MDUFA V: FDA And Industry Still At Odds Over Carryover Funds, Vacancies, Meeting Commitments

Source : Medtech Insight

The US Food and Drug Administration and medtech industry representatives have significant disagreements over whether the agency has met its previous user-fee obligations and if it needs more funding to continue improving its premarket review process.

The Medical Device User Fee Amendments V (MDUFA V) negotiations between the FDA and industry groups is finally underway after almost a yearlong delay because of the COVID-19 pandemic. Agency and industry representatives have met twice this year, on 28 February and 17 March . Minutes for the March meeting, however, were posted online by the FDA last week. ()

There are clear areas of disagreement between the FDA and industry represented by AdvaMed, the Medical Device Manufacturer’s Association (MDMA), the Medical Imaging and Technology Alliance (MITA), and the American Clinical Laboratory Association (ACLA) that are reflected in the minutes. As usual, ACLA says it’s only attending the meetings in the event the FDA decides to start regulating laboratory developed tests (LDTs), which is highly likely under a Biden administration. MT143450

The FDA’s Center for Devices and Radiological Health has maintained over the past year that it has continued to meet its user-fee commitments while also working overtime to do its part to tackle the pandemic. However, the CDRH has asserted that its regulatory oversight beyond COVID-19 has been suffering as its staff have been stretched thin. The agency has argued that it needs more funding through user fees to not only continue its work but to improve the work it already does. ()

On the other hand, industry has argued that it wants to see the FDA use carryover user fees from previous user-fee deals to fill vacant full-time equivalent (FTE) positions that are required under past commitments. It has also argued that fee increases in the past were used to build up the FDA’s capabilities, and now it’s time to find ways of streamlining what’s already there to make the regulatory process more efficient. ()

Jeff Senger, an attorney at the law firm Sidley Austin and a former FDA acting chief counsel, told Medtech Insight that as the pandemic becomes more manageable it’ll be harder for the CDRH to make the case that it needs more user fees to offset the extra workload its reviewers have had to take on.

“It seems like that there’s a light at the end of the tunnel with COVID, and hopefully the sprint that's occurred over the last year is slowing and may not be as much of a tax on resources,” he said. “I think FDA’s position is weaker because of those points.”

“Industry is often frustrated at what it views as the lack of specificity in FDA deficiency letters.” – Jeff Senger

The regulatory agency in February said it met its review performance goals and performance enhancement commitments. However, industry pushed back, stating the FDA had not met average total time to decision for 510(k) applications; additional information (AI) letters still lacked specific justifications for cited deficiencies, potentially not meeting FY 2021 pre-submission performance goals; and not meeting certain digital health commitments.

At the March meeting, the FDA took on the industry’s assertion that the agency had not met or is unlikely to meet its MDUFA IV performance obligations.

More specifically, the FDA argued that the goal for 510(k) submissions is a shared outcome goal and asked industry to provide information at the next meeting, set for 7 April, on what it had done to help meet those goals. In response, the agency also said that it was too early to predict the performance goals for the pre-submission process goal for FY 2021. The FDA further disagreed with industry’s assertion that the agency was missing hitting the mark on digital health commitments but was open to setting new goals in MDUFA V.

One of the main areas of contention between the FDA and industry seems to be over whether the agency had met its MDUFA IV goals over deficiency letters. The agency argued that it met its commitments by publishing an update to existing guidance on deficiency letters, providing training to staff and managers, and completing an audit by fiscal 2020. Industry reps, however, disagreed, arguing that they believed all deficiency letters would include a statement for the basis of the deficiency, which the FDA hadn’t done.

In response, the FDA said the goal of the deficiency letter provision in the MDUFA IV commitment was not to provide a statement in all cases, but rather to aspire to that goal. The agency said it’s still working to make improvements but needs more resources to be able to meet that goal. Industry said it appreciated the agency’s efforts, but noted it came nowhere near being able to meet that goal. Industry further said it was critical for the FDA to provide justification for deficiencies so sponsors can have a clearer understanding of what’s required of them and avoid getting deficiency letters in the future.

“Industry is often frustrated at what it views as the lack of specificity in FDA deficiency letters,” Senger said.

He noted that sponsors want more certainty about the path forward and specifically want details on what was deficient in their application, what needs to be fixed, and how it can be fixed. Ultimately, he said, companies are looking for predictability when they file an application, but the lack of details makes that difficult.

“I think FDA sometimes wants to keep its options open; that’s more complicated and more time-consuming,” Senger said. “More detailed letters require more signoff clearance, more work and more commitment. If you describe a path forward then you have to follow it, and it’s easier to not be as specific.”

In the end, however, neither side was came to a conclusion on the topic and instead decided to pick up the topic at a later meeting.

Another key area of contention over the past two meetings has been the funds the FDA has used versus what’s left over from previous MDUFA cycles. Industry argued that the agency has a number of FTE positions left vacant that it’s required to fill under previous deals.

At the March meeting, the FDA provided more high-level financial data from MDUFA IV, arguing that it raises far less in user fees than the combined human medicine user-fee programs. More specifically, the agency said it raised more than $1bn during the last user fee negotiations compared to the more than $8bn raised through the drugs, generics and biologics programs.

The medtech industry said those are not accurate comparisons considering the device and diagnostics industries have far less revenue compared to their human medicine counterparts.

“I’d like to see what CDRH would do with the money, and not just because they want it because [the Center for Drug Evaluation and Research (CDER)] has it,” Senger said. “And then industry – if persuaded that the bang is worth the buck – would be more amenable to us paying it.”

In the February meeting, while the FDA was asking for more resources and more staff, industry representatives noted that the agency had 36 MDUFA IV FTEs that had already been funded by user fees but were left vacant. The reps wanted more information on why those positions have not been filled, especially because the FDA says its resources have been stretched thin.

The FDA obliged in the March meeting and said it faced a number of hiring challenges during the fiscal 2018 and 2019 cycles but have worked to try fill the spots. In fiscal 2020 the agency was able to make some progress and filled 92% of MDUFA IV positions through the end of that year, leaving 15 of 189 positions unfilled. The agency also noted that an additional 14 positions were unfilled due to staff leaving the agency, but it expects to meet its hiring targets in fiscal 2021.

“I think government in general tend to want more staff and more resources, and industry too for that matter; I think it’s a human impulse,” Senger said. “I would like to see the data … rather than [FDA saying] ‘CDER has more so we want more.’”

Specifically he said he’d like to see data in terms of 510(k) application rates and staff turnover rates, as well as an explanation for why more staff is needed. He also wants to know if there is a significantly higher influx of applications, whether the applications more complicated and if the COVID-19 crisis will continue to divert the agency’s resources in a way that will continue into the foreseeable future.

Finally, another key area of contention between the FDA and industry has been the use of user-fee dollars to upgrade the agency’s IT infrastructure. In the February meeting the agency said part of its carryover balance from the previous deal was used for acquisition, maintenance and updates of IT resources through its Digital Transformation Initiative.

Industry, however, said during the meeting that it had not been previously informed about the decision and expressed concern that the FDA was using significant carryover balances to update its IT infrastructure at a time when the pandemic was delaying MDUFA submissions. Reps further noted that although MDUFA funding for IT was negotiated and agreed on in past deals, it did not extend to all aspects of the Digital Transformation Initiative.

But in the latest meeting, the FDA argued that its current IT infrastructure was outdated, fragmented and inefficient, which was slowing the regulatory process. It also said the MDUFA IV deal included commitments to update its IT infrastructure for submission management, including electronic submission templates and linking pre-submissions with subsequent premarket submissions.

“It doesn't surprise me that CDRH would think modernizing systems would be a good use of money, but industry would like more tangible benefits for the money that industry is paying, like improved review-cycle times and more specific deficiency letter responses rather than upgrading hardware,” Senger said.

“Industry is serving their customers, their doctors, their shareholders; that involves getting better products to market sooner and with greater predictability,” he added. “Their ability to raise funds – to get capital – is dependent on a predictable path, and modernizing FDA infrastructure is a step removed from that. It might be related but industry is going to want direct proof that modernizing systems will get them that.”

Senger said details were lacking in the meeting minutes around the area of digital health. The minutes note that the FDA discussed further investments in digital health but there weren’t any specifics.

Senger, who has a lot of clients in the digital health space, wants more details on what investments the CDRH is proposing and what investments industry would like to see.

By Ferdous Al-Faruque