New NO FEES Act Cuts Registration Costs for U.S. Startups While Hiking Foreign Fees Eight-Fold

The NO FEES Act of 2026 is a major shake-up for the drug and medical device industries, specifically targeting the annual registration fees companies pay to the government. Under Section 2, the bill creates a new 'small business' definition—any company with fewer than 20 full-time employees, including affiliates—and gives them a serious financial break. For the first three years after approval, these tiny startups pay $0 in registration fees, followed by a 50% discount for the next two years. It’s a clear attempt to lower the barrier for a domestic entrepreneur trying to get a new medical device or a generic drug to market without being crushed by upfront administrative costs.

The Five-Year Timer and the Final Word

While the bill offers a helping hand to startups, that hand is eventually pulled back. Once a company hits its five-year anniversary of coverage or grows beyond 20 employees, the waiver vanishes entirely, and the Secretary has no power to extend it under Section 2. Perhaps the most significant change for business owners is that the Secretary’s decision on a waiver is now final. If the government decides your affiliate count is too high or your paperwork is late (it’s due 60 days before the fee deadline), there is no longer a process to ask for a reconsideration. For a small lab manager, this means the margin for error on paperwork just got a lot thinner.

A Steep Price for International Players

If you are a foreign-owned drug company, this bill is much less friendly. Section 3 mandates that facilities owned or operated by foreign entities must pay an annual registration fee that is eight times higher than what domestic companies pay. To put that in perspective, if a local manufacturer pays $20,000, a foreign competitor would be on the hook for $160,000. Additionally, foreign companies are strictly barred from the small business waivers and are forbidden from setting up 'shell' U.S. entities just to dodge these costs. This could lead to higher costs for imported medications or devices that many Americans rely on daily.

The Reality of the 'Small' Label

By tying the definition of a small business to the Small Business Administration’s standards (Title 13, CFR), the bill adds a layer of complexity for companies with investors or parent organizations. If you’re a small biotech firm but a larger venture capital group owns a significant stake in you, those 'affiliate' rules might disqualify you from the waiver entirely. Because the bill removes the ability to appeal these decisions, a mistake in how a company’s corporate structure is interpreted could result in a massive, unexpected bill that a small firm isn't prepared to pay, with no way to fight it in the administrative system.