Regulatory Realignment: EU Gains Ground as Choice for Product Commercialization

Regulatory Realignment: EU Gains Ground as Choice for Product Commercialization

Evangeline Loh and Stewart Eisenhart

If recent research is to be believed, European medical device regulatory review models are bringing products to market in significantly less time and at less cost than the United States. The U.S. regulatory process overseen by the U.S. Food and Drug Administration (FDA) long has served as a benchmark for other regulatory bodies due to the agency’s perceived high standards in terms of safety and efficacy.

According to recent medical device industry studies, however, a combination of external market factors and self-inflicted inefficiencies now threaten to both diminish the FDA’s standing as a global regulatory leader and hinder or delay U.S. patient access to cutting-edge devices approved faster and at less cost in Europe. Ongoing deliberations by the FDA on whether to make its 510(k) premarket notification process more exacting only have added to industry concerns, and may further prompt manufacturers to seek other markets (particularly Europe) in which to develop and commercialize their products. The U.S. medical device market’s loss of dominance is, however, in no way a foregone conclusion—recently announced agency efforts to expedite pioneering high-risk device approvals indicate at least some level of sensitivity to industry grievances—but until the regulator can build greater efficiency into its clearance and approval processes, the European Union and other markets only stand to gain at the United States’ expense.

Medical device manufacturers and industry advocates interested in product commercialization should bear in mind these apparent advantages of the current E.U. regulatory environment, especially relative to that of the United States.

Mounting Evidence

Released over the past few months, three industry studies have provided a cumulative view of how contentious manufacturers’ interactions with the FDA have become compared to their dealings with E.U. Notified Bodies (as readers of this column are aware, Competent Authorities in each member state, equivalent to the FDA, delegate some of their authority for review to Notified Bodies); how emerging markets will become more attractive in terms of supporting medical device innovation in coming years; and how similar product recall rates in the United States and the European Union despite the former market’s stricter review process demonstrate the advantages of the European approach.

In late 2010, Stanford University consulting professor of medicine and medical device industry entrepreneur Josh Makower conducted a survey titled “FDA Impact on U.S. Medical Technology Innovation,” with support from the Washington, D.C.-based industry trade group Medical Device Manufacturers Association. The study examined U.S. medical device manufacturers’ experiences working with both the FDA and E.U. regulatory bodies in terms of issues including predictability, reasonability, transparency and overall experience. More than 1,000 firms were surveyed for the study, but only 204 responded. Significant majorities of respondents reported highly positive experiences with E.U. regulators, while few survey participants rated their FDA experiences similarly.

Duration of clearance and approval processes also was considerably longer in the United States than in Europe, according to survey results. Low- to moderate-risk device 510(k) clearances took an average of 10 months, according to respondents, while firms that asked the FDA about clinical studies for such products reported an average of 31 months to successfully obtain 510(k) clearances. Processes for the same or equivalent devices took only seven months on average in the European Union.

The time lag was even more pronounced for high-risk devices. Premarket approvals (PMA) typically took 54 months, compared to 11 months in Europe. And with such drawn-out regulatory processes come significant costs to manufacturers—specifically, about $31 million per low-to-moderate-risk device and about $94 million per PMA device. Of course, shorter time frames for European approvals also have meant lower costs incurred by these manufacturers bringing products to market in the European Union.

Losing the Innovation Race

Time and cost factors not only pose challenges to medical device makers, but also to the U.S. market’s standing as the world’s key source of industry innovation. While the FDA vigorously has reprioritized its mission of ensuring public safety, the agency may have done so at the expense of efficiency, so suggests recent research by PricewaterhouseCoopers (PwC) in its January 2011 report called the Medical Technology Innovation Scorecard.

According to PwC, European regulators have struck the right balance between safety and efficiency, and only stand to improve their approval processes going forward. An overly cumbersome regulatory system represents one of several factors eroding the U.S. market’s standing as an innovation powerhouse. It typically takes twice as long for new market entrants to gain clearance or approval by the FDA as it does in Europe (or Israel), and PwC does not expect this trend to abate. As such, the European Union has become the first market of choice for an increasing number of manufacturers.

The auditor cited four medical device manufacturers’ recent experiences with U.S. and E.U. regulators to bolster its forecast of declining U.S. industry prowess. One firm, Thrombovision, failed to obtain 510(k) clearance after a two-year effort with the FDA, and has since filed for bankruptcy. The three other firms—OrthoAccel Technologies, Fairway Medical Technologies and ExploraMed (run by Josh Makower)—reported years-long efforts to commercialize their devices in the United States but speedier processes to gain CE marking in Europe. These manufacturers describe strategies of obtaining market approval in Europe before the United States as vital to maintaining healthy bottom lines, if not outright solvency.

Similar Recall Rates

Perhaps the strongest evidence to surface in recent weeks that the FDA’s heavy-handed methods haven’t paid off in terms of improving public safety comes from a January 2011 study by the Boston Consulting Group (BCG) showing highly similar rates of medical device recalls (termed Field Safety Corrective Actions in the E.U.) in the United States and Europe, despite the FDA’s more complex and rigorous clearance and approval processes. The study’s investigators claim the results indicate the EU’s faster approval process does not compromise public safety.

The study, sponsored by the medical device industry lobbying group Advanced Medical Technology Association (AdvaMed), is, however, not without artifacts. Investigators themselves acknowledged that recall data comparisons between the highly centralized U.S. regulatory system and the more dispersed European system (with Competent Authorities in each member state) are less than airtight, and recall data from France—one of the EU’s largest markets—was not available. Nonetheless, taken in context with the Stanford and PwC research, the BCG/AdvaMed study seems to further demonstrate the need for a more efficient, time- and cost-sensitive regulatory approach to medical devices by the FDA.

Mixed Signals onReversing Course

These comparative studies come to light as E.U. lawmakers deliberate over a proposed recast of medical device regulations. Although the studies largely are U.S.-centric, the comparative efficiency researchers found in the E.U. model should bolster arguments to preserve many of the existing European regulatory paradigms.

John Wilkinson, CEO at European medical device trade association Eucomed, has done just that, seizing upon the studies as evidence that the E.U. regulatory model strikes an appropriate balance between innovation and safety. In reaction to the BCG/AdvaMed study, Wilkinson said, “…We believe that the current concept of decentralized oversight must remain.”

Will the cumulative effect of these studies prompt U.S. regulators to adopt an approach more similar to the EU approval process? Some recent steps by the agency indicate some willingness to address industry concerns—but only some. The agency announced in February an initiative to facilitate expedited PMA processes for cutting-edge Class III devices, and has delayed its long-awaited decision whether to require some 510(k) applicants to provide clinical data along with their submissions, with no final decision until at least July 2011.

Furthermore, Jeffrey Shuren, M.D., director of the FDA’s Center for Devices and Radiological Health, was cited in a Feb. 9 article in The New York Times acknowledging the benefits of a more consistent and predictable review process—but then dug in his heels, asserting that the European approval system has pursued efficiency at the expense of safety and stating that the U.S. regulator had no plans to “relax its standards.”

Shuren added, “We don’t use our people as guinea pigs in the U.S.,” subsequently spawning a transatlantic spat between U.S. and E.U. regulators. The European Commission’s health and consumers department head Paola Testori Coggi sent a letter to FDA Commissioner Margaret Hamburg on Feb. 18 casting Shuren’s remark as an attempt to publicly discredit the European regulatory process for medical devices, the Reuters news service reported. She furthermore requested evidence from the FDA of any unsafe devices currently marketed in Europe. (The FDA so far has not provided any.)

In light of the tightening regulatory climate in the United States, the imminent recast of E.U. medical device legislation should be monitored with great interest.

Stewart Eisenhart is regulatory editor, and Evangeline Loh, Ph.D., RAC, is vice president of regulatory affairs for Emergo Group, an international medical device consulting firm providing regulatory, quality assurance and distribution consulting services. Evangeline can be reached at [email protected].