Global Markets Flatten, but Challenges Remain

NEWS TRENDS

As the world becomes more connected and virtually smaller, many countries grapple with improving their own regulatory and reimbursement programs. Adva­Med has made it a priority to urge various governments to adopt regulatory systems that provide safe, in­novative products to patients without being overly burdensome.

Many governments recognize the importance of converging regulations via the Global Harmonization Task Force, but some still impose inappropriate regulatory hurdles, according to Ralph Ives, executive vice president of global strategy and analysis at AdvaMed.

In Japan, the largest individual overseas market for AdvaMed members, the government uses a foreign average pricing program that compares prices in Tokyo with other markets, such as the United States. Ives advises Japan to look at cost pressures in its own market. “Countries have different cost structures, different demand structures, and different income levels.” While AdvaMed has been working with Japan in efforts to change its current methods, political pressure remains an obstacle.

Ives calls the regulatory structure in Japan the most “onerous and burdensome” in the world. As a result, the products being used on patients are often three to five years behind those in Europe, the United States, and some Asian markets. Part of the solution is to increase the number of reviews. According to Ives, there are only about 28 reviewers for all medical devices entering Japan versus nearly 300 reviewers in the United States. “Here's a country where the population is ­roughly half of the United States, and they have much fewer than half the number of reviewers.”

In light of the recent recalls related to consumer products and pet food imported from China, any products coming from that country are being strongly scrutinized. China is a huge source for medical devices, as the value of imports into the United States was about $2.4 billion last year.

AdvaMed works with two regulatory agencies there to encourage the adoption of global guidelines and standards for the regulatory system. “That's a big challenge for us, because the Chinese are coming out of decades of a state-controlled regulatory system that is nascent,” said Ives. The main Chinese agencies are the State Food and Drug Administration (SFDA) and the Quality Supervision, Inspection, and Quarantine of People's Republic of China (AQSIQ).

Other issues in China include controlling healthcare spending, imposing limits on the markup of medical devices, and addressing intellectual property violations.

In Europe, the main markets are the UK, Germany, France, and Italy. Those countries are moving to a diagnosis-related group (DRG) payment system, where a bundled payment is made for a treatment rather than just the medical device. Since the DRG system has been in place in the United States since the 1980s, ­AdvaMed is using its experience to help the European governments im­plement the system in a transparent manner while maintaining data ­accuracy.

AdvaMed is also working to aid governments with regulatory and reimbursement issues in Mexico, Brazil, South Korea, Australia, Malaysia, and South Africa.

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