Worldwide Medical Device Regulatory Updates

Health Canada has announced changes to its list of recognized list of medical device standards used to demonstrate safety, effectiveness and labeling requirements of the Canadian Medical Devices Regulations in order to foster more efficient device reviews.

The changes to the Therapeutic Products Directorate’s List of Recognized Standards for medical devices have specifically been altered as follows:

• 28 new standards will be added to the List
• 10 new editions of currently recognized standards will replace previous editions
• One standard will be deleted from the List
• Two standards will be superseded

These changes are part of Health Canada’s ongoing effort to ensure standards it requires licensed medical device manufacturers to follow are up to date.

Health Canada has published new guidance for manufacturers of Class II, III and IV medical devices on the Medical Device License renewal process.

The Medical Device License renewal process entails manufacturers licensed to sell their products in Canada notifying Health Canada annually before November 1 if information submitted with their license applications have not changed.

Right-to-sell fees incurred by license holders for renewals depend on individual firms’ annual gross revenues. For firms with annual revenues of $20,000 or less from sales of medical devices in Canada, a right-to-sell fee is assessed at $50 according to Section 48. (1) (a) of the Free Regulations; firms with annual revenues above $20,000 will be charged $330.

License holders will see right-to-sell fees increase by two percent starting April 1, 2012.

For manufacturers that haven’t completed a full calendar year of selling in the Canadian market by the time license renewals are due, HC will defer their right-to-sell fees until the end of that year, according to the guidance.

The new guidance document, “Guidance Document – Medical Device Licence Renewal and Fees for the Right to Sell Licensed Medical Devices,” replaces “Guidance for Industry – Medical Device Licence Renewal” published August 23, 2005.

Citing rising costs of performing medical device and pharmaceutical regulatory activities in Canada, Health Canada has announced user fee increases—some of them substantial—for medical device license application reviews, medical device establishment license reviews and right-to-sell licenses.

Health Canada argues that user fees currently in place have not been adjusted since 1995, and no longer align with the costs involved in regulating the Canadian market effectively.

The current fee structure for drug and medical device submission evaluations is linked to the submission type and is component-based, where individual fees are identified based on the type of information provided to support the submission, and added up to determine the total fee payable for any given submission.

The proposed revised fee structure establishes a flat fee for different categories. This reflects the average activity cost and level of effort associated with those groups of submissions; the type of submission is no longer relevant in fee calculations. The proposed flat fee structure applied to drugs and medical devices will simplify the determination of the fee to be charged, more effectively align that fee to respective costs and provide an increased level of cost certainty for fee payers.

Existing fee structures in Canada depend upon submission types and components, with individual fees determined using the information provided by firms to support their submissions. Going forward, Health Canada will impose flat fees for types of licenses being sought in order, according to the regulator, to reflect average costs of dealing with submissions.

All fee increases are set to go into effect April 1^st.

Most significantly, the regulator will charge $7,200 for medical device establishment licenses.

Medical device license application review fees have also been released:

Right-to-sell license fees for Class II, III and IV medical devices will also rise to $330 on April 1^st.

Canadian regulators expect these fee adjustments, along with similar increases imposed upon pharmaceutical firms, to generate $66.4 million in additional revenues; over the next 10 years, Health Canada expects the fee increase to result in a $639.9 million boost.

Full fees for examinations of medical device license applications will not pertain to private-label medical devices sold under the names of separate manufacturers. Fee mitigation or deferral may also be available for manufacturers with small revenue sources, those in their first year of business, or firms developing devices to be sold for international humanitarian efforts.

Health Canada’s fee restructuring may seem prohibitive and sudden, especially given the rapid implementation date, but won't likely deter manufacturers over the long run from one of the world’s more lucrative medical device markets.