US Regulatory Roundup, 2018: 5 Core Issues That Help Explain The Year In Medtech Policy
Executive Summary
Global harmonization, regulatory innovation, rising safety scrutiny, medtech reimbursement hopes and global trade threats were key underlying concepts for the medtech regulatory and policy environment in 2018. Here's a spotlight on those issues and the top 30 articles from last year.
Although 2018 ended with a government shutdown, for most of the year, new proposals and programs flowed out of Scott Gottlieb's US FDA at a mile-a-minute. It remains to be seen what elements of the agenda will end up as lasting components of US device regulation, but there is no question that the past year has been a period of regulatory innovation, with multiple pilots picking up speed, major reforms announced, and restructurings pursued.
Much of FDA's recent reform plans have been framed as paths to streamlining regulations and supporting the US as a go-to market for medtech. But as the year progressed, FDA and industry faced increasingly public pushback from consumer advocates, documentarians and reporters casting doubt that current oversight of devices and planned reforms are sufficient to protect patient safety.
Meanwhile, many in industry will say that issues outside of FDA's jurisdiction were, in fact, the source of most US public-policy anxiety for the sector in 2018. Most significantly, reimbursement remains laden with uncertainty for device companies. And trade policy has been thrust into hard-to-predict realms by the protectionist policies of the Trump administration.
Here is a look at the five most important US regulatory and policy themes for the medtech sector from 2018, based in part on what Medtech Insight online readers paid most attention to. The 30 most popular US policy stories that ran last year are also spotlighted. (See table below.)
1. Global Harmony?
Efforts to support long-term harmonization were a significant underlying force driving FDA activities in 2018. It certainly is a theme that Medtech Insight readers picked up on, in particular, with regard to FDA's plans to harmonize its Quality System Regulation with international quality systems standard ISO 13485. Our coverage of those plans and implications accounted for multiple spots on our top 30 list – and it's no wonder, as it’s a major change that will impact how every single company in industry approaches its manufacturing and design operations. Kim Trautman, who authored the QSR in the 1990s, dished about the challenges of bringing the US regulation together with the ISO standard and what to expect in an August interview with Medtech Insight that was the most popular regulatory story of 2018.
Medtech's Next Top Maturity Model
One coverage highlight for the year was Medtech Insight's four-part series on the new paradigm FDA is developing for the appraisal of manufacturing capability and maturity in the medical device industry:
Another important 2018 development that fell in the harmonization bucket is the advancement of the Medical Device Single Audit Program, which allows device manufacturers to undergo a single audit to satisfy the quality requirements of the US, Australia, Brazil, Canada, and Japan in lieu of facing many inspections from different regulators. 2018 was an important transition year for the program – as of Jan. 1, 2019, companies must have undergone an MDSAP audit to continue selling product in Canada. Further, FDA is considering whether MDSAP audit results can take the place of a pre-approval inspection.
FDA also took steps to shore up its use of standards and is pushing for an alternative 510(k) pathway that would put more emphasis on consensus standards instead of predicate device comparisons. The agency has referenced harmonization as one key driver for these policies.
2. Spotlighting Maturity And Excellence
A central theme to 2018 regulatory innovation is FDA's development of new approaches to evaluating company operations by assessing things like manufacturing maturity and operational excellence.
The approach puts more emphasis on incentivizing companies to pursue quality instead of reacting to a more compliance/enforcement mindset, and on FDA establishing trust in engaged firms to streamline or outright remove the need for individual submission reviews and inspections.
One great example of this approach that took off in 2018 is the agency's Voluntary Medical Device Manufacturing and Product Quality Pilot Program, which applies a medtech industry-tailored "maturity model" framework to measure a company's capability and maturity. Medtech Insight's multi-part feature series on the effort proved popular with readers in 2018, perhaps one sign that the approach has legs as FDA looks to stand it up beyond the pilot phase in 2019.
The goal of the program is to empower companies to holistically measure quality and improvement needs, and to incentivize firms to stay on a path of continuous improvement. Participating companies benefit from streamlined options for 30-day notices, site-transfer changes and pre-market submissions. Eighteen firms, including heavy-hitters like Boston Scientific, Medtronic and Edwards Lifesciences, were assessed under the pilot, which closed on Dec. 31. (Also see "FDA's Maisel Updates Industry On Maturity Model Pilot, Facility Inspections, MDSAP" - Medtech Insight, 18 Dec, 2018.)
A similar theme underlies FDA's drive over the past year to leverage a regulatory approach it calls "pre-certification." The concept puts attention on company operations and particularly its demonstration of "excellence" in how it designs, develops and ensures the safety of its products. Companies that prove such excellence can be pre-certified, and minimize or outright avoid product-by-product FDA reviews.
FDA has been busy developing this approach for software devices in a pilot it hopes to launch into a full-fledged program this year. The agency is also championing the concept for the regulation of lab tests as part of reforms under consideration in Congress. And it is applying the approach already for direct-to-consumer genetic health risk testing services, where it will exempt DTC test-makers (starting with 23andMe) from pre-market review after each individual developer comes to the agency for a one-time review to ensure it meets FDA requirements.
FDA's focus on pre-certification, and related approaches that put more emphasis on companies' holistic operations, seem likely to expand in 2019.
The Apps Have It
Even beyond FDA's focus on pre-certification, digital health was a major emphasis for the agency in 2018. Artificial intelligence technology moved squarely into the clinic in 2018 with multiple FDA approvals and clearances throughout the year. In addition, the agency approved its first high-profile consumer mobile apps this year, with the Apple Watch ECG app and Natural Cycles Nordic's contraceptive app. The developments parallel the tech industry's increasing movements into the medtech space – a trend that is cause for some trepidation by device firms. And there have been concerns raised by some in industry that FDA is giving big-tech companies like Apple special treatment.
3. Scrutiny Escalates
Even as FDA has put significant emphasis on supporting device innovation, companies should not get too comfortable. Several serious safety issues that cropped up with particular devices in recent years are driving an increasingly vocal community of patient and consumer advocates. They are demanding stricter safety oversight of devices, including more pre-market data requirements. Medtech Insight has documented those increasingly prominent demands, and the issue captured significant reader attention in 2018.
The message found a home earlier in the year in a documentary called "The Bleeding Edge," which was picked up by Netflix. It attracted public attention and was strongly criticized by some in industry as misleading. More recently, the International Consortium of Investigative journalists launched the "Implant Files," an investigation of the industry that paints a picture of unsafe products and unchecked companies putting profits over safety. (Also see "Device Sector Braces For Investigative Stories Critical Of Industry" - Medtech Insight, 21 Nov, 2018.)
FDA is certainly feeling some pressure. In the weeks before the ICIJ investigation was made public (but when FDA was being asked for input by ICIJ reports), the agency released multiple announcements highlighting its focus on device safety and catching problems early.
On Nov. 26, the day after the first Implant Files story came out, FDA released a series of pre-planned proposals to reform the 510(k) pathway, by which most products and product updates reach the US market. Primarily, the agency says it plans to encourage less use of older predicate devices. It made a point in the announcement to stress that 510(k) submissions have gotten longer and have been subjected to more scrutiny in recent years.
The announcements appear to represent a tone switch by FDA away from a more prominent focus in public statements on streamlining the path of new innovations to market. Where the agency's balance between encouraging innovation and ensuring safety settles when it comes to policy development will be a key variable to monitor in 2019.
4. Impending Progress With Medicare
But, for now, at least, the sense is FDA has become a more welcoming place for getting innovative products to market. Meanwhile, FDA's sister agency, the Centers for Medicare and Medicaid Services, has been the source of greater sector anxieties. As companies face quicker FDA market approvals, they often also face an unclear path to the coverage and payment necessary to support market adoption. Nadim Yared, CEO of CVRx and outgoing chairman of AdvaMed, calls this period between approval and coverage the "valley of death" for industry.
But in reimbursement policy in 2018, there were positive signs for industry, if not clear-cut advancements. White House and CMS officials made clear in multiple public statements throughout the year that the administration is prioritizing improving the reimbursement process for innovative devices and diagnostics.
That promise was formalized somewhat when CMS put a breakthrough device reimbursement pathway on its latest regulatory agenda, with a proposal expected by March. The plan, supported by US industry, would establish automatic, but temporary, Medicare coverage for devices designated as "breakthrough" by FDA while manufacturers collect real-world data for the new technology, and it would also establish a similar approach that can be tapped by devices even if they have not been formally designated as breakthrough.
5. Trade Troubles
As the Trump administration puts out positive signals for industry regarding reimbursement, trade policy is a different matter. The administration escalated trade tensions around the world by implementing tariffs on aluminum and steel from many places around the world and a broader set of tariffs specifically on products made in China.
The device industry was impacted indirectly by the former, and more directly by the China tariffs, which are charged to more than two-dozen device products. While that is an improvement from what was originally proposed by the White House, tariffs and related challenges to device companies acting on a global stage will remain an important headwind for the year ahead.