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New IVD Regulation, Brexit Continue to Create Uncertainty in European Diagnostics Market


NEW YORK (360Dx) – The implementation of the new European In Vitro Diagnostics Regulation (IVDR) and negotiations related to the departure of the UK from the EU continue to create uncertainty among diagnostics companies.

While companies are expected to have their IVDs certified under the new regulation by 2022, manufacturers are frustrated by the slow pace of the certification process. Meantime, no Brexit deal has been announced, and the likelihood of a no-deal, or hard Brexit, has prompted some UK firms that certify devices, called notified bodies (NBs), to relocate activities to the continent.

That in turn has created more uncertainty about obtaining certification for IVDs in Europe, as the UK has been one of the main gateways for IVD manufacturers to reach the European market in the past, and its NBs have been the busiest in Europe.

No one knows what the regulatory landscape in the UK will be in the case of a hard Brexit. The UK is expected to leave the EU in March 2019, and some firms are concerned about having to undergo duplicate certification processes in the future, one to sell their tests in the European market and another to sell the same tests in the UK, if no agreement is reached.

"Nobody knows where we will be by the end of next March," said Erik Vollebregt, an attorney at the Amsterdam-based law firm Axon Lawyers, who specializes in EU regulatory issues relating to medical devices.  In August, British Trade Minister Liam Fox announced there was a 60 percent chance of a hard Brexit, he noted. "These are signals you cannot ignore," Vollebregt said.

While Brexit and the implementation of the IVDR are two separate processes, they are linked because much of the NB capacity in Europe is located in the UK, where multinational companies like BSI and SGS have maintained the resources to certify IVDs.

"If there is a no-deal Brexit, and the UK is out of the EU, suddenly 40 percent of the NB capacity is no longer available," said Vollebregt. "For IVD manufacturers with high-risk devices, that's a major problem, and Brexit is one enormous complication."

A shortage of NBs

In recent decades, Europe was widely seen as the region to launch new IVDs, due largely to vagueness in the older regulation covering medical devices, which allowed for a self-certification process in the case of newer tests, especially multimarker genetic panels. Following this self-certification process, companies were free to sell IVDs into the clinical market.

The new IVDR, however, groups IVDs into four categories A, B, C, and D with varying degrees of approval required. Class A devices will still reach the market via the self-certifying process, but most molecular diagnostics actually fall into Class C, or, in some instances, such as various blood tests, Class D, which means they will have to be certified by NBs for clinical use.

"The classification system is radically different" under the IVDR, said Paul Brooks, executive director at the Regulatory Affairs Professional Society (RAPS), a Rockville, Maryland-based organization of professionals involved in the regulation of healthcare-related products.

"Previously, 80 percent of IVDs were self-certified, and 20 percent needed to be reviewed by an NB," Brooks said. "Now 80 percent need to be reviewed, and only 20 percent will be self-certified. That's a huge difference in the amount of work that manufacturers need to do."

While the IVDR has created more work for manufacturers, it has also forced NBs to invest in resources to oversee the assessment of what will be thousands of new applications in coming years. Complicating the situation is the fact that of the roughly 20 NBs that had been certified by authorities to assess IVDs under the older regulation, just seven have submitted applications to be certified to evaluate IVDs under the new IVDR, and none of them have received that certification to date.

"We are currently under assessment, but there is no real clarity on the process," said Andreas Stange, vice president for the medical health services group at TÜV SÜD, a Munich, Germany-based NB, who is responsible for its global IVD devices business. "We have no idea when we can expect designation," Stange added, "maybe by the middle of next year."

With no NBs certified to evaluate IVDs under the new IVDR a year after the regulation entered into force, and the clock ticking toward the 2022 deadline, manufacturers have expressed concern about the process, and have gone so far to suggest the deadline be delayed until a "fully functioning NB system" is in place. In July, MedTech Europe, a Brussels-based trade association for the European medical technology industry, released a position paper outlining its members' concerns.

In the paper, MedTech Europe called on the European Commission and all member states to provide solutions that would "rapidly install the functionality of the new regulatory systems." The organization said that while manufacturers had been investing to comply with the new regulations, the infrastructure to have IVDs cleared by the deadline was not yet in place. As such, industry's ability to keep their tests on the market "could be seriously jeopardized by the slow progress" of authorities in designating NBs to certify IVDs under the new IVDR.

"We gave the authorities 12-plus months to start building the new regulatory system and to start increasing their resources," said Oliver Bisazza, director of regulations and industrial policy at MedTech Europe. "By June, the IVDR had turned a year old and we took stock of the implementation progress," he said. "Although some first targets had been hit, a huge amount remains to be done before the IVD [industry] has the mechanisms they need to comply."

In the paper, MedTech Europe suggested that regulators address this bottleneck by either freezing the transition time for the IVDR until the system for certifying the new devices was ready, extending the May 2022 deadline, or at least extending that deadline for legacy products.

"If such contingency plans do not exist early enough, we fear that the business uncertainty will grow so large as to compromise our ability to ensure continuity of care to patients, and this must, of course, be avoided," Bisazza said.

In terms of NBs specifically, Bisazza said that "tens of thousands of IVDs" will need NB coverage, and noted that the designation codes are "very granular and highly numerous" for these kinds of devices. Additionally, authorities expect NBs to have at least two in-house product experts per IVD scope designation code. "This is extremely concerning, as there are limited numbers of such product experts in the world, let alone in the immediate neighborhood of the NBs," said Bisazza.

As such, Bisazza recommends a "quick, targeted correction of the transitional process." The regulatory system, and in particular the IVD NBs, "clearly need more time to get ready," he said.

That is unlikely to happen, though. "The informal reaction [to the MedTech Europe position paper] has been to stop complaining and do your homework," said Axon Lawyers' Vollebregt.

"The lack of NBs could create a market problem theoretically, but the authorities don't think it will happen," he said. "They think the industry is crying wolf as it always does."

TÜV SÜD's Stange agreed that such an extension or grace period was unlikely to happen. "This is the law that all the member states agreed on," he said. "Changing that is close to impossible."

To allay the concerns of European IVD manufacturers, the European Commission earlier this month issued a working plan for the implementation of the IVDR, providing adoption timelines and the status of 12 implementing acts under the regulation and a dozen other initiatives. Yet only one of the implementing acts in this roadmap has to date been completed — the defined scope of NB designations — and that was adopted by the Commission last year.

On October 25, Elżbieta Bieńkowska, the EU commissioner for internal market, industry, entrepreneurship and small- and medium-sized enterprises, addressed some of these concerns during a session of the European Parliament. Bieńkowska said that authorities are "on track and in the timeline" for implementing the IVDR. She said there has been "no delay" in the assessments of NBs, and that the first NBs might be available by the end of the year.

However, she was commenting on the availability of NBs for certifying medical devices under the new medical device regulation (MDR) as well as the IVDR. Roughly 33 NBs have so far requested certification to evaluate medical devices under the MDR, compared to the seven that have filed applications to be designated to certify IVDS. Moreover, manufacturers are expected to bring products into line with the MDR by May 2020, two years prior to the IVDR deadline.

Preparing for Brexit

In her remarks, Bieńkowska also addressed concerns related to Brexit. She noted that the four British NBs have "already taken initiatives to adapt to the post-Brexit scenario." BSI, the largest of the quartet, announced earlier this year its aim to be designated for certifying tests via its office in the Netherlands. That would mean that in the case of a hard Brexit, its Netherlands office would conduct assessments of IVD applications, limiting any disruption to clients.

SGS, another UK NB, maintains offices in Finland and Belgium that will serve a similar function, while UL and LRQA, the other two UK NBs "have approached the same national authorities for a possible application," she said.

In May, BSI announced its intention to transition clients to its Netherlands office as part of its contingency planning for a hard Brexit. BSI already had an office in the Netherlands, but it did not have a medical device notified body there. As such, it has in the past year set up an NB in the Dutch office for handling medical devices and IVDs.

In the same statement, BSI noted that 45 percent of all medical devices currently CE marked in Europe use UK NBs for their conformity assessment requirements, and that about 70 percent of all non-EU-based manufacturers have used UK NBs to access the European market.

RAPS' Brooks, who worked previously at BSI, said that UK NBs are undertaking such moves because of the continuing uncertainty around Brexit.

"There is too much that remains unknown with a deadline looming closer," said Brooks. "This lack of clarity is a huge headache for regulatory affairs people," he said. "I'm sure all companies are concerned about what Brexit means to the market."

He also noted that, historically, UK regulators have played an "important role" in shaping and implementing new European regulations and noted the UK Medicines and Healthcare Products Regulatory Agency has continued to do so even in the current circumstances. In February, for instance, MHRA published a 22-page guidance for bringing IVDs into line with the new IVDR. Brooks said it was unclear who would "fill that vacuum" once the UK exits the EU.

The questions surrounding Brexit could arguably lead companies to seek certification through other NBs that don't have a footprint in the UK, though.

"We are located in Germany and can assure our clients that no matter what happens, our certifications will remain in place after March 2019," said TÜV SÜD's Stange.

He noted that TÜV SÜD has been scaling up its workforce of IVD experts in the past few years to handle the anticipated spike in new applications. "We are running relatively well," he said, "and we are not putting any limits on new clients."

IVD players big and small

While questions swirl around the readiness of NBs to process new applications under the IVDR and to navigate any regulatory fallout from Brexit, there is also the issue of preparedness on the part of manufacturers.

Last month, RAPS, together with international professional services company KPMG, released a survey of medical device manufacturers related to complying with the MDR. Only a fifth of the respondents — roughly 200 regulatory affairs professionals surveyed worldwide — said they had a deep understanding of the regulation.

While the KPMG/RAPS survey did not address IVD manufacturers' preparedness, Brooks said that companies that sell IVDs probably have "more work to do" compared to those who make medical devices, given the changes in regulation.

He also observed that while larger, multinational IVD companies have invested resources in bringing their menus into compliance, SMEs are perhaps even less prepared for the shift.

"I'm sure the multinationals get it, but as for the smaller IVD firms, I am not sure how much this is in their minds," said Brooks.

Another issue is that while European companies are "in the eye of the storm" when it comes to the implementation of IVDR, some firms outside the EU remain aloof to the new regulation.

Vollebregt agreed. "In the US, there are no doubt many companies that have no idea of what is going on and there is a lot of missing work to be done," he said. Vollebregt said that, in general, some companies are working deliberately toward implementation, but they remain a minority.

"Others are sitting on their hands, a strategy that amounts to staring at the headlights," said Vollebregt. "I see a lot of companies doing that."

Dirk Stynen, president and chief consultant for Qarad, a Geel, Belgium-based company that helps test providers bring their IVD products in line with European regulations, said that his firm has been receiving more queries from larger companies connected to the IVDR.

"Up until a year ago, we were working mainly with SMEs," said Stynen. "There is a wave of interest from very big companies to help them with certain things, either interpretation of certain things, or having additional resources," he said. In contrast, Qarad's smaller customers have been "very quiet," he added. "The big companies are actively working to ensure they comply with regulations."

Stynen noted that each day that passes without a deal on the UK exiting the EU increases the chances of a hard Brexit with "considerable consequences on the medical devices and IVD industries."

In addition to NBs moving out of the UK, Stynen said that authorized representatives companies that represent firms outside the EU in certifying their IVDs are also moving out of the country.

"People in the field are not waiting and assuming it will be a soft Brexit," Stynen said. He noted that the European Medicines Agency is also leaving London for Amsterdam. "These are all signs that point to a hard Brexit rather than a soft one," Stynen said.