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Study: FDA Process "Unpredictable," "Characterized by Disruptions and Delays" BY LAUREN UZDIENSKI, NOVEMBER 22, 2010

More than 200 small and mid-size medical technology companies were surveyed for a new report designed to uncover lags, challenges and inefficiencies in the U.S. regulatory process, with respondents comparing their U.S. experiences to European regulatory experiences. Across the board, European approvals were faster, and EU regulatory authorities received substantially higher ratings in the area of "predictability," "reasonableness" and "transparency." As for "overall experience," 75% of respondents rated their regulatory experience in the EU excellent or very good, compared to 16% for the FDA.

The lag in getting products to patients was one of the more notable results of the study, with respondents reporting that their devices were available to U.S. patients an average of two years later than patients in other countries, attributed to FDA delays or strategic decisions to pursue OUS markets before beginning the regulatory process in the U.S. The report states that lags in bringing devices to market can reach 70 months in some cases.

Respondents also characterized the FDA as driving up the costs of product development. The reported average total cost for participants to bring a 510(k) product from concept to clearance was approximately $31 million, with $24 million spent on FDA activities. For PMA submissions, a total of $94 million was spent on average, with $75 million linked to FDA-related costs. This is particularly daunting for U.S. companies as, among venture-backed startups, less than one out of four succeed, half of all reported exits are less than $100 million and "the total pool of available investment capital is shrinking."

The survey concluded that the U.S. regulatory process was "unpredictable and characterized by disruptions and delays." Further, the MDMA said in a press release praising the study that "the current regulatory environment is adversely impacting innovation, patient care and job-creation here in the United States."

The project was initiated in summer 2010 and surveyed over 200 companies. Results will be used to support discussions with the FDA and the Institute of Medicine (IOM), which is currently conducting a review of the 510(k) process.

The study was conducted by Josh Makower, M.D., consulting Professor of medicine at Stanford University, CEO of ExploraMed Development and Venture Partner at NEA as well as Aabed Meer, an M.D.-MBA candidate at Stanford University and Lyn Denend, a Stanford University research associate. The MDMA provided support for the project, as did the National Venture Capital Association (NVCA) and multiple State medical industry organizations.

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