The FDA's Center for Devices and Radiological Health (CDRH) in October issued guidance to industry and the agency on third-party review of 510(k) submissions, offering recommendations about conducting and documenting third-party reviews of traditional, abbreviated, and special 510(k) submissions. The guidance applies to devices regulated by the Office of Device Evaluation and in vitro diagnostic devices regulated by the Office of In Vitro Diagnostic Device Evaluation and Safety. It supersedes guidance on third-party review originally released in 1996.

The Accredited Persons Program was created by the FDA Modernization Act of 1997. According to the FDA, the purpose of the program is to improve the efficiency and timeliness of the agency's 510(k) process. Under the program, the FDA has accredited third parties that are authorized to conduct the primary review of 510(k)s for eligible devices. The third party conducts the primary review of the submission and then forwards its review, recommendation and the 510(k) to the FDA. By law, the FDA must issue a final determination within 30 days after receiving the recommendation of an accredited third party.

The agency said that during FY02, 510(k)s reviewed by third parties received FDA marketing clearance in an average of 77 days after initial receipt by the accredited agency, which is 29% faster than comparable 510(k)s reviewed entirely by the FDA. For 2003, total elapsed time from a third party's receipt of a 510(k) to an FDA decision of substantial equivalence was 74 days. Comparable submissions that went through the FDA without using a third party took 112 days, CDRH said.

For fiscal 2003, CDRH reported receiving 190 510(k)s reviewed by third-party organizations, according to the center's recent annual report. This is a 50% increase compared to the 127 submissions received in 2002. CDRH speculated that the increase may be due, in part, to the implementation of the user fee program mandated by the Medical Device User Fee and Modernization Act. In 2003, CDRH made 196 final decisions on third-party submissions, up from 132 in 2002. By comparison, the FDA received a total of 4,247 original 510(k) submissions in 2003.

The guidance offers in-depth documents on specific steps and device categories, including background resources, organization and formatting a submission, and submission evaluation, which includes seven steps.

The first, and most obvious, is to ensure that the device is eligible for third party review. All Class III devices, as well as any Class II device that is intended to be permanently implantable, life-sustaining or life-supporting, or that requires clinical data in a 510(k) submission, are ineligible. A list of eligible devices if available from CDRH.

The second step involves obtaining relevant FDA guidance and information. CDRH recommends that the 510(k) submitter fully inform the company of any substantive pre-submission communications with FDA about the device, in addition to consulting CDRH's web site to obtain any relevant FDA guidance, or information about the legally marketed device the submitter is comparing to or other similar devices, include the indications for use statement, the 510(k) summary and the FDA's decision letter.

Third, consult as needed with the appropriate branch chief within CDRH. These consultations can contribute to timely and consistent 510(k) reviews by identifying relevant issues and review criteria, according to FDA. CDRH says the consults are particularly important for first-time reviews of devices without device-specific guidance.

Fourth, CDRH advises screening the submission using the Screening Checklist on the FDA's web site. This step entails screening the submission to ensure that the submission is administratively complete.

Step five calls for conducting a substantive review, which focuses on substantial equivalence. A device is considered substantially equivalent if it is reviewed as safe and effective as a predicate device – one that already has been cleared by the FDA.

The sixth step is to identify any deficiencies in a submission. If the company spots any deficiencies, the FDA recommends contacting the 510(k) submitter. CDRH says any form of communication can be used as long as confidentiality can be maintained. The agency advised against the exchange of substantive data and information over the telephone to avoid errors that may arise in the absence of a written request and response.

Step seven is a review of all documentation. The content of documentation will vary based on the type of 510(k) submission and device.

A complete list of accredited third parties is available from CDRH.

Device competition legislation introduced

The Medical Device Competition Act of 2004, S 2880, was introduced last month by Sens. Herb Kohl (D-Wisconsin) and Mike DeWine (R-Ohio). The legislation – authorizing the Department of Health and Human Services (HHS) to oversee group purchasing organizations (GPOs) – is the result of almost three years of hearings into the actions of GPOs. The intent is to prevent these groups from engaging in anti-competitive or unethical practices.

The subcommittee's recent investigations have focused on allegations that the practices of some GPOs harm competition and innovation among manufacturers of medical devices by excluding these manufacturers from gaining access to the hospital marketplace. In response, the industry adopted a baseline code of conduct. Six of the nation's leading GPOs separately enacted voluntary codes of conduct to address anticompetitive business practices and ban unethical practices.

The Kohl-DeWine bill has three essential provisions intended to ensure that GPO practices are in the interests of hospitals, physicians and patients: The legislation directs HHS to write rules forbidding GPO practices that are unethical, anticompetitive or prevent needed medical devices from access to the hospital marketplace; it is intended to prevent GPOs from accepting fees from hospital suppliers unless HHS certifies that the GPO does not violate these rules; and the bill proposes a ban on vendor fees that exceed 3% of the price of the good or service sold.

"Our goal is to ensure that physicians and patients have access to the highest quality medical products at the lowest prices, and to prevent improper barriers to competition among hospital suppliers," Kohl and DeWine said in a joint statement. "We also want to ensure that GPOs fulfill their important purpose – to cut prices for thousands of hospitals across the country and thereby restrain healthcare costs." DeWine is chairman of the senate's Subcommittee on Antitrust, Competition Policy and Consumer Rights. Kohl is the ranking member.

The senators said that the bill "strikes the right balance" and should ensure that any reforms already achieved in the hospital purchasing industry would not be lost "should our scrutiny of this industry be lessened." Kohl added: "Our bill will ensure that GPOs act in the best interests of patients and hospitals. Giving the Department of Health and Human Services oversight of this industry will help prevent improper practices that can endanger patients' access to the best and safest products."

DeWine also said the subcommittee has "come a long way" with the GPO industry. "Through many discussions and hard work on the voluntary codes, manufacturers, hospitals, doctors and other healthcare workers, and most importantly patients, are all better off," he added. "This bill is another step in the process, and I look forward to working with all the interested parties to assure that we continue to progress toward better, safer and less-expensive healthcare."

Critics of the bill, such as the Health Industry Group Purchasing Association (HIGPA; Arlington, Virginia), contend that government regulation is not necessary and that industry is able to act as its own watchdog. "HIGPA's code of conduct is still working," Robert Betz, PhD, president and CEO of the association, said during recent testimony before the subcommittee. "Private-sector compliance programs are the most efficient and effective ways to advance best practices that hospitals apply to purchasing and [they] ultimately strengthen our healthcare system."

CMS trial program targets quality-of-life issues

The Centers for Medicare & Medicare Services (CMS; Baltimore) recently rolled out long-expected plans for a demonstration program to find ways to improve the health and quality of life of Medicare beneficiaries with high medical expenses while at the same time reducing costs for the program and beneficiaries. The intent is to better control chronic illness and end-of-life expenses that represent the bulk of CMS spending, said CMS Administrator Mark McClellan, MD. "A modern healthcare system needs to find opportunities to improve their lives," he added. "We're going to find the most promising, innovative approaches."

CMS said the demonstration is designed to study various care management models for high-cost beneficiaries in the traditional Medicare fee-for-service program, including intensive care management, increased provider availability, structured chronic care programs, restructured physician practices, and expanded flexibility in care settings.

At present, 15% of Medicare fee-for-service beneficiaries account for about 75% of total Medicare expenditures each year. Many beneficiaries have multiple conditions and are at high risk of continuing to require intensive medical services. For some very ill patients, a restructuring of care to integrate provider services and to deliver those services in locations such as the beneficiary's home could significantly approve their quality of life, McClellan said, while also reducing costs for the beneficiary and Medicare.

This is the first effort to focus specifically on high-cost fee-for-service Medicare beneficiaries, according to the agency. A CMS demonstration notice invites physician groups, hospitals and integrated delivery systems to submit proposals for participation. Other types of organizations may apply, but they must be part of a consortium that includes at least one of the above entities and plays a major role in carrying out the demonstration.

Beneficiaries eligible for participation will be identified by CMS as meeting its high-cost guidelines as well as any additional targeting criteria for the individual programs. The agency said that participation would not restrict a beneficiary's access to regular Medicare services or providers, and participating beneficiaries will assume no financial liability for the administrative and care management fees.