Out-Law News | 08 Feb 2019 | 11:41 am | 5 min. read
Commitments to close the regulatory gap that currently exists was set out in a recent report charting the work to-date of an executive working group set up by the EU and US. That group was established to take forward plans to strengthen EU-US trade which were agreed during talks between US president Donald Trump and European Commission president Jean-Claude Juncker last summer.
According to the executive working group's interim report, the EU will "take steps to make use of single audit reports … in a manner that is compatible with EU legislative requirements".
Single audit reports is an initiative developed by the International Medical Device Regulators Forum (IMDRF) to enable regulators across the globe to rely on the regulatory clearance provided by a sister authority and remove the need for the regulators to carry out their own assessments. The initiative is supported by authorities Australia, Brazil, Canada, Japan and the US. Regulatory differences limit its use on a broader scale, including in the EU.
The working group confirmed that the EU and US will also "cooperate to ensure alignment of electronic database specifications for Unique Device Identifiers (UDIs)" and that they will "develop a plan for bilateral test of compatibility of respective UDI databases, in concert with ongoing IMDRF efforts".
UDIs are used to identify and track medical devices placed on the market. A UDI system already exists in the US, and a new system is currently being introduced in the EU.
Helen Cline of Pinsent Masons, the law firm behind Out-Law.com, said: "The EU and US currently have different regulatory regimes for the medical devices industry. As a result, duplicate testing of products is required. This can delay access, and often lead to higher prices for patients. Therefore, any attempt during these negotiation to remove the need for duplicate testing, and assessment is to be welcomed."
Cline said that bridging the regulatory gaps "won’t be without its challenges".
"What is needed is a concerted effort by both sides to achieve a high degree of market integration," Cline said. "This is surely within the realm of possibility as both the EU and US systems are underpinned by the same objectives, assuring product and patient safety."
"The benefits of greater harmonisation between the EU and the US include broader access for patients to medical technologies and lower costs to market and accordingly lower prices and a more sustainable healthcare economy. Regulatory harmonisation is likely to be of major economic benefit to the EU where the medical technology sector is more fragmented then the US, with a large number of small and medium-sized companies," she said.
The work of the executive working group is focused on five areas, including exploration of trade facilitating actions in a number of sectors including pharmaceuticals and medical devices, and closer cooperation on standards.
The publication of the executive working group's report came after the European Commission set out a draft negotiating mandate for trade talks with the US. The Commission's draft negotiating mandate still needs to be authorised by the European Council.
Included in the mandate is a recommendation to open negotiations on a new international agreement between the EU and US that would provide for mutual recognition of conformity assessments carried out by EU or US regulators.
"The European Union and the United States have their respective practices of conformity assessments to ensure that manufacturers can only place a product on the market when it meets all the applicable requirements to ensure that unsafe or otherwise non-compliant products do not find their way to their respective markets. These may include testing, inspection and certification. Differences in approaches to conformity assessment can result in additional costs and lengthy and complex administrative processes without necessarily improving the safety of products," the Commission said in its report.
"A reduction in the number of barriers in relation to conformity assessment could be of particular benefit for exporting SMEs in the manufacturing industries," the Commission said in its report. "They are likely to gain in greater proportion from a decrease in costs of trading. This decrease in trade costs can sometimes make the difference between exporting or not."
Dublin-based life sciences expert Karen Gallagher of Pinsent Masons, the law firm behind Out-Law.com, said: "Moves to harmonise the regulatory regimes of the EU and the US are recognised by the Irish medtech sector as offering growth opportunities, particularly given the high percentage of SME medtech companies operating in Ireland, and the current scale of export activity in the sector."
"According to the Irish Medtech Association, Ireland is now one of the largest exporters of medical products in Europe, with annual exports of €12.6 billion to over 100 countries worldwide, and medtech exports account for more than 10% of all Irish exports. The Irish medtech industry is keen to continue to expand its global reach, and the reduction of regulatory differences between the EU and US markets will facilitate this. In addition, 80% of the 450 medtech companies based in Ireland are SMEs or start-ups, and these are the types of companies that stand to benefit most from the reduction in trading costs that increased EU-US co-operation in this area will bring," she said.
Munich-based expert in medtech regulation Julia Traumann of Pinsent Masons said: "One of the key areas of the TTIP negotiations had been regulatory cooperation. As these negotiations stopped, it is to be welcomed that talks especially with regard to medical devices have been continued. They come at a time where there is a transition period in medical device law in Europe as we await the new EU medical device regulation, finalised in 2017, to take effect."
"One of the challenges will be to ensure that EU-US cooperation efforts can be squared with the high standards of quality and safety for medical devices set in the new regulation and in relation to harmonising forms for getting new medical devices approved so that EU and US regulators could work on approvals at the same time," she said.
In its interim report, the EU-US executive working group separately confirmed that there has been an agreement reached in principle to expand the scope of the existing EU-US Pharmaceutical GMP Mutual Recognition Agreement (MRA) to include veterinary drugs. A formal decision could be issued by July this year.
Further work is being explored to expand the MRA further to cover joint inspections of manufacturing facilities for human vaccines and plasma-derived pharmaceuticals by "no later than 2022".
"This MRA facilitates trade by reducing unnecessary duplications of inspections at manufacturing sites," the report said. "Under the existing MRA, the EU and US are able to avoid unnecessary duplicate inspections and thereby realise savings of the order of $380,000 per average inspection, as well as ensuring an improved allocation of resources by regulators."
"Once the agreement is fully implemented, hundreds of inspections of pharmaceutical facilities could potentially be avoided thanks to the EU-US agreement," it said.