FDA Announces It Will Now Regulate Devices as Devices

On the heels of Genus Medical Technologies’ successful lawsuit against FDA—Genus was represented by Hyman, Phelps & McNamara PC—in both the District Court of D.C. and the Court of Appeals for the D.C. Circuit, FDA published a Federal Register Notice today (August 9) soliciting comments on its proposed approach to implementing the Court’s interpretation of the Federal Food, Drug, and Cosmetic Act (FDCA) distinction between drugs and devices.  As you may remember, Genus sued FDA back in 2019, alleging that FDA’s classification of, and putative regulation of, its barium sulfate products as drug products violated the FDCA because barium sulfate meets the statutory definition of medical device and therefore must be regulated as a device.  The FDCA definition hinges on the mechanism by which a product meets its primary intended purposes.  FDA claimed that Congress afforded FDA the discretion to regulate devices as drugs based an overlap in the statutory definitions of “drug” and “device” and chose to do so in the case of contrast agents in response to a 1997 court decision and related Citizen Petition.  Both courts disagreed with FDA’s broad assertion of discretion, as neither the statutory construction nor the legislative history supported such discretion.  Ultimately, FDA decided not to request a hearing en banc nor to seek review of the decision in the Supreme Court.

In light of this decision, FDA has acquiesced to regulating barium sulfate as a device, and is now exploring the application of this decision beyond the Genus products at issue in the litigation.   To that end, FDA’s Federal Register Notice explained that “FDA intends to regulate products that meet both the device and drug definition as devices, except where the statute indicates that Congress intended a different classification . . . .”  Further, FDA will comb through its previous classifications to “bring previously classified products into line with the Genus decision.”  Products—not just barium sulfate products or contrast agents—that satisfy the device definition will hereafter be regulated as devices regardless of previous classification.

FDA stated that it will now use as the determining factor, in accordance with the definitions in the FDCA, “whether the product achieves its primary intended purposes through chemical action within or on the body or is dependent upon being metabolized for the achievement of its primary intended purposes.”  While FDA previously stated in guidance that these factors typically determine how to regulate medical products, the Federal Register Notice admits that “FDA has not always examined these factors”—the exact problem that led to the Genus litigation in the first place—due to its presumed discretion.  Now, however, the courts have made clear that FDA must regulate devices as devices unless other provisions of the FDCA say otherwise.  Thus, FDA will evaluate the primary intended purposes and mechanism of action for all products, and then comb the statute for any language suggesting otherwise.  Previously, FDA applied that analysis only to those products that FDA decided merited such an analysis.

The Federal Register Notice specifically addresses medical imaging products, like those at issue in the Genus case.  While FDA previously regulated all imaging agents as drugs regardless of how they achieve their primary intended purposes, FDA will now “reexamine whether individual imaging agents meet the device definition.”  Existing approved imaging agents will transition from drug status to device status where applicable, and the Agency will aim to transition products in a way that does not disrupt supply.  FDA will publish a Federal Register Notice with a tentative list of approved products that will transition from drug to device and will provide an opportunity for industry to comment on the specific product’s classification.  Recognizing that the transition will require sponsors to shift from compliance with the drug regulatory scheme to the device scheme, FDA requests that stakeholders provide comments on the timeline for implicated products to come into compliance with device regulations, such as updating labeling, establishing procedures that comply with FDA’s Quality System Regulations, and preparing for device inspections.  FDA also seeks industry suggestions to facilitate the transition without disrupting supply.

FDA explains that the transition will take some time and consequently products previously regulated as drugs will still be subject to drug approval user fees (PDUFA and GDUFA user fees) until they transition: The Federal Register Notice explains that FDA “does not anticipate that the identification and transitioning of products from drug status to device status pursuant to the Genus decision will be completed before October 1, 2021.”  Thus, FDA suggests that sponsors of implicated products pay the drug user fees to avoid placement on the arrears list and any associated penalties.  Sponsors can then request a refund.  This could get complicated though, as FDA explains that the transition may affect program fee tier assessments for ANDA holders or facility fees.  And it is unclear how the excess user fees collected for devices would factor into the estimates to set the next year’s user fee rates.

FDA encourages all sponsors of implicated products to submit comments on this notice.  Until FDA takes action, there is nothing else for sponsors to do but to sit tight, but FDA includes no anticipated timeline for taking action.  However, for all “time-sensitive” inquiries, questions can be directed to a Genus-transition-specific email address at Drug_Device_Transition_Inquiry@fda.hhs.gov.  FDA also requests comments on “statutory provisions other than the drug and device definitions that may indicate Congressional intention regarding the appropriate regulatory pathway (i.e., drug or device) for certain types of products.”

Interestingly, throughout Genus’s dealings with FDA, the Agency insisted that very few products had been subject to its “discretion” to regulate devices as drugs, but the Federal Register Notice implies that the transition will affect more than a handful of stakeholders.  It’s unclear at this time how many products have been erroneously classified due to FDA’s purported discretion, and its request for comments on other statutory provisions that may direct the appropriate regulatory pathway suggests that application of this discretion may not have been limited to devices.  In that case, it’s not entirely clear how far FDA believed its discretion extended, and on what basis that discretion was predicated.  It definitely seems possible that FDA’s exercise of discretion went farther than the Agency represented.  We look forward to seeing the tentative list of products that need to transition, and reading industry comments.

Comments are due on October 8, 2021.