Here is an interesting generic critique of the FDA 510(k)...

Here is an interesting generic critique of the FDA 510(k) process. While its fairly long, it explains the complexity of the process (and why any delays in HGR's filing are perfectly understandable) and also gives some clear pointers to why being the first device to get 510(k) clearance is so strategically important (a monopoly perhaps?). The article was written 2 years ago.


Insight Report Vol. 7 No.1
How the FDA is Causing Monopolies

Monopoly is not an oft used word in the USA: There are many government agencies that are there to protect us from such situations.

What is a monopoly? In basic economics 101, we were taught that a monopoly was a business that had control of a market place - dominate the market, i.e. a cartel.

When we just hear the word monopoly we cringe. There can’t be any monopolies in the USA! Our government won’t allow such a thing.

And how can there be such a cartel? Again we cringe…. Why? Because when we say the word cartel, we think of the drug cartel in Colombia that is brutal and is in complete control of the drug trade, government officials and just about unstoppable.

“So, what am I talking about?” you may be asking yourself. Why am I bringing up such nonsense when discussing the FDA, medical device industry, and possible monopolies?

Let’s take a look at our good old FDA. What is their job? Well, we all assume that the FDA is there to protect the America public from misbranded and/or adulterated foods, drugs, medical devices and cosmetics, among other things. To some extent, we can all agree on this.

But, what happens when the FDA starts addressing their own concerns and overrides the bases of the laws and regulations that they are there to enforce and not interpret?

For instance, in the medical device regulations there is a requirement that medical device manufacturers must obtain pre-market clearance (510(k)) approval or (PMA) prior to distributing their devices in the USA. So, let’s look at the 510(k) requirements a little closer. The 510(k), or pre-market notification is used when a device has been classified as a class II device and there is already a similar device being legally marketed (has a cleared 510(k)).

After the implementation of the medical device regulations in 1976, the FDA required that all new devices that were in the Class II category (and some Class I or Class III) had to have a 510(k). The FDA’s requirements for a 510(k) were basically a submission of your device labeling, specifications and you had to show how your device was substantially equivalent to a legally marketed device in the USA. 510(k) submissions were one or two pages, maybe 4 at a maximum. The writers of the regulations thought that if there was a device already being marketed that if you could make a device that was substantially equivalent (SE) to that device, then there was no real reason to do any testing to prove your device and by just showing the SE you would be able to get FDA clearance to market. It made a lot of sense. If you had a wheelchair that had two large wheels and two small wheels and had a seat and you claim that it was SE to another wheelchair that was intended for the same use, then why not let the company sell their product also. Made good sense and allowed for a “free market”, while still having an FDA oversight.

Well, as the medical device industry grew and the FDA medical device division matured, the FDA saw some flaws in this system. What were these problems? Well, most were determined to be design flaws. You see, the original medical device regulations stated at the point when the device is manufactured, it was illegal to ship an adulterated or misbranded medical device (a device that was not manufactured in specifications or was not labeled properly). But, this was not good enough for the FDA. They were seeing an increase in the number of device recalls. Was the increase due to more companies selling more products, or manufacturing problems. No, the FDA determined from reviewing recalled products and reasons that the major problem was in how companies conducted their design control. So the FDA wanted to be able to inspect and monitor the design control phase of a company’s operation, for any new medical devices that a company wanted to market.

Besides design control, the FDA felt that the 510(k) pre-market notification method of only showing SE was not a good way to protect the American public. The FDA felt that since companies did not have to “prove” that their device was equivalent, i.e. conducting comparison testing, or clinical trials to prove their safety and efficacy, that many of the devices that were being marketed could be inherently unsafe.

An interesting point to consider is that when Congress set up the medical device regulations in 1976, and Class II devices were supposed to meet a performance standard, the FDA was supposed to write these standards. An FDA committee determined that if they were to write a standard for each Class II device, it would take approximately 1 million man-years. This was just not feasible. This was another good idea that came from our Congress without any fore thought.

So, what does our Congress do to rectify the situation? They write a new law to circumvent the old one -- In 1990; the FDA was given several new regulations that were to close the gaps, loopholes and inabilities of the industry and the agency. It was called the Safe Medical Device Act of 1990. It was written and passed as a result of the Generic Drug Scandal of the late 1980s. (By the way, an investigation by OBM found that the medical device division of the FDA was not involved with any scandals that were found in the Generic Drug division of the FDA. So why did Congress change the medical device regulations and not the Generic Drug regulations is still a mystery.)

What new powers did the Safe Medical Device Act of 1990 give the FDA? There were several very important changes for the medical device industry imposed by this act. First of all, the FDA was given the power to regulate Design Control (though it took 7 more years for the FDA to actually enforce those regulations). Second, 510(k)s had to now show Safety and Efficacy (a new SE), as well as the old SE, substantially equivalency. Thirdly, the FDA was relieved from writing any additional performance standards (they never really got around to write any as it was), and now companies would have to show how their device met any available performance standard (US or International) to get 510(k) clearance.

Remember the good old days when the FDA review of 510(k)s went from approximately 100 days. Well that swelled to over 360 days, (circa 1992). It felt like the FDA was just not going to approve any new 510(k) applications and that there weren’t going to be any new medical devices allowed to enter the marketplace. (Sounds like a monopoly? But, we will get back to that shortly.)

The good old days of submitting 2-4 pages for a 510(k) were now over. 510(k)s became mini-PMAs with reams of paper showing all of testing and comparison studies. Some 510(k) submissions required over 500 pages of documents.

The FDA was just getting started. The FDA is not only mandated to protect the American and worldwide public from dangerous medical devices, the FDA was determined to come up with their own biases as to what tests had to be run for which devices. Cost was never considered and would not deter the FDA from their “mission.” Cost may not have been a problem for the FDA, but for the companies it is becoming a real concern.

To top off all these new regulations, testing and documentation, Congress decides in their divine wisdom to impose User Fees – a tax on the medical device industry. It worked well in the pharmaceutical industry, so why not the medical device industry? Has anyone seen a new pharmaceutical company enter the industry recently? If you look very closely, there are very few pharmaceutical companies and those control the marketplace. There aren’t even that many generic drug companies in the USA.

So, what the heck, let’s see how much revenue the US Treasury can generate taxing the medical device industry. It seems like a robust industry that can absorb a small tax.

Now let’s see where things stand.

SE does not just stand for Substantial Equivalency any longer. All 510(k) submissions are required to be shown to be safe and effective as well as substantially equivalent.
All devices must meet a performance standard if there is one.
All testing must be conducted and submitted to or at least attested to in the application.
Clinical trials may be required to prove the efficacy of the device.
FDA user fee – tax, is required for all applications.
Sounds like quite a lot of roadblocks for any new medical device company if they want to enter this industry. But, why stop here. Let’s see how much more the FDA can push this industry before there is a real problem with the medical device technologies in the marketplace. Is it possible that the FDA, an agency in our own government, can go about and create monopolies?

Now there is one more nail in the proverbial coffin. At times, FDA reviewers run into some obscure situation that they feel needs to be addressed. Now, it is the job of the FDA to protect the world from adulterated devices, and they will do their job to the best of their ability. But, how far does that go? If an FDA reviewer reads a “publication” that states that there is a potential danger in a device, though, it was never observed, is it the FDA’s responsibility to now require all companies that want to market that device to test for that possibility. No matter how obscure the test may be and what the cost of the test is. Remember the FDA is not concerned with the industries expenses or profits. Or for that matter that there is no laboratory that conduct this obscure testing.

If the FDA requires such testing on all new products, but does not go back into the data base (device listing) and require devices already cleared for marketing to now perform those tests, who wins, the FDA, the public or the company already marketing their devices? Can someone spell m o n o p o l y?
The situation has gotten out of hand with some of the FDA offices where the new medical devices are being reviewed. We hear stories concerning such FDA requests. If you want 510(k) approval, get this test done! But, unfortunately, there is no laboratory that will or knows how to conducts this tests. So finding a private laboratory to conduct the test may require that the tests be conducted off shore and the cost for such tests runs in the tens of thousands of dollars. It is reasonable to question the FDA’s requirement to have that test conducted, when the device we are making substantial equivalence to never had to have that test conducted on their device. We are showing Substantial Equivalency to a legally marketed device, we thought that was what the regulations called for?

As new devices go through the FDA review process, proving that they are equivalent to a legally marketed device should require that we conducted all the testing of that the SE device conducted. But, in many cases this is just not good enough to get FDA approval. We have to meet the reviewer’s new requirements, while the competitor’s device that already has passed the FDA review process, is continued to be allowed to be marketed with no additional testing. Where is the logic? Where is protection to the America public? Why would the FDA continue to allow a company with an “inferior” device continued to be marketed and used by the public?

It may not be intentional but the FDA must know that what they are doing is not only inherently unfair, not providing for consumer protection but will cause monopolies. Those who have approved 510(k)s will be allowed to keep their market share and those who can’t meet the new “standards” will not be allowed to enter the market.

Where is the protection? Where is the justice? Is anyone watching the government involved in monopoly formation? Is anyone watching at all?

Comments are greatly appreciated, [email protected].