Specifically, the senators want to know how the Army handled these procedures—i.e., were the patients told that they were receiving devices for uses that were not cleared by FDA? And how do Army protocols ensure proper review of medical tests involving this population? The surgeons, who were paid by Medtronic, implanted and wrote about the company's Hydrosorb Mesh. Although Hydrosorb is FDA approved, it was only approved for non-weight-bearing applications and not for spinal procedures. Six years later, the product still hasn't been approved for such use, which prompts safety concerns, Baucus says.

“Safety must come first, especially for America’s men and women in uniform, and putting soldiers’ health at risk is an unacceptable price to pay for medical advancements. This case raises serious questions about whether men and women in uniform always receive the best care—questions that need answers,” Baucus said in a statement.

The commander of the Walter Reed Healthcare System says a response to the senators is forthcoming (by January 14). Large companies and their paid surgeon-consultants are continuously under scrutiny, but the inquiry shows that even practices from years past are not exempt. —Lawrence Lloyd

The move threatens medical device and medical electronics manufacturers, who should expect to face rising prices on the materials. Rare earth metals are used in the production of various smart electronics, as well as yttrium-aluminum garnet (YAG) lasers, PET scanners, and x-ray machines, among others.

—Heather Thompson

In that vein, I’ve asked some of our advisory board members and a few other trusted folks to provide me with a few predictions. As you might expect, some contributors went a little further out on the limb than others. Maybe next December we can go back and see how accurate our “experts” really were.

From Tim Mohn, a principal at Sparta Systems and a former manager for worldwide quality systems at Ortho-Clinical Diagnostics (a Johnson & Johnson company):

As device companies strive for greater operational efficiencies, they’ll look to the pharma sector for lessons-learned in centralizing regulated companies—especially in processes and technology. And look for more automation in the regulatory affairs space as companies demand efficiencies for things like product registration tracking.

From Jim Fitzgerald, executive vice president at Vesta:

FDA scrutiny of supplier controls will continue to have a direct impact on business relationships, with significantly more time being spent on control plan documentation, process validations, and expectations for higher process capability. Hence, staffing levels will increase to support increasing frequency in customers’ supplier audit programs.

Anticipate double-digit revenue growth driven by strong single-digit growth on existing products.

Investments in dedicated manufacturing operations will significantly increase to support the rapid advancements associated with material property enhancements to deliver therapeutic and antimicrobial benefits.

Expect an increasing amount of mergers/acquisitions to happen at every level of the medical device supply chain, as corporate investment spending increases due to attractive borrowing rates and improving economic trends.

From Nancy Singer, president of the Compliance-Alliance and a former special counsel for AdvaMed:

As the number of recalls for medical devices increases, the FDA will be looking more closely at firms’ design controls, and will issue more warning letters in this area. In addition, the FDA will increase the emphasis on holding specific company officials accountable. During inspections, when investigators find violations, they will ask for the names of individuals who had the responsibility for the product area, the action the individuals took or failed to take, and the length of time the firm took to correct the situation.

Medical device firms will continue to merge. Regulatory and quality officials will need to devote substantial resources to programs that help the acquired firm to accept the compliance culture of the acquiring firm.

From Marlene S. Bobka, vice-president of FOI Services Inc:

In keeping with the government-wide transparency initiative, the FDA’s Division of Freedom of Information is actively developing an automated system for submitting Freedom of Information Act (FOIA) requests, and it will go live in the first half of 2011. This system will offer the industry and consumers new tools to facilitate placing and following FOIA requests, such as immediate FDA confirmation of request receipt and the associated tracking number for later follow-up. This development will lead to smoother processing of FOIA requests.

From John T. Bentivoglio, partner at Skadden Arps and former Associate Deputy Attorney General and Special Counsel for Healthcare Fraud, U.S. Department of Justice:

Healthcare fraud/abuse enforcement actions against medical device makers will increase—beyond the record level of 2010. Prosecutors will expand their use of criminal charges against company employees and executives, including strict liability misdemeanor charges for senior managers under the so-called Park doctrine. We are also likely to see the HHS OIG be more aggressive and creative with its authority to exclude companies and individuals from federal healthcare programs (as the OIG did in forcing Synthes to divest its U.S. operating company as a condition of settling an FDCA investigation). The enforcement actions will continue to focus on off-label promotion, improper payments to physicians, and product quality and manufacturing issues.

From Jonathan Lee, vice-president regulatory, quality, and clinical, for Medtronic Surgical Technologies:

Social media will become more relevant to patient care, therapy decisions, and outcomes.

National healthcare isolation is a thing of the past.

More data will be transferred to/from devices through wireless systems, resulting in data theft of patient information, especially for celebrities or public figures.

These wireless data transfers used to upgrade device features provide a potential path for malicious software uploading.

From Denise Dion, formerly FDA medical device expert investigator and currently senior regulatory consultant for Eduquest:

The FDA’s new group of investigators will continue their training into 2011, meaning that, at times, inspections will have multiple investigators.

The FDA’s Software Forensic group will take a more proactive approach to medical-device software defects.

From Debra Csore, president of Kruse & Company:

The FDA will expand its interpretation of what activities are required to meet design controls. Hence, firms that have bare-bones software development processes will be expected to meet recognized consensus standards such as IEC 62304, Medical device software - Software life cycle processes.

The country's likely budget pressure from the federal debt will lead to attrition of reviewers and increased turnaround times for FDA approval of devices.

From Ryan Kelly, a training specialist at Stryker Medical:

In 2011, companies will be looking to better gage the efficacy of their training programs. Business leaders will dedicate a considerable amount of resources to training and will often fail to quantify the benefit. They will begin to ask how training contributes to the bottom line and how it can do so more effectively.

From Nicole Petty, a senior manager of learning and development at Stryker Instruments:

There will be an increased importance on the role learning plays in the organization. Learning is critical to keep pace with the changes to our products, skills, processes, and strategies that are dictated by the evolving marketplace and regulatory environment.

Do you have any predictions of your own that you’d like to add to the list? Or do you strongly disagree with any of our experts? Let us know.

 

Users put on the device 20 minutes before chemo begins and continue wearing it until about 30 minutes after treatment. It chills the scalp and reduces blood flow to the area, which limits the delivery of chemo to hair follicles. The chilly temperature also slows down the metabolism of hair follicles, meaning that they process less of the chemo that gets through the cap. The LA Times looks at this and another cooling device currently being tested. If all goes well, the DigniCap could obtain FDA approval by late 2012.

The idea of cooling to prevent hair loss has been around several decades, and recent research studying various devices and methods has shown positive results overall. And in this case, we really do hope that cooler heads prevail. —Lawrence Lloyd

If you haven't seen the story yet, the headline is scathing, focusing on perceived greed of the orthopedic community. It reads, "Top Spine Surgeons Reap Royalties, Medicare Bounty." The Wall Street Journal article explores how Medtronic awarded royalties to spinal surgeons at Norton Hospital (Louisville, KY). From 2004 to 2008, says the journal, Norton performed the third-most spinal fusions on Medicare patients in the country. To complicate the issue, five surgeons at the hospital are also among the largest recipients nationwide of payments from Medtronic.

In the first nine months of 2010, the surgeons—Steven Glassman, Mitchell Campbell, John Johnson, John Dimar and Rolando Puno—received more than $7 million from the company.

Of course, WSJ got this information directly from Medtronic, which began disclosing the payments in advance of the Physician Payment Sunshine Act set to take effect in 2013.

The device in question is the morphogenetic protein-2, known as BMP-2—which has been increasingly used spinal fusion surgery. According to the Journal Sentinel, "There is no evidence any of the surgeons who have published articles on BMP-2 received royalties they did not deserve. However, the spinal surgery field has been plagued by troubling questions about transparency."

Transparency is just one part of a complicated issue, but its probably the one that will effect device makers the most. The Physician Payment Sunshine Act is important legislation under the Patient Protection Affordable Care Act. It requires companies to begin recording any physician payments that are worth more than $10 in 2012 and to report them on March 31, 2013. That includes stock options, research grants, knickknacks, consulting fees, and travel to medical conferences. The details will be posted in a searchable database starting Sept. 30, 2013.

The best advice that I can offer is that device firms should be prepared to have their practices questioned. With any luck, you've kept your dealings with physicians above-board. This industry needs physician collaboration and it would disastrous to have it taken away due to suspicious practices.

"It seems to never occur to fools that merit and good fortune are closely united." —Johann Wolfgang von Goethe

—Heather Thompson

But when the celebrated founders of a new venture approached him during the six-month period after the acquisition announcement, McDonough found he couldn’t resist the lure of a “compelling” market opportunity.

John McDonough

That new venture is T2 Biosystems, a Cambridge, MA—based private biotech company that’s developing a proprietary point-of-care diagnostic device that combines nanotechnology and miniaturized MR capability. The single, portable instrument will use the technology to offer rapid POC care in a range of healthcare settings, according to the company. The MR technology itself uses superparamagnetic nanoparticles and reagents to detect the presence of substances in solution. The concept of portable—and accurate—point-of-care diagnostics is one that had always strategically interested Cytyc, McDonough says.

McDonough wasn’t the only one with an appreciation of the $4 billion market for POC diagnostic devices. In May 2010 T2 Biosystems took in approximately $15 million in Series C funds from steady investor Physic Ventures and new investors such as Arcus Ventures and RA Capital. T2 had raised $10.8 million in Series B financing in 2008. Initial Series A funds of $5.5 million in 2006 had come from Flagship Ventures, Polaris Venture Partners, and IDG Ventures. The company also received approximately $730,000 in grants from an IRS program established to support companies developing therapeutic instruments and diagnostic tests that apply to specific diseases. DOE also awarded $1.4 million in a grant for an environmental testing project that uses the technology to detect water contaminants and other nucleic acid sequences.

T2 Biosystems’ was founded in 2006 by an illustrious team that includes Tyler Jacks, director of MIT’s Center for Cancer Research, and Ralph Weissleder of Massachusetts General Hospital’s Center for Molecular Imaging Research, as well as researchers from Harvard University

A certified public accountant, McDonough graduated from Stonehill College in 1981 and was a senior accountant with Deloitte, Haskins and Sells. Before joining Cytyc, he was cofounder, CEO, and president of Soundbite Communications, the COO of Direct Hit Technologies, and CEO and president of WorkgroupTechnology.

McDonough believes his successful high-tech business background brings outside-the-box thinking to the medical device space. “In high-tech you talk about bits and bytes and in medtech you talk about molecules and proteins,” he says. In this interview with MX McDonough discusses his transition to the medtech industry, his acquisition strategy at Cytyc, T2’s “personal computer” approach, and the similarities between high-tech and medtech.

MX: You have a business background in accounting, and the first companies you led focused on communication and Internet technology. What attracted you to medical devices?
 

John McDonough: Actually, two things, one probably more on a personal level, and the second one was more at the business level. At a very personal level I really made an active decision to [be in the] medical technology space as a natural transition from what I had been doing. One of the companies I had been involved with in high-tech was selling services to medical technology companies [and] imaging product development. My mother had been in the medical industry on the healthcare side. I really wanted to be in an industry where the products you’re developing have a direct impact on people. So reason number one was really just a personal motivation.

And reason number two had more to do with where I see growth opportunities. The businesses I have been involved with have all been kind of fast-growth, and I think there’re just enormous opportunities in medical technology, and the Internet boom is just a little bit less [active].

What aspect of moving to this industry was particularly challenging for you?
 

In terms of technology you need to get up to speed on the different lingo, if you will, and the work in one industry and how it fits in, and understanding the big picture. Business backgrounds can be great for understanding markets and market opportunities, but now you need to really understand the inner workings of technology. The good news is that in high tech you talk about bits and bytes, and in medtech you talk about molecules and proteins. Honestly, they’re almost the same things in terms of how they operate. There’s a lot of overlap.

Almost like building blocks. Conversely, what are some advantages of bringing someone with your business background and success level to a medtech company?
 

I think the big advantage you have is that you more naturally think outside of the box. That’s helpful when you’re developing this instrument for decentralization of diagnostics out of the lab in a point-of-care setting. In high-tech the first start-up I was involved with, which goes back to 1983, was with the advent of the personal computer. So a lot of our strategy [reflects] the way I think that our instrument can be the personal computer for medical diagnostics, and I think of our strategy as very similar to Apple in terms having a single interface with a number of applications that run on this instrument.

I actually the analogy fits extremely well. You may think about business models that may have been applied in high-tech that people in the medical technology industry haven’t really thought about.

That leads to a question about your acquisition strategy at Cytyc. Obviously, it was very successful. You mention thinking outside the box, but are there any thoughts or advice you can share on how best to achieve those results? What kinds of things you were doing that made you so successful there?
 

Honestly, I’d probably start by saying make sure you surround yourself with a great team like we had a Cytyc, [one] that works really well together and that really creates the strategy. So I’d put that at the top of any advice I’d give anybody.

Number two, the approach we took in putting the [acquisition] strategy together was somewhat formulaic, but we stuck to our knitting; meaning we first really tried to understand what the strengths of Cytyc were. We then really tried to understand where the market opportunities were; we tried to match the strength of Cytyc to the market opportunities, and then we applied great discipline to the value we were trying to create. You know, if we were acquiring a company, we wouldn’t overpay, and we understood what the value was. We did over a billion dollars in acquisitions, but we probably walked away from another billion dollars in acquisitions.

T2 Biosystems has quite a pedigree, given the people working with you. Did you find the company or did you decide to leave Cytyc Development?
 

They found me, and it was after we had announced the acquisition by Hologic. In that six-month period between the announcement and closing they approached me with the T2 opportunity. And I was honestly planning on staying, because I really loved Hologic and I think the opportunity there was phenomenal and on a personal level there were some great opportunities as well.

But the T2 opportunity was compelling because of the founders and investors behind the company, and more important at Cytyc we had a strategy of looking for a company that could move us into decentralized diagnostics. So I knew what that opportunity was—I had never heard of T2 because it was a very early-stage company—but when I was presented with the technology and the opportunity I knew how big this could be and with the kind of scientists and investors we had it just made sense.

Is there a lot of competition in that POC diagnostics space?
 

The way I would position it is that you don’t directly compete, but there are others coming at point-of-care testing from a different standpoint. Other companies are basically taking the same approach that runs on large analyzers that are in central labs and trying to miniaturize it and bring it to point of care. There’s been some success; it’s over a $4 billion market. But having said that, it’s only 10% of the overall $40 billion point-of-care diagnostics market. And the reason that it’s only 10% is that the accuracy of the result when you miniaturize something is not as good as when it’s done by a central lab.

The T2 approach is different. We’re not miniaturizing what other people are doing; we’re completely changing what we’re doing.

You have a new kind of science or technology.
 

Exactly. We have a novel way of detecting within our diagnostic instrument…that changes the whole game and creates big opportunities. You can almost think of our detector as being the operating system, going back to my first analogy of when mainframes were replaced by personal computers and the operating system changed. The DOS operating system—the Windows operating system—essentially was created for the personal computer. I would argue the T2 detector has been created for decentralized diagnostics. Others are trying to use the old operating system….

The technology and the concept clearly have been recognized. T2 has received grants from the DOE and an IRS program. Did they approach you or did you pursue those?
 

We pursued those. In the case of the Department of Energy we approached them with certain opportunities. The grant from the IRS was a whole process. The IRS had established that if you didn’t pursue it you weren’t going to get it. In both cases we were the ones pursuing those opportunities.

On the financing side this year T2 has received funds from Physic Ventures and even some new investors. What’s the investment community’s attitude toward medtech and T2 in particular? Are you doing better, do you think, in this climate because of T2’s unique technology than some other companies perhaps?
 

I think that’s right. I think it’s a tough market to be raising money, honestly, no matter who you are. And [that’s true] certainly as a small company. From a venture capital standpoint it’s extremely difficult to find new investors, because investors are holding whatever capital they have as reserves to support companies they’re already invested in. So it’s tough to get them to invest, but you want to find a new investor because you certainly want to expand the connections and capability of your investor syndicate, and you also like to have someone from the outside validating everything that you’re doing on the inside.

Our success, I think, was really related to the quality of the technology, but very importantly [it’s related to] the fact that we have been able to validate and prove that it works. And so if this were a good idea it would have been harder to get people to invest than if it were a good idea that has really been validated to work but now we need capital to build the product. So in our case I think it was the quality of the market opportunity, the unique technology position, the fact that it was proven, and the fact that we have world-class founders, and honestly just an exceptional group of engineers and scientists at the company developing the product.

It has to be all that because one tenet of investing is that investors like stability, and with some uncertainty still surrounding the status of healthcare reform there’s a sense that people might be a little reluctant to put their money up.
 

No question. I think in our case we play extremely well into the changes in healthcare.

Why is that?
Because we take cost out of the healthcare system. If you look at it from a macro level you’d rather be investing in a company that enables the reduction of cost, because if there’s anything we’re sure of, it’s that there’s going to be a focus on cost containment here, probably for the next 20 years and beyond that.

You say you have a fully functional alpha version of the benchtop instrument. When will T2 launch its first commercial product?
Our plan is to be in a clinical setting doing our FDA clinical trials by the end of next year.

Speaking of settings, your Web site talks about developing diagnostic devices for hospitals, labs, medical offices, and consumers. Will the devices be configured differently for each end use or be pretty much the same configuration?
 

There are definitely differences in configuration. The basic detector is the same, that doesn’t change. But what changes as you go to different settings relates to what kind of throughput the instrument can allow. In hospitals and labs, for example, they’re going to be running hundreds, if not thousands, of tests a day, so you need to enable them to be able to load multiple cartridges on an instrument and walk away. In the home you’re going to do one test at a time. You don’t need that kind of throughput. So the differences in configuration really have to do with the throughput of the instrument. What we’re developing today—the first instrument—is what I would call a “medium-throughput” instrument that would fit extremely well into a hospital lab setting and even a physician’s office. And then we will have versions that will work with consumers and, going the other way, even higher throughput instruments that could go into the larger labs.

Do you have the price points figured out yet?
 

We do not have the costs yet.

Is there anything you could share in terms of price range?
 

We would certainly expect the initial instrument that’s targeting the hospital lab setting to be in the $30,000 to $40,000 cost range.

As you acknowledged, replacing a large lab instrument with POC testing typically is difficult. How do you answer skeptics who say that such devices are too tough to operate or ineffective in everyday settings? Your proof of concept is already there, right?
 

What I say is: “Come into our lab and let me show you how it works.” For us it’s simple. If you have a whole blood test and you’re in a hospital, blood is captured in a tube. In our system, you take that tube, you snap it onto our cartridge, you put the cartridge in the instrument, and you’re done. The instrument manages everything else, runs the test, provides the results, not just on the screen, but actually the automation is integrated into the hospital lab information system so the results go automatically into the patient’s record. But we can demonstrate that now and just have somebody look at in a lab.

What would say is your biggest challenge right now then?
 

There are always big challenges. (Laughs.) I wish I could say there are no challenges. The big challenges for us are, first, we’re building out this instrument…to a commercial instrument, and we’re building tests and instruments at the same time, so you’ve got to manage that from an operational standpoint, and I’m knocking on whatever my desk is made of.

That’s going well. We’ve been right on track with what we want to accomplish, but it is and will always be a challenge. And, second, there is a tremendous amount of interest in our technology within the industry by diagnostic companies and biotech and pharmaceutical companies. Also, third parties want to use this technology either to run their tests for their decentralized diagnostic strategy and for preclinical trial management, and managing all the external interest is a challenge and making sure that it doesn’t [make us lose our focus] from the products we’re building and want to bring to the market. That’s one of the biggest challenges—keeping ourselves focused—because we literally probably have 25 to 30 discussions going on with the third parties.

With your business background and track record, would you say what you just described is always a concern when you are trying to build a company?
 

You bet. Because when you’re a little company you have to be extremely focused, but then you also have to be extremely opportunistic. And those two things conflict, right? So you need to keep talking and listening to people and then you need to be really disciplined so that you don’t lose focus.

Are there any plans to go public at some point or is it too soon to talk about that?
 

It’s probably a little soon to talk about, and certainly the public markets aren’t there. Certainly, we could very well be in a position within the next two years to three years to consider that path. Not that I’m an expert, but I think there’s a reasonable probability that the public markets might be open in that time frame, so it certainly could be a path for us.
 

Reports of concussions are up 21% from last season, although the league views this as a good sign (in other words, underreporting has become less of an issue).

"We're trying to make sure that players have the message: playing through pain is good; playing through pain is what sports are about. But that's leg pain. That's arm pain. Not brain injury. Because a brain injury and spine injury can threaten their future," according to Hunt Batjer, cochairman of the NFL's head, neck and spine medical committee.

From FDA:

DA Workshop - Assuring the Safety and Effectiveness of Seizure, Cognitive Function, and TBI/Sports Concussion Diagnostic Devices, June 2-3, 2011

The Food and Drug Administration (FDA) is announcing a public Workshop on Non-invasive Devices for Seizure Detection, Cognitive Evaluation, and Traumatic Brain Injury/Sports Concussion Assessment. Attendees will discuss approaches and endpoints for clinical studies for these devices and how the results should be conveyed to the users so that the devices may be used effectively.

This meeting will be held June 2-3, 2011, at

Food and Drug Administration
White Oak Campus
10903 New Hampshire Ave
Building 31
Silver Spring, MD 20993

Do any of you dear readers plan on going? I have to warn you—there may be more clinical trials folks there than NFL players. —Lawrence Lloyd

Under FDA’s medical device reporting (MDR) regulation, manufacturers must report a serious injury or death that their device has or may have caused or contributed to.² Manufacturers also must report any device malfunction that would be likely to cause a serious injury or death if it were to recur. These MDRs typically must be filed within 30 calendar days, except in cases for which remedial action is necessary to prevent an unreasonable risk of substantial harm to the public health. The latter reports must be filed within five working days.

The OIG examined manufacturer reports from 2003 through 2007 (p. 9, 13 of OIG report). The OIG found that the number of 30-day reports more than doubled, from 64,784 in 2003 to 140,698 in 2007. The five-day reports were relatively fewer, declining in the same time period from 432 in 2003 to 54 in 2007 (the OIG could not determine the reason for the decline).

The OIG took a careful look at how FDA used these data, and found that the agency “does not use adverse-event reports in a systematic manner to detect and address safety concerns about medical devices” (p. 13 of the report). There was no qualification or mitigation offered to soften such a conclusion. Simply put, the OIG found that between 2003 and 2007, FDA did not make use of the MDR data to improve device safety. 

As the OIG notes, MDR regulation is intended to enable FDA “to take corrective action on problem devices and to prevent injury and death by alerting the public when potentially hazardous devices are discovered” and “to detect unanticipated events and user errors” (p. 1 of the report). Thus, the OIG’s finding essentially means that FDA’s implementation of the MDR regulation failed to meet the basic purpose of the regulation.

Some of the OIG’s subsequent findings were equally disheartening. For instance, the OIG found that FDA’s review of MDRs was generally untimely. Of the malfunction reports assigned to an FDA analyst for review, the OIG report found fewer than one third were read within 30 days, and less than half were read within 60 days. Even the relatively small numbers of five-day reports were not read in a timely manner. From 2003 to 2006, FDA analysts read fewer than 1% of these reports within five days of receipt. In 2007, that figure only rose to 6%. Yet, the five-day reports are those that likely represent the most serious risk to public health. These reports can include what FDA calls “Code Blue” reports of pediatric deaths, multiple deaths, exsanguinations, explosions, fires, burns, electrocutions, and anaphylaxis (p. 15–16).

The metrics noted in the previous paragraph apply only to reports actually assigned to an FDA analyst for review. Buried within the OIG report is the astonishing fact that FDA “assigns only 10% of malfunction reports to FDA’s analysts for review” (p. 15 of OIG report). Thus, it appears that FDA routinely ignores 90% of all malfunction reports received each year. Although these reports are potentially available to FDA for trending, FDA did not provide the OIG with evidence that the agency makes effective use of trend data.

Based on this information, it is difficult to escape the conclusion that manufacturers have spent millions of dollars over the years to collect, analyze, and report adverse-event data for little purpose. Likewise, Congress has appropriated substantial sums of tax dollars for FDA to review, analyze, and manage the data without a measurable public health benefit.

For this reason, it may further be said that the MDR system cannot be credited with the substantial improvement in medical device safety that has taken place during the past 26 years (e.g., since MDR regulations were put in place). These improvements have taken place in the absence of meaningful FDA oversight based on MDRs. One wonders why we needed an expensive system of mandatory reporting to populate a data warehouse that FDA has rarely visited, much less used in the manner envisioned by the system’s proponents.

Effects of the Report

The OIG investigation was limited to the period from 2003 to 2007. It seems unlikely, however, that FDA operated more effectively prior to 2003 or achieved a sudden radical improvement after 2007. FDA did not publicly dispute the OIG’s findings or suggest that they are already obsolete, even though the OIG report was not issued until October 2009. FDA has not publicly announced any improvements intended to address the OIG report. Finally, FDA does not publish any metrics that would demonstrate its systematic use of MDR data to improve device safety.

The OIG carefully notes that the conclusion about FDA’s use of adverse-event reports rested on lack of documentation. So, it is theoretically possible that FDA has made effective use of the data. But again, there is no evidence that the agency has done so. Sound public policy is not built on mere speculation and anecdotes. It is FDA’s responsibility to demonstrate that it systematically uses MDRs to benefit the public health. According to the OIG, the proof is completely lacking.

What to Do About MDRs

It is a wasted opportunity if the OIG’s examination of the problems with the MDR system does not result in useful reform. There can be no justification for continuing to operate such an expensive and time-consuming mandatory reporting system on the basis of good intentions rather than actual results.

The OIG does make some recommendations, primarily that FDA should document follow-up on adverse events and should ensure and document that CDRH does a better job of meeting its existing guidelines for reviewing five-day and Code Blue adverse-event reports. But these recommendations seem fairly minimalist and unlikely to get to the heart of the matter.

It is not easy for an outside observer to suggest how FDA’s use of MDR data might be improved because there is almost no disclosure as to what FDA currently does with the data. The Office of Surveillance and Biometrics (OSB) claims responsibility “for ensuring the continued safety and effectiveness of medical devices after they have reached the marketplace.”³ Yet, OSB’s short, five-paragraph Web page has only the vaguest description of its activities, with no metrics, no hard data, and very few specifics. The OSB’s “transparency dashboard” does not provide any information or metrics on the use of MDR data.⁴ Even the fiscal year 2010 strategic planning document for CDRH (the most recent one posted on the Web site) proposes only technical improvements in MDR event and product coding, and unspecified “improvements to CDRH’s adverse-event reporting data systems.”⁵ There are no other goals that appear to be related to improving FDA’s use of MDR data. Finally, the division of postmarket surveillance within OSB has direct responsibility for MDR analysis. Its Web page too has only a general description of how it uses adverse-event reports, with no metrics or other hard information provided.

It seems likely that part of the problem arises from the nature of the information that FDA receives via MDRs. Complaints about medical devices can allege all kinds of malfunctions, with many variations and idiosyncrasies. Many of these reports are really noise that, if FDA were actually to analyze them, would obscure more than they illuminate about the safety of medical devices in use today. Yet, it is these reports that make up the largest volume of MDRs that manufacturers must file. 

The most useful immediate reform would be to eliminate the requirement for malfunction reporting. As the OIG found, FDA analysts have read only a tiny percentage of malfunction reports, so no one can argue that these reports provide essential information that has allowed FDA to systematically address safety problems. Rather, the evidence shows that FDA has not been reviewing these MDRs in a timely fashion or making systematic use of trend data to improve device safety. Furthermore, the variation and detail involved in many of these complaints make them difficult to trend, even for companies that have a much better understanding of their own devices than FDA’s staff does. It seems unlikely that malfunction reports could ever be made useful to the agency. If FDA disagrees with this conclusion, the agency should provide data to prove that it can make use of malfunction MDRs to improve device safety. To date, it has not done so.

Malfunction reports also create complexities for manufacturers, which must wrestle with determining whether a complaint is a malfunction (not all are), and whether a malfunction is reportable because it would be “likely” to cause injury or death if it were to recur. In many cases, this latter determination involves making a difficult and subjective probability prediction. On the flip side, FDA currently wastes valuable inspectional resources in determining whether malfunction MDRs should have been submitted. There is something peculiar about a system in which FDA spends compliance resources to inspect files for nonsubmission of malfunction MDRs which are then submitted, at great cost and effort, and not used by FDA in any meaningful or systematic fashion.

Conclusion

Malfunction reports have generated much of the expense and complexity of the current system, but have provided little or no benefit. By contrast, an MDR system that focused solely on the possible contribution of devices to serious injuries or deaths would be easier for FDA to administer, and would more reliably alert FDA to true safety problems. The smaller resulting data set might also improve the odds that FDA could review and trend all of the reports it receives in a timely manner and take action when appropriate.

In theory, it might have been a good idea for FDA to be given malfunction information to help it anticipate device safety problems. But in reality, there is no evidence that the system actually operates according to this theory, and the OIG report provides ample evidence that it does not. Those who would defend the current malfunction reporting requirements bear the burden of proving that these reports can be used to improve medical device safety. FDA should also publish metrics quarterly or annually that demonstrate the agency’s use of malfunction MDR data to improve device safety. 

Industry should reject the notion that it is acceptable for burdensome regulation to continue on autopilot for decades just because it has a worthy purpose and seems like a good idea. FDA should provide a data-driven demonstration that the MDR system is worth the resources being spent. Based on the OIG’s report, the opposite appears to be true.

References

1.    Daniel Levinson, “Adverse Event Reporting for Medical Devices,” October 2009: available from Internet [pdf]: oig.hhs.gov/oei/reports/oei-01-08-00110.pdf.
2.    21 CFR 803.50.
3.    “About FDA: Office of Sureillance and Biometrics,” available from Internet: www.fda.gov/AboutFDA/CentersOffices/CDRH/CDRHOffices/ucm116002.htm.
4.    “FDA-Track CDRH Office of Surveillance and Biometrics Database,” available from Internet: www.fda.gov/AboutFDA/Transparency/track/ucm203271.htm#KeyCenterDirector.
5.    “CDRH FY 2010 Strategic Priorities,” available from Internet: www.fda.gov/AboutFDA/CentersOffices/CDRH/CDRHVisionandMission/ucm197647.htm.

Jeffrey K. Shapiro, JD, is a partner at Hyman, Phelps & McNamara, PC (Washington, DC).  Contact him at jshapiro@hpm.com.

Deputy commissioner Joshua Sharfstein told a think tank conference in Washington that FDA’s intention is ultimately to “harmonize” the data standards that compose a critical basis for the agency’s regulatory function. However, no consideration is being given to modeling future data standards for medical devices on those currently applicable to drug products.

“Data standards for drug evaluation cannot be a starting point for standards to be applied to medical devices,” Sharfstein said, adding pointedly: “There are enormous differences in evaluating drugs and devices.”

Some of these differences, he indicated, include the fact that in contrast to drug development, the development process for medical devices tends to be evolutionary or iterative in nature. Moreover, Sharfstein noted that designs of clinical trials for devices are typically quite different from those employed for drug evaluations.

Sharfstein’s comments were in response to a question posed at a conference titled “Regulation and Reimbursement for Medical Devices: Protecting Public Health While Fostering Innovation.” The meeting was cosponsored by the American Enterprise Institute (AEI) and the Brookings Institution’s Engelberg Center for Health Care Reform. Session moderators included former FDA commissioner Mark McClellan, currently director of the Engelberg Center, and former FDA deputy commissioner for medical and scientific affairs Scott Gottlieb, now serving as an AEI resident fellow. Both McClellan and Gottlieb were Republican appointees to the agency during the previous administration.

Ross Jaffe, cofounder of Versant Ventures, a venture capital firm that specializes in early-stage development of innovative medical devices, said funding for innovative products has declined precipitously in recent years, and that the United States is at risk of losing its position of leadership in developing such products. “The last 10 years has been a lost decade in the development of new, innovative, healthcare technologies in the U.S., with investment in this country shifting toward later-stage development,” he said.

Furthermore, Jaffe indicated that many American companies are now taking innovative ideas overseas for development and initial marketing efforts, with product “incubators” often located in Europe, Israel, and Australia. According to Jaffe, this trend is due to a combination of factors, including a lengthy FDA product review process involving greater financial risk than is typically experienced in Europe and elsewhere. A further incentive to moving new technology development abroad, Jaffe said, is the prospect for rapid growth in some overseas markets.

A survey of 204 medical device companies also pointed blame toward FDA for the decline in funding for device innovation. It was conducted by Josh Makower, a device inventor and CEO of venture capital firm ExploraMed. According to Makower, 44% of survey respondents indicated that frequent changes in FDA staff during the period that their products were under review often resulted in an unnecessarily lengthy regulatory process. The situation has meant that products can take up to two years longer to reach patients and consumers in the United States than in Europe. Similarly, 30% of respondents indicated that a lack of clarity in FDA clinical trial requirements—disagreements over what may constitute an endpoint, for example—has often resulted in considerable time and expense to product sponsors.

CDRH director Jeffrey Shuren said FDA “takes seriously” industry criticisms of agency proposals to reform the 510(k) review process, and he avowed concern over the current unfavorable climate in the United States with respect to investment in innovative medical devices. Shuren said an internal (CDRH) assessment of the 510(k) process yielded 55 recommendations for strengthening—not replacing—the 510(k), of which 40 recommendations have received support from the device industry and other “stakeholders.”

Shuren said that the agency expected to identify which of these recommendations will be adopted by the end of the 2010, with timelines for putting them into effect. Further, he said that the Institute of Medicine will deliver an independent assessment of the 510(k) process later in 2011, which is expected to lead to additional improvements.
In response to a question, Shuren said that, given the increasing complexity of many new and innovative medical devices, and the difficulty of evaluating them, he is open to consideration of de novo reviews for such products.

CDRH Regulation Called ‘Vastly Inadequate’

But the device-drug comparison drumbeat goes on. Also in November, two U.S. medical writers went to press asserting that CDRH’s regulation of medical devices is vastly inadequate, with standards much lower than those applied to drugs. In the November 2 issue of the British Medical Journal, Jeanne Lenzer and Shannon Brownlee said that CDRH’s inadequacies may have contributed to hundreds of deaths associated with Cyberonics’ vagus nerve stimulator (VNS). The device was approved in 1997 for treating treatment-resistant partial seizures. The device was later also approved for treating treatment-resistant depression.

Their report said that neither Cyberonics nor FDA have systematically investigated what role the device may have played in the deaths. “Although Cyberonics conducted postapproval studies, none of the studies submitted to FDA included mortality data,” it says. “FDA did not specifically require Cyberonics to submit mortality data as part of the follow-up study, merely to ‘characterize morbidity and mortality.’” Lenzer and Brownlee said that FDA’s lack of aggressive follow-up “is but one example of the gap in postapproval surveillance of medical devices.”
In an accompanying editorial, Harvard Medical School professor Jerry Avorn wrote,

The standards for device approval and surveillance have fallen far below those for drugs, and even those that would be dictated by common sense. It would be unthinkable for a drug company to go to FDA or the European Medicines Agency and say in effect, ‘This new drug is much like an older product we sell, except that we have added a new amine group and modified one of the side chains. Apart from that, it’s pretty close, so we won’t be doing any new clinical tests on it. When can we begin marketing?’ But this is essentially what happens with many new medical devices when they are approved.

He called on FDA to abandon the “substantial equivalence” standard used in the 510(k) clearance process and to develop better requirements for clinical review of new products.

Cyberonics chief financial officer Greg Browne told Lenzer and Brownlee that “none of the approximately 900 deaths reported to FDA were attributed to VNS therapy. Available data indicate that all-cause mortality rates for VNS therapy patients are less than half the rates in the comparable non-VNS epilepsy patient population.”

The authors concluded that FDA will only improve when it gets more staff, better funding, more authority, and more outside experts to objectively evaluate device safety.

Hamburg Tries to Assuage Industry’s ‘High Anxieties’

In a keynote address at AdvaMed’s annual conference in October in Washington, DC, FDA commissioner Margaret Hamburg acknowledged some concerns (“high anxieties”) that have been expressed by medical device manufacturers about anticipated changes in the 510(k) clearance process, as well as other uncertainties over evolving programs and priorities at the agency. However, she quickly sought to place the need for change in perspective.

The commissioner pledged to proceed carefully and in a fully transparent manner as any changes are implemented. She noted that public comments on preliminary 510(k) recommendations, which were delivered by an internal agency study group in August, have generally been supportive.

“I realize it is taking time to determine what changes are needed, but the process should be a thoughtful one, with ample opportunity for feedback from industry and other stakeholders,” Hamburg said. “Before any decisions are made, it is critical that we have a solid understanding of the root causes of problems with the current approval process.”

The extraordinary success of the medical device industry over the past decade drew high praise from the commissioner as she noted that designers of devices have scored an “80% increase in breakthrough patents” during that time period. Indeed, Hamburg described the industry as a virtual “poster child for innovation.” She pointed out that U.S. manufacturers remain first among competitors, worldwide, as exporters of medical devices. She also predicted continuing success for exporters of American medical devices, as world markets for these products expand, particularly as a result of major growth in potential customers among the rising middle classes of India and China.

According to Hamburg, important challenges that currently face the device industry are understood and appreciated by FDA—including a difficult economy with jobs moving overseas and frequently changing rules for reimbursement. She said the agency is supportive of the industry in this difficult time, “Because we all want to see safe, effective products reach the marketplace.”

As an example of a recent measure designed to assist the medical device industry, Hamburg pointed to a policy decision (“parallel review”) that allows CMS to begin making preliminary coverage decisions for some promising medical products that have yet to receive final FDA approval.

Not Many 510(k) Devices Get Class 1 Recalls

Less than 0.5% of 510(k)-cleared medical devices have been involved in Class 1 recalls between 2005 and 2009, according to a recent white paper released by the California Healthcare Institute (CHI).

The data come from a five-month study by MR3 Medical CEO Ralph Hall that found that 89 (0.45%) of 19,873 510(k)-cleared devices from that period were subject to Class 1 recalls. Forty-three (0.22%) of the same base were recalled for premarket issues. Design issues were the predominant reason for the recalls, Hall found.

In addition to Hall’s report, the CHI white paper described a discussion the institute convened in July involving former FDA chief counsel Peter Barton Hutt, former CDRH director David Feigal, and ExploraMed CEO Makower, among others.

The white paper concluded that the 510(k) process is integral to medical technology innovation and that “increased uncertainty, unpredictability, and inconsistency are beginning to take a toll.” Proposed reforms to the process, including restricting the use of multiple and split predicates, consolidating the “indication for use” and “intended use” concepts, creating a subset of Class II devices, and giving CDRH formal rescission authority, are considered controversial, it said.

The white paper urged “careful and deliberative consideration” be given to such ideas, lest the 510(k) process become “more cumbersome, complex, and costly, to the detriment of medical technology investment, innovation and, ultimately, patient care.”

Dental Amalgam More Toxic Than FDA Says

Barely a month before FDA was officially due to hear critics of its 2009 final rule that declared dental amalgam safe and effective, the agency was confronted by two new studies in November condemning the health damage caused by amalgam’s principal ingredient, mercury.

One, prepared for a mid-December special FDA advisory committee meeting on dental amalgam risks, examines U.S. public exposure to mercury and suggests that amalgam fillings expose 122.3 million Americans to quantities of mercury in excess of the safe dosage level established by the California Environmental Protection Agency in 2008. This reference exposure level is accepted by other government agencies for public protection. The other study, published in the November 15 issue of the Journal of Alzheimer’s Disease, directly links mercury in amalgam causatively to that disease.

Both studies effectively contradict an assertion made at a 2009 press conference on the new amalgam rule by CDRH dental device division acting director Susan Runner: “The best available scientific evidence supports the conclusion that patients with dental amalgam fillings are not at risk for mercury-associated adverse health effects.”

The first study is also critical of FDA’s failure to consider the additive effect of nondental sources of mercury and the compounding effects of similar neurotoxins such as lead and methyl mercury. “Neurological effects, particularly in the nervous system of the developing fetus/neonate/child, represent the most sensitive endpoint for exposures” to these neurotoxic substances, according to the study report. The report was commissioned by the International Academy of Oral Medicine and Toxicology (IAOMT), which was among the petitioners scheduled to present at FDA’s meeting December 14–15.

Noting recent literature on the effects of the three heavy metals in humans, the first study, led by Ottawa, Canada–based SNC-Lavalin’s G. Mark Richardson, says that potential neurological effects of lead and mercury on the developing brain of the fetus are likely to accumulate via the placenta and breast milk.

The study report estimates that more than 121 million Americans have an exposure level from the combined three heavy metals that exceeds the 2003–04 National Health and Nutrition Examination Survey safety standard. The researchers reached this conclusion based on criteria set out in guidance issued by both the U.S. Agency for Toxic Substance and Disease Registry and the Environmental Protection Agency.

According to the report, these substances share the following characteristics:

• All are absorbed in large proportion into systemic circulation.
• All cross the blood-brain and placental barriers.
• All cause neurological toxicity.
• Exposure to all of these substances currently exceeds individual reference exposure levels for many in the U.S. population.

Although not part of the study, the report also notes that high-fructose corn syrups have recently been found to contain high levels of inorganic mercury, with average daily intakes in the United States at 50 grams per person “due to its widespread use in numerous commercial prepared foods and sweetened beverages.”

In the second study, authors Richard Deth and Joachim Mutter present a meta-analysis of 106 case-control or comparative cohort studies to classify mercury as a causative factor in Alzheimer’s disease. Noting that the main source of mercury in the human body is dental amalgam, the authors say the mercury

evaporates at a slow rate, but is released at a higher rate, when the fillings are put in place or removed. From this source, and other, less common ones, 1.2–27.0 mcg of Hgo [elemental or metallic mercury] are taken up per day, and 1.0–22.0 mcg of Hgo are retained. Other variable factors of mercury release include the number, age, and size of the fillings, the presence of dental alloys, individual chewing habits, and drinking hot liquids, as well as bruxism.

A news release issued by the authors quoted Samueli Institute fellow Harald Walach comparing the situation to that of smoking concerns in the early 1970s. Experimental evidence of smoking’s harm existed, but human studies were inconclusive “and were under attack by groups with a vested interest. To wait until irrefutable evidence has accumulated is not the best option in view of what we already know about the toxicity of mercury,” Walach said. “The removal of inorganic mercury from ecological cycles might prove to be the easiest and most effective public health measure to contribute to the prevention of Alzheimer’s disease.”

Petitioner IAOMT issued a news release hailing the Mutter-Deth study and urging NIH to fund “realistic research” on the mercury-Alzheimer’s link. The release quoted former California first lady Maria Shriver as expressing concern that Alzheimer’s disease “will bankrupt every family in this country.”

Seeking 510(k) Clearance without a Predicate

CDRH has begun posting de novo classification letters to help medical device sponsors better understand how they can request a 510(k) clearance for a device without a predicate. The de novo process applies to low- and moderate-risk devices that have been classified as Class III (premarket approval required) because they were found not substantially equivalent to existing devices. Applicants who receive this determination may request a risk-based evaluation for reclassification into Class I or Class II categories.

The center has been considering tweaks to the de novo process as part of its 510(k) revamp. “As currently implemented, the de novo classification process tends to be associated with lengthy review timeframes and nontransparent data requirements, making it an impractical path to market for many device developers,” a recent 510(k) report said.

In October, CDRH Office of Device Evaluation acting director Christy Foreman said at an industry meeting that the center would begin posting the de novo letters as part of a pilot program under its transparency initiative. She also provided an update on other 510(k) issues, such as a revision to CDRH’s longstanding guidance on when to submit a 510(k). The guidance will no longer contain a flowchart to guide device makers through the decision process on when device changes warrant a new submission.

One of the first two de novo letters involves Erchonia Medical’s ML Scanner, indicated for use as a noninvasive dermatological aesthetic treatment for reducing the circumference of hips, waists, and thighs (down-classified to Class II). Another letter focuses on Zeltiq Aesthetics’ dermal cooling device, which is indicated for use as a noninvasive dermatological aesthetic treatment for reducing subcutaneous fat layers (down-classified to Class II).