Lobbying For Labels:

December 1, 2002

Lobbying For Labels:
Congressional Committee Discusses Legislation on SUD Reprocessing

By Kathy Dix

Pushingfor equality among manufacturers and reprocessors, lawmakers face a new debatein the Senate over specific verbiage for labels on reprocessed medical devices.On Oct. 2, 2002, the House of Representatives' Committee on Energy and Commerceapproved language regarding the labeling of reprocessed single-use devices (SUDs).The language was reviewed in a markup session, during which the legislative billwas put into final form before being referred to the House for floorconsideration. The House approved HR 3580 on Oct. 9 as amended; the proposedlegislation was then received in the Senate.1

The proposed law would require reprocessed SUDs to bear a prominent labelstating "Reprocessed device for single use. Reprocessed by ____," withthe reprocessor's name inserted. HR 3580 also proposes the creation of an Officeof Combination Products and Product Jurisdiction that will "be responsiblefor designating the center with primary or exclusive responsibility for thepremarket and postmarket regulation of drugs, devices and biologicalproducts."

HR 3580 would also grant exceptions for certain humanitarian devices andcertain devices sponsored by federal or state government, and allow theSecretary of Health and Human Services to waive one premarket application orreport if the applicant is a small business submitting its first premarketapplication or report. It even provides for reduced fees for small businesses.

"We've been working very hard trying to get FDA to treat reprocessorsthe same way our companies are treated," says Larry Holden, president ofthe Medical Device Manufacturers Association (MDMA). Reprocessors are currentlyrequired by the FDA to provide the same kind of information that originalequipment manufacturers (OEMs) must, including registration and listing, medicaldevice reporting, medical device tracking, medical device corrections andremovals, Quality System Regulation (QSR), labeling and premarket requirements.2

"We want them to be treated like a medical device company," Holdenadds. "What the reprocessors say is they can't do that because they don'thave the data from the original manufacturer and the manufacturer won't give itto them." Holden stresses two points: first, that the FDA should knowwhether a device can be reprocessed or not, and second, if it can bereprocessed, how often that should be done before the device is discarded.

"The FDA is fully regulating this industry -- there's clearly a levelplaying field already, and there's not a public health issue withreprocessing," says Mark Salomon, senior vice president of corporatedevelopment at Vanguard Medical Concepts, Inc. "In some senses, this HR3580 will create an un-level playing field from the manufacturer's standpoint.In the final analysis, we can live with everything in 3580. What's good aboutthis is that some of the changes will provide more access to more products onthe reprocessing side."

"(Reprocessors) need to do their own clinical trials for the FDA ontheir own time and their own dime," Holden says. OEMs argue that they haveinvested significant funding in researching a device and launching it; thus, athird-party reprocessor should be obligated to do the same research at its ownexpense, rather than reaping the benefits of the OEMs' work.

"There is language in here that allows for a class resubmission thatwould not require a right of reference, so I don't have to describe themanufacturing process of the OEM. In other words, I have to describe mymanufacturing process, and those materials are my raw materials," Salomonexplains.

Obviously, with the existing rift between OEMs and third-party reprocessors,reprocessors were not likely to be given access to the manufacturers' originalmanufacturing process or other details. So, says Salomon, "(H.R. 3580)allows third-party reprocessors to open to new products and provide anotherlevel of enhanced regulation."

The MDMA asks that a reprocessed device be labeled as such, so physicians andpatients know whether they are using a brand-new device or a reprocessed one."At the end of the day, you almost get to the common sense position, whichis, it's either a single use device or not. We should not be reprocessing singleuse devices; it either should be used again or it should not be," Holdensays. "But if we're going to reprocess devices, we have to make sure (theprocess is) safe. The FDA's entire mission is safety and efficacy."

Reprocessors, however, emphasize that reprocessed devices -- if sterilizedproperly -- are no riskier than brand-new devices. Thus, labeling a product asreprocessed or new may not be necessary.

If HR 3580 becomes law, the requirement of labeling devices as reprocessedwould only apply to devices introduced or delivered for introduction as of Oct.1, 2002.

The legislative language proposed by OEMs includes more than just arecommendation to label reprocessed SUDs. It also sets forth requirementsregarding the following:3

  • Facility inspection by nongovernment inspectors

  • Outside expert review (accredited third parties) of applications for devices subject to premarket notification

  • Designating priority devices for the treatment of serious diseases or conditions

  • Manufacturers and importers reports only for types of devices requiring malfunction reporting

  • Labeling for intended use of devices found substantially equivalent to legally marketed devices

  • Notification of false or misleading proposed labeling

  • Approving supplements to approved applications seeking to add a specification of a subpopulation under an approved condition of use

  • Using the least burdensome scientific evidence required to demonstrate a device's effectiveness

  • Investigational plans examining the safety, effectiveness or substantial equivalence of a device

  • Notification of deficiencies

  • The guidance development process utilizing nongovernmental employees

  • Modular review of applications

  • Registration

  • Electronic labeling

One element of HR 3580 is the inclusion of a user fee; this, says Salomon, isincluded as something of a common-sense tax, as a way for the industry to payfor the FDA's efforts. "In essence, what they're doing is applying a userfee like a tax on automobiles -- that tax just gets funneled back to the agencythat would use it for enforcement, so it provides money back into the FDA and tothe various different elements of the FDA."

But how will this automatic fee affect reprocessors? "It'll have someoverall effect on our overhead but it won't skew it immensely," Salomonanswers.

HR 3580 gave the Association of Medical Device Reprocessors (AMDR) and theMDMA the opportunity to openly discuss some of the issues dividing the twogroups. "It was an effort between reprocessors and OEMs to sort of tablesome of the issues and get them resolved, because of some of the common goals inthis legislation, on both sides," adds Salomon. It allowed the two sides toobtain closure in some volatile areas. "There was some give and take,"Salomon recalls. "It's a good sign."

HR 3580 is "all about the patient and public health, and ensuring thatwe can deliver a good product to the patient and a solution to the rising costof medical devices in the public health sector," Salomon adds. This, hesays, can be done through reprocessing "and with tenets that we cancertainly live with that are in this law."

"AMDR members have always been supportive of the process and ofregulating this industry where it's appropriate," he adds. "We havegone along with every set of terms and requirements that have been thrown at us,all of this without the issue of public health; there has never been an issuewith the public health."

Currently, he emphasizes, reprocessors are regulated at the same level asOEMs. "(To regulate reprocessors) there's not much more we would have todo," he says. "It ultimately provides more stability for the entireindustry ... expanding access to the practice of reprocessing."

HR 3580, Salomon says, is a "tremendous solution" for the industry."I see nothing but tremendous growth. Right now, you're seeing the numberof reprocessors shrink as these guidelines come into play; so, if anything, theAMDR companies are getting larger. There's consolidation in the industry."And, he adds, over time more companies will probably enter the reprocessingfield. Overall, he says, HR 3580 has strongly impacted both OEMs and third-partyreprocessors. "This is tremendous for the stability of this entireindustry."

Despite the impact of HR 3580, Salomon does not anticipate a substantialchange in the number of hospitals that reprocess devices. Gradually, they havebeen phasing themselves out of reprocessing. "Some of the largest hospitalsin the industry are openly saying they're not going to reprocess anymore, thattheir mission is to take care of patients, not to be a manufacturer,"Salomon affirms. "There are fewer and fewer hospitals doing reprocessing. Idon't know that you're going to see any massive switch; I think most of it hasbeen driving toward third-party reprocessors, and the business is growingnicely. There are no fewer disposable instruments being manufactured today, andthat provides a rich environment in driving down health care costs. If you lookat the cost of the services from the provider side of the thing, it's amazingthat you can start to bring (in) some level of stability. Is reprocessing theonly answer to that? No, but it is clearly one of the solutions."

HR 3580, which was modified slightly before reaching the President, wassigned into law as HR 5651 on October 26. An issue close to the hearts of many,the law flew through Congress to the President's desk with lightning speed."This one was kind of near and dear to my heart because I was invited toparticipate in the drafting of the legislation," recalls Don Selvey, thevice president of regulatory affairs and quality assurance at Alliance MedicalCorporation. "It was pretty neat to sit there and watch how the processcame together."

In September, the House Committee on Energy and Commerce brought togetherrepresentatives from many different backgrounds: original equipmentmanufacturers, reprocessors, the American Hospital Association, the FDA.Staffers for the Committee then locked the door and informed the participantsthat no one was leaving until a consensus was reached.

With that incentive, the parties fell to work and drafted language that wassigned into law only a month later. Of course, it is too early to tell how thenew legislation will affect the industry long-term. But, says Selvey, OEMs andreprocessors have already begun building bridges. "What we've been seeingover the last year and a half or two years is manufacturers saying, 'Can we worktogether to make a device that has some limited reprocessing(capability)?'" Selvey recounts. There is, perhaps, some middle ground forthe two factions. "I think the new law and collaborative effort we wentthrough to develop this law might help that a little bit -- we hope," hespeculates.

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