Guidance Breakdown: Medical Device User Fee Small Business Qualification and Determination
The FDA updated its small business fee reduction framework with three distinct benefit tiers and streamlined processes.
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The FDA just finalized its guidance "Medical Device User Fee Small Business Qualification and Determination," superseding the August 2018 version and establishing updated procedures for medical device companies seeking user fee reductions and waivers under MDUFA.
The guidance does a few things:
It clarifies three distinct small business benefit categories with different gross receipts thresholds.
It streamlines the application process through the CDRH Portal.
It provides detailed instructions for both domestic and foreign businesses navigating the qualification process.
With medical device user fees continuing to rise (the FDA just increased its FY2026 user fees by 7.1% for premarket approval and notification applications), understanding these cost-saving opportunities is essential for resource-constrained companies.
We've distilled the key points below.
What qualifies as a small business?
The guidance establishes three separate small business definitions based on different gross receipts thresholds, each tied to specific benefits. Companies must include gross receipts or sales from all affiliates when calculating their totals, making affiliate identification and documentation critical to the process.
For reduced application fees, small businesses are defined as having gross receipts or sales of no more than $100 million for the most recent tax year, including all affiliates. This threshold applies to the broadest range of fee reductions and covers most MDUFA submission types.
For the first premarket application/report fee waiver, the threshold drops to $30 million in combined gross receipts or sales. This one-time benefit waives the entire fee for a company's first PMA, BLA, PDP, or PMR submission, but companies lose eligibility permanently once they or any affiliate has submitted any premarket application, regardless of approval status.
For registration fee waivers, the threshold is $1 million in combined gross receipts or sales, with the additional requirement of demonstrating financial hardship. FDA currently recognizes active bankruptcy as the primary objective standard for financial hardship, though the guidance leaves room for case-by-case evaluation of other circumstances.
The three benefit categories explained
Let’s quickly run through all three of these categories:
Reduced application fees represent the most commonly accessed benefit, providing substantial savings across multiple submission types. Eligible applications include PMAs, BLAs, PDPs and their supplements, 510(k) notifications, PMRs, De Novo requests, PMA annual reports, and 513(g) classification requests. Companies qualifying for this benefit pay significantly lower user fees for these submissions throughout the fiscal year, from the date of FDA determination through September 30.
First premarket application/report fee waivers eliminate the entire fee for qualifying companies' initial major premarket submissions. However, the guidance includes important exclusions that can trip up unwary applicants. Companies lose eligibility if they acquire another business that previously submitted premarket applications, if they change names after submitting applications, or if they submit additional premarket applications regardless of the outcome of their first submission. This "one and done" nature makes timing and strategic planning crucial for companies considering this benefit.
Registration fee waivers target the smallest businesses facing genuine financial difficulties. Beyond meeting the $1 million threshold, companies must demonstrate that paying the annual registration fee represents a financial hardship and must have previously registered and paid the fee in a prior year. FDA's current position limits hardship recognition primarily to active bankruptcy situations, requiring documentation that debts have not been discharged or reorganization plans have not been confirmed.
Application processes and documentation requirements
The guidance sets up different pathways for U.S. and foreign businesses, with U.S. companies generally following simpler procedures while foreign businesses navigate additional certification requirements from their national taxing authorities.
U.S. businesses
U.S. businesses must complete a MDUFA Small Business Request (SBR) through the CDRH Portal, including their Organization ID number from the FDA User Fee System.
Documentation requirements include complete, signed copies of original Federal income tax returns for the most recent tax year for both the applicant and all U.S. affiliates.
For any foreign affiliates, companies must obtain certified National Taxing Authority Certifications using the MDUFA Foreign SBR process.
Foreign businesses
Foreign businesses face a more complex multi-step process involving their national taxing authorities. They must complete sections of the MDUFA Foreign SBR covering business information and affiliate details, then submit the form to their National Taxing Authority for certification of gross receipts or sales figures. (Instructions here.)
The National Taxing Authority completes the certification section and returns the form, which the business then submits to the FDA along with any required documentation for affiliates.
National Taxing Authority Certifications must be in English, include gross receipts or sales in both local currency and U.S. dollars with exchange rates used, provide collection period dates, and bear the official seal of the National Taxing Authority.
For jurisdictions without national taxing authorities, companies may submit alternative evidence like financial statements or shareholder reports for case-by-case FDA review.
Critical timing and procedural requirements
All small business determinations are granted for single fiscal years and expire on September 30, requiring annual requalification for companies seeking ongoing benefits. The guidance establishes specific submission windows designed to ensure determinations are available before fees become due.
For reduced application fees and first premarket application/report fee waivers, FDA accepts requests beginning August 1 prior to the fiscal year starting October 1. Companies requesting FY 2026 status can submit requests from August 1, 2025, through July 31, 2026, though earlier submission is recommended to ensure determination before submission deadlines.
For registration fee waivers, actively registered firms must submit requests between August 1 and October 31 before the relevant fiscal year. This compressed timeline reflects the December 31 registration fee due date and the statutory requirement for supporting information submission at least 60 days before fees are due.