My dear readers, as we move quickly toward the end of 2013, once again another holiday season is upon us. Dr. D would like to wish all of the readers a joyous holiday season and a happy and prosperous start to 2014.

For this week’s guidance the doctor would like to reflect upon the medical device industry and the ongoing changes to the quality and regulatory environment and the industry as a whole. Not wanting to state the obvious but obliged to do so, change in a highly regulated industry is inevitable and you can take that to the cloud, where ever in the heck the cloud may be. Seriously, one of the changes Dr. D is seeing across the industry is a continuation of layoffs. The reasons for the reductions in workforce vary but the underlying theme appears to be Obamacare and an extremely punitive 2.3 percent medical device innovation tax. Will Obamacare continue to have a significant role in the shaping of the device industry? Only time will tell my friends. However, the layoffs are having an immediate impact to industry and you better believe FDA is well-aware of the impact of layoffs versus sustaining a compliant quality management system. Considering the “nimiety” (look-it-up) of regulations device manufacturing are required to comply with, not having sufficient resources to sustain compliance is a recurring nightmare for Chief Jailable Officers (CJO) everywhere. That being said, the doctor hopes you enjoy this week’s guidance.

Layoffs Dr. D saw the layoff trend continue in 2013. In fact, whether one wants to believe in the employment numbers being posted by the government, or not, layoffs in the device industry appear to be on the rise. Regardless of the underlying causes associated with layoffs, the end result is device manufacturers having to do more with less. The good news is, consulting firms such as Devine Guidance International are doing quite well as device manufacturers rush to fill voids created by layoffs.

Conversely, using consultants is just a short-term solution. Device manufacturers still need warm bodies to execute the day-to-day activities associated with quality and regulatory compliance. Not unlike Santa Claus checking his naughty or nice list, FDA is checking their list too. Folks, making it to the top of the FDA’s naughty or nice list is not necessarily a good thing. For starters, not only does FDA expect device manufacturers to establish written procedures, the expectation is that procedures are actually implemented and being used. Dr. D thinks it might be kind of difficult to establish, implement and adhere with procedures if a device manufacturer is resource challenged.

The best advice Dr. D can offer to the Chief Operating Officers (COO) of the world, you need to think long and hard about all layoffs that potentially impact the overall effectiveness of the QMS. If the trade-off is dollars for other device establishment needs versus quality and regulatory compliance, quality and regulatory compliance (Dr. D’s humble opinion) should win every single time. Why? Have fun trying to get FDA to review and approve new products or sign Certificates to Foreign Governments (CFG) with a warning letter hanging over the proverbial head of a device manufacturer.

Warning letters  Another trend the doctor witnessed in 2013 was an increase in the number of FDA warning letters and the number of observations cited in each letter. Once a device establishment is blessed with a warning letter, all bets are off. Dollars saved due to potentially ill-conceived reduction in workforce are now flying out the doors of the offending establishments as they work toward regaining compliance in the eyes of FDA. For some reason, management sometimes seem to think that warning letter remediation is something that is fixed in a few short weeks or even a month or two. Nothing could be further from the truth. The doctor had the pleasure of leading a team that worked on remediating Boston Scientific’s warning letter. Several years and millions of dollars later, FDA finally blessed Boston Scientific’s warning-letter remediation efforts and lifted the warning letter.

For smaller device manufacturers, lacking the fiscal resources, a warning letter could be the kiss of death. The best advice Dr. D can offer to the COOs of the world, you need to think long and hard about all layoffs that potentially impact the overall effectiveness of the QMS. Why? Warning letters are expensive and will quickly consume all of the fiscal resources saved as a result of an ill-conceived RIF. Hopefully, you are starting to catch Dr. D’s drift here.

Enforcement reports If the readers have not already done so, the doctor recommends subscribing to the FDA’s weekly enforcement reports. Similar to layoffs and warning letters, it appears the number of corrections and removals is on the rise. Why? If you need to ask why then you just may be in the wrong industry. Somewhere buried in the root-cause behind every correction and removal is a quality problem or a regulatory compliance problem. Guess what? Poor quality quickly becomes exacerbated if a device manufacturer lacks adequate resources to ensure quality is designed and built into a finished medical device that is safe and effective. If the regulatory resources are stretched thin, then errors in 510(k) and PMA submissions can result in significant delays in product approvals. Even worse, failures to report MDRs in a timely fashion may bring a surprise visit from the FDA for a cup of coffee and a for-cause inspection. However, poor quality will eventually lead to Dr. D’s favorite 6-letter word becoming a reality, RECALL! Recalls are expensive and the loss of consumer faith may be difficult to recover. Rest-assured, your competitors are knocking are the doors of you customers, more than happy to fill the void caused by a product recall. If the underlying cause of the recall is a lack of resources to drive product quality, your competitors will be smiling all the way to the bank. Regulatory trends affecting the industry Although this week’s guidance is clearly FDA-centric, much is happening around the globe. Before you begin to read this section, please keep in mind Dr. D is currently at 33,000 feet and sipping on some JD (Jack Daniel’s for you prohibitionists). 

• Brazil announced modifications to modification to their good manufacturing process impacting the issuance of BGMP certificates. 
• Unlike 2012, ANVISA (Brazil) has managed to work through the entire year without a strike. Congratulations.
• SFDA (China) is now CFDA, who knew?
• KFDA (Korea) is now MFDS (Ministry of Food and Drug Safety), who knew?
• The EU Commission has proposed retooling the MDD. Can you say unannounced notified body audits you are going to have to pay for (surprise-surprise)? Can you say Competent Authority review and input of Design Dossiers (Class III device in the EU)? I wonder how much time this is going to add to the review and approval process. Can you say a regulation versus a Directive? There will definitely be more to come on this topic folks. Note: better oversight of notified bodies is also being promised. Dr. D is just giddy with excitement over this one. The doctor is growing tired of inexperienced notified body auditors that do not understand 93/42/EEC or ISO 13485. Instead, some of these folks make up their own regulations along the way.
• There are regulatory requirements required to ship product into Kenya. Who knew? The Ministry of Health in Kenya provides regulatory oversight for medical devices being imported into Kenya. Who knew? Note: the same hold true for Uganda and the Ugandan NDA (National Drug Authority), once again, wow, who knew? 
• Someone mentioned to the doctor in passing that there are no medical device regulations for former Soviet-block countries. Are you kidding me? It is this type of nonsense that quickly gets medical device manufacturers in deep doo-doo with regulators. Please, when in doubt contact someone like The Emergo Group (the doctor is not a paid spokesperson for Emergo) for advice; or give Dr. D a shout.
• In case you haven’t noticed, FDA is ramping up unannounced inspections (surprise-surprise).
• The Unique Device Identifier (UDI) is now a regulatory requirement in the United States (21 CFR, Part 830).
• Is it a medical device, is it a drug, no it’s a combination device; 21 CFR, Part 4 (GMP for Combination Devices) became a reality in the United States in 2013.
• China and Brazil have stated that streamlining of the medical device approval process is on the horizon. We shall see more in 2014.

Takeaways Folks, the doctor will leave the readers with just one big takeaway from this guidance. THANK YOU! Thank you for reading DG, week-after-week. Thank you for buying Dr. D’s books from Amazon.com. Thank you for inviting Dr. D to speak at your conferences. Thank you for hiring Dr. D to support your firms.

In closing, thank you, thank you, and thank you again for joining Dr. D and I hope you find value in the guidance provided. Until the next installment of DG in the new year, cheers from Dr. D. and best wishes for continued professional success.