FDA is updating guidance on its humanitarian device exemption program to clarify an expanded profit allowance and a potentially less-restrictive upper-limit on the number of qualifying HDE devices that can be sold for profit in a given year.
The FDA released the guidance on March 17, incorporating changes to the HDE program that was enacted by the FDA Safety and Innovations Act of 2012 (FDASIA). Humanitarian-use devices are intended to help undeserved, rare conditions. The sponsor must show the device is safe, but the effectiveness threshold is lower than a PMA. The sponsor also must show the device is intended to treat or diagnose a condition that affects fewer than 4,000 patients in the U.S. per year.
The HDE-approved device cannot be priced higher than the cost of R&D, fabrication and distribution of the device. In 2007, Congress removed the profit restriction from HDEs seeking a pediatric indication, with the goal of stimulating investment in medical devices for children.
In FDASIA, Congress refined the act and put in language to allow profit-seeking in other situations. Specifically, for devices “intended for the treatment or diagnosis of disease or conditions that does not occur in pediatric patients in such numbers that the development of the device for such patients is impossible, highly impracticable, or unsafe.”
The updated guidance indicates that FDA will determine whether a device meets the “impossible, highly impracticable, or unsafe” standard. This will based on information submitted by an applicant that demonstrates the sponsor will not be able to conduct the necessary studies in a pediatric population. For example, an HDE device might qualify for profit-seeking if the annual pediatric incidence of the disease is so small or so geographically dispersed to prevent sufficient recruitment.
The other HDE provision in FDASIA revised the definition of the “annual distribution number,” which must be predetermined as the maximum number of qualifying HDE devices that can be sold by a company for profit annually. Under the 2010 HDE guidance, the annual distribution number is capped at 4,000. The new draft guidance removes the 4,000 device cap, and assumes the annual target population is 4,000.
Comments on the draft guidance are due in June and once finalized it will replace the 2010 version.
Please share your thoughts on the new guidance.
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