Prominent regulatory changes throughout the numerous medical fields are coming in 2024, with pharma and medical device companies urged to be on with a year of legal edits.
Right from the UK’s reworking of the Voluntary Scheme for Branded Medicines- VPAS as well as delayed plans in order to introduce a new medical device validation scheme, to the US’s attempt to regulate products that make use of AI, 2024 is all set to be a busy year when it comes to healthcare regulators.
US: Regulating Laboratory-Developed Tests
Chief among US legal shifts set to come into effect in 2024 that have gone on to raise concern is the Food and Drug Administration’s- FDA’s plan so as to regulate laboratory-developed tests- LDTs as medical devices, a strategy that has gone on to see pushback from numerous companies that suggest that the move is indeed unwanted.
The proposed rule looks to amend the FDA’s regulations in order to make explicit that in vitro diagnostic products- IVDs happen to be devices under the Federal Food, Drug, and Cosmetic Act. This is when in case of the manufacturer of the IVD happens to be a laboratory.
The move has gone on to receive criticism from groups like the Utah University-based ARUP Laboratories, which argues that the research, which is published in the American Journal of Clinical Pathology, goes on to detail that 93.9% of tests ordered in 2021 happened to be tests that were cleared, given a nod, and also authorized by the FDA.
Former FDA adviser and partner for Foley & Lardner, the legal company, David Rosen, summarized how the shift in regulation can go on to cause uncertainty.
According to Rosen, the LDTs have been on the market for some time now. He thinks what the FDA happens to be saying is that they are looking to have more data so that they can go on to have confidence in the reliability of such tests and the capacity of practitioners in order to rely on the results that happen to come from these tests.
He added that they are going to have to staff up so as to be able to do it because it is going to be a challenge; there happens to be a significant number of them out there, and whether or not organizations are just coming into the market so as to be able to do this and get the tests cleared via the FDA and how quickly it is going to be done is going to remain an issue.
It is well to be noted that the FDA’s rationale when it comes to this decision is that the concerned patients can go on to initiate unnecessary treatment or delay or even forego proper treatment, which is based on inaccurate test results, a thing that they worry can go on to cause harm. The FDA has gone on to say that since the initial rules with regards to the regulation of LDTs were brought to the fore with the Medical Device Amendments of 1976 ruling, such tests have become rapidly more complex, varied, and, at the same time, able to be run with much greater capacities than ever before.
Partner for US law firm Sidley, Torrey Cope, has gone on to detail as to how he felt about the announcement amongst life science firms, which was kind of mixed, with some firms embracing the announcement better than others.
Cope went on to say that either way he thinks it will go on to have a big impact on pharma companies as they have increasingly had to deal with companion diagnostics so as to get approval for numerous products, and in some cases, a prominent amount of the testing usage in the real world happens to be a laboratory-developed test, and that is an issue they had always wanted to navigate.
If their labelling says that they have to be making use of an FDA-approved test and they know physicians are using a non-approved lab-developed test, how would they navigate that? Certainly, if in case the legal landscape gets altered, that will go on to completely change how they plan for that challenge going forward.
March-in rights
Beyond the FDA, the Biden Administration does have plans to allow agencies to make use of march-in rights to regulatory changes across the US and UK so as to watch in 2024 patents of government-funded drugs if it goes on to feel that pharma firms have gone on to price them too high. This would be done by making sure to take advantage of a clause in the 1980 Bayh-Dole Act that enables the government to grant production rights to government-funded patents to third parties if the product does not become accessible to the public.
But in making the announcement, the White House has gone on to urge that the usage of march-in rights will be particularly fact-dependent and will be based on the totality of all the circumstances.
David Rosen goes on to predict that this will likely lead to substantive challenges and debate, legal as well as otherwise, over whether the government truly possesses the right to seize patents and that it happens to be having the capacity to stifle the US’ research and development landscape, arguing that the government cannot set drug prices.
Rosen went on to say that he thinks that there is going to be immense controversy and litigation over this and that he wants the National Institute of Health- NIH to participate due to the nature of the cutting-edge research it happens to be doing and to have the government gauge what is going on, but to enable the government to come in and seize those patents, they will go on to have to strike a balance.
It is indeed very hard to analyze the cost-effectiveness of the therapy if it costs a lot of money but goes on to treat the disease, which is better for the healthcare system than not going ahead with the therapy at all. If the government goes on to march in and seize patent rights, that is very likely to have an adverse effect on continued drug development by way of using NIH funding.
Following this announcement that was made by the Biden administration went on to reveal further initiatives that include a plan to require some drug companies to go ahead with price negotiations for some drugs in order to stay in line with inflation, thereby underscoring 48 drugs in the Medicare program that have experienced price surges surpassing inflation in Q4 2023.
UK: Medical Devices Shake Up as well as Voluntary Medicines Pushback
In the UK, the medical device market is all set to see a shake-up as the country goes on to prepare to replace the already set-up European Union CE marking with its own UKCA marking, which is intended as the national equivalent to the certification following the nation’s exit from the EU.
It is well to be noted that initially, device manufacturers whose devices had a CE mark would have needed to change over to the UKCA system by June 2023; however, this was later delayed by the Medicines and Healthcare Products Regulatory Agency- MHRA by another year, which means that it will come into effect in June 2024.
The legal director of UK legal firm Pinsent Masons, Louise Fullwood, went on to say that this further delay takes away the focus for manufacturers so as to get UKCA-ready, as it can continue to be kicked down the road with no possibility of what the eventual position is going to be.
A contributing element to the announced delay is that there are most likely to be a relatively small number of UK-approved bodies in order to carry out conformity assessments. Dekra had gone on to be appointed last month as just the third UK-approved body. More six organizations are going through the approval process, and the MHRA happens to be in discussions with numerous other potential candidates.
2024 is also going to witness the introduction of the Voluntary Scheme for Branded Medicines Pricing, Access, and Growth- VPAG system, which happens to be a replacement for the UK’s previous VPAS system. This came about following prominent industry pushback on the proposed changes to the 2024 VPAS system, thereby resulting in industry-wide negotiations.
In the past, the changes proposed, which happened to be proposed by the Department for Health and Social Care, would have witnessed the imposition of a payback rate of 26.5% with the hope of maintaining the NHS’ capacity to have branded medicines in the wake of COVID-19. But due to the industry pushback from groups like the British Pharmaceutical Industry- ABPI, a deal had gone on to be struck on 21 November 2023, thereby replacing the single payback rate set each year with two varied rates for newer as well as older medicines. It also goes on to change the annual allowed growth in sales of branded medicines from 2% this year rising to 4% by 2027. Medicines that are older and those that have not previously had a price decrease will pay a top-up rate of almost 25% along with a base rate of 10%.
