More than simply building a prototype and attempting to sell it, this complicated process requires a deep understanding of engineering, business, legal and regulatory requirements.
During their careers, it is not uncommon for physicians to experience many “eureka moments,” where they feel that they have just discovered the next multimillion-dollar invention. But the road to successful entrepreneurship from what began as a simple idea can be quite difficult.
Unfortunately, what many physicians do not realize is that the path to commercialization of their medical device idea is oftentimes long, arduous, expensive and requires a general understanding of business, law, engineering and regulatory principles. This article will look at the critical steps to turning an idea into a marketable product.
The first step of product development requires evaluation of the concept. Once the idea for a new medical device is formed, or even a prototype built, it is important to investigate its viability. Several factors are important to the success of a new medical device idea, ranging from creating a financially sustainable business model to obtaining intellectual property to protecting your idea. Inventors should consider their answers from four key areas of product development.
Key Questions for Physician Inventors
- What is the problem your device is trying to solve? Does this problem create an unmet medical device need in the market, and if not, why would clinicians use your device over others already on the market?
- What is the potential size of the market for your medical device? How many procedures are performed nationally and globally for which this device can be used?
- Who are the users of your device and will it be adopted by those potential users? What is the possible market penetration of this device?
- Who are the closest competitors? What percentages of the market do they control?
- Can this device be developed and manufactured at a reasonable cost to allow competitive pricing (engineering)?
- Are there any identified early adopters (key opinion leaders) who could perform beta testing of the device and become the early champions?
- How can you sell and distribute this device (independent sales distributors, hiring your own sales force or partnering with a medical device company whose current devices are synergistic with your device)?
- What are the financial terms you desire if you license the device to a medical device company compared with launching a startup company to commercialize the device?
- What is the business structure if you launch a startup company to develop, manufacture, market, sell, and distribute this device? Who will fund the company (friends and family financing vs. angel or institutional investors)? Who will manage the company on a day-to-day basis (management team)?
Product Pricing and Reimbursement Strategy
- What is the cost of competitor devices?
- Who will be the purchaser? (Hospitals, outpatients, pharmacies?)
- Are codes currently available for reimbursement?
- How are decisions made by your target market regarding purchasing?
- Are cost caps currently in place?
- How will the device be sold? Reusable/one-time purchase, completely disposable, base unit with consumables?
- Does the device use technology that is currently available, or will technology need to be developed?
- What are the engineering challenges to develop and manufacture this device?
- Does the device use off-the-shelf components or do components need to be manufactured specifically for it? Can it be manufactured with biocompatible materials?
- Do you have the capability to design, develop and manufacture this device in conformance with appropriate U.S. Food and Drug Administration and international regulatory requirements?
Physician inventors also need to consider to what class their devices will be assigned. Classification will determine the regulatory requirements for FDA approval to sell and market it in the United States. The goal of FDA approval is to determine whether a device can be used safely and effectively according to its intended indication. Therefore, medical device classification is risk-based and depends on the degree of difficulty in providing reasonable assurance of the device’s safety and effectiveness.1-3
- Class I: These devices pose low to moderate risk of harm, are typically simple in design and usually subject to general controls with some exceptions and make up 47 percent of U.S. medical devices. Many Class I devices are exempt from Premarket Notification 510(k) requirements.
- Class II: These devices are more complex, pose a moderate to high risk and are therefore subject to both general and special controls, making up 43 percent of all U.S. medical devices. Special controls include performance standards of the device, post-market surveillance, special labeling requirements, and premarket data requirements. Many Class II devices require Premarket Notification or 510(k) clearance before marketing the device in the United States.
- Class III: These devices are high-risk and usually sustain or support life, are implantable or pose a potential unreasonable risk of illness or injury and make up the remaining 10 percent of medical devices. Such devices require a Premarket Approval before marketing in the United States, which must demonstrate valid scientific evidence from clinical trials that the device is safe and effective for its intended use and design.
The most important phase of developing a medical device is the initial evaluation of the concept. By thinking about business, regulatory and intellectual property issues, you will be better able to answer the following question: Is my medical device concept viable?
Whether the answer is "Yes" or "No," you will save time and money by either not pursuing a bad device concept or streamlining your intellectual property, business and regulatory processes as you move forward with developing your device.
Turning an Idea into a Marketable Product
Physicians play an essential role in the medical device innovation process, providing tacit knowledge, technical expertise and clinical experiences and opinions that form the rationale and recommended requirements for new medical devices. Yet, many physicians fail to undertake proper steps to ensure their ideas are protected and that appropriate steps are taken to achieve success.
Intellectual Property Strategy
An appropriate intellectual property strategy, although typically a lengthy and expensive process, is important when commercializing a device to ensure that the device does not encroach on a previously granted patent while providing the right to exclude others from making and selling it.
Despite common perception, a U.S. patent does not grant the inventor the right to make his or her device, but rather, the right to exclude others from doing so. This strategy begins with surveying previously granted patents, as well as the medical literature, for any “prior art” that could be used to disqualify your patent application. A prior art search may also identify so-called blocking IP, which may require a license agreement for you to practice your invention.
For a patent to be granted, the device must be useful (utility), new (novel) and nonobvious (to a person having ordinary skill in the area of the invention). The term of a U.S. patent grant is 20 years from the date of filing of a non-provisional patent application.4
A provisional patent application is relatively inexpensive, does not require the filer to determine the claims of the patent and establishes an early filing date with a 12-month priority benefit. Lasting only one year, a non-provisional patent application must be filed before the provisional one expires.
In 2013, the United States transitioned from “first to invent” to “first to file.” Thus, if two inventors simultaneously invent the same device, the U.S. Patent and Trademark Office will determine priority based on the filing dates rather than the date of the invention.1,4 Such intricacies of patent law demand that an inventor make use of patent attorneys to manage drafting, filing and prosecution of the patent.
Research and Discovery Phase (Non-Regulated)
Upon determining your medical device idea is viable, the next step is to transition into the research and discovery phase, which is considered “non-regulated” as design and testing of the device does not need to be controlled under a quality system per the FDA’s Code of Federal Regulations and international regulations.2
This phase includes the creation of a multidisciplinary team, design, prototyping, proof-of-concept testing and iterative redesign. It is also important to closely monitor your budget during this phase because the costs can escalate quickly.
Affording a large design team is often challenging for most physician-inventors, so one must determine whether to employ the respective members, use a medical device engineering company or hire a consultant to manage this process. Research is required to determine the pros and cons of each. A team should be composed of individuals with expertise in at least the following areas:
- Engineering and design.
- Human-factors engineering and usability.
- Business, finance and accounting.
- Clinical and scientific knowledge in the medical field of intended use.
- Regulatory affairs and quality assurance.
- Intellectual property and business law.
In building the team, evaluate your own skills so you can employ partners that fill any expertise gaps. Many experienced medical device professionals will lend their expertise in exchange for an equity stake in your venture. The technology underlying your device will determine the level of expertise needed within the team.
If you have a complex product, such as a Class II combination product that includes a mechanical design and drug delivery system, the engineering and scientific expertise needed will be different from that needed for a simple Class I device.2
Design and Prototyping
During the R&D phase, the focus should be on prototype function, and not necessarily aesthetics (the design and performance characteristics will be refined later). Computer-aided design software can offer a variety of methods to build a prototype. It is important to identify the most appropriate prototyping method for the project because cost and functionality can vary greatly depending on the method, as seen in Table 1.5
Proof-of-Concept and Iterative Redesign
Proof-of-concept testing of the prototype is used to determine that the device can function as designed. This generally begins using benchtop engineering tests. For example, if a device is designed to clamp an artery without causing damage, the POC testing may include clamping a simulated vessel containing a pressure transducer multiple times to show that the maximum pressure did not reach the threshold for vessel damage.
If the prototype did not pass testing, a second round of design and prototyping may be needed. The process of revising the prototype design in response to test results is called iterative redesign. It is always more cost effective to invest in design and functional changes earlier in the process because making changes later can be significantly more expensive.
The iterative redesign process can provide data to define the general characteristics of the device, which will later become the design and performance specifications in the regulated phase of design and development. These specifications will then guide the development and testing processes, and substantiate the claims on your device for regulatory approval. With a functional prototype, the end of the R&D phase has occurred allowing one to determine the viability of device commercialization.
Defining Design and Performance
If you have decided to proceed with commercialization of your device, you must next enter a process strictly governed by a quality management system (QMS), which is a framework of policies and procedures for how products are developed and manufactured.
This system is regulated under Good Manufacturing Practices (GMP) as specified by FDA 21 CFR Part 820 and ISO 13485.6 A quality management system is used to guide the entire device development process, resulting in the generation of a design history file. The DHF is the compilation of all design, testing and manufacturing information related to the final product.
A regulatory agency such as the FDA can then audit the DHF and the associated facilities that helped develop and manufacture the device to ensure that the product is safe and effective for use according to the device’s performance claims and regulatory requirements.
Design control documents are generated to specify each function the device will perform and the corresponding engineering specifications for that function (i.e., “the device will atraumatically grasp a vessel” and “the maximum compressive force shall not exceed 10 newtons.”)
These specifications often are modified throughout the development process, but the changes must be properly performed and documented according to a QMS for later review by regulatory agencies.
For example, if an initial engineering specification states that the maximum force of a surgical clamp is 10 newtons, but the force requirement is changed to 5 newtons, testing must be performed and documented to demonstrate that the new device design does not exceed the new 5-newton specification.
This type of mechanical and functional performance testing (verification testing) is a crucial part of the development of nearly every medical device to demonstrate the device meets design specifications. However, verification testing does not prove that the device meets the user's requirements. Validation testing is used for that purpose. You can think about the two types of testing in this way: Verification means the device meets design specifications and validation means the device meets user needs.
Other types of testing that may be required include usability engineering/human-factors engineering (UE/HFE), non-clinical testing and clinical testing. Although it’s not a new field, UE/HFE has become increasingly more important for FDA approval of medical device applications. The goal of usability testing is to understand how people interact with technology and to identify potential use-error patterns that may harm users or patients.
A use error is defined by several international standards as “an act or omission of an act that results in a different medical device response than intended by the manufacturer or expected by the user.” Usability testing is a systematic approach to evaluate the people who use the device, the device/human interface, and the overall environment in which the medical device is used.7
Non-clinical device testing is governed by good laboratory practices (GLP) as specified by the FDA in Chapter 21 of the Code of Federal Regulations Part 58 (21 CFR 58), as well as other international standards.8 The term “non-clinical” or “preclinical” refers to testing that is performed on living non-human test subjects. In addition to the FDA regulations, the use of non-human subjects in medical device testing is also dependent upon regulations and oversight by various national and local organizations.
Clinical testing of a medical device is regulated by the FDA through good clinical practices as described in various parts of 21 CFR and international regulations.2 Testing involving human subjects is generally reserved for new and potentially dangerous medical devices.
Before a medical device can undergo clinical testing, an investigational device exemption may be required by the FDA depending on whether the device is considered a non-significant or significant risk device. Regardless, all clinical studies require institutional review board approval prior to initiation.9
FDA Application Type and Testing
Depending on the type of device, the FDA application will vary, as will the amount of required testing.2 Table 2 lists the associated regulations, FDA applications and device class associated with the types of testing.
Once the design history file has been completed, you will need to submit for regulatory clearance to market and sell your device. In the United States, a medical device is required to follow the CFR and be approved by the FDA, which requires evidence that the device is safe and effective for use.
In most other countries, ISO standards are used for medical device development. In Europe, a “CE” mark denotes conformance with the European Union’s Medical Devices Regulation regarding the device, similar to receiving FDA clearance in the United States.
An annual review of 510(k) applications by the Emergo Group showed the average length of time to FDA clearance in 2016 was 191 days, with a 19 percent chance of device clearance in three months, and a 58 percent chance in six months.10 PMA applications took longer for approval — about 262 days in 2014, according to the Regulatory Affairs Professionals Society.11 Although many applications are cleared on the first submission, the FDA frequently submits letters of deficiency to applicants who have not provided sufficient information within their applications.
Once again, investing in a high-quality team with the needed expertise from the beginning, including regulatory and quality assurance, will help ensure your FDA application process is timely and cost-effective.
The final phase of the medical device lifecycle is post-market surveillance. The FDA requires that medical device manufacturers monitor the safety and effectiveness of marketed devices and report that information to the FDA. The FDA tracks both manufacturer and publicly reported adverse events in the Manufacturer and User Facility Device Experience database. If significant post-market issues are noted, the manufacturer may be required to recall a device until there is sufficient evidence that those issues have been remediated.12
Turning your medical device idea into a marketed device is a complex process that requires more than simply building a working prototype and attempting to sell it. The medical device commercialization process requires a deep understanding of the engineering, business, legal and regulatory requirements.
Because most physicians do not have this knowledge or experience, it is very important for physician-inventors to seek out a highly qualified team with experience commercializing medical devices, so that their devices can be brought to market successfully while meeting all regulatory requirements.
Stuart Hart, MD, MBA, MS, FACOG, FACS, is senior director of global medical affairs at Medtronic in Tampa, Florida. Mark Armstrong, MD, MSBE, is associate medical director for colorectal health and PACE curriculum manager at Medtronic in Tampa, Florida.
This article was originally published by the American Association for Physician Leadership in September 2016.
- Food and Drug Administration. Overview of Device Regulation.
- Food and Drug Administration. Medical Devices: Device Classification Panels.
- Food and Drug Administration. Learn if a Medical Device Has Been Cleared by FDA for Marketing.
- S. Patent and Trademark Office. General Information Concerning Patents.
- Mugan, J. Comparing Prototype Techniques. Medical Device and Diagnostic Industry.
- Good Manufacturing Practices. FDA Code of Federal Regulations, Title 21, Part 820.
- FDA Guidance Document. Usability/HFE.
- Good Laboratory Practices (Non-clinical testing). FDA Code of Federal Regulations, Title 21, Part 58.
- Food and Drug Administration. Information Sheet Guidance for IRBs, Clinical Investigators and Sponsors: Frequently Asked Questions About Medical Devices.
- Emergo Group. How long it takes the US FDA to approve 510(k) submissions.
- Regulatory Affairs Professional Society. FDA Sees Record-High PMA Approval Rate for 2015.
- Food and Drug Administration. Device Post-Market Surveillance.