R&D costs for a new rapid POC diagnostic are variable based on whether the diagnostic would require the development of a new platform (i.e., instrumentation) along with the test. Other factors also influence R&D costs, such as the existence of a predicate device. Given that there currently are FDA-approved MRSA tests in the market, we assume that the new rapid POC diagnostic for detecting MRSA colonization will likely have a predicate device which will allow the manufacturer to pursue FDA clearance through the 510(k) route.
While the precise sequence of the steps may vary from case to case, the R&D costs associated with bringing a device to market generally include: development of engineering drawings, definition of the final materials list, device bench testing, development of design controls as well as costs related to market research to establish that a clinical need and a market for a new device, or a new version of a device, exists. Table 22 presents estimates for the different R&D cost components. Based on Table 22, we estimate the total R&D cost for a rapid POC diagnostic for MRSA at $1.4 million. For sensitivity analysis, we assume that the R&D costs follow a triangular distribution with a lower bound of $1.0 million and an upper bound of $2.0 million, with a likely point estimate of $1.4 million.
Table 22: R&D Costs for a New Rapid POC Diagnostic Requiring a 510(k) Approval
|R&D Component||Cost ($)|
|Exploratory research – engineering drawings, final material list, and bench testing||$1,000,000|
|Identification of Predicate Devices||$15,000|
|Development of Design Controls||$200,000|
|Development of SOPs||$30,000|
|Development of a Risk Management System||$30,000|
|Holding a pre-Submission Meeting with FDA||$2,000|
|Preparation of Indications for Use||$20,000|
|Validation of Device Sterility||$75,000|
|Investigational Device Exemption (IDE) Approval [a]||$25,000|
Source: Eastern Research Group, Inc., 2012
[a] This cost component may not be applicable to a POC diagnostic for MRSA.