Medical Device Recall or Product Enhancement? FDA’s New Draft Guidance Should Be Recalled for Significant Repairs

By Jeffrey K. Shapiro – 

FDA has just issued a draft guidance document titled “Distinguishing Medical Device Recalls from Product Enhancements and Associated Reporting Requirements” (Docket No. FDA-2013-D-0114) intended to clarify how to distinguish product “corrections” from product “enhancements.”  Although the draft guidance would be applicable to all kinds of devices, this issue is particularly prevalent with software based products, since software in distributed devices is easily and often updated, creating the potential that an update could legally be considered a “correction.”  As will be discussed, the draft guidance is a disappointment on several levels.

Legal Framework

As background, FDA defines a recall as a correction or removal of distributed product that FDA considers to be in violation of the Federal Food, Drug, and Cosmetic Act (FDCA) or other laws it administers (21 C.F.R. § 7.3(g)).  A correction is defined as the repair, modification, adjustment, relabeling, destruction, or inspection of a device without physical removal from its point of use (id. § 806.2(d)).  A removal has the same definition as a correction except there is physical removal of the device from the point of use (id. § 806.2(i)).

A correction or removal should be conducted under the procedures in 21 C.F.R. Part 7.  It also must be reported to FDA within 10 working days under 21 C.F.R. Part 806 if it is initiated to reduce a risk to health or to remedy a violation of the FDCA caused by the device that may present a risk to health (id. § 806.10(a)).  The correction or removal of a device that only involves a “minor” violation of the FDCA is a market withdrawal and not a recall (id. § 806.2(h)).  A correction or removal of device that has not been marketed or has not left the “direct control” of the manufacturer is a stock recovery rather than a recall (id. § 806.2(l)).  However, it is not a stock recovery if any “portion of the lot, model, code, or other relevant unit … has been released for sale or use” (id.).

Evaluating the Draft Guidance:  The Good, The Bad, and the Ugly

The Good.  The draft guidance provides greater clarity as to when a device is considered violative under the FDCA, such that a correction or removal to address the violation constitutes a recall.  The draft guidance advises (lines 219 271) that a device is violative if it is (i) adulterated under the FDCA due to a failure to perform as intended or to meet specifications, or (ii) misbranded under the FDCA due to labeling that is false or misleading or otherwise inaccurate or that fails to meet other specific labeling requirements.

Additionally, product enhancement has never been defined in FDA’s regulations.  The draft guidance helpfully provides a working definition (lines 141-146):

Product enhancements include, but are not limited to, changes designed to better meet the needs of the user, changes to make the product easier to manufacture, and changes to the appearance of the device that do not affect its use.  A product enhancement is both (1) a change to improve the performance or quality of a device, and (2) not a change to remedy a violation of the [FDCA] caused by the device.  A product enhancement is not a medical device recall.

Unfortunately, these clarifications pretty much exhaust the useful aspects of this draft guidance.

The Bad. The bad thing about this draft guidance is that it creates a new reporting requirement under 21 C.F.R. Part 806 that appears to be unauthorized by either the FDCA or Part 806.  The relevant discussion occurs in lines 100-102 and Section VI, lines 415-429.  The minimal reasoning supplied to support this new requirement is difficult to understand if not completely incoherent.

The draft guidance indicates that a product enhancement initiated to reduce a risk to health must be reported even though it is not a recall.  This assertion is not logically supported by either Part 7 or Part 806.  A recall under Part 7 is defined as a correction or removal of distributed product.  Such a correction or removal, in turn, must be reported under Part 806 if it is intended to reduce a risk to health.  But a device modification that is not a recall is also by definition not a correction or removal.  Since Part 806 only requires reporting of a subset of corrections and removals, a modification that is not a correction or removal logically cannot be reportable under Part 806.

Tellingly, the draft guidance does not cite any legal authority for this new reporting requirement.  It could not have done so, because FDA is granted authority in Section 519(g) of the FDCA to issue a regulation requiring firms to report “any correction or removal of a device” within certain parameters.  Nothing in Section 519(g) or Part 806 authorizes FDA to require reporting of product enhancements that are not corrections or removals (i.e., not recalls), nor has Part 806 ever been so interpreted – until now.

Even worse, the draft guidance seems to suggest that FDA’s position applies to product modifications implemented exclusively in the manufacture of new units, with distributed units being left unchanged.  For instance, two of the three examples given of reportable modifications are design or manufacturing changes not likely to be implemented for distributed units, and therefore are not likely to be corrections or removals.  It appears that the draft guidance is intended to require that every single modification be evaluated as to whether it would reduce a risk to health, and if so, it must be reported under Part 806.

The determination whether a modification reduces a risk to health is not easy.  Yet, the draft guidance would magnify the number of times a firm must wrestle with this question.  Previously it has been reserved for the determination whether a correction or removal is initiated to reduce a risk to health.  Under FDA’s new reporting requirement, it would be necessary to make this determination for virtually every device modification, even if it does not qualify as a correction or removal.

To implement this brand new requirement, FDA suggests a new type of Part 806 report that would identify the device modification as an enhancement rather than a recall.  If FDA concurs that it is an enhancement, the action would not be treated as a recall, but the agency would provide advice on “appropriate premarket and postmarket actions necessary to address the information contained in the 806 report.”  This statement may have unwittingly revealed the motivation behind this new requirement.

One can imagine that FDA would use the flood of Part 806 reports from this new requirement to gain greater visibility to product modifications that firms have concluded do not require a new 510(k).  The agency undoubtedly would use the opportunity to begin issuing letters directing that 510(k) filings be submitted for these modifications when the agency disagrees with the determination.  The agency has taken a similar approach when firms with in vitro diagnostic devices seek Clinical Laboratory Improvement Act (CLIA) waivers from FDA.  These waiver reviews give FDA visibility to device modifications implemented via letter to file, and FDA uses these reviews as an opportunity to issue directives requiring new 510(k)s.  The same thing would surely happen if FDA were to review all the new Part 806 reports.

FDA’s new approach raises serious questions about criminal and civil liability.  A violation of Part 806 causes devices to be misbranded under Section 502(t) of the FDCA.  A firm distributing misbranded devices in commerce is subject to criminal and civil liability.  Accordingly, firms might feel compelled to report virtually all modifications, to ensure that they are not exposed to significant criminal and/or civil liability should FDA or the Department of Justice choose to second guess whether a change was implemented to reduce a risk to health.  Yet, this unprecedented reporting requirement requires a statutory change and cannot lawfully be accomplished merely by issuing a guidance.  Section VI of the draft guidance should be withdrawn.

The Ugly.  A guidance such as this one is supposed to clarify FDA’s enforcement of its regulations, with special attention to interpretational issues that have arisen over the years.  This draft guidance does no such thing.  Instead, for the most part, it merely regurgitates regulatory provisions set forth in Parts 7 and 806.  The following examples higlight the absence of meaningful guidance:

• The draft guidance reminds us (lines 299-300) that Part 806 requires a report within 10 working days from the time the firm “initiates” a recall.  Part 806 does not define “initiates” and the draft guidance does not attempt to clarify what it means.  A common sense interpretation would be that a recall is initiated when communications are sent to device users notifying them of a correction or removal.  In practice, however, at least some FDA districts have said that initiation occurs when a firm subjectively “decides” or “becomes aware” that a recall is needed.  This interpretation of the regulation is legally questionable and is a trap for the unwary.  The draft guidance should have provided a clear definition with legal support and practical examples.

• To determine whether a modification reduces a “risk to health,” the draft guidance suggests performing a Health Hazard Evaluation (HHE) based on the factors set forth in 21 C.F.R. § 7.41 and provides a bulleted list of factors that FDA considers (lines 366-406).  None of this information is new, particularly to anyone who has ever read § 7.41 or completed FDA’s HHE form.  Much more guidance is needed on this complicated question.

• Is a safety improvement an enhancement over baseline safety or is it addressing a failure of the product to perform as intended?  This question is often difficult to answer, especially for software changes.  Yet, the draft guidance offers a mere six sentences of very general advice (lines 219-236) and provides only three actual examples, all involving battery life (line 238).  The draft guidance should have provided more examples, and it could profitably have devoted half a dozen or more to software alone.

• Under the regulations, a correction or removal based on a minor violation or no violation is called a “market withdrawal” and excluded from classification as a recall (21 C.F.R. §§ 7.3(j), 806.2(h)).  The draft guidance fails to clarify what might constitute a “minor violation.”  It even fails to mention market withdrawal as a possibility in the decision making flow chart (line 272).

• The draft guidance confirms that “[o]nly marketed devices can be recalled” and that “devices that have not entered the market fall within the definition of a stock recovery” (lines 202-204).  However, footnote 3 states that “if a change is made to newly manufactured, unreleased lots of a model that is in commercial distribution, that change is not considered a stock recovery.”  This footnote is confusing and probably should have been the subject of an extended discussion in the text.  It appears to mean that a change made to product held in inventory meets the definition of a recall, even if other product in the field is not recalled.  If so, FDA’s position is likely based upon the definition of a “stock recovery” in § 7.3(k) and § 806.2(l).  These legal citations should have been included.  It would also have been helpful if the other interpretational issues concerning stock recovery had been addressed (e.g., what does it mean for devices to be within the “direct control” of a manufacturer?).

• There are subtle differences between the definitions in Part 7 and Part 806 of the terms “stock recovery” and “correction.”  It would have been helpful to have some commentary reconciling the differences and addressing whether they are meaningful or not.  The draft guidance never discusses the discrepancies in the definitions.

All in all, FDA should recall this draft guidance for a substantial overhaul.  Section VI needs to be withdrawn completely.  The remainder of the draft guidance needs to be expanded with careful commentary on the difficult interpretational issues that have arisen over the years under Parts 7 and 806, so that it goes beyond superficial regurgitation of regulatory provisions.  Hopefully, FDA will issue a second draft for public comment, since this draft will require substantial revision in order to be useful, and the public should be given an opportunity to comment again before the guidance is finalized.