Surgical Mesh Controversy Revisited

On February 12th, FDA’s Obstetrics and Gynecology Devices Panel of the Medical Devices Advisory Committee held a hearing to review the status of mesh devices for pelvic organ prolapse, taking a fresh look at a device type that has been the source of intense patient pushback over the past few years. The advisory committee offered several non-binding recommendations, primarily focused on postmarket surveillance data used to support premarket applications for pelvic mesh products.

According to the FDA’s 24-hour summary of the hearing, the Society of Gynecological Surgeons said the data suggest the rate of mesh erosion may be as low as 1.4 percent and as high as 19 percent. Another medical society recommended that uses of mesh be restricted to those at high surgical risk, including those with recurrent prolapse and/or comorbidities, while a third indicated a preference for up to ten years of data on safety and effectiveness.

That last message was not lost on the advisory panel, which said that a reasonable expectation regarding device durability is ten years. The panel also suggested that premarket studies of meshes for pelvic organ prolapse (reclassified by the FDA as Class III devices in 2016, although meshes for other uses remain Class II) should run as long as 24 months, with an additional five years of postmarket surveillance. Surgeon experience and patient selection were also considerations for the advisory committee, and it seems likely that companies in this space will have substantially more work ahead of them.

January Jitters; Brexit, FDA Budget Provoking Anxiety

January is often a slow month for med tech news, but this month is proving the exception, largely for the wrong reasons. From the English Channel to the Potomac River, the news raises more questions than it answers, leaving device makers with even more than the usual degree of uncertainty over matters on the near horizon.

Brexit Blues Persist

The Brexit is still a thorny problem for companies doing business in the U.K. thanks to a failed vote on a deal with the European Union that would have provided an orderly exit. The Brexit will take place one way or the other on March 29, but the only question is whether it will be a “hard Brexit,” thus leading to strained economic and political relations between the island nation and the 27 nations that will remain in the E.U. after that date.

Members of Parliament voted down the Brexit deal by 432-202 on Jan. 15, but Prime Minister Theresa May has so far declined to bring the matter to a second referendum. The E.U. is still working under an established overhaul of the medical device regulations, but the U.K. Medicines and Health Care Products Regulatory Agency has a tougher lift ahead of it. In an updated advisory, MHRA said that in the absence of a Brexit deal, it would grant U.K.-based notified bodies the authority to recognize any devices that were approved prior to March 29. The agency also said it will have a regulatory system up and running March 30, which will reflect all the key elements of the E.U. regulatory system.

What is not clear, however, is whether the no-deal scenario will add to the cost of devices shipped either way across the English Channel. At the very least, a no-deal Brexit will make life even more complicated for device makers doing business in both the E.U. and the U.K., given that industry is already on the hook for renewals of existing marketing licenses under the terms of the E.U. regulatory overhaul. Even if there are no new tariffs to grapple with, the ongoing problem with notified body bandwidth will grow even more nettlesome in this not-so-brave new world.

Precert Pilot Posted

Despite the ongoing shutdown of a large part of FDA operations, the agency published the pilot version of the software precertification program in early January, a document that would seem to answer a number of questions raised by earlier versions of the precert program. However, the latest version raises some significant new questions, including whether the proposed pilot adds work for applicant companies compared to the traditional approach of obtaining the agency’s approval for a moderate-risk device.

The release of the pilot was significant enough to bring FDA commissioner Scott Gottlieb forward with a press release stating that the pilot would involve a more tailored process that takes into account the device type. Some stakeholders may be miffed to see that the IMDRF definition of software as a medical device (SaMD) is still in vogue at the FDA, but possibly more problematic is the proposal to use the de novo pathway for applicant SaMD products. This move may be seen as part of the agency’s larger disregard for the 510(k) process, but in any event, the use of the de novo process in addition to the organizational certification process seems to indicate that participation will offer no improvement in time to market over the current approach.

Regulatory attorney Brad Thompson said in an interview that the pilot version is difficult to reconcile with the previous iterations of the precert program, but he also said the pilot comes across as a concept paper rather than a finished product, even only for the purposes of the pilot. Thompson said industry will need more answers than the FDA has provided at this point before they can be expected to line up for the pilot.

Shutdown Lingers

The partial government shutdown has already outlasted all previous versions, and FDA commissioner Scott Gottlieb has done his social media part to keep stakeholders abreast of how the agency is handling the problem. The agency has also posted several items to keep employees and stakeholders up to date, and as of Jan. 18, nearly a third of agency employees had been furloughed.

Nine percent of FDA employees are excepted, which is to say they are working without pay, while another 37 percent are exempt from the budgetary effects of the shutdown. Approximately 23 percent are in a category described as partially exempt/excepted/furloughed, leaving the agency with what seems to be in the area of a 40 percent staffing shortage.

How long the impasse between the Trump administration and Congressional Democrats will last is anyone’s guess, but the FDA also put out a statement indicating that the furlough should not last beyond Feb. 19. Whether the principle players in the latest budget showdown can live up to that prediction will occupy Wall Street, Main Street and Washington until a resolution is reached. In the meantime, any premarket applications received by the agency after Dec. 22 will be held up in queue, making this latest shutdown showdown a potentially costly one for device makers.

A Look Ahead to 2019

2018 was anything but a slow year for regulatory developments in the world of medical technology, but there is still plenty to look forward to for 2019. Following are several key developments that will do much to shape the prospects for industry going forward.

Rules of Civil Procedure Revised

This first item is not an FDA regulatory matter, but refers to something that took place in early December 2018, although the real impact is unlikely to be felt until 2019 starts to unwind. The Advisory Committee on Civil Rules had amended several of the Federal Rules of Civil Procedure earlier in the year, and those changes, including those applied to Rule 23, went into force Dec. 1.

One of the changes to Rule 23 allows the use of one or more electronic methods of contacting members of a class action regarding settlements, but a more significant change is in the method for dealing with bad objectors. Up to Dec. 1, a court had to approve the withdrawal of each individual objection to a settlement, but that requirement is no longer in force. Those whose objections are seen as an impediment to a reasonable settlement can simply withdraw their objections without forcing the court through a time-consuming review of the objection. While there are other issues related to the Federal Rules of Civil Procedure that are in need of redress, these latest changes should at least expedite the process considerably.

Device Tax Again Topical

Despite that it is not scheduled to resume until after 2019, the 2.3 percent tax on medical devices is again in the news thanks to the prospect that it might be pushed back an additional five years. That is the stated intent in connection with legislation that would provide some fixes for the tax overhaul signed into law at the end of 2017.

That legislation, which arose from the House Ways and Means Committee, seems to have been pushed aside by the latest budget impasse, however, although the fact that the tax does not resume for another year should give industry some comfort. Device makers will argue that their budgeting for activities such as research and development require more than a 12-month window, but it is not at all clear whether House Democrats are interested in H.R. 88 as currently written, if at all. Consequently, it seems at least somewhat likely that the device tax suspension will once again come down to the 11th hour.

As an aside, the budget problem involves the FDA budget, and one line of thinking is that the stand-off between the White House and Capitol Hill has better odds of resolution once the 116th Congress is sworn in on Jan. 3. In the meantime, user fees are funding much of the agency’s work, but routine manufacturing facility inspections may be held up in the meantime.

FDA’s Clinical Lab Regulation

This issue has been percolating for several years now, and includes an FDA discussion paper published in early 2017. That effort has been supplanted by a “technical assistance” provided to Congress in August 2018.

The original impetus for the FDA’s technical assistance was to help Congress refine the Diagnostic Accuracy and Innovation Act, but that bill has given way to the Verifying Accurate Leading-edge IVCT Development Act of 2018. Both bills were primarily sponsored by Reps. Diana DeGette (D-Colo.) and Larry Bucshon (R-Ind.) although the VALID Act is still in the form of a discussion draft, according to DeGette’s congressional webpage.

The bill makes reference to a precertification concept similar to that seen in digital health, which would be applied to moderate-risk tests, while high-risk tests would still be subject to the more traditional premarket review processes. Other interested parties include Sen. Orrin Hatch (R-Utah), who said in a statement that supporters will push the bill in the 116th Congress, suggesting that 2019 might finally be the year that the agency’s clunky approach to diagnostics regulation will receive a much-needed overhaul.

Guidance Agenda for 2019

The FDA’s device center is always busily compiling a new round of guidances, but one of the priority guidances of interest as announced in the device guidance agenda is a draft for demonstrating substantial equivalence through the use of performance criteria. This draft will pertain to abbreviated 510(k)s, according to the CDRH guidance agenda, but this draft might be as important as any that will emerge in this new year, thanks in part to what some observers are likely to see as an end run around the statute. The agency announced it would revisit the 510(k) program in an November announcement which also evinced some hostility toward the substantial equivalence standard.

There are a number of existing guidances that may be up for review as well, including the 1999 guidance for surgical mesh 510(k)s. That document is on the agenda for the obvious reason, including that the agency has up-classified these meshes for at least one indication, not to mention the ongoing patient concerns about mesh implants that have gone bad.

FDA’s Statement on Its Modernization of Its 510(k) Program

Jordan Lipp, Esq. |Attorney, Managing Member | Childs McCune

On November 26, 2018, the FDA released a statement on its views on the modernization of its 510(k) process. Historically, the 510(k) process is the FDA’s clearance of a medical device to be sold in the United States, if the FDA finds the device is substantially equivalent to a previously approved (or grandfathered in) device.

In the FDA’s recent statement, FDA Commissioner Scott Gottlieb, M.D. and Director of the Center for Devices and Radiological Health Jeff Shuren, M.D., explained that “[t]he most impactful way that we can promote innovation and improved safety in the 510(k) program is to drive innovators toward reliance on more modern predicate devices…” As such, they explained that they “believe that newer devices should be compared to the benefits and risks of more modern technology; that is why we’re looking at ways to promote the use of more recent predicates.” So, the FDA is considering putting on its website which cleared devices are based upon predicate devices that are more than 10 years old, and it is seeking public feedback on this plan.

The FDA is also planning in early 2019 to finalize guidance establishing an alternative 510(k) process, called the “Safety and Performance Based Pathway,” which will permit manufacturers of certain devices “to rely on objective safety and performance criteria to demonstrate substantial equivalence” based upon a contemporary baseline. The goal, as described by the FDA, is for the FDA and manufacturers to look to the future as opposed to looking to the past as the baseline for safety and efficacy.

The FDA’s statement also discussed the recent increase in the size of the 510(k) submissions, the increase in review time of these submissions while a simultaneous decrease in the time until clearance, and its actions in “up-classifying” certain devices from Class II to Class III (i.e., taking an existing device out of the 510(k) process and requiring the more vigorous Class III premarket approval.) For those in the industry, the six-page long statement, linked here, is worth reviewing.

FDA Explains CMP Policy for Clinical Trials

The FDA announced recently its new policy for the assessment of civil monetary penalties for failure to appropriately register a human clinical study at the clinicaltrials.gov website, providing sponsors with a 30-day grace period before the imposition of CMPs. Sponsors are advised that the penalties can add up quickly, given that the penalty can come to $10,000 a day for each violation.

The FDA said it will hear complaints from other entities about unregistered clinical trials and incomplete registrations, but many of the violations will be detected during inspections under the Bioresearch Monitoring program. The agency will send those suspected of a violation a pre-notice letter describing the violation and requesting that the offending party correct the problem within 30 days of receipt of the letter, but much of the focus will be on high-risk trials and companies with poor compliance records where clinical trial registration is concerned. Another factor will be whether the agency has reason to believe that the sponsor’s conduct of the study is violative for other reasons.

Should the sponsor fail to react within 30 days, the FDA may begin assessing CMPs, but the rule is not yet in force pending the closing of the comment period and finalization of the draft. The FDA said it is taking comment through Nov. 20.

Gottlieb Responds to Questions Regarding Apple De Novos

FDA commissioner Scott Gottlieb took to the agency’s blog recently to discuss the granting of two de novo applications by tech colossus Apple Inc., an event that seemingly caught medical device makers and others by surprise. Gottlieb seemed intent on answering questions about the speed with which the FDA turned around the de novo applications in question, but he did not address what some see as the more important question, that of the simultaneous announcement of the de novos and Apple’s unveiling of the requisite hardware platform, the Apple Watch 4.

The FDA had granted the two de novo applications for the heart monitoring apps to be used with the latest version of the Apple Watch, but the speed with which the agency had reviewed the de novos – which was achieved in no more than 33 days in either case – was no more conspicuous to many than the simultaneous announcement of the granting of the de novos and Apple’s unveiling of the Watch 4. Gottlieb said in a Sept. 26 statement at the agency’s blog, FDA Voice, that the agency was compelled by a need to “encourage greater innovation in digital health.” In addition, Gottlieb said the agency must respond to the perception that regulations are creating drag on digital health, and thus the FDA “must be as nimble and innovative as the technologies we’re regulating.”

Gottlieb makes several other points in this context, but nowhere does he take up the question of timing. It’s not as though this is an entirely exceptional incident. The FDA does, after all, occasionally make announcements regarding a product to coincide with major medical society meetings, but those announcement are often aimed at a more select audience and typically affect an entire class of products. One exception was the safety advisory regarding the Abbott Absorb device for the coronary arteries in early 2017, which the agency placed on its website prior to the expiration of an embargo on a medical society announcement regarding the device.

Left unanswered by Gottlieb’s response is the question of whether the FDA intends to make a habit of cooperating with device makers regarding the timing product announcements. This is a particularly salient question for the smaller companies in this space, who might see in all this a conspicuous degree of bonhomie between a government agency and a company with a market cap in excess of $1 trillion.

Plaintiff Runs out of Time in Prosthetic Hip Lawsuit

Device makers know all too well they can be hit with a Warning Letter for failure to file a medical device report (MDR) when they reasonably should have known the device was associated with an adverse event, but a plaintiff in a lawsuit over a hip implant recently received the same message. The plaintiff had attempted to argue that the clock for the statute of limitations for a liability claim had not commenced until the implant was removed, but the judge who heard the case said no reasonable juror would have entertained any misgivings about the origins of the symptoms for that long a time.

The implant of the Zimmer hip took place in early 2011, and the plaintiff is said to have “suffered pain and complications as early as September 2012, when she returned to her surgeon due to recurrent pain in the hip. The surgeon initially treated the plaintiff for bursitis, but began to check for evidence of problems directly associated with the device in January 2013. Although imaging scans ruled out any loosening or fracture of the device and joint, there was evidence that metal ion levels were outside the normal range. The plaintiff experienced a dislocation of the hip in November 2014, however, and the physician advised the patient in January 2015 that a revision procedure might be necessary to address the problem.

The plaintiff agreed to undergo revision surgery in January 2015, and the procedure took place the following month. The plaintiff filed suit in February 2017 for strict liability, negligence and  three counts for breach of warranty, and toward the end of May 2018, Zimmer petitioned for summary judgment based on the two-year statute of limitations for such claims under Pennsylvania state law. The plaintiff argued that she could not have been clear on the precise origin of the problems until the device had been removed, but the judge in this case said the plaintiff’s acknowledgment in January 2015 that the device “had to come out” was a clear indication that the patient either already understood – or at least should have recognized – that the device was at the root of the problem.

At the very latest, the plaintiff’s signature on a consent form dated Feb. 9, 2015, which authorized the revision procedure, suggested that the plaintiff ought to have recognized “through the exercise of reasonable diligence,” that the hip implant was the root cause of the difficulties, wrote Judge Edward Smith of the U.S. District Court for the Eastern District of Pennsylvania. The suit was filed two years and one day after that consent form was signed, and Smith said no reasonable juror would have concluded that the plaintiff “was unaware, or should not have been aware” of a connection between the hip dislocation and device until after the revision surgery. While the surgeon confirmed after the revision that the device was, indeed, the cause of her injuries, Smith said that knowledge of precise medical cause is not required to start the clock on the two-year limitations period.

Apple Scores Quick De Novo

The pilot program for the FDA precert framework for software medical devices is still in development, but Apple Inc. scored a win with two apps for its Apple Watch 4 in a remarkably short amount of time. Other companies in the device business, even tech companies toiling in the digital space, might find the quick turn-around time for the de novo applications conspicuous, but the timing of the grant of the de novos was unusual as well.

The FDA posted the granted de novo petitions (here and here) to the agency’s website Sept. 12, the day after the date the petitions were granted. The interesting part of this discussion is that neither premarket filing took more than 33 days, a far shorter amount of time than the average turn-around of 150 days called for under the fourth device user fee agreement.

More conspicuous to some observers, however, was that the agency had posted those de novos on the same day that Apple unveiled the Apple Watch 4, the platform for the two software devices. Regardless of whether one sees the rapid review as more conspicuous than the synchronized announcements, the combination of the two makes it difficult to ignore the possibility that the entire affair was worked out well in advance.

There are clear indications that the de novos had been in the works for some time prior to the nominal filing dates – indeed, FDA Commissioner Scott Gottlieb tweeted that the agency had “worked closely” with Apple during the two software devices’ developmental phases – but Apple had the smarts to hire a consultant with the regulatory chops to help the company avoid choppy regulatory waters. Donna-Bea Tillman, who at one time was the director of the Office of Device Evaluation at the FDA, served as the lead consultant for these projects on behalf of Biologics Consulting Group in Alexandria, Va.

Conspiracy theorists may ultimately have nothing to dissuade them from their suspicions about the timing of all this, but device makers who hope that this signals a new era of cooperation may be likewise disappointed if they are hoping that this is the new normal at the FDA. There are far too many product releases to allow the agency to regularly coordinate with device makers in this manner, but one of the Apple apps is designed to detect atrial fibrillation, which is strongly associated with sudden cardiac death. The agency’s Sept. 12 announcement not only emphasized the need to encourage development in the digital space, but also to “help millions of users identify health concerns more quickly,” thus suggesting the FDA saw a considerable public health benefit in connection with the grant of these de novos.

Glaxo Draws Support in Petition for Cert

GlaxoSmithKline LLC of London has filed a petition for cert with the Supreme Court over an attempt by the state of Louisiana to sue the drugmaker separately over allegations the company thwarted the availability of generic versions of a sinus medication. At stake is the question of whether the Eleventh Amendment allows states to work a legal end-around of the outcome of class actions in federal courts, even when the state in question benefited by the class action.

The State of Louisiana had declined to opt out of a federal class action against Glaxo, which revolved around the issue of the company’s alleged interference with the FDA’s efforts to approve a generic version of Flonase. In 2013, the company arrived at a settlement with private and indirect purchasers in the amount of $150 million, but Louisiana’s attorney general filed a suit over the matter the following year.

The State of Louisiana had received a notice of the outcome in 2013 as stipulated by the Class Action Fairness Act (CAFA), but did not receive the notice of settlement approved by the U.S. District Court for the Eastern District of Pennsylvania. In its decision on the matter, the District had purportedly enjoined all states, including Louisiana, from taking further action on the matter, but the Louisiana attorney general successfully argued that the Eleventh Amendment does not allow states to be bound to a class action. The case then moved from the district court to the U.S. Court of Appeals for the Third Circuit, which arrived at essentially the same determination. In its Dec. 22, 2017, decision, the three-judge panel at the Third Circuit said the state did not waive its sovereign immunity merely by its receipt of the CAFA notice.

This isn’t the first time Glaxo Louisiana have tangled. The two settled for $45 million in 2013 over allegations the company had illicitly marketed and/or promoted several drugs for a number of indications, including Avandia and Wellbutrin. This settlement was a separate conclusion to the cases filed jointly by a number of other states, and followed a $3 billion settlement with the federal government the previous year, in part for promotion of off-label use.

Glaxo petitioned the Supreme Court for cert after the Third Circuit declined to grant an en banc hearing, stating in the July 6 petition that states have not enjoyed sovereign immunity “when they are aligned as plaintiffs.” The company stated also that the outcome flies against the 1985 Supreme Court decision in Phillips Petroleum Co. v. Shutts, which provided for the legal use of opt-out class actions. Glaxo said the opt-out class action would be rendered “categorically unconstitutional” by the Third Circuit’s decision.

As it turns out, Glaxo has company in making those arguments. The Washington Legal Foundation has filed an amicus brief, and said in an accompanying statement that Louisiana’s lawsuit was a copycat lawsuit, adding that the Eleventh Amendment applies only to lawsuits filed against a state rather than in response to a lawsuit filed by the state. The Pharmaceutical Research and Manufacturers of America also weighed in, stating that Louisiana “did not somehow become a defendant at any point,” and that a constitutionally sufficient notice of class action eliminates any form of immunity from a plaintiff-side position. The association further stated that absent any textual or historical indications to the contrary, “there is simply no warrant for this Court or the Third Circuit to simply make such rules up.”

Technical assistance or radical overhaul?

Despite its hiatus from the headlines, the question of FDA regulation of lab-developed tests never quite went away, and is now topical again thanks to a technical assistance document recently published by the agency. The proposal has its critics, but Congress might soon act on the question if some stakeholders have their say.

The Aug. 8 technical assistance refers to the notion of a pre-certification program akin to the digital health pre-cert program, but FDA commissioner Scott Gottlieb had already said the pre-cert concept could be applied to LDTs, so such a provision hardly comes across as any surprise. There is a provision in the FDA approach, however, for the use of for-cause inspections when adulteration or misbranding is suspected, and ultimately this document may prove significant if the Diagnostic Accuracy and Innovation Act of 2017 gathers sufficient momentum to reach the House floor in the remaining weeks of 2018.

Among the supporters of the FDA framework is the diagnostic arm of the Advanced Medical Technology Association, which said in an Aug. 8 statement that the FDA document “is an important and necessary next step” in providing a statutory framework for LDT regulation. Perhaps less expected is the support of the American Clinical Lab Association, which had previously expressed skepticism regarding FDA regulation of LDTs.

Not everyone is so optimistic, however. An entry at the FDA Law Blog by Hyman, Phelps and McNamara points out that the FDA document would jettison the existing lexicon for premarket review of LDTs, to be replaced by “a whole new vocabulary.” Jeffrey Gibbs of Hyman Phelps said the novel regulatory mechanism of a test group is not functionally similar to that of the predicate device of 510(k) lore. Gibbs said the document would also seem to offer outside parties the opportunity to challenge the approval obtained by a test maker, an outcome he said the FDA “would not want.”

FDA Meets Pushback on Product Jurisdiction

The FDA may have intended the draft rule for product jurisdiction for combination products to clarify the agency’s approach to how it will deal with such products, but the draft has proven unpopular so far, suggesting the agency has its work cut out for it.

The draft rule, which was prompted in part by the 21st Century Cures Act, proposed to eliminate a step in the appeals process, a step the agency suggested was superfluous. As previously discussed, the FDA also oddly cited the prospect that the proposed rule would save lives, but stakeholder see a lot of problems in the draft. For instance, the Washington Legal Foundation said stakeholders might have expected the draft to explain how the agency would “place the dividing line between drugs and devices,” but that the draft fails to do so.

WLF’s Richard Samp and Corey Andrews, respectively the organization’s chief counsel and senior litigation counsel, said the draft rule deviates from the statute with regard to determining a product’s primary mode of action. Samp and Andrews said the statute defines PMOA as “the single mode of action of a combination product expected to make the greatest contribution to the overall intended therapeutic effects of the combination product.” In contrast, they said, the draft rule proposed to evalute the primary mode of action for each of the constituent parts rather than determining the PMOA of the product as a whole, an approach they said “improperly skews” those determinations toward a determination that the product should be reviewed as a drug application.

Several organizations recommended that the FDA allow requests for designation to run to 30 pages rather than the current 15-page limit, but attorneys with the D.C.-based law firm Hyman Phelps & McNamara had other critiques of the draft rule as well. HPM’s Jeffrey Gibbs and Jennifer Thomas said the agency’s position appears to be that a combination product “is a drug or biologic rather than a device if it exhibits any chemical action that contributes to the therapeutic effect.” Thomas and Gibbs said FDA regulations pertaining to combo products dictate that any component of a combination product may have only one mode of action, and that the net effect of these two conditions is to “bias FDA’s jurisdictional evaluations significantly in favor of determining that products composed of multiple distinct components should be regulated as drugs or biologics, rather than [as] devices”

Thomas and Gibbs cited the well-known conflict between the FDA and Prevor of Valmondois, France, over the diphoterine application – which led to a lawsuit that twice appeared in the District Court for the District of Columbia – as an example of the FDA’s propensity for determining that a combination product is a drug despite “very minimal chemical action.” They stated also that the agency’s requirement that the applicant prove the combination is primarily a device within 15 pages is further evidence of a bias against a determination that the product operates principally as a medical device.

Another FDA draft document pertaining to medical devices has provoked concerns among those in industry, the multiple function draft guidance released by the agency in mid-April. The intent in developing the draft was to clarify how FDA staff would deal with applications that embody components that meet the regulatory definition of a device along with components that do not meet that definition, but stakeholders expressed concerns over what seems to have come across as a regulatory slippery slope.

Fears of Regulatory Mission Creep

In that draft, the agency coined the term “device-function-under-review” to distinguish between the regulated and non-regulated functions, and the FDA said the term “function” means “a distinct purpose of the product.” Definitional issues aside, some who commented for the docket indicated that the draft could be applied to combination products, possibly leading to regulatory mischief. Another concern is that any function fulfilled by a component that qualifies as a device that is under enforcement discretion might nonetheless fall under premarket scrutiny if the agency determines that the component in question could provoke questions regarding the safety and/or effectiveness of the entire product.

Another point of consideration is how the FDA’s field investigators would handle inspections of a facility when these non-device components are involved in a product, but there are also lingering questions revolving around recalls and field corrections. Those in the field of in vitro diagnostics may be concerned that controls and calibrators might be swept up in a premarket review if the agency fails to make explicit that these components would not be seen as subject to review despite that the agency has explicitly exempted them from such scrutiny.

China, FDA Sources of New Regulatory Developments

As two recent developments make clear, fledgling regulatory frameworks for medical devices are in a state of churn in several nations, but the more mature regulatory systems are anything but static. The first of these two latest developments bodes well for industry where a massive Asian market is concerned, but the second would seem to suggest that digital health has a number of hurdles to overcome in the U.S.

China Overhauls Medical Device Regulations

China’s State Drug Administration recently announced several proposed changes to its regulatory framework for devices and diagnostics, but the changes arrived as Washington and Beijing haggle over trade in a dispute that could lead to a significant boost in tariffs.

One of the more significant of the proposed SDA changes is that industry would not have to obtain approval for manufacturing in China prior to obtaining marketing approval for that device. Another important change is that the SDA would no longer require that the manufacturer also serve as the holder of the certificate, which would free up device makers to do business with local representatives who are in a better position to avoid delays. These two changes alone would seem to represent a significant reduction in time and/or hassle to market.

Another significant change is that SDA may accept clinical studies conducted outside China, although this provision would not apply to high-risk devices. Precisely how much this helps device makers is not clear inasmuch as clinical studies are categorically mandated only for high-risk devices. One bit of seemingly good news on the moderate-risk device front is that provincial authorities will no longer be tasked with premarket review, a switch that hopefully will create a more predictable process.

The agency also said it intends to form a dedicated facility inspectorate by hiring inspectors on a full-time basis. The impact of this change might not be obvious in the near term, but the fact that these inspectors will not be distracted with other matters might at least lend more consistency to inspections.

By some accounts, the draft rule would eliminate the nation-of-origin rule that has rankled device makers for a number of years. Device makers in the U.S. have argued for some time that nation-of-origin rules left device makers in other nations at a competitive advantage. That particular problem may soon be a thing of the past. SDA is taking comment on the proposal through July 24.

Device makers have worked for years to pry open the Chinese market with middling success, but the ongoing trade controversy could be a setback. Among the targets of the Trump administration’s tariff list on Chinese products are medical devices, and U.S. device makers are concerned that a retaliatory tariff may be in the offing. The predicament is serious enough that Rep. Erik Paulsen (R-Minn.) penned a May 15 letter to the U.S. Trade Representative recommending caution, given that the trade deficit for medical technology is relatively narrow and actually favors the U.S. in some categories. Trade discussions between Washington and Beijing are ongoing, however, and both sides still have ample room in which to negotiate.

Legality of FDA’s Precert Program Questioned Again

The FDA’s effort to streamline its review of software as a medical device (SaMD), a vital cog in its overall digital health enterprise, revolves around a program for precertification of SaMD vendors, but the latest update has prompted observers to question again whether the agency can legally step around its current authorities to deploy the program. At stake is the future of a program seen as critical to sustaining the digital health pipeline, although some might question whether there will be a challenge to what some argue is the FDA’s extralegal approach to digital health regulation.

As previously discussed in the May 17 blog, the agency’s digital precert program would replace a product-by-product review process with one that certifies the vendor’s quality program instead. This approach carries with it a presumption that the FDA will more closely track outcomes and adverse events associated with the SaMD in question, and possibly exercise more rapid remediation of any problems than might otherwise be the case.

Version 0.2 of the precert program emerged in late June, proposing to revise the two levels of precert accreditation. Previously, the FDA had proposed a leaner precert process for companies with histories of successful navigation of the agency’s premarket and postmarket requirements, but the latest update would eliminate prior regulatory experience as a determinant, and instead allow entities that score well on a number of key performance indicators to employ the less cumbersome process.

The questions surrounding the legality of the precert program were not long in coming. In an Aug. 16, 2017, post at the blog for Health Affairs, a trio of authors described the precert program as “an experiment in medical product regulation” that lacks any statutory backing, even with passage of the 21st Century Cures Act, which FDA commissioner Scott Gottlieb has cited as an authorizing text.

The authors of the Health Affairs editorial are not the only ones who have misgivings. Bradley Thompson of Epstein Becker Green gave voice to a similar concern recently. Thompson, who has represented several ad hoc medical technology alliances over the past few years, suggested the precert pilot as currently understood would amount to a suspension of both statutory and regulatory authority.

Obviously industry will not want to make waves in connection with the precert program, but there are other stakeholders with different incentives. Public Citizen and the National Center for Health Research are well known for looking askance on device approvals, and so can be expected to track the precert program as it moves along. Any related litigation would end up in the U.S. District Court for the District of Columbia – which is known for giving federal agencies the benefit of the doubt – but a lawsuit could impede the precert program considerably, even if it did not derail the program entirely.