Transcript Slide 1

CDRH, Congress
and the 510(k) Process
MassMEDIC | The 510(k) Process
Best Practices in Changing Times
Paul Kim, Foley Hoag LLP
April 1 2010
ATTORNEY-CLIENT CONFIDENTIAL
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Health Reform Toplines
Strategic Priorities
Congressional Outlook
Closing Discussion
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Health Care Reform
 Patient Protection & Affordable Care Act (Pub. L. 111-148)
– The Senate passed on December 24, 2009
– The House passed same bill on March 21
– President signed into law on March 23
 Health Care and Education Affordability Reconciliation Act
(Pub. L. 111-152)
– The House passed the reconciliation bill, meant to change
provisions in PPACA, on March 21
– The Senate passed and House agreed to on March 25
– President signed into law on March 30
ATTORNEY-CLIENT CONFIDENTIAL |
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Core Consequences
COVERAGE 
 Insures 32 million uninsured
 Extends health insurance from 83 percent to 94
percent of Americans by 2019
COST 
 $938 billion, 2010-2019
 Second decade costs grow dramatically
 Deficit reduction of $124 billion
FINANCING 
 Reimbursement reductions for Medicare providers
 Excise taxes on high-value health plans
 Expansion of Medicare HI tax to non-payroll income
dusty fees
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Timeline
2010
2011
2012
• Part D manufacturer discount, July
• Part D model agreement, May
• 340B regulations, September
• Increased Medicaid rebate, January
• Funding for CER begins
• Select insurance reforms: lifetime caps, preexisting conditions, rescissions, preventive
services
2013
2014
2016
• Physician payment annual reporting
begins
• Medical device tax
• Individual mandate
• Reduced beneficiary obligations in coverage
gap begins
• Hospital-acquired conditions regulations
• Pharmaceutical industry excise tax
• Prescription drug labeling report by Secretary
• Medical homes
2018
2020
• Payment bundling pilot program,
per Secretary’s discretion
• State exchanges begin
• Prescription drug labeling regulations
• First IPAB report to President & Congress
• Wellness demonstration projects
• Insurance industry fee
• Employer mandate
• Remaining insurance reforms: annual caps,
pre-existing condition, discrimination, premium
ratings
• “Cadillac” tax
• Part D medication therapy management
programs
• CMS Medicare & Medicaid Innovation Center
annual reports begin
• Rewards for ACOs
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Payment Reforms
 Comparative Effectiveness Institute
–$600M annual research budget to compare the clinical
effectiveness, risk and benefits of two or more medical
treatments, services or items
 Medicare and Medicaid Innovation Center
–Test innovative payment and service delivery models to
reduce expenditures while enhancing quality of care
 IPAB
– Recommend ways to achieve “savings target”- lesser of
1.5% of Medicare spending or excess identified by CMS
Actuary; physicians, hospitals shielded until 2019
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Medical Device Excise Tax
 Broad But Deferred Tax
–Excise tax on devices equal to 2.3% of price from 2013; tax
deductible lessens impact; generate $20 billion over 10 years
–All devices except eyeglasses, contact lenses, hearing aids, and
other devices that are sold to the general public at retail
establishments (Class I OTC)
 Key Issues
– Exemption but “generally purchased by general public”; “at
retail”; and “for individual use” as determined by Treasury
–Effect of reconciliation: dropped from 2.9%, ratio of total gross
sales, pushed back from 2011, dropped broad Class I exemption
– Gone but not forgotten: House (Administration) national device
registry
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“Sunshine” Reporting
 First Reports Due March 2013, Data Collection in 2012
–Device, drug manufacturers must disclose almost all payments
and “transfers of value” made to physicians or teaching hospitals
–Disclosures publicly available via a searchable online database
–Specific payments made to individual physicians and teaching
hospitals, rather than aggregate payments
– Limited “floor” preemption overrides some state laws
 Primes Heightened Scrutiny, Enforcement Initiatives
–Significant financial penalties for noncompliance: unknowing
failures, $1-10,000 capped at $150,000 and knowing failures, $10100,000 capped at $1 million
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New Leadership
Strategic Priorities
Congressional Outlook
Closing Discussion
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Leadership | Old is the New New
– Dr. Margaret ‘Peggy’ Hamburg
– Dr. Josh Sharfstein, Principal DC
– John Taylor III, Counselor
– David Dorsey, DC Policy Planning Budget
– Mike Taylor, DC Food
– Dr. Jesse Goodman, Chief Scientist and DC
– Dr. Mac Lumpkin, DC International
– Dr. Janet Woodcock, CDER
– Dr. Jeff Shuren, CDRH
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FDA Priorities
– Funding (FY2011 +23%, +6% in approps)
– Scientific Staffing
– Imports, Food Safety, H1N1, Tobacco
– Transparency, Consistency, Predictability
– Congressional Oversight Unabated but
Administration Freedom to Operate
– Reviews and Credibility – REMS, 510(k)s
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CDRH FY 2010 Strategic Priorities
– Fully Implement a Total Product Life Cycle
Approach
– Enhance Communication and
Transparency
– Strengthen Our Workforce and Workplace
– Proactively Facilitate Innovation and
Address Unmet Public Health Needs
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CDRH Pre-Market Reforms
– Begin implementing cross-center compliance
strategy (May)
– Implemented 510(k) Working Group (Sept)
– Adopted 510(k) iReviews (Sept)
– “Take steps” on class III 510(k)s (end 2010)
– Improve quality of PMA clinical data (end 2010)
– Assessed IOM recommendations (June 2011)
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CDRH Post-Market Reforms
Increase real‐time AERs and establish MedSun
interoperability, increase registry partnerships
(Jan 2011)
Better capture, analyze, share high‐quality AER
information (Jan 2012)
Implement a Unique Device Identification (UDI)
system (Jan 2013)
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“Let’s look under the hood and
The
best
laid schemes
mice an' men
see
if there
are anyo'problems”
Gang aft agley
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New Leadership
Strategic Priorities
Congressional Outlook
Closing Discussion
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Menaflex
“External considerations affected the decision-making
process and possibly the review decisions of the ODE
Director”
[This] “constitutes a clear deviation from the principles of
integrity used in this review and undermines the ability of
the agency to counter the suggestion that lobbying on behalf
of ReGen affected the decision”
“The predicate [510(k) review] system, as implemented,
appears to perpetuate questionable review decisions”
Hamburg: Schultz’s departure “would be in the best interest
of the center and the agency”
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Decisions about Class III Devices
Fiscal Years 2003–2007
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MDUFMA Performance Goals
– +242 FTEs in FY 2007 vs 2002
– Medical Device User Fee Amendments of
2007 – MDUFMA fees “significantly reduced”
– 510(k) fee fell 18%, PMA fee by 34%
– Small business fees feel 49% and 57%
– Will short-term benefits be offset in
reauthorization? Post-market safety
‘mission creep’?
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Heightened Advocacy
“Clearly, the focus of the 510(k) process has been on letting companies change
devices in the name of innovation, not based on public health standards or
problems. As a result, devices are being sold that are so different from previous
“substantially equivalent” devices that the FDA has no idea whether the
product is safe or effective, and in many cases these innovative devices are
either not as safe as other products on the market, or not as effective.”
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Select Issues
– Reforming 510(k) Clearance Authority
–510(k) Rescission Authority
– 510(k) Postmarket, ‘Condition of
Clearance’ Studies
– Preclearance Inspections Linkage
– MDUFMA Fee Linakge
– Riegel, Wyeth Preemption
– Device DTC Restrictions, Disclaimers
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Potential Vehicles
– Post health reform fatigue, short election
year – yet food safety (S.510) may move
– FDAGA as vehicle
– 2011 MDUFMA and ‘UFA reauthorizations
– Note progression of ‘counter cyclical’
legislation: Sunshine (Kohl-Grassley),
reverse payments
–Sustained Oversight (Myxo mitral-valve
ring, orthotics, etc)
ATTORNEY-CLIENT CONFIDENTIAL |
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New Leadership
Strategic Priorities
Notable Product Reviews
Closing Discussion
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