On July 31, 2014, President Barack Obama issued a new executive order requiring federal government contractors to disclose labor violations when competing for contracts valued at more than $500,000. The new executive order also requires contractors to periodically report labor violations throughout contract performance, provide employees with accurate information explaining the basis for their pay, and, in more limited circumstances involving the acquisition of non-commercial items, the option to refuse to arbitrate claims of discrimination, sexual assault, or sexual discrimination. Although the new reporting requirements apply to all government contractors, information provided by medical device manufacturers and suppliers may be subject to heightened scrutiny. Two reports referenced in a fact sheet accompanying the new executive order specifically identify members of the medical device industry in highlighting that government contracts have been awarded to companies with multiple labor law violations—a circumstance that the new executive order is designed to prevent.
The new executive order will require manufacturers and suppliers seeking the award of a government contract to disclose violations of fourteen federal statutes and executive orders, and their state law equivalents, setting forth wage and hour, health and safety, collective bargaining, family and medical leave, anti-discrimination, and other labor-related requirements. Specifically, manufacturers and suppliers seeking an award will be required to make a representation regarding administrative merits decisions, arbitral awards, and civil judgments issued in a preceding three-year period for violation of the requirements covered by the new executive order. Manufacturers and suppliers that receive an award must update this representation every six months and require their subcontractors to make a similar representation if their subcontractors provide goods or services, other than commercially available off-the-shelf items, with an estimated value of more than $500,000.
Contracting officers will consider the nature of any disclosed violation, as well as steps taken to correct a violation or improve compliance with labor requirements, to determine whether a manufacturer or supplier seeking an award is a responsible contractor qualified to receive a government contract. The new executive order indicates that a single violation will generally not preclude a manufacturer or supplier from receiving an award. However, contracting officers may report multiple or severe violations to agency suspension and debarment officials who may prohibit a manufacturer or supplier from conducting business with the federal government for an extended period of time. Disclosures made after an award may also result in the termination of an awarded contract. In addition, commentators have suggested that the Office of Federal Contract Compliance Programs may use the information provided by manufacturers and suppliers to direct enforcement efforts at particular companies.
In order to comply with the new reporting requirements, manufacturers and suppliers will likely need to incur additional costs to establish internal mechanisms that track reportable decisions, awards, and judgments. In addition, as suggested by the fact sheet accompanying the new executive order, manufacturers and suppliers may feel pressure to settle labor disputes rather than risk disputing a claim that could result in a reportable decision.
Additional details are forthcoming with respect to how the new reporting regime will be implemented. The new reporting requirements are expected to go into effect in 2016.
On 18 July 2014, the Medicines and Healthcare Products Regulatory Agency (MHRA) announced that it will create a new independent Devices Expert Advisory Committee (DEAC) before April 2015.
The DEAC will be responsible for providing independent expert advice to help the MHRA regulate medical devices. The MHRA hopes that the DEAC will help the MHRA “have stronger links with the wider scientific community to facilitate access to specialist expertise.” The DEAC is expected to be relatively small in size with around 12 members and a chair to enable the group to be more agile and responsive to important regulatory issues concerning medical devices.
The DEAC will be linked to a network of specialist sub-groups and ad-hoc groups. The membership of the sub-groups will be flexible depending on the topics and existing specialist groups.
The DEAC will replace the MHRA’s current expert advisory group, the Committee on the Safety of Devices (CSD). The CSD was temporarily suspended earlier this year. Until the new DEAC is created, an Interim Committee on the Safety of Devices and Transitional Advisory Group will be set up. The Interim Committee will be composed of members of the CSD and will perform the duties of the CSD and support the implementation of the Stephenson Review recommendations, discussed below.
The MHRA’s announcement of the intention to establish DEAC comes as part of the MHRA’s response to recommendations by the Independent Review Group chaired by Professor Terrence Stephenson. Last summer the MHRA asked Professor Stephenson to lead an independent review into how the MHRA can improve its access to clinical advice and engagement with the clinical community. The Stephenson Review made 12 recommendations covering four areas:
- The organisation of clinical advice, input, and leadership.
- Collecting and using device incident data.
- Communications and partnerships.
- Future developments and emerging challenges.
The MHRA accepted all of the Stephenson Review’s recommendations.
In a major announcement, on July 31, FDA notified Congress of its intent to issue two draft guidance documents that, if finalized, would implement a new regulatory system for laboratory developed tests (LDTs). These guidance documents have been anticipated for several years, with the agency announcing over four years ago that it intended to change its regulatory policies for LDTs. FDA’s draft guidance documents include the following:
- “Framework for Regulatory Oversight of Laboratory Developed Tests (LDTs).”
- “FDA Notification and Medical Device Reporting for Laboratory Developed Tests (LDTs).”
The European Commission’s Borderline and Classification Medical Devices Expert Group has published a new version of its Manual on Borderline and Classification in the Community Regulatory Framework for Medical Devices. The updated manual includes a new section on software and mobile applications reflecting the growing industry of medical device software. The manual also provides new guidance on the classification of two distinct borderline medical device-medicinal products, namely, a riboflavin solution for the treatment of keratoconus and dentistry products with aluminium chloride used in haemostasis.
On July 30, 2014, FDA issued a final guidance, “Center for Devices and Radiological Health Appeals Processes: Questions and Answers About 517A,” which provides an interpretation of key terms for appeals of certain CDRH decisions under section 517A of the Food, Drug, and Cosmetic Act (FDCA), including what constitutes a “significant decision” and a “substantive summary.” This guidance is a companion to FDA’s 2013 guidance on CDRH Appeals Processes, which describes the processes for seeking an appeal within CDRH as well as the statutory timeframes for the processing of appeals of significant decisions (for our earlier discussion on this guidance, see here).
On July 28, 2014, FDA issued an important final guidance relating to the Agency’s substantive review of 510(k) notifications, entitled “The 510(k) Program: Evaluating Substantial Equivalence in Premarket Notifications [510(k)].” This guidance applies to the 510(k) review process for both diagnostic and therapeutic devices and is applicable to 510(k) reviews undertaken by the Center for Biologics Evaluation and Research (CBER) as well as the Center for Devices and Radiological Health (CDRH). Although FDA notes that this guidance is “not intended to implement significant policy changes,” the guidance clarifies and addresses many key issues in the 510(k) program. FDA describes in detail the Agency’s critical decision points in the 510(k) review process and updates the 510(k) review flowchart that was first introduced in 1986. This guidance also discusses key concepts in the 510(k) program, such as the difference between “indications for use” and “intended use,” the use of multiple predicates, and requests for clinical data.
On July 14, 2014, FDA publicly posted its response denying Public Citizen’s August 2011 citizen petition concerning the marketing of non-absorbable surgical mesh products for transvaginal repair of pelvic organ prolapse (POP). In its response, FDA took the position that a ban or recall of POP devices is not warranted at this time.
As background, in August 2011, Public Citizen filed a citizen petition asserting that POP devices “offer no clinically significant benefits in comparison to surgical repairs for POP performed without placement of surgical mesh” and “have high rates of serious complications.” Public Citizen requested that the agency take the following actions: (1) ban the marketing of all available non-absorbable surgical mesh products for transvaginal repair of POP; (2) order all manufacturers to recall these products; and (3) classify all new non-absorbable surgical mesh products for transvaginal repair of POP as class III devices and approve the products only under a premarket approval application (PMA).
The China Food and Drug Administration (CFDA) issued a Notice on Items Related to Class I Medical Device Notifications (Notice) to establish new notification procedures for Class I medical devices, which includes in vitro diagnostics. This Notice is one of several that CFDA issued at the end of May 2014 related to the implementation of its recently completely revised Medical Device Supervision and Administration Regulation (MDR), which became effective on June 1, 2014.
On July 15, 2014, FDA issued a draft guidance entitled “Benefit-Risk Factors to Consider When Determining Substantial Equivalence in Premarket Notifications [510(k)] with Different Technological Characteristics,” which describes the benefit and risk factors that FDA may consider during the review process for a 510(k) submission (“draft guidance”). This draft guidance applies to both diagnostic and therapeutic devices. FDA makes clear at the outset that the draft guidance is not intended to change the 510(k) premarket review standard or impose extra burden on a 510(k) submitter to provide additional performance data.
Recently, the United States Food and Drug Administration (FDA) released two long-awaited draft guidance documents pertaining to internet and social media:
The first draft guidance outlines FDA’s current thinking concerning how manufacturers of drugs, biological products, and medical devices should respond to misinformation about their products posted by third parties on internet/social media platforms. FDA recognizes that information created by third parties is not always accurate and may be “dangerous or harmful to public health.” Therefore, the guidance provides firms various methods to correct such misinformation.