Device Makers, e.g. Johnson & Johnson, May Benefit Most from FDA User Fee Bill

Device Makers, e.g. Johnson & Johnson, May Benefit Most from FDA User Fee Bill

"Put simply," says AdvaMed, the trade association of the medical device industry, "the [user fee agreement recently reached between FDA and the medical technology industry] is good for FDA; it is good for industry; and most of all, it is good for American patients."

The House version of the FDA user fee bill, which is currently being marked up, is "widely expected to contain more industry-friendly provisions, especially for medical device makers," according to Politico (here).

"One in particular is the HELP bill’s efforts to streamline the FDA’s ability to reclassify the risk level of devices. Whether a device is deemed more, or less, risky can dramatically change the amount of clinical data and other studies required for approval.

"Currently, such reclassification is a long-term rulemaking process that must be cleared by Health and Human Services and the Office of Management and Budget along with the full complement of public hearings and comment periods. The HELP bill would turn that into a faster administrative process without the extra layers of oversight."

According to Politico, AdvaMed is still pushing something in between "to preserve some of our due process rights,” AdvaMed's head of government relations (ie, chief lobbyist).

Details of "FDA’s ability to reclassify the risk level of devices" may be hidden in the bills. One of these details may concern "a loophole in the law that allows [medical device manufacturers] to submit new products to the FDA for instant review as long as they classify them as an upgrade even if the product has changes that could affect safety," says Consumer Reports. "Companies now use the process 90 percent of the time, according to a report published by Rep. Ed Markey, D-Mass., who is an advocate for industry reform."

Meanwhile, the FDA wants to assign a new bar-code-like identification number to medical devices to help it detect malfunctions in devices AFTER they have been approved. By tapping into medical and billing records from hospitals and insurance companies, FDA hopes to identify faulty devices before they cause deaths, such as the 686 deaths from 2009 to last year connected to automated external defibrillators and at least 20 deaths recently linked to surgically-implanted heart defibrillator wires.

One of the leading manufacturers of heart defibrillation devices is Guidant. A few years ago, it had to recall one of its devices that was linked to several deaths (see NYT article). That derailed a takeover bid by Johnson and Johnson (JNJ). Meanwhile, JNJ is actively growing its medical device business and will soon acquire Synthes -- a Swiss manufacturer of orthopaedic devices -- for $21.3 billion. Devices now account for 40% of JNJ's worldwide sales (see chart below; source of data: CNNMoney.com and Q1 2012 financial statement).

JNJ may position itself as a "consumer" products company, but its  main business is pharmaceutical drugs and medical devices. With the acquisition of Synthes, which had sales of nearly $4 billion last year, JNJ's device business will be an even bigger slice of its global sales pie (maybe 43%).

Medical Device Marketing Don't Need No Stinkin' ROI!

Medical Device Marketing Don't Need No Stinkin' ROI!

"Standards for devices exist, they just don't make sense," industry critic Dr. Diana Zuckerman, president of the National Research Center for Women & Families, said in a Consumer Reports release (also read this CBS report "Investigation: Most medical devices implanted in patients without testing"; see video below).

"An investigation by Consumer Reports, which included interviews with doctors and patients and an analysis of medical research and a device-safety database maintained by the FDA, shows the following areas of concern:

• Medical devices often aren’t tested before they come on the market. “What they’re doing is conducting clinical trials on the American public,” says Dan Walter, a political consultant from Maryland. His wife was left with heart and cognitive damage from a specialty catheter, cleared without testing, that malfunctioned during a procedure to treat an abnormal heartbeat.
• There’s no systematic way for the government, researchers, or patients to spot or learn about problems with devices. “A coffeemaker or toaster oven has a unique serial number so if a problem is found, the company can contact you to warn you. Your artificial hip or heart valve doesn’t,” Zuckerman says. “Your doctor is supposed to notify you of a problem but may not be able to if he has retired or passed away.”
• Without major changes in the system, there’s not much that patients can do to protect themselves.

According to Consumer Reports, the majority of medical implants are not tested to make sure they are safe. Most of the time device manufacturers only need to pay the Food and Drug Administration (FDA) a fee of about $4,000 with minimal testing in order to get approval for marketing. Compared to drug approval, this is a walk in the park.

In fact, sometimes device manufacturers bypass this minimal approval process altogether as did Johnson and Johnson's Ethicon unit (see "J&J Marketed Medical Device Without FDA Approval").

Not only is the approval of medical devices by FDA more lax than the process used to approve drugs, medical device marketing is worlds apart from Rx drug marketing as I learned from a presentation made by a Medtronic marketing VP. The presentation focused on a case study of a marketing campaign for the Prestige Cervical Disc.

That case study showed that out of an estimated 5 million spine surgery candidates (patients) in the US, Medtronic only needed to capture 125 of them to break even on a very successful marketing campaign that reached 6.2 million local TV viewers, 80.5 million radio (especially satellite radio) listeners, 4 million print readers, and 73 million Internet browsers. (Get more details about that case study by downloading this Pharma Marketing News article: "Medical Device Marketing: Worlds Apart from Rx Drug Marketing"; use discount code 'DEV444' BEFORE April 15, 2012 to get it FREE!).

While drug advertisers would sweat and moan over whether such a campaign would have a positive ROI (return on investment), medical device marketers don't need to worry about no stinkin' ROI because of such low numbers of conversions required AND also because very little resources need to go into premarket testing in order to get FDA approval.



Although the FDA has met most of its goals for fast-track medical device approvals, it's taking substantially longer to issue decisions on devices than it used to, concluded a report from the Government Accountability Office (GAO). The GAO said:

"FDA has begun to take steps to address GAO’s 2009 recommendation about high-risk devices that are allowed to enter the U.S. market through the less stringent 510(k) process, but progress has been limited. High-risk devices include those which are implantable or life sustaining. In 2009, GAO recommended that FDA expeditiously take steps to issue regulations for the device types classified as high risk that are currently allowed to enter the market via the 510(k) process. Since then, FDA has set strategic goals to address these device types, but has issued a final rule regarding the classification of only one device type. As of April 1, 2011, FDA’s action on the 26 remaining types of high-risk devices was incomplete. Thus, these types of devices—such as automated external defibrillators and implantable hip joints—can still enter the U.S. market through the less stringent 510(k) process. GAO found that, since its report was issued in January 2009, FDA has cleared at least 67 510(k) submissions that fall within these high-risk device types. FDA has taken some additional steps to enhance premarket device safety since GAO’s 2009 report was issued—for example, it commissioned the Institute of Medicine to conduct an independent review of the premarket review process—but it is too early to tell whether any forthcoming changes will enhance public health."

To get a copy of the GAO report, see the end of this post: "FDA Taking Longer to Approve Medical Devices, Says GAO"

Physician Bailout Part Deux: On Average, Device Manufacturers Pay Every US Orthopedic Surgeon Over $9,000 Per Year!

Physician Bailout Part Deux: On Average, Device Manufacturers Pay Every US Orthopedic Surgeon Over $9,000 Per Year!

File this under Pharmaguy's Believe It or Not! An analysis of financial payments made by orthopedic device manufacturers to orthopedic surgeons -- published today in the Archives of Internal Medicine (Arch Intern Med. 2011;171[19]:1759-1765) -- documents that if these payments were evenly distributed to all 25,000 surgeons, each surgeon would have received $9,120! This dwarfs the $750 per US physician that the drug industry pays to physicians every year (see "Physician Bailout: On Average, Pharma Pays Every US Physician Over $750 Per Year").

Of course, not every orthopedic surgeon receives money from the 5 largest orthopedic implant makers responsible for approximately 95% of all knee and hip implants used in the United States. (FYI: the 5 are Biomet Orthopedics, DePuy Orthopaedics, Smith & Nephew, Stryker Orthopaedics, and Zimmer.) In 2008, only 526 orthopedic surgeons received a total of more than $228 million (including $109 million in royalty payouts). On average, each of THESE surgeons received $433,460!

NOTE: 2008 may have been an unusual year due to royalty payouts. In 2007, 939 orthopedic surgeons received more than $198 million, which works out to $210, 863 on average per surgeon. Also, these figures do NOT include remuneration for meals and travel. Most payments are for consulting, royalties, and "research."

[In comparison, drug companies paid, on average, $1,520 to each physician that received payments, which DO incude meals and travel expenses.]

The authors were able to study payment trends for 3 of the 5 companies -- DuPuy, Smith & Nephew, Stryker -- over a 4-year period from 2007 through 2010. The mean payments per surgeon are plotted in the following chart.

The authors note that the average surgeon's salary is between $370,000 and $525,000 and they calculate that these payments by device companies would "likely represent 25% or more of an average orthopedic surgeon's annual income."

The 939 surgeons paid big bucks by device companies in 2008 represents only about 4% of the 25,000 orthopedic surgeons in the US. In comparison, drug companies made payments of some kind (including meals and travel reimbursement) to approximately 50% of ALL US physicians.

Apparently, device manufacturers are more selective than are drug companies regarding the physicians who receive payments. At least 44% of surgeons receiving money from device makers had an academic affiliation. The study's authors suggest that device makers may "curry relationships" with academic surgeons because they have the "potential to influence the future implant choices of all residents passing through a given program." Other critics have noted that high-volume surgeons also receive large consulting payments from device companies.

In a commentary published along with the study cited above, Robert Steinbrook, MD, of the Yale School of Medicine, noted that the term “consulting” is ambiguous. "Consulting related to research and development differs from consulting related to sales or marketing, and payments for consulting differ from research support or royalties. Consulting should be explicitly defined, and different types should be reported separately."

Meanwhile, CMS has yet to specify in regulations exactly how payments are to be classified when it comes time for ALL drug and device companies to report these payments to the federal government as required by the Patient Protection and Affordable Care Act (payments for 2012 must be reported by March 2013 and HHS will make these data public in September 2013).

FDA Issues Long-Awaited Guidance - for Mobile Medical Apps. Janssen, Look Out!

FDA Issues Long-Awaited Guidance - for Mobile Medical Apps. Janssen, Look Out!

While one arm of the FDA -- the Division of Drug Marketing, Advertising, and Communications (DDMAC), the arm responsible for regulating drug promotion -- is dragging its feet issuing guidance for social media promotion (first promised for 2010, now completely off the 2011 guidance calendar; see "FDA Drops Social Media from Its 2011 Guidance Agenda"), two other arms -- the Center for Devices and Radiological Health (CDRH) and the Center for Biologics Evaluation and Research (CBER); responsible for regulating medical devices -- has issued guidance for mobile medical applications (see "FDA outlines oversight of mobile medical applications" where you can download the guidance document).

The guidance focuses only on a select group of applications and goes out of its way to assure the public that the FDA "will not regulate the sale or general consumer use of smartphones or tablets."

As you know, there are probably thousands of consumer-focused health apps available for smartphones. The guidance carves most of these out of its regulatory bailiwick. According to the guidance, the following represents mobile apps that FDA does NOT consider to be mobile medical apps for purposes of the guidance:

"Mobile apps that are solely used to log, record, track, evaluate, or make decisions or suggestions related to developing or maintaining general health and wellness. Such decisions, suggestions, or recommendations are not intended for curing, treating, seeking treatment for mitigating, or diagnosing a specific disease, disorder, patient state, or any specific, identifiable health condition [my emphasis]. Examples of these apps include dietary tracking logs, appointment reminders, dietary suggestions based on a calorie counter, posture suggestions, exercise suggestions, or similar decision tools that generally relate to a healthy lifestyle and wellness."

I highlighted the wording that determines whether or not FDA might consider health apps subject to being regulated as medical devices: "not intended for curing, treating, seeking treatment for mitigating, or diagnosing a specific disease, disorder, patient state, or any specific, identifiable health condition."

The guidance defines what would make an app a mobile medical app subject to regulation as:

"When the intended use of a mobile app is for the diagnosis of disease or other conditions, or the cure, mitigation, treatment, or prevention of disease, or is intended to affect the structure or any function of the body of man, the mobile app is a device."

"One example," says the FDA, "is a light emitting diode (LED) included on a mobile platform with a mobile app to make that LED operate. If the manufacturer intends the system to illuminate objects generally (i.e., without a specific device intended use), neither the mobile app nor the mobile platform would be considered medical devices. If, however, through marketing and distribution, the mobile app is promoted by the manufacturer for use as a light source to examine patients, then the mobile app would meet the definition of a device. (In this case, the intended use of the light source would be similar to a conventional device such as an ophthalmoscope.)"

Are there any pharma developed and promoted mobile apps that fit this definition and thereby SHOULD be regulated as a medical mobile app?

YES, THERE IS!

Back in March, I suggested that Janssen's "Psoriasis" app for the iPhone and iPad may be a candidate for regulation as a medical device. You can read all about that in this blog post: "FDA Promises Still More Guidance! This Time It's Mobile. Janssen's Psoriasis iPhone App May Need It" and in this Pharma Marketing News article: "Pharma SmartPhone/Tablet Apps. Is There a Regulation for That?"

One of the questions I had about Janssen's Psoriasis app concerned the accuracy of the formula used to calculate PASI ("Psoriasis Area and Severity Index"), which is a tool for the measurement of severity of psoriasis. The app is intended for physicians to use in diagnosing their patients. Suppose there was a "bug" in the program that calculated the PASI score? It seems that such software needs to be regulated as a medical device by the FDA.

In fact, I notice that there is an update available for Janssen's Psoriasis app. It was issued on 31 May 2011, about a month and a half after I blogged about the app. The note relating to the update merely states "bug fix." Could there have been a "bug" -- ie, ERROR -- in the formula used?

I updated my iPhone version of Janssen's Psoriasis app, but I do not notice any difference in the app nor the instructions that come with it. The "bug fix," therefore, could actually involve the software that calculates PASI.

Regardless of whether such pharma apps may be regulated by FDA as medical devices, I strongly believe that developers of health-related apps should explain in detail what "bugs" were fixed so that users have an idea of how the "bug" may have affected them. Shame on Janssen for not being more transparent in this regard!

[This post originally appeared in Pharma Marketing Blog. 

Make sure you are reading the source to get the latest comments.]

FDA Targets Genetic Testing Services for Advertising Unapproved "Medical Devices"

FDA Targets Genetic Testing Services for Advertising Unapproved "Medical Devices"

FDA recently  (May 11, 2011) sent letters to two DNA testing services concerning their Direct to Consumer (DTC) advertising. The companies are Precision Quality DNA (see letter here) and Lumigenix Inc (see letter here).

Precision Quality DNA, offers a service intended to help individuals "understand the analysis of their DNA sequence while focusing on main target genes, such as BRCA1/BRCA2, to determine that individual’s main risk factors or likely response to a particular drug." FDA claims that the service "appears to meet the definition of a device as that term is defined in section 201(h) of the Federal Food Drug and Cosmetic Act."

Section 201(h) of the Federal Food, Drug, and Cosmetic Act defines a medical device as:

“... an instrument, apparatus, implement, machine, contrivance, implant, in vitro reagent, or other similar or related article, including any component, part, or accessory, which is … [either] intended for use in the diagnosis of disease or other conditions, or in the cure, mitigation, treatment, or prevention of disease, in man or other animals ... [or] intended to affect the structure or any function of the body of man or other animals.”

FDA looked high and low in its files and "ha[s] been unable to identify any Food and Drug Administration (FDA) clearance or approval number for the Precision Quality DNA. We request that you provide us with the FDA clearance or approval number for the Precision Quality DNA . If you do not believe that you are required to obtain FDA clearance or approval for the Precision Quality DNA, please provide us with the basis for that determination."

Actually, Precision Quality DNA does NOT believe it requires FDA clearance and says so right on its website on a page titled "Health, Politics and Regulatory Issues" (see here). On that page, Andre Gous, Co-Founder of the company and addressee of FDA's letter, has some interesting things to say about the FDA and its authority to regulate software as a medical device, including:

"Even if you're in favor of government regulation, you're probably wondering how a 1976 FDA law could be applicable to DNA biotech -- an entire field of endeavor that was unknown to the legislature at that time. And, since that law focuses on devices, the FDA is (no surprise) also classifying more and more things, even things as ethereal as software, as a 'device.'

"If the FDA were simply deluded, that would have been bad enough already. However, the FDA didn't stop there. They mailed intimidating letters to the top 5 DNA biotech US companies, and since then they have mailed out 14 more such letters yet."

After that it's pretty much an Ayn Rand style rant; ie, government should just leave capitalists alone.

My guess is that Precision Quality DNA was not among the the "top 5 DNA biotech US companies" that previously received letters from the FDA. To paraphrase it's marketing tag line, Precision Quality DNA "Dodged the Bullet with its Name on it" from the FDA in the past, but now has to deal with that bullet. It will be interesting to see who prevails, the bullet or the target.

Pharma Tracks Docs at Medical Meetings Using RFID Technology

Pharma Tracks Docs at Medical Meetings Using RFID Technology

Although the pharmaceutical industry is dragging its feet implementing RFID (Radio Frequency Identification) technology to keep track of drug supplies, some companies are currently using the technology to track physicians' movements at scientific conferences.

"Dr. Wes" (Westby G. Fisher, MD, FACC) called this "Physician Tag and Release" (see "The Implications of Physician Tag and Release"). The photo on the left shows the back of Dr. Wes's badge at the recent American College of Cardiology Conference held 2-5 April 2011 in New Orleans, LA.

The technology is also being used at the Heart Rhythm Society conference going on right now. Propublica and USA Today co-published a story about how doctors are being bombarded with pitches for drugs and medical devices at this conference (see "Financial Ties Bind Medical Societies To Drug and Device Makers").

RFID tracking is a disturbing aspect of industry-sponsorship because it may give exhibitors access to the identity of any physician who enters (or merely passes by?) sponsor booths at medical meetings even if the docs do not talk to reps or give their permission to collect such information.

"Many physicians were unaware that exhibitors had paid to receive real-time data about who visited their booths, including names, job titles and how much time they spent," says Propublica.

The Heart Rhythm Society claims that exhibitors are not getting doctors’ personal information, but here's what the American College of Cardiology says about how its exhibitors benefit from RFID technology (see "Using Technology to Better Understand ACC Meeting Attendees"):

"The second way in which RFID technology is utilized is in the Exposition. Exhibitors were able to rent RFID readers from the vendor. They are able to use the data in much the same way as the ACC – to evaluate how effectively their work stations are structured and to improve their offerings to attendees. In addition, they are given access to limited information about the visitors to their booths. The information they are given is the same information that was available on meeting attendees badges in print (name/city/state/institution). No contact information is provided. ACC’s intention was not to create a revenue source by offering attendee data to exhibitors (in fact, only five out of more than 300 exhibiting companies decided to invest in RFID in their booths), but rather to provide exhibitors another resource by which to understand the traffic flow in their booths and to better align their displays with attendees’ needs."

Instead of "opting in" for tracking at scientific meetings, doctors must "opt out" from the use of tracking technology when registering for scientific meetings.

The practice "disturbs" Dr. Wes who says:

"It is no secret that these societies make a significant portion of their operating revenues from industry sponsors at these meetings. By instituting tracking, the value of their membership's privacy has taken a back seat to the income generated from tracking revenues."

and

"At the risk of sounding like a conspiracy theorist, it is not too hard to imagine one's credentials being called into question in court because a doctor did not demonstrate enough time in CME activities at the scientific sessions to quality for credit or because these data implicate a doctor in a purchasing agreement between a vendor and hospital system simply because a doctor visited a display booth."

Dr. Wes also imagines a scenario where RFID data collected at medical meetings can be combined with a doctor's prescribing information without their permission. That's a double whammy for physicians who wish to keep their prescribing habits private. The Supreme Court is deliberating that issue (see "Supreme Court to Decide Fate of State Laws that Prohibit Use of Rx Records by Pharma").