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How to Avoid Ending Up Like Theranos

A regulatory expert explains how medtech companies can avoid the problems that Theranos faced.

Editor's note: This is an updated version of a story MD+DI originally published in August 2016. The story was updated in September 2021 as Theranos Founder Elizabeth Holmes' trial has brought renewed attention to the company's story.

Any new medtech company could run into the problems that have troubled the now-defunct Theranos, David Amor told MD+DI in 2016. At the time, Amor was CEO of Minneapolis-based Medgineering, had defended the company in an article about a year earlier, and said he remained "a fan of the technology if it works."

Holmes is charged with 10 counts of wire fraud and two counts of conspiracy to commit wire fraud. If found guilty, she could spend up to 20 years in prison.

Amor's tips for staying out of the same hot water Theranos landed in:

  • Differentiate between user and/or other stakeholder requirements and needs, and the actual technical requirements that are written to an engineering level of detail.
     
  • During design validation, make sure you test the technology using the same setup customers would be working under. That includes putting the device through usability testing.
     
  • Conduct a careful risk-benefit analysis, and compare your device to similar ones that are already on the market.
     
  • To achieve production equivalence, use product builds with the same design, components, processes, and materials you used in the design validation process, so they can be expected to perform the same.
     
  • Be strict about document control. Have a dedicated document management system to track design changes, process changes, etc., and evidence of who signed off on each.
     
  • Be a stickler about intended use. Make sure you only use your device for the use FDA has approved.
     
  • Develop a clinical rationale for your technology and explain it. Many companies don't.
     
  • Triage device nonconformances with a CAPA escalation. Consider the risks to the patient, the device's regulatory status, and the business; the frequency of the issue; and whether it would result in a significant regulatory problem such as medical device report, recall, etc.
     
  • If you are an investor or want to attract investors, have an independent party perform due diligence on your technology.
TAGS: IVD
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