We as human beings are hesitant to accept change.
And this pending MDR is all change.
It’s gonna change your whole world as a medical device manufacturer. Especially if you are a small company, or a startup with limited funds and big plans.
Manufacturers will now have to decide if they want to sell their products in Europe or not, then determine the dollar value of the regulatory process to achieve that goal.
They will have to ask themselves some hard questions – What will the actual dollar value be to maintain our ability to sell product in Europe? Will our sales and revenue offset that expense enough to grade the device launch as a success? Do we have enough resources and a strong enough quality management system to make it through the certification process?
For some manufacturers, it’s just not going to make sense to continue in that direction.
This is a huge and unexpected macroeconomics problem that will change the entire medical device industry’s performance, structure and behavior going forward.
And believe you me, the industry is not yet ready for what is coming.
At this year’s FDA/Xavier MedCon conference in Washington, DC, representatives from two notified bodies took part in a panel discussion with the audience.
Bassil Akra, Vice President, TÜV SÜD Product Service and Klaus-Dieter Ziel, Managing Director, MEDCERT answered questions about MDR and the changing regulatory landscape in Europe. Referring to the pending changes, both representatives agreed that it is in fact a mess.
Yikes – and this is from the people who are responsible for clearing your new products.
They went on to say that the number of notified bodies will decrease while the number of requirements for a device – or a notified body – to become certified will increase.
As for the timeline, it’s going to take 12 to 18 months to transition products with an MDD certificate that are already on the market to the MDR.
At least. For new products, no one knows.
Let me say that again – for new products, no one knows how long the MDR certification process will take.
If that little factoid doesn’t keep you up at night, I don’t know what will.
The number of notified bodies available will decrease. The number of requirements needing to be met will increase, as will the number of devices needing certification, as both existing and newly launched products will need to go through the process.
Even for those of us who hate math, it doesn’t take long to realize this just does not equal a timely market introduction.
What does this mean for the future of medical devices in Europe? What’s gonna happen to innovation in medical devices?
It’s gonna die. Why?
Because the small startups that foster innovation and ingenuity and out-of-box thinking will struggle to survive in the face of the new regulations.
It is quite possible that the large global medical device companies lobbied for these regulations in part because they have the money and resources to meet them that small companies and startups do not have.
Think about it. The startups are going to have restricted sales already because of what they can afford to do (or not do). And then the larger, established and well-funded companies are going to say, well, we’re going to acquire you, because we already have the systems in place to align with MDR, we’ll just roll your device into our existing system. But we’re not going to give you what you think you’re worth in the EU because we’re still going to have to do all that work ourselves, so your value to us is lower.
To make things even tougher for small companies, the Netherlands has just instituted a fine program for non-conformances.
If they determine that your notified body assessment has too many major non-conformances, and they think you are in gross violation of the MDR, they can fine you 10% of your entire financial holdings.
Small, startup companies cannot afford to pay out 10% of their holdings in fines, and the venture capitalists funding these companies are not going to want to see their investments used to pay such a penalty.
By helping to bring more stringent standards to medical devices, not only are the large manufacturers squeezing out their competition, but they’re also making it impossible for these small startup companies to launch products into this market, which means that their valuation is going to be lower, and therefore acquisition easier – and cheaper – for the larger manufacturers.
So, while not all medical device innovation will vanish, the changes to the regulatory landscape and the associated costs will certainly limit the number of innovative devices and methods coming to market in the next few years. And that is a sad state of affairs for an industry that is primed for new technologies and new ways of thinking.