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  1. Economic Impact Analyses of FDA Regulations

Administrative Destruction Regulatory Impact Analysis (Final Rule) 

The final rule will implement the authority of the United States Food and Drug Administration (FDA) to destroy a device valued at $2,500 or less (or such higher amount as the Secretary of the Treasury may set by regulation), that has been offered for import and refused admission into the United States under the Federal Food, Drug, and Cosmetic (FD&C) Act, by providing notice and opportunity to the owner or consignee to appear and introduce testimony to FDA prior to the destruction. Because the majority of devices offered for import that are valued at $2,500 or less are shipped via international mail and express couriers, FDA currently intends to implement the final rule at the International Mail Facilities (IMFs) and express couriers. We do not, therefore, consider impacts related to shipments via commercial air, land, and sea ports.

The costs and benefits of the final rule will depend on the number of administrative destructions that FDA orders each year for refused devices valued at $2,500 or less. For our primary estimates, we assume that FDA will order the destruction of 65 percent of refused devices valued at $2,500 or less. We additionally assume that FDA will contract out the act of destruction to a private firm and combine the notice and hearing process for destruction with the notice and hearing process for refusal.

We estimate that the annualized benefits over 10 years will range from $148,000 to $750,000 at a 7 percent discount rate and a 3 percent discount rate, with a primary estimate of $317,000. The annualized costs will range from $68,000 to $1.59 million at a 7 percent discount rate, with a primary estimate of $475,000, and from $63,000 to $1.58 million at a 3 percent discount rate, with a primary estimate of $470,000.

Over 10 years, the present value of total benefits will range from $1.04 million to $5.27 million at a 7 percent discount rate, with a primary estimate of $2.22 million, and from $1.27 million to $6.39 million at a 3 percent discount rate, with a primary estimate of $2.70 million. The present value of total costs will range from $474,000 to $11.14 million at a 7 percent discount rate, with a primary estimate of $3.33 million, and from $539,000 to $13.49 million at a 3 percent discount rate, with a primary estimate of $4.01 million.

Regulatory Impact Analysis

Administrative Destruction Regulatory Impact Analysis (Final Rule) (PDF 426KB) 

Federal Register: 89 FR 47074 
Publication Date: 5/31/2024
Docket: FDA-2021-N-1348

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