Coping With Change
Medical device regulatory experts provide their perspectives of what changes might take place under the new U.S. Food and Drug Administration leadership.
The regulatory and review landscape for medical devices is poised for change not seen since the late 1980s and early 1990s, when charges of agency corruption and falsified data caused an overhaul in the way the U.S. Food and Drug Administration (FDA) conducts product reviews, some industry experts observe. Congressional skepticism over safety and the strength of existing compliance oversight has led to shakeups in FDA leadership, an influx of new reviewers and a mandate that the Institute of Medicine (IOM) evaluate the 510(k) review process.
These changes, coupled with global economic unrest, healthcare reform that could carry a hefty financial burden for device manufacturers and increased competition from foreign manufacturers raise questions about what it all means to those in the medical device arena, particularly smaller companies that might be discouraged from innovation if the regulatory and review process becomes too onerous and expensive. On the other hand, one expert told us, “raising the bar on safety is a good thing for all.”
To provide some idea of how the landscape might look in the short and long terms, Medical Product Outsourcing turned to some seasoned observers in the device and regulatory space, and asked them to evaluate what’s happening and the likely impact on device makers and consumers:
• Seth A. Mailhot, counsel, Nixon Peabody LLP, Washington, D.C.
• Michael Morton, senior director for regulatory affairs, Medtronic Inc., Minneapolis, Minn.
• William A. Morton, president, Medical Device Consultants Inc., North Attleboro, Mass.
• Brent Noblitt, co-founder and senior partner, Noblitt & Rueland, Irvine, Calif.
• Frances J. Richmond, Ph.D., director of regulatory science programs, University of Southern California School of Pharmacy.
• Alan Schwartz, executive vice president of mdi Consultants, Great Neck, N.J.
• Glenn Stiegman, M.S., vice president, Regulatory Affairs, Musculoskeletal Clinical Regulatory Advisers LLC, Washington, D.C.
What is your overall impression of regulatory changes happening now and on the horizon in the medical devices arena, and what challenges do you foresee?
Richmond:Until recently, the focus seemed to be primarily on the premarket area, so once devices were on the market, maybe they got a little less scrutiny. Now we’re seeing the sentinel initiative coming out of [the pharmaceutical space]—using software and bringing all the data together into one database to search for sentinel events.
The IOM is revisiting the whole 510(k) process, with the idea perhaps being to go to a two-tiered system more like that in the European or Canadian system, where more products will need more testing.
Mailhot:The medical device industry will have to adjust from the more cooperative regulatory environment it has faced over the last decade. The agency is moving in new directions, strengthening its compliance operations and increasing the rigor of the premarket process. For the device industry, many of these changes were unanticipated. The idea that the 510(k) process would require significant changes would have been unthinkable just two years ago. Adjusting to this new compliance-oriented agency will be a key challenge for the device industry for the foreseeable future. This will pose a problem for many companies struggling in the current economic climate.
W. Morton:As we look out on the horizon, it is clear to us that the importance of evidence-based clinical trials is increasing. Understanding, from the beginning of a regulatory strategy, the criteria by which the device will be reviewed is critical to the success of a defined regulatory pathway. The increasing need for scientific evidence surrounding adaptive design in clinical trials as well as health economics will continue to grow and create challenges for existing products on the market as well as new products attempting to enter the market.
Stiegman:Right now, the FDA is very conservative and is asking for a lot of data, both clinical and preclinical, before making any decision. It takes an incredible amount of time and money to get anything onto the market that’s relatively new in any capacity, so companies need to be thinking about collecting this data beforehand and be ready to address these tough questions during the review process. The FDA has been consistent in asking for clinical data on any device that represents any new technology where there may not be a perfect predicate.
Schwartz:I feel sorry for device manufacturers now. This is not a good time to be in, or thinking of, entering the medical device industry—that is, as it relates to the FDA regulatory environment. When I ask new companies if they know what they’re getting into, and how much it’s going to cost and how much time it will take to bring a new product onto the market, they have no idea.
Has a new administration changed the regulatory playing field for medical devices? Will healthcare reform, in whatever shape it comes, impact the regulatory process?
M. Morton:New administrations always impact the regulatory process. With newly established leadership at the FDA, there is an increased focus on the safety of food, drugs and medical devices. It will have some impact on the medical device industry regarding the timing of the availability of new products and the safety of medical devices in general. But, in the long run, raising the bar on safety is a good thing for all. The new agency leadership is affecting change internal to the FDA and externally to the regulatory environment. In general, the FDA today is more empowered and better funded than it was during the previous administration.
Mailhot:The new administration promised change, and we are already witnessing major changes at the FDA. So long as the agency is perceived as being under-resourced to face the problems of regulated industry, the administration and Congress will continue to increase FDA’s authority and funding. Proposed changes to the U.S. healthcare system present problems for the device industry. Businesses crave certainty, and investment in the healthcare industry has been on hold pending a clear indication of the direction for healthcare reform. Further, some healthcare proposals seek to fund healthcare reform through taxation of the device industry. Given the difficult economic environment the device industry is already faced with, this has the potential to stall device innovation.
Stiegman:The reason the environment is changing right now at the FDA is related to industry and the development of new technologies. These trends come in waves, and right now there are a lot of new treatment modalities, materials, and, in general, new methods of treating the old diseases. If the FDA sees something new, regardless of type of change, comparison to a predicate is more difficult; they ask for clinical data. So, nothing we’ve seen so far is related to a change in administration, directly.
But in the future, with healthcare reform and the FDA saying “we might revamp the 510(k),” there could be changes, and we may see some differences then.
W. Morton:A new administration, as always, will change the regulatory playing field by the choice of leadership for the various regulatory bodies that govern our industry. Healthcare reform is in its infancy, and as it develops and changes, it is imperative that the medical deviceindustry stay involved in order to understand the possible impact on the regulatory process.
Richmond:I think that political change was in part what initiated the 510(k) scrutiny. The people at the top [of FDA] are not device people; they come from foods and drugs, and they may have a different way of looking at things.
The fact that healthcare reform includes the idea that the medical device industry should provide funding to the tune of $40 billion has really hit a nerve, and device companies are not happy. Most device companies are mostly small, and in this environment are trying to cope with the recession, increased costs, the devalued dollar, foreign competition and now a fairly substantial tax.
Schwartz:Democrats control the House Oversight Committee and definitely feel the 510(k) process is not strong enough.
Things don’t look good for the industry for the foreseeable year or so, at least until the 2010 elections when, hopefully, there will be change in the makeup of the Congress.
Has new leadership at the FDA had an impact thus far? What are your predictions going forward regarding the effects of that change?
Mailhot:FDA’s new leadership has made significant changes to the organization of the agency, following the administration’s directive to improve regulated industry compliance. In particular, the restructuring of the Office of the Commissioner has given the commissioner more direct control over FDA’s day-to-day operations. For example, the addition of John M. Taylor III in the position of counselor to the commissioner gives [FDA] Commissioner [Margaret] Hamburg access to a person with a deep institutional knowledge of the FDA. Given Commissioner Hamburg’s progress to date, the hands-on approach taken by FDA’s leadership will have a profound impact upon FDA and regulated industry.
Schwartz:The FDA oversight committee has definitely made their policies known and that they want a much tighter review on all new applications. With these policies and the hiring of new reviewers to replace the aging and retiring staff at the FDA, it is causing havoc with the review process. The last time we had seen things this bad with the review process was back in 1991-1992, after the generic drug scandal when the FDA was instructed to basically shut down the review process and it took over a year to get a 510(k) cleared. It hasn’t gotten that bad again yet, but we’re definitely getting multilevel reviews now, causing undue and, in my opinion, unnecessary delays.
W. Morton:The new leadership at the FDA has made clear their intention to focus on compliance. It is a plan that has and will result in increased enforcement within the industry. The effects on the change in leadership are just beginning to show results in policies and actions. We predict that compliance activities and enforcement activities will continue to increase and the industry itself will increase its own self review.
Richmond:Changes at the FDA have had an impact. Leadership has stepped down, there have been a lot of questions asked about role of the previous FDA head, and there is pressure from Congress. The new administration is very much more focused on—and has asked the FDA to be more focused on—safety and human protections. It has had the effect of causing practices in the CDRH to be rethought, and with that rethinking, there’s a certain amount of delay.
We had a period of five years or more of stability. Most of the senior people at CDRH [Center for Devices and Radiological Health] were fairly well known, and there was the sense that we knew the system and could work within it.
Stiegman:The environment is changing dramatically at the FDA, and not just the change in administration. It’s just a new day at the FDA. As I said, these things happen in cycles, and it’s just a hard cycle right now.
Most of the [new] reviewers are coming out of school with no industry experience, no experience in theclinical setting, and maybe haven’t even seen the devices they’re making decisions on. As [reviewers] learn the process and learn the industry dynamics, they should learn the proper way to regulate the devices, meaning, which questions to ask, which questions don’t need to be asked. Right now, I don’t see them reaching out to the industry, and instead are making their decisions without asking the quality questions first.
Noblitt:It is likely that we will also see more clinical data being requested to support 510(k)s. We have also seen changes in FDA procedures for how to handle responses to inspections and the issuance of warning letters. We will likely see more warning letters being issued and with faster turnaround after the inspection.
Manufacturers will need to be even more aggressive and thorough regarding compliance to the QSR [Quality System Regulation] and when putting together submissions. If they are not, they can expect to see warning letters and delayed submission clearances. I also believe manufacturers will want to use pre-IDE [Investigational Device Exemption] meetings more frequently to try to narrow down the target that FDA will require for clearance.
What do you expect in the long term—and short term—from the change in leadership at the CDRH and the IOM’s review of the 510(k) process?
Mailhot:The short-term result will likely be longer reviews for 510(k) submissions, as there will be increased pressure on reviewers and management to focus on issues of safety and protection of the integrity of the 510(k) review process. Despite the recent problems, the 510(k) review process has consistently received high marks from the industry. There is a real need to have a nimble regulatory process for device marketing authorization, given the rapid pace of innovation in the industry and emerging patient needs. I anticipate that the internal and Institute of Medicine reviews will offer some changes, including the likelihood of some form of additional oversight. These reviews should also find that the FDA has established a good process, and that the advantages of the 510(k) process should not be discarded to satisfy those looking for significant changes.
W. Morton:The recent controversy over device reviews has created a short-term impact of increased scrutiny on current reviews within CDRH. The long-term impact, we believe, will result in increased requests for additional data, including clinical studies for 510(k) submissions.
The report [on the IOM review of the 510(k) process] is expected in early 2011, and I expect it will result in changes to existing policies and procedures. Meanwhile, the agency will continue to look for inefficiencies and attempt to address them while the review is ongoing. The goal of the FDA is to review and adapt the policies in order to address the innovative products that need to undergo review and reach the public. If that is the end result, we would hope that the review will have a positive impact.
Richmond:When I came into this system, we did implantable devices, so our way of thinking did not change much from one country to another. However, when you work within a 510(k) product line, countries differ markedly. The 510(k) process uses predicates over and over, often without stopping and looking hard at the product that has evolved through several iterations. So, you can understand how people looking in from outside might question it. But the European system using notified bodies has been questioned, too. So, everyone is wondering what the best system is for medium-risk devices, and I think the jury’s still out on that.
Schwartz:It is interesting that what [change to the review process] does is provide a monopoly edge to the old technologies, which you would think Congress would try to prevent. It basically has the reverse effect of what anyone wants; it could result in potential harm and less consumer safety because it will stifle improvement and allow products to stay on the market that may not be as good as new products and technologies.
There are really only minor differences between premarket approval (PMA) and a 510(k) clearance. The PMA approval requires a medical review panel and a pre-award inspection for QSR compliance—otherwise, the applications are very similar.
In the long run, making it more difficult to get a 510(k) clearance will put tremendous strain on the medical device industry and undue damage to the competitiveness of the industry and to the small businesses that have been using the 510(k) process to enter the marketplace.
Stiegman:That will be interesting to see what changes, whether they use industry input, surgeon input, and how much may be taken from the European regulatory process. As everyone knows, things get on the market in Europe much quicker, and gather real world information much more quickly. Surgeons there aren’t stuck using outdated technologies because the FDA won’t allow new technologies on the market.
There needs to be a mechanism in the 510(k) process, or even a completely new process, that will allow these devices to get into the hands of surgeons quicker.
M. Morton:The 510(k) process is misunderstood by many individuals outside of the FDA and the medical device industry. It is a system that continues to work and deliver safe and effective devices to the U.S. medical community. Any process, including the 510(k) process, can benefit from review. Major changes to [the 510(k)] process could result in an increase in the burden on industry and the FDA for which neither is resourced. These industry concerns about potential delays in bringing devices to the market should be noted, but it is too early in the IOM review to predict what the long-term outcome will be. The new leadership has implemented a new dispute resolution process and this is a good step toward restoring confidence in the review process.
Finally, any internationalconsiderations come to mind when looking at the regulatory horizon?
M.Morton:Yes, the changes to the MDD [the European Union’s Medical Device Directive], and the changes to regulations in other countries such as Brazil, India, and Turkey. These countries have an opportunity to look to organizations such as the Global Harmonization Task Force, Asia Harmonization Working Party, and the Pan-American Health Organization to observe what industry and regulators have learned through experience and apply these best practices as they develop regulations of their own.
Mailhot:The Interagency Working Group on Import Safety, which was formed during the last administration, appears to no longer be active. Its impact, however, is still being felt. FDA has opened several offices in foreign countries, and expanded its inspectorate allowing it to better cover foreign imports and foreign manufacturers. There is a proposal in the Customs Reauthorization bill to reform the interagency working group on import safety, and FDA continues to focus onimport safety issues. In addition, FDA continues to focus on purchasing controls required as part of its Quality System Regulation, which places the burden of regulating the quality of the supply chain on finished device manufacturers.
W. Morton:The international regulatory community continues to look at the FDA as the leader in device review. As the FDA adapts a more conservative approach to reviews, increasing the request for clinical data on devices, including adaptive study design and health economics data, we believe the international community will follow with similar practices.
Noblitt:I would expect FDA to continue to increase their presence worldwide as they continue to set up offices internationally. From a European Union standpoint, manufacturers have until March 21, 2010, to comply with the new revisions of the medical device directive.
Richmond:That’s the elephant in the room. We’re getting ready to take a group of doctoral students to Asia for two weeks, because we feel that globalization is such an important area to study. In 10 years, the world will be a different place. Five years ago when we were talking to companies overseas, those companies were talking about generic drugs. Now countries—India and China, especially—are realizing they can do a lot in the medical device arena, not only at the low end, but at the high end, as well. There will be more FDA scrutiny of foreign firms, import regulations, auditing – a new environment.
Schwartz:If you look back to the early 1990s after the generic drug scandal, many of the larger medical device companies moved their R&D out of the country to a more friendly environment, like Europe. Many of these R&D divisions never returned.
With the growth of the medical industry in India and China, the percentage of the U.S. medical market in the worldwide picture is getting smaller. Why would a company decide to put up with the hassle of dealing with the FDA when they can start their marketing and sales in a more friendly country?
Stiegman:U.S. companies are seeking to have their devices studied and marketed outside the U.S., and sometimes getting CE marked is considered a priority before entering the U.S. market because of the burdensome environment created by the FDA’s requirements. As far as companies entering the U.S. [from abroad], some don’t even attempt it anymore. Certainly, the environment the FDA has created for industry has caused people to look elsewhere.
Maybe we should study why the regulatory pathways overseas seem to work and get the latest devices into the hands of surgeons, and try to use that model to influence the 510(k) and PMA process.