U.S. Entity or U.S. Agent: What a Foreign Device Maker Actually Needs
A practical comparison of forming a U.S. entity versus appointing a U.S. Agent as a foreign medical device manufacturer entering the American market.
Every foreign medical device manufacturer selling into the United States eventually faces the same decision: incorporate a U.S. company, or appoint a U.S. Agent and operate through a partner. The two options are frequently treated as equally heavy, which leads companies to spend six figures on an entity they did not need. The FDA’s own requirements, read carefully, are narrower than the market conversation suggests.
What the FDA actually requires
For a foreign establishment that manufactures, prepares, propagates, compounds, assembles or processes a device for U.S. distribution, 21 CFR 807.40 requires establishment registration and device listing, plus the designation of a U.S. Agent. The U.S. Agent is a resident or domestic business that the FDA can contact during normal business hours and that can relay communications to and from your company.
Nowhere in that requirement is a subsidiary mandated. What is mandated is a durable U.S. communication channel, a registration record that matches your device, and an importer of record for each entry. Those obligations can be satisfied through an entity you own, or through a qualified partner acting on your behalf.
When a U.S. Agent is enough
A U.S. Agent structure works well for manufacturers that sell into the U.S. through distributors or a partner warehouse, keep manufacturing abroad, and do not need U.S. payroll, a U.S. bank account, or U.S. tax residency. In these programs the partner handles FDA correspondence, entry documentation, storage and release, while regulatory responsibility for registration and listing stays with your company.
- You retain product ownership and set U.S. pricing and channel strategy.
- No U.S. payroll, corporate filings, or local benefits obligations.
- Compliance communication is centralized: FDA inquiries reach one accountable contact.
- Expansion is incremental: warehousing first, support or manufacturing later.
When a U.S. entity still makes sense
There are legitimate reasons to incorporate. If you plan to raise capital from U.S. investors, hire a U.S. sales team, contract directly with hospital group purchasing organizations under your own terms, or hold a 510(k) under a U.S. legal name, a subsidiary simplifies contracting and tax treatment. The trade-off is fixed cost: legal formation, registered agent, accounting, payroll, insurance, and a compliance function that does not scale down when sales are slow.
A middle path is common: launch through a U.S. Agent and operations partner to prove demand, then form an entity once revenue justifies the overhead. Nothing about the first shipment requires a subsidiary, and moving to one later does not restart the product’s regulatory history.
How to decide in a single meeting
Ask three questions. First, who signs U.S. customer contracts and holds the receivable? Second, who answers an FDA investigator’s phone call on a Tuesday morning? Third, what is the annual fixed cost of maintaining that answer? If the first two can be served by a partner and the third matters to your runway, the agent structure is the correct starting point.
Need this applied to your device?
We run U.S. entry, warehousing, fulfillment and post-market support for medical device manufacturers. Bring the specifics and we will map the steps.