The European Union medical device regulations (EUMDR) and in vitro diagnostic regulations (EUIVDR) present significant new business and compliance challenges for companies selling these products in the EU. While many of these challenges are new to the device and diagnostics industry, they are generally acknowledged as known impacts. However, several more subtle issues are emerging because of industry’s experience with the regulations and may present unique difficulties to the industry as it continues to maneuver through complex terrain. This article surfaces these less transparent – and underappreciated – issues, and offers pragmatic recommendations toward their mitigation.
Huge change, lack of clarity, shortage of resources
Don’t make the mistake of thinking that compliance with MDR will be a simple undertaking just because your organization currently complies with the EU Medical Device Directive (MDD). For one, EUMDR significantly expands compliance demands. Where MDD is 60 pages long, EUMDR is 157 pages. The EU has published 39 priority actions to clarify EUMDR, and 12 essential implementation acts to amend it. It’s not surprising then, that when the Regulatory Affairs Professional Society surveyed 200 regulatory leaders at medical device companies in June of 2018, 78% responded that, they did not have a sufficient understanding of the EUMDR.
EUMDR and EUIVDR also increase requirements across critical functions, many of which have been acknowledged as some of the most sweeping changes in the industry. Some of the most significant challenges include:
- Labelling. Changes to labelling requirements are sweeping. Under EUMDR and EUIVDR, every label for every affected product will change. How to manage the translation of labels into all EU languages, how to determine which materials require printing or website reference, and anticipating where symbology guidance will fall are just of few of the fundamental actions industry is contending with.
- Clinical evidence. Every product seeking a CE mark will need to be supported by clinical evidence. Existing trials, published literature, registry studies or studies previously initiated by investigatory bodies may satisfy these requirements—but they may not. New, post-market studies may have to be conducted, especially for up-classified products or in cases where supporting studies are older.
- Unique Device Identification (UDI) and EudaMed. EUMDR and EUIVDR create UDI requirements in the EU for the first time. EUMDR and EUIVDR are unclear when UDI information has to be entered into the EU medical device registry (EudaMed). In addition, EUMDR and EUIVDR may affect master data (MDM) and product information management (PIM) systems and processes.
- Changes and recertification. EUMDR and EUIVDR require that manufacturers recertify products with “significant changes” but do not provide a specific definition of what qualifies a change as “significant,” an area where certified regulatory agents would normally give guidanc
- New product classes in scope. Several products and product classes not having an intended medical purpose are also addressed under EUMDR and EUIVDR. Annex XVI of EUMDR lists a variety of these products, including contact lenses and other products used in or on the eye; equipment used for liposuction, lipolysis, or lipoplasty; high-intensity radiation equipment used for tattoo and hair removal: and equipment using electrical or magnetic currents to stimulate the brain.
Despite this influx of complex regulations and impacts for new product classes and myriad functions, the soundings across industry indicate that the European Commission has been uncharacteristically silent in offering much needed guidance to industry. Further, device and diagnostics companies traditionally relied on notified bodies (NBs) to help provide such guidance. NBs are organizations designated by the EU to assess the conformity of products before they are placed on the market. But a shortage of NBs is complicating the flow of information. In 2012, there were 87 NBs available to assess medical devices. As of April 2019, there were only 55
—and they all have to be re-certified under MDR. Only one had completed recertification by March 2019.
Another wrinkle? Brexit. Several NBs that maintain the largest volume of CE marking responsibilities are located in the United Kingdom. With the stipulation that all Notified Bodies need to have their place of legal business in the EU in order to remain certified under EUMDR and EUIVDR, UK-based NBs have recently begun unwinding their legal domicile and transferring to other EU locations. Companies need to make sure their NBs are, or will be, able to maintain their client’s CE markings in good standing as political forces remain unstable. On the other side is the UK’s potential change in position in allowing CE-marked products to be marketed in country. While the UK indicates it will recognize CE marks, it is currently unclear what additional hurdles medical device and diagnostics companies will have to overcome to offer products in a post-Brexit UK market. Further throttling information flow is the fact that NBs are precluded from advising or interpreting legislation until they have been certified, producing an unfortunate cascade of potential delays in scheduling NBs for technical file assessments and conformity audits.
The ramifications are widespread. With many device and diagnostics companies spending anywhere between $10M-$200M to level their products up to EUMDR and EUIVDR, there is a growing need for more actionable guidance from authorities. In the absence of these expected sources of information, many firms are using a wider variety of inputs to help guide decision making. For example, we have observed more companies establishing centers of excellence and enlisting internal and external subject matter and consulting participants as stopgap measures.
Another unintended consequence from the lack of limited authoritative guidance is that companies are making underestimating the cost and level of effort for EUMDR and EUIVDR remediation. Higher uncertainty means higher risk, and higher risk usually means higher contingency. If anything, companies should be increasing their spend forecasts around EUMDR and EUIVDR remediation. Instead, we feel many are underestimating those costs..
Ramifications of EUMDR and EUIVDR conformance may also extend beyond the EU. EUMDR and EUIVDR effects on product conformance may also require updates to regulatory filings in other countries. In addition, several markets outside the EU look to a product’s CE marking as a basis on which to recognize a product’s conformance to generally accepted regulatory standards. Therefore, failure to comply with EUMDR and EUIVDR could mean a de facto failure to comply with regulatory standards in some non-EU markets.
Fifty-six percent of respondents said their companies might undergo a large-scale transformation in the next three years, and 25% indicated they definitely will. About a fifth, or 19%, indicated a broad revamping is unlikely. Of those who believe major transformation could happen, 78% said they are considering transformation as a means to adapt to challenges companies face in the pharmaceutical market.
Creating EUMDR and EUIVDR awareness at the C-Level
Many organizations are experiencing a disconnect between executive leadership and front-line EUMDR and EUIVDR remediation stakeholders. Leadership has historically been able to assimilate and respond to different regulations applied to the device and diagnostics industry, but previous regulations have typically been more manageable, affecting a narrower band of functions and processes. EUMDR and EUIVDR are much more sweeping, encompassing multiple functions across the enterprise.
As a result, senior leadership may not appreciate many facets of EUMDR’s and EUIVDR’s impact to the organization, which has created a gap of understanding between senior leadership and the operational stakeholders vested in EUMDR and EUIVDR remediation. Setting budget and spend estimates is probably the biggest example highlighting this gap. It is very difficult for senior management to accept that remediating the gaps in current EUMDR and EUIVDR conformance could be between 5 and 8 percent of overall revenue. That’s the generally accepted industry forecast, though our experience indicates it may be even higher. Functional owners are generating more bottom-up estimates of remediating technical and quality documentation. While these estimates may not be based on a consistent set of assumptions around the budgeting effort, they are being contested by CFOs who are unwilling to accept them. Still, CFOs have recently been including EUMDR and EUIVDR in their company’s earnings announcements
One client recently remarked, “it's been a journey with us…from disbelief (they're going to grant more time, but now the reality of it is setting in) to how are we going to manage the budget and manage the resources and additional resources that may be required to comply with this?”
EUMDR and EUIVDR are introducing significant change management issues by subjecting organizations to a level of cross-functional coordination rarely required before. Companies will need to address conformance with dedicated teams and significant budgets, but the lessons learned from these more ambitious programmatic efforts can serve as a blueprint for how organizations can operate more effectively in the future.
Strengthening the chain: understanding economic operators
One of the more underappreciated impacts to industry is in the area of “economic operators.” EUMDR defines economic operators as:
- Manufacturers (Article 10) – entities that manufacturer or refurbish medical devices
- Authorized Representatives (Article 11) – entities that act on manufacturer’s behalf
- Importers (Article 13)—entities that place a device from an outside country on the EU market
- Distributors (article 14) —any party in the supply chain other than the manufacturer or the importer
Annex VI of EUIVDR significantly expands and enhances the roles and responsibilities of this wider network of stakeholders. These responsibilities include:
- Maintaining documentation and samples of devices for market surveillance
- Receiving onsite inspections from competent authorities
- Taking corrective action on devices with an unacceptable risk (including but not limited to recalls)
- Registering with, and confirming the accuracy of, data in EudaMed
Device and diagnostics manufacturers should create an overall master plan to coordinate how they interact with their authorized representatives, importers and distributors to confirm they are prepared to meet new compliance requirements. Quality management systems will need to establish additional procedures to effectively monitor and control this chain of custody. This confirmation may require upfront investment in training and awareness building to guarantee cohesive compliance throughout the supply chain. Extensive and regular communications and training of economic operators will be a key EUMDR and EUIVDR compliance effort.
The right approach to EUMDR and EUIVDR
Companies often have multiple products subject to EUMDR and EUIVDR, and those products are often managed through different departments within an organization. The result? Disparate and inconsistent compliance approaches that lead to compliance gaps or other compliance issues. What’s more, since EUMDR and EUIVDR take a product life cycle approach, compliance isn’t something accomplished once you have obtained a CE mark, but rather an ongoing exercise. It is vital for companies to establish a systemic, disciplined and scalable EUMDR and EUIVDR approach and infrastructure that drives effective, efficient and transparent compliance activities across all functions, all corporate divisions and all products.
The first step to effective compliance, for example, is a thorough gap analysis to determine how the differences between EUMDD and EUMDR will impact your products and organization. Next, analyze those gaps to define the level of detail and effort that will be required to remediate them.
Given the scope of EUMDR and EUIVDR compliance, it is then vital to effectively prioritize your compliance effort. Determine your EU market by product, down to the SKU level. Then you can decide which technical files and QMS documents to address first based on the market size for your products, thus ensuring that your biggest revenue generators are ready first.
The right tools matter. Organizations that use an ad hoc approach, with different portions of the organization using different compliance approaches for different products will, at a minimum, waste considerable time and money on inefficient compliance. In all likelihood, they will also face the additional expense of compliance failures that will have to be remediated later, along with possible lost revenue as they face delays getting their products approved for sale in the EU. Consider an integrated solution that will establish and enforce an appropriate and consistent EUMDR and EUIVDR compliance approach. This solution should:
- Capture and assess compliance efforts across all organizational boundaries and products
- Scan, monitor and track remediation efforts
- Identify and estimate costs for addressing technical file and quality management function compliance
- Establish a foundation that will allow for future automated assessment and compliance using machine learning and other tools.
EUMDR and EUIVDR compliance will be a huge and expensive effort. They will also significantly increase time to market in the EU. But, by creating a holistic approach, choosing the right tools, effectively rationalizing and prioritizing your products and potentially retargeting products that no longer make economic sense in the EU to other geographies, you can outperform your competitors and build strategic advantage.
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