, bank 
draft, or U.S. postal money order payable to the order of FDA. More 
complete payment instructions will be included in the Federal Register 
notice published after the date of enabling appropriations.

    Dated: November 15, 2002.
Margaret M. Dotzel,
Associate Commissioner for Policy.
[FR Doc. 02-29572 Filed 11-20-02; 8:45 am]
BILLING CODE 4160-01-S