How much does a 510k submission cost with MDUFA fees?

## Navigating FDA 510(k) MDUFA Fees: A Guide to the Small Business Program When planning a 510(k) submission, forecasting costs is a critical task for medical device manufacturers. A significant and mandatory component of this budget is the user fee required by the FDA under the Medical Device User Fee Amendments (MDUFA). These fees support the FDA's review activities but can represent a substantial expense, particularly for smaller companies. To alleviate this burden, the FDA offers a Small Business Determination (SBD) program, which provides a significantly reduced user fee for eligible organizations. However, qualifying for this program is not automatic and requires careful planning, timely application, and a thorough understanding of the FDA's strict eligibility criteria. Navigating the SBD process correctly is essential for financial planning and preventing costly administrative delays to a 510(k) submission. ### Key Points * **Advanced Approval is Mandatory:** A company's Small Business Determination (SBD) application must be reviewed and officially approved by the FDA *before* submitting the corresponding 510(k) application. Submitting with a pending SBD application is not sufficient. * **Eligibility is Based on Total Gross Receipts:** Eligibility is determined by the gross receipts or sales of the applicant and all of its domestic and international affiliates, parent companies, and subsidiaries. This is a common point of confusion and a frequent cause of rejection. * **Documentation is Strict:** Applicants must provide official financial documentation, typically the most recently filed U.S. Federal income tax return. Foreign companies must provide equivalent documentation with a certified English translation. * **Status is Time-Sensitive:** SBD status is granted for the FDA's fiscal year (October 1 to September 30). It is not perpetual and must be renewed annually. A 510(k) submitted on October 1, 2024, requires an SBD certification for fiscal year 2025. * **Risk of RTA Hold:** Failure to pay the correct fee at the time of submission is a common reason for a Refuse to Accept (RTA) decision. This can occur if an SBD application was not approved in time or if the incorrect fee amount was paid. * **FDA Website is the Only Official Source:** MDUFA fee amounts are updated annually. Sponsors must always consult the official FDA website for the current fee schedule for the correct fiscal year. ### Understanding MDUFA Fees and the Small Business Program The Medical Device User Fee Amendments (MDUFA) authorize the FDA to collect fees from medical device companies to help fund the review of premarket submissions, including 510(k)s. This program provides the agency with resources to meet performance goals and ensure timely patient access to safe and effective devices. Each fiscal year, the FDA publishes a schedule of user fees. For 510(k)s, there are two primary fee rates: a standard fee and a significantly lower fee for qualified small businesses. A "small business" is defined by the FDA based on gross revenue criteria outlined in the Federal Food, Drug, and Cosmetic Act. It is crucial for sponsors to understand that this definition may differ from that of other government agencies like the Small Business Administration (SBA). The SBD program is the formal process through which a company requests and obtains certification from the FDA that it qualifies as a small business. This certification, once granted, allows the company to pay the reduced MDUFA fee for any submission filed during that fiscal year. ### The Small Business Determination (SBD) Application Process: A Step-by-Step Guide Successfully navigating the SBD program requires a structured, proactive approach. Missing a step or misunderstanding a requirement can lead to delays or the need to pay the full standard fee. #### Step 1: Confirm Eligibility and Calculate Gross Receipts Before beginning the application, a company must confirm it meets the FDA's definition of a small business. This involves calculating the total gross receipts or sales from the most recent tax year for the applicant and all of its affiliates. * **What is an Affiliate?** The FDA has a broad definition of an affiliate. This includes parent companies, subsidiaries, and any businesses that are under common control. For example, if a startup is majority-owned by a venture capital firm, the revenue of the VC firm and potentially other portfolio companies may need to be included in the calculation. * **Global Calculation:** The calculation must include revenue from all domestic and international sources for all affiliated entities. * **Common Pitfall:** Companies often fail to account for the revenue of a new parent company following an acquisition or a significant funding round that changes the control structure. This can render a previously eligible company ineligible. #### Step 2: Gather Required Financial Documentation The SBD application must be supported by objective financial evidence. * **For U.S. Businesses:** The primary document is the most recently completed Federal income tax return (e.g., Form 1120). All supporting forms and schedules for the return must be included. * **For Foreign Businesses:** The company must submit the equivalent national tax documentation from their home country's government. This document must be accompanied by a complete, certified English translation. It must clearly show the company's total revenue. * **New Businesses:** For companies that have not yet filed a tax return, the process is more complex and may require consulting directly with the FDA's SBD program staff for guidance on acceptable documentation. #### Step 3: Complete and Submit the SBD Application Form The FDA provides a specific form (Form FDA 3602) for the SBD application. * **Accuracy is Key:** The form must be filled out completely and accurately. All affiliates must be listed, and the calculated gross receipts must match the supporting tax documents. * **Submission Timing:** The SBD application should be submitted well in advance of the planned 510(k) submission. A conservative timeframe is to apply at least 60-90 days before the target 510(k) submission date to account for FDA review time and to resolve any potential questions from the agency. #### Step 4: Obtain FDA Approval and User Fee Payment ID The FDA typically reviews SBD applications within several weeks. If approved, the agency will issue a formal SBD approval letter containing a unique Small Business Qualification Number. This number is essential. When the sponsor is ready to submit the 510(k), they must pay the correct reduced fee through the Device Submission User Fee website and receive a Payment Identification Number (PIN). The 510(k) cover letter must clearly state that the sponsor is a qualified small business and include both the SBD Qualification Number and the PIN to confirm payment. ### Scenario 1: A U.S. Startup with International Sales * **Situation:** A Delaware-based SaMD company has low domestic sales but significant revenue from a partnership in the European Union. * **What FDA Will Scrutinize:** The FDA will require the company's U.S. Federal tax return, which under 21 CFR and U.S. tax law, should report worldwide income. The gross receipts calculation must include all sales, both domestic and foreign, to determine eligibility. * **Best Practice:** Ensure financial records and tax filings accurately consolidate global revenue. Misrepresenting or omitting foreign sales on the SBD application can lead to rejection and potential compliance issues. ### Scenario 2: A Company Acquired by a Larger Corporation * **Situation:** A small device company was SBD-qualified in 2023. In early 2024, it was acquired by a large, publicly traded corporation. The company plans to submit a 510(k) in late 2024. * **What FDA Will Scrutinize:** For its fiscal year 2025 SBD application, the company is now an affiliate of the large corporation. The FDA will assess eligibility based on the combined gross receipts of the entire corporate family, which will almost certainly exceed the small business threshold. * **Best Practice:** The company must recognize that it is no longer eligible for small business status. It should budget for the full standard MDUFA fee for its upcoming 510(k) submission to avoid an RTA hold and financial planning disruptions. ### Strategic Considerations and the Role of Q-Submission While MDUFA fee logistics are not a topic for a Q-Submission meeting, managing the administrative aspects of a submission is a critical component of a successful regulatory strategy. A delay caused by an RTA hold over an incorrect fee payment can have significant strategic consequences, pushing back product launch timelines and impacting business milestones. Integrating the SBD application process into the overall project plan is essential. It should be treated with the same diligence as preparing technical documentation, as a failure in this administrative step can halt the entire regulatory review process before it even begins. Early and accurate budgeting for user fees, whether standard or reduced, provides clarity for internal stakeholders and investors. ### Key FDA References - FDA Guidance: general 510(k) Program guidance on evaluating substantial equivalence. - FDA Guidance: Q-Submission Program – process for requesting feedback and meetings for medical device submissions. - 21 CFR Part 807, Subpart E – Premarket Notification Procedures (overall framework for 510(k) submissions). ## How tools like Cruxi can help Managing the numerous deadlines and documentation requirements for a 510(k) submission is a complex task. Tools like Cruxi can help teams manage critical regulatory deadlines and documentation. By creating dedicated trackers for administrative tasks like SBD applications alongside technical submission files, teams can ensure that crucial steps are not missed, reducing the risk of administrative holds and keeping the overall project on schedule. *** *This article is for general educational purposes only and is not legal, medical, or regulatory advice. For device-specific questions, sponsors should consult qualified experts and consider engaging FDA via the Q-Submission program.*