A. Summary of Impacts
1. Summary of Costs
The full discussion of the Final Regulatory Impact Analysis, Final Regulatory Flexibility Analysis, and Unfunded Mandates Reform Act Analysis (Ref. 17) is available in docket FDA-2011-N-0090 and at http://www.fda.gov/AboutFDA/ReportsManualsForms/Reports/EconomicAnalyses/ucm309815.htm.
The detailed data for this cost analysis were developed by Eastern Research Group, Inc. (ERG) under contract to FDA and are presented in the full report "Unique Device Identification (UDI) for Medical Devices: Economic Analysis of the Final Rule," 2013 (cited in Ref. 17). The final ERG report updates the 2012 ERG cost analysis used to support the FDA's Preliminary Regulatory Impact Analysis of the proposed rule. The Preliminary Regulatory Impact Analysis and the 2012 ERG report are available at http://www.fda.gov/AboutFDA/ReportsManualsForms/Reports/EconomicAnalyses/ucm309815.htm.
Table 2 of this document presents for each affected sector a summary of the estimated present value and the annualized domestic costs of this final rule over 10 years using discount rates of 7 percent and 3 percent. Over 10 years, the estimated present value of the total domestic costs is $642.2 million using a 7 percent discount rate and $737.7 million using a 3 percent rate, and the annualized costs are $85.7 million using a 7 percent discount rate and $84.1 million using a 3 percent discount rate.
Table 2--Summary of the Estimated Domestic Regulatory Costs of the Final Rule
Total present value Total annualized
of costs over 10 years
cost over 10 years ( $million)
Affected sectors 3 Percent 7 Percent 3 Percent 7 Percent
Domestic Labelers *1 $713.2$620.4$81.2$82.6
Issuing Agencies 1.4 1.3 0.2 0.2
FDA 23.1 20.5 2.7 2.9
Total Domestic Cost of the Final Rule 737.7 642.2 84.1 85.7
*1 Present value and annualized costs calculated at the beginning of the period.
2. Costs to Domestic Labelers
The majority of the costs of this final rule will be incurred by labelers of medical devices. Labelers include manufacturers, reprocessors, specification developers, repackagers and relabelers that cause a label to be applied to a medical device. The estimated present value of the costs for domestic labelers over 10 years is $620.4 million
at a 7 percent discount rate and $713.2 million
at 3 percent. Over 10 years, the annualized costs for domestic labelers are $82.6 million
at a 7 percent discount rate and $81.2 million
at 3 percent. The largest components of one-time costs include planning and administration and the costs to integrate the UDI into existing information systems; to install, test, and validate barcode printing software; and to train employees. Other significant components of one-time costs include costs to redesign labels of devices to incorporate the barcode and date format, and to purchase and install equipment needed to print and verify the UDI on labels. In addition, labelers will incur one-time costs for recordkeeping and reporting requirements, and the direct marking of certain devices.