A Senate committee last month took a step forward in addressing the rising costs associated with the Medical Device User Fee and Modernization Act (MDUFMA), which have been a concern to device companies especially of the early-stage variety and industry organizations. The Health, Education, Labor and Pensions Committee, which oversees the FDA, held a markup session on proposed legislation called the Medical Device User Fee Stabilization Act of 2005 (S.1420), voting unanimously to send the legislation to a full Senate vote.
The proposed fix is a big win for device companies, especially small- to mid-sized firms. Fees have increased rapidly since the program's inception in 2002. A series of compensating adjustors in the original law allowed Congress and industry to defer budgeted fees from one year to the next. This has sent fees for new product submissions skyrocketing and average annual cost growth for the program to more than 20% per year, according to FDA figures. The proposed stabilization would hold annual growth over the next year to roughly 6%.
Under the current law, $32 million would have been required to make up the shortfall in fees and government appropriation from 2003 and 2004. The new legislation would wipe the slate clean, requiring no added appropriations, but full Congressional funding would be mandated for 2006 and 2007. The workload and inflation compensating adjustments in the current law also would be removed in the new version. User fee increases for standard premarket applications (PMAs) for FY06 and FY07 would be capped at 8.5%. Right now, the increases, if left unchecked would be 21% and 20% respectively. This would make a PMA for 2006 $259,000, rather than $287,000, and $281,000 for 2007 vs. $344,501 without the change.
In what appears as a lobbying win for the Medical Device Manufacturers Association (MDMA; Washington), which has fought for changes to MDUFMA, the bill would increase the small business threshold from companies with $30 million in gross revenue to $100 million. It also would eliminate the FDA's ability to modify the small-business threshold. To receive a first-time PMA fee exemption, however, a company still will have to be below the $30 million threshold.
The new legislation also will attempt to clarify Section 301 of MDUFMA, which deals with labeling and branding of single-use devices (SUDs). The proposed language would limit the branding provision only to reprocessors of SUDs.
"We worked as hard as we could to ensure that the fee increases were as small as possible and the small business threshold was a large as possible," Mark Leahey, MDMA's executive director, told The BBI Newsletter following the meeting. "We have members who have been holding PMAs because they can't afford the fees. This is not just a political victory. Patients, ultimately, are the ones who benefit from allowing this new technology to get to market faster."
Committee member Sen. Barbara Mikulski (D-Maryland), who briefly was hospitalized last month when she was diagnosed with atrial fibrillation, told Senate colleagues that she didn't have to look far to see the benefit of the device industry, especially now that she is wearing a heart monitor. "Medical device development in this country is really phenomenal, and I am not just talking about the really high-tech stuff," she said. "My heart monitor was invented in the United States of America and approved by the FDA. We ask where the jobs are going to come from in the future in this country. They will come from dynamic sectors like this."
Industry groups hope the House and Senate will act before this month's congressional recess so the target sunset date of the MDUFMA program is not reached. In 2007, MDUFMA will be re-evaluated and subject to a more comprehensive overhaul.
Ubl new president of AdvaMed
Rudderless for nearly 3-1/2 months, the Advanced Medical Technology Association (AdvaMed; Washington) tapped Steven Ubl to steer the association as its new president and CEO. Ubl is no stranger to the medical device industry or AdvaMed. He served as the association's executive vice president for government relations from 1998 until last year, when he opened his own healthcare consulting firm. With his experience both in industry and the association, Ubl will "undoubtedly hit the ground running," Art Collins, CEO of Medtronic and AdvaMed's board chairman. "What's important is his passion, his enthusiasm and his energy about medical technology."
Ubl was one of the lead architects of AdvaMed's work to hammer out the Medical Device User Fee and Modernization Act of 2003. That experience may come in handy as an October deadline approaches. Industry, Congress and the FDA will seek to negotiate, by that deadline, a trigger "fix" for the legislation to help curb sharply rising user fees. "His knowledge of the industry and his accomplishments within a broad range of legislative decisions that have been made was clearly part of the decision-making process, but it wasn't exclusive," Collins said. "It was a number of factors. He possesses a rare combination of policy depth and political acumen that has earned bipartisan respect on Capitol Hill and among policymakers."
Identified with the help of a professional search firm, along with recommendations from member companies and lawmakers, more than 50 candidates were reviewed by an internal search committee, Collins told BBI. The list then was honed to a handful of possibilities. "I must add that [the search committee] received and I have personally gotten a number of calls from very influential people involved in legislation and the administration, that were universally favorable of Steve Ubl, assuming that he would be one of the final candidates."
Collins also said that with a new president finally named, AdvaMed may shake up the status quo a bit. "We made it very clear to Steve as we went through his process that we were not looking for an administrator to come in and conduct business as usual," he said. "AdvaMed has been extremely effective up until this point, but are we not going to do things exactly as we've done in the past. Steve will come in with fresh eyes, and we want to continually raise the bar in terms of what we expect in performance."
Ubl began his Washington tenure on Capitol Hill, serving as special assistant to Sen. Charles Grassley (R-Iowa). He later worked as vice president of legislation at the Federation of American Hospitals (Washington). The Hill newspaper and Legal Times cited Ubl as one of Washington's top lobbyists for securing passage of FDA and Medicare reforms, AdvaMed said.
Ubl replaces Pamela Bailey, who left the position in late March to head the Cosmetic, Toiletry and Fragrance Association (Washington), a group representing a sector that is marked by substantially fewer regulatory burdens than those facing med-tech. Bailey had headed AdvaMed since 1999.
Crawford confirmed as chief of FDA
After months of political wrangling, the Senate voted in mid-July to confirm Lester Crawford as FDA commissioner. The confirmation passed handily with a vote of 78-16. The 67-year-old Crawford, who has served as acting commissioner since Mark McClellan left FDA more than a year ago to head the Centers for Medicare & Medicaid Services (Baltimore), was nominated by President George Bush in February. Since then, a series of roadblocks and a little scandal conspired to delay Crawford's move from "acting" to official head of the agency.
There were allegations that Crawford improperly promoted an employee with whom he had an affair, an investigation then clearing the nominee of those charges. Some lawmakers also pointed to Crawford as a symbol of a system that needs to be revamped, citing questions about FDA post-approval surveillance of drugs and devices, drug safety monitoring, alleged mismanagement of flu vaccine supplies and the status of an application to make the Plan B morning-after contraception available over the counter.
Democratic Sens. Patty Murray (Washington) and Hillary Clinton (New York) had vowed to block the full Senate vote until the FDA ruled on whether the morning-after pill could be sold without a prescription. Murray and Clinton agreed to lift their hold following assurances from the FDA that it would issue a decision on Plan B by the beginning of September.
Many senators including Edward Kennedy (D-Massachusetts), ranking Democrat on the Senate's health committee and one of Capitol Hill's most widely recognized healthcare hawks said they believed the need for permanent leadership the agency made it important for the process to move forward. And they want Crawford to tackle the change necessary at FDA, unencumbered by his "acting" status. "With a commissioner in place, we can work more effectively on the key issues facing the agency, from how FDA monitors drug safety, to ways to address flu vaccine shortages, to how it handles conflicts of interest on its advisory committees, and how it has acted on Plan B," Kennedy said on the Senate floor.
"While I respected the right of my colleagues to disagree with a president's choice, in the end, I believe we have made the right decision to promote Dr. Crawford," Sen. Mike Enzi (R-Wyoming), chairman of the health committee, said in a statement. "He has a long and distinguished history of leadership and public service, and I look forward to his continued work in promoting and protecting the public health." Enzi added that the Senate's vote provided Crawford with "a mandate to act."
Breaking ranks with most Republicans, Senate Finance Committee Chairman Charles Grassley (Iowa), who has held hearings about FDA safety issues, was unyielding in his criticism of Crawford's appointment. "It is becoming more and more obvious to me that FDA is plagued by structural, personnel, cultural and scientific problems," Grassley told colleagues on the Senate floor before the vote. "Those problems should be equally obvious to Dr. Crawford. But under [his] leadership . . . the FDA appears to be in a state of denial. Dr. Crawford has not stepped up to the plate. I have seen no recognition of the depth and breadth of the problems at the FDA. I have only seen a few short-term Band-Aids."
On his first day as president of AdvaMed, Ublsaid Crawford understands the "unique characteristics" of the device industry and was pleased FDA now has a permanent leader. "We have collaborated with him on a broad range of issues over the years designed to ensure timely reviews of innovative medical technologies and effective postmarket surveillance," Ubl said. "He is an individual committed to doing what's in the best interests of the public and patients, and that's good for our industry."