Good News: FDA Faster, More Approvals

The FDA, which has made it a central objective to expedite pre-market approval (PMA) and 510(k) processing (see the FDA’s Expedited Access Pathway Program and the Medical Device Development Tools (MDDT) Program) issued a progress report for the first quarter of 2016 and the previous decade and a half which shows that the agency has streamlined the regulatory process and significantly improved time and likelihood of a successful application to the FDA.

“The agency implemented a number of new policies and programmatic changes over the past five years to improve its performance and to adapt its oversight to the global marketplace and to new technologies. Added funding and increased capacity, as the result of the 2012 reauthorization of MDUFA [Medical Device User Fee Amendments], also helped reverse the direction of the agency’s medical device premarket program, ” FDA stated in a report published last year.

As a result, FDA then reported that total times to decision for all types of device submissions have sped up in the last five years, compared to the preceding decade, a trend that continues in the first three months of this year. In 2015 the FDA approved 98% of the premarket approvals (PMAs) submitted to them. In the first quarter of 2016, that number has declined to 91%—but both approval rates are historically high and represent a significant improvement over the 59% low which was recorded in 2010.

As the following chart illustrates, FDA PMA approvals have been rising for the past five years.

The time it took to work through the FDA’s PMA gauntlet also improved. Under the Medical Device User Fee Agreement (MDUFA), the FDA committed to reducing its average total time to decision for PMAs and 510(k)s.

To obtain a PMA approval, companies had to allow an average of 209 days. Of that total, the submitting companies accounted for 44 days or 21% of the total. The FDA accounted for the remaining 165 days or 79% of the total time. To put this in perspective, in 2009, when time to PMA decision reached its peak at 464 days, the FDA accounted for 266 days or 57% of the total time.

Since 2009, the FDA has cut 100 days from its own processing time and reduced the complexity for submitters, which has cut their times by a whopping 154 days.

In 2015, the time required by companies submitting their PMA applications had dropped from 266 days in 2009 to just 44 days in 2015.

Here is the PMA time to decision chart:

Lawrence Biegelsen, Senior Analyst, Medical Supplies & Devices at Wells Fargo Securities, LLC and his colleague Craig Bijou also noticed the favorable PMA trends at the FDA and said this on March 23:

“CY 2015 PMA Approvals Highest Since 2001. The number of original PMA (pre-market approval) and PMA panel-track supplements approved by the FDA last calendar year reached the highest level since CY 2001. The FDA approved 43 original PMAs, which is 18 more than CY 2014 (25 approvals) and more than double the original PMAs approved in CY 2013. We primarily attribute the strong CY 2015 approval volume to the increase in submission activity from device manufacturers and faster review times from the FDA. Taken together, we view these recent data trends to be encouraging for the medtech industry. CY 2015 PMA approval activity was diverse across industry, but led by the cardiovascular subsector (14 original and 7 panel-track PMA approvals). PMA activity in the 2016 calendar year is off to a strong start with 7 original PMA approvals through February, slightly ahead of CY 2015’s pace of 5 original approvals over the same time period.”

510(k) Approvals

The FDA received 4, 020 510(k) applications in 2015. Each one sought to receive a clearance from the FDA to commercialize a product which is substantially equivalent to a product cleared under the 510(k) rules in prior years.

The 510(k) clearance process, which is substantially less complex than the PMA process, actually has a lower approval rate.

For 2015 85% of the 510(k) submissions were deemed by the FDA to be substantially equivalent to previously cleared products. That FDA’s rate of 510(k) clearance has stayed comparatively flat since 2001.

Here’s the data in chart form:

The time it took to receive a decision from the FDA, likewise has been improving steadily since 2010. While, on average, it took 209 days to get through the PMA process, it required 109 days, about half the time, for a 510(k).

Of course, technically the FDA is supposed to inform submitters of their decision within 90 days. That goal has only been met one time in 15 years—2005.

Interestingly, for the three years between 2010 and 2012, the amount of time companies required to submit their 510(k) was longer than the time it took the FDA to evaluate the submission.

But, for 2015, all relationships returned to their natural pattern with the FDA taking the most time.

Here is the 510(k) average time to decision chart.

Certainly, one implication of these faster clearance or approval times, and the 85-98% favorable decision rates is that the regulatory environment is improving and could even be considered more innovation friendly than in prior years.

According to an analysis by Wells Fargo, 3, 025 510(k)s were determined to be substantially equivalent by FDA in calendar year 2015. That volume is down 6% compared to 2014 but, according to Wells Fargo, is still essentially in-line with the FDA’s previous 5-year average.

So far in 2016, 510(k) submission activity is 2% ahead of the same period in 2015. If the trend for 2016 continues, the FDA’s 510(k) clearance rate this year will be approximately 2 ½% below last year’s rate.