FDA/CDRH Changes: How MedTech Companies Can Prepare Webinar Summary

Randy Horton

Published on: March 6th, 2025

Executive Summary

The FDA’s Center for Devices and Radiological Health (CDRH) is undergoing a series of structural and organizational changes that have the potential to significantly affect how medical device companies, especially those developing AI/ML, Software as a Medical Device (SaMD), and connected devices, navigate regulatory processes in the near future.

Orthogonal’s latest webinar on March 26, 2025 brought together a panel of industry and regulatory experts (three of whom had previously worked for many years at the FDA) to explore these developments and discuss practical steps MedTech teams can take to prepare.

Moderated by Randy Horton, Chief Solutions Officer at Orthogonal, the conversation featured insights from:

Steve Silverman, President, The Silverman Group
Kwame Ulmer, Managing Partner, MedTech Impact Partners
Philip Desjardins, Partner, Arnold & Porter
Megan Graham, VP, Regulatory & Quality, Orthogonal

Structural Shifts at FDA: What’s Changing and Why It Matters

The FDA is expected to undergo significant changes due to internal restructuring and federal spending cuts in the upcoming months. While pre-submissions and traditional regulatory reviews continue, the overall pace and predictability of industry engagement with the FDA could be impacted.

Key concerns raised by the panel include:

A hiring freeze that could shrink the FDA workforce through attrition.
Potential 10-30% budget (including staffing) reductions across the agency, including CDRH.
Delayed or canceled projects and limited participation in standard-setting activities aimed at improving regulatory science, reviewer tools, and overall capacity to fulfill the agency’s mission.

These changes certainly don’t indicate that the FDA is closing its doors. The panelists suggest that companies should prepare for potentially longer review times, reduced predictability, and increased effort needed to maintain regulatory continuity.

“It is naive to think that those types of basic practices aren’t subject to change.”
—Steve Silverman, President, The Silverman Group

Understanding the FDA’s Funding Model and Its Influence

To understand what is happening at the FDA, it helps to look at how the agency is funded. The FDA’s budget comes from two sources: user fees and congressional appropriations.

User Fees

Approximately one-third of the FDA’s budget comes from user fees, which are negotiated with industry every five years through programs such as the Medical Device User Fee Amendments (MDUFA).

In exchange for receiving this funding, the FDA commits to performance-related goals that are typically tied to timelines for review and resource allocation for high-priority programs.

However, these fees are specifically intended to support negotiated activities. They’re not meant to cover the FDA’s entire operational budget or to be allocated wherever the FDA chooses to increase funding.

Congressional Appropriations

The remaining two-thirds of the FDA’s budget comes from Congress. This funding supports various functions: staffing, infrastructure, and initiatives that are not covered by user-fee agreements, including guidance development, internal R&D, standards participation, and internal training.

“There is no world in which FDA can operate functionally, given the volume of work that it has to do, relying exclusively on Congressional appropriations.” – Steve Silverman, President, The Silverman Group

What’s at Risk

Early signs suggest that Congressional appropriations, the primary funding source for functions outside user-fee agreements, are under strain.
Recent temporary staff cuts of just 10% have already led to noticeable delays in communication and review timelines.

If the larger cuts occur, the FDA may need to deprioritize or pause activities not covered by user fees, such as pre-submission meetings, guidance publication, and cross-industry collaboration.

User Fees Aren’t Going Anywhere, But They Aren’t Enough

The existing MDUFA User Fees are expected to remain at their current levels. These fees are a stable and well-defined part of the FDA’s funding ecosystem. In addition, the medical device manufacturers who pay these fees have been collectively vocal in their support for them and expressed significant satisfaction with the value they receive from the FDA in return for those fees.

However, user fees still only cover one-third of the FDA’s overall budget. If congressional appropriations decrease, the FDA’s ability to keep up with innovation, address emerging regulatory needs, and ensure quality across programs could be affected.

Policy Isn’t Just Made through Guidance. It is also made through Priorities set by Agency Leadership

One key point raised in the discussion is that the FDA establishes policy not only through formal guidance, but also through what activities it chooses to prioritize or deprioritize.

Panelists predicted that:

Programs considered essential (e.g., Investigational Device Exemptions, Breakthrough Designations) are expected to continue receiving FDA support resources.
Early-phase engagements (e.g., pre-submission meetings) may face longer wait times, be deprioritized or receive more limited resources
In contrast, lower-visibility programs, like participation in standards organizations or educational outreach, may be reduced in both the short and long terms.

“Activities and applications that directly impact the patient will be prioritized first.”
—Kwame Ulmer, Managing Partner, MedTech Impact Partners

By maintaining an awareness of this shift, companies can recalibrate their expectations and strategies.

What SaMD and AI/ML Developers Should Pay Attention To

The panel emphasized that existing R&D best practices such as clear documentation and system-level transparency, will continue to be vital for all medical devices, including software-based medical devices.

For example, they noted that:

Thoroughly and clearly documenting system architecture (data inputs/outputs, user interactions, model training, etc.) is essential.
Using third-party models in AI/ML devices requires careful explanation of their roles and validation processes as these models introduce additional layers of complexity. Without clear explanation and validation, the FDA can’t evaluate the model’s safety, reliability or suitability for clinical use.
Well-structured submissions help new FDA reviewers quickly understand a device, minimizing back-and-forth questions, shortening the onboarding time for reviewers unfamiliar with the device, and reducing friction in the review process.

“Build the quality in. The better the quality on the market, the less regulatory burden you’re going to have.”
—Megan Graham, VP, Regulatory & Quality, Orthogonal

These are not “nice to haves,” they’re essential for credible, efficient regulatory engagement.

Staff Turnover and Reviewer Transitions: Be Proactive

As the FDA faces potential staff attrition, companies have to navigate new reviewers during the process. The advice from the panel was clear:

Don’t assume that new reviewers are up to speed on past interactions.
Summarize previous conversations in your next submission or communication.
Assist new staff in quickly getting up to speed by being clear, concise, and constructive in your communications with them.

“Once you’ve identified who the lead reviewer is, send a short email: ‘I don’t think we’ve had the opportunity to work before. Here’s a little bit of history… If you have any questions, I’d be happy to jump on a call and bring you up to speed.”
— Philip Desjardins, Partner, Arnold & Porter

An ongoing investment in building relationships can prevent costly misunderstandings later and position your team as collaborative and credible.

Strategy in Uncertain Times: Stay the Course

Given the current uncertainties, should companies pause their regulatory submissions and wait for clarity? According to the panel, that’s not the best approach.

Instead:

Don’t rush: Submit when testing is complete and documentation is thorough.
Avoid last-minute changes to incorporate new features or design changes.
Review regulatory strategy and risk internally every 6–12 weeks.
Stay alert to signals from the FDA such as shifts in review timelines, staff availability, or communication cadence and be ready to adapt your approach.
A strong, timely submission is often better than waiting for conditions to stabilize.

“I always recommend, if the testing is done and we’ve got everything ready to go, let’s submit. I’d rather have the clock running than we polish it 10 different times.”
—Phil Desjardins, Partner, Arnold & Porter

Domestic Uncertainty, Global Opportunity

While the U.S. regulatory environment faces headwinds, the FDA remains a global benchmark for device safety and effectiveness. The panel stressed that companies should take a deliberate, business-first approach when evaluating where and how to launch their products.

Why the U.S Still Matters

Despite ongoing challenges, FDA clearance remains the gold standard.

“The FDA really is the gold standard. Globally, they set the tone. They set the policies. They set the expectation for global product safety and efficacy.”
—Phil Desjardins, Parter, Arnold & Porter

For global MedTech companies, the U.S. remains a commercially vital market, particularly for digital health products; consequently, companies will continue to collaborate with the FDA.

“First and foremost, you need to think about your business… where does it make sense to have your product? … Are you clear about how you’re going to get paid? … I still think that the FDA is a more straightforward submission timeline. It’s still considered… a key market from a business strategy perspective.”
— Megan Graham, VP of Quality & Regulatory, Orthogonal

Opportunities Beyond the U.S.

That said, alternative markets like the EU or the UK may offer faster pathways or more predictable timelines.
Strategically sequencing launches (e.g., launching first in one region and then leveraging that approval elsewhere) can unlock efficiencies and build momentum.
Companies can better position themselves globally by mapping global regulatory requirements early across multiple markets.

Still, the panel emphasized that FDA clearance remains the gold standard and withdrawing from the U.S. market should be a strategic decision, not a reaction to recent turbulence. It should be a carefully considered decision grounded in overall business strategy.

Advocacy and Industry Engagement: Use Your Voice

The panel concluded by encouraging companies to engage with Congress and the Executive Branch, both individually and collectively:

Industry groups including AdvaMed, MDMA, and RAPS provide a channel for advocacy.
Public comment periods are still open and valuable.
Standards development and other public-private partnership initiatves through organizations like MDIC, CTA, AdvaMed (through its merger with MITA) and AAMI remains an important avenue for shaping future policy.
Patient advocacy alliances can elevate the urgency and human impact of innovative products

“The way you punch up as a small or even large organization is having some level of activity with a major trade association like AdvaMed… who can speak as the voice of the industry.”
—Kwame Ulmer, Managing Partner, MedTech Impact Partners

Conclusion: Prepare Now to Stay Ahead

While the FDA and CDRH adapt to budget pressures and internal changes, the fundamentals of a sound regulatory strategy remain unchanged. Companies that are:

Monitoring closely
Documenting clearly
Communicating proactively
Planning strategically
Engaging constructively

…will be better equipped to navigate what’s ahead.

These changes don’t signal a slowdown in regulatory innovation. They call for greater clarity, discipline. The FDA is still listening. The question is: Are you ready to speak their language?

Watch Webinar Recording

Bernhard Kappe orthogonal software as medical device

Randy Horton, VP of Solutions and Partnerships, Orthogonal