Medical Device Safety Act Archives - Shopfloor

Never Letting a Good Deed (Device) Go Unpunished (Unregulated)

By | Briefly Legal, General, Innovation, Regulations, Taxation | One Comment

In a Forbes magazine column, “K Street Capers,” Brian Wingfield reviews some of the lower-profile issues on which business associations lobby, such as the unintended consequences of Iran sanctions, foreign-made plastic flowers and mixed-martial arts.

And lithium batteries. We wrote yesterday how the new health care law taxes one of U.S. industry’s great success stories, medical devices, forcing manufacturers to cut jobs and investment. (“Never Letting a Good Deed (Device) Go Unpunished (Untaxed).”) Federal regulators are also working to make it more expensive and difficult for the industry to operate in the United States.

Batteries. Makers of lithium ion batteries and medical-device producers are fuming about a proposed Department of Transportation rule they claim will drive up the distribution costs to power cellphones, e-readers, pacemakers and insulin pumps by $8.5 billion during the next decade. The regulation would classify all lithium batteries as hazardous materials when transported by cargo plane–requiring special storage easily accessed by pilots in case of fire–and forcing manufacturers to get safety certifications for battery design. A pending transportation bill sponsored by House Transportation Committee Chairman Jim Oberstar (D–Minn.) would impose similar restrictions.

Meanwhile, the trial lawyer lobby is still trying to stimulate more speculative lawsuits against device makers, pushing the Medical Device Safety Act, which would replace consistent federal safety standards under the FDA with a more exploitable regulatory regime under 50 state court systems. (The bills are S. 540, originally introduced by Sen. Edward Kennedy.)

Too many federal officials claim to support U.S. manufacturers but then enact laws and regulations that disadvantage the same manufacturers in global competition. In the case of medical device manufacturers, they have to be wondering, “What’s next?”

Anti-Jobs, Anti-Innovation — The Medical Device Tax

By | Briefly Legal, Health Care, Innovation, Taxation, Technology | No Comments

the great successes of the U.S. medical device industry in life-saving innovation have made the device manufacturers a target in Congress’ legislation to expand government control over health care. The revenue raisers have the industry in their sights.

From The Washington Post, “Medical-Device Firms Criticize Tax Proposal“:

Under the bill approved on Tuesday, the medical-device industry would pay a total of $40 billion over 10 years. Players big and small in the industry, which makes items from tongue depressors to artificial hearts, warned that the tax would harm their ability to innovate.

“This is a really devastating proposal for a large number of our membership,” said Stephen J. Ubl, president and chief executive of the Advanced Medical Technology Association, the organization hosting this week’s AdvaMed 2009 conference at the Walter E. Washington Convention Center. “It’s bad for patients, bad for jobs and bad for research and development.”

An amendment to remove the $40 billion tax was defeated last week in the Senate Finance Committee by a partyline vote, 13-10.

At a time when unemployment is still rising even with the nascent recovery, the device tax also represents a tax on job creation. As USA Today reports:

Twenty House members from California, home to heart-valve maker Edwards Lifesciences, signed a letter asking the Senate Finance Committee to reconsider the tax. Senators from Minnesota and Indiana — three Democrats and one Republican, in all — sent a similar letter.

“Minnesota, like many states, has lots of people employed in the medical device industry,” Sen. Amy Klobuchar, D-Minn., whose state is home to Medtronic, one of the nation’s largest device manufacturers, said in an interview. “I want to keep jobs in my state.”

Mark Leahy, President and CEO of the Medical Device Manufacturers Association, in a statement: “There can be little doubt — the proposed tax will have a cascading effect upon innovation, access to technology and employment in the industry.”

Meanwhile, the only interest group to have escaped the taxers and “reformers” in the health care legislation, the trial lawyers, also has the medical device industry targeted. The Medical Device Safety Act is one of the American Association for Justice’s top lobbying priorities, the goal being to replace a consistent federal regulatory regime with a patchwork of state regulations determined by the courts — that’s a much more lucrative environment in which to sue manufacturers.

In March, when the bill was reintroduced, NAM President John Engler issued a statement, making the central point: “At a time when our country is mired in a severe recession, suffering from rising job losses and a financial system in tatters, Congress is proposing legislation guaranteed to discourage innovation and drive up medical costs even further.” See also the Forbes column by Richard Epstein, “A Sickly Medical Device Safety Act.”

So here’s a test by which one can hold elected officials accountable: If in a speech, a member of Congress claims the future of the U.S. economy involves high-tech jobs, innovation, and the growth of medical sciences, just ask if this member supports the $40 billion tax on medical devices. If the answer is yes, judge the previous statements accordingly.

Attacking Preemption, the Opposite of Health Care Reform

By | Briefly Legal, Health Care | No Comments

A Forbes column by noted Chicago law professor Richard Epstein, writing about H.R. 1346 and S. 540, the Medical Device Safety Act, “A Sickly Medical Device Safety Act.” Epstein analyzes both Wyeth v. Levine and Riegel v. Medtronic as basically malpractice cases that were exploited and turned into cash-seeking legislation against the drug and medical device industries, respectively.

Judges constantly state that product liability law is supposed to make manufacturers bear the full costs of their product defects. But they have crafted bizarre, upside-down rules that make drug companies and device makers bear the full costs of the mistakes of downstream actors whose actions take place outside of their control. Fix state tort law, and you can forget about federal preemption. But with loopy tort law a fixture at the state level, Congress has to act. It should let the MDSA die. And it should restore parity by offering the same statutory protection to drug manufacturers that it now supplies to device manufacturers.

Elsewhere in the world of preemption, the Heritage Foundation has posted the video of its panel discussion last week, “Hurting or Helping Consumers? Destroying Federal Preemption One Industry at a Time.

A Reliable Regulatory Regime for Medical Devices: Saving Lives

By | Briefly Legal, Health Care | No Comments

The Senate HELP Committee yesterday held a committee hearing, “Protecting Patients from Defective Medical Devices,” with the central issue being federal preemption, that is, should FDA approval of medical devices preempt suits against those devices in state courts. In a 2007 decision in Riegel v. Medtronic, the U.S. Supreme Court ruled that Congress clearly intended such a consistent, federal regulatory regime. (Much more detail on the case at the ScotusWiki entry.)

Indeed, as the testimony of Peter Hutt of Covington & Burling, a former FDA chief counsel, explained yesterday, the specific and clear “Pre-Market Approval” (PMA) language was written into law in 1976.

The trial lawyer lobby has made elimination of preemption one of its top priorities. After defeat in Riegel v. Medtronic, they succeeded in the Supreme Court in the case of Wyeth v. Levine, dealing with prescription drugs.

For devices, Congress is now the focus. The goal is to replace the rigorous FDA approval process and recognized federal standards with the equivalent of a 50 state regulatory regimes, all determined by litigation and the courts. Once that happens, the trial lawyers will be able to identify particularly plaintiff-friendly and generous venues. There are bills to accomplish that goal now in the Senate and House, the Medical Device Safety Act (H.R. 1346 and S. 540).

Yesterday’s Senate hearing can be seen as part of that legislative push, but thankfully, testimony offered balance. One witness was Michael Roman, a race car driver from Missouri, who suffered debilitating chronic pain after his leg was amputated, pain only relieved after he started using a spinal cord stimulator manufactured by Boston Scientific, the Precision Plus ™ Spinal Cord Stimulator System, based on the same technology used in cochlear implants.

His testimony tells a wrenching story of what he suffered and what he regained thanks to the medical research that led to the device’s creation. The costs of increased litigation could have made it all impossible:

What if Congress had enacted the Medical Device Safety Act in 2001? For me, I’m sure it would have been game over.

It scares us to think I would lose the life I have today because a researcher decided to throw in the towel in 2002 – deciding that the status quo was good enough – and that the $60 million in development and testing costs of my device weren’t worth the risk of putting a cutting edge, FDA-approved product on the market, only to have that product’s value systematically reduced by lawsuits. There are millions of people out there who might one day benefit from the breakthrough therapies still in development. We need to think about those people when we think about the consequences of this bill.

Roman also issued a statement through the AdvaMed trade association, saying, “Decisions about the safety of medical devices should be left to the experts and scientists at the FDA who evaluate new products with the overall public good in mind. When juries are hearing about a patient who is harmed, it is easy to forget about the people like me who have had a great experience with a device.”

The question boils down to, which serves the public better — lawsuits or medical research?

Preemption, How Times Change…Quickly

By | Briefly Legal, Economy, Global Warming, Regulations | No Comments

On Tuesday President Obama led a White House event hailing the adoption of a national standard on fuel efficiency. From the transcript:

The goal is to set one national standard that will rapidly increase fuel efficiency — without compromising safety — by an average of 5 percent each year between 2012 and 2016, building on the 2011 standard my administration set shortly after taking office.

A series of major lawsuits will be dropped in support of this new national standard.

On Wednesday, President Obama issued a memo to the Executive Branch agencies announcing his Administration’s opposition to a national standard for the regulation of products. We predict: A series of major lawsuits will be drummed up as a result of this new, 50-state, inconsistent standard.

Is that what commentators mean by pragmatic?

UPDATE (10:35 a.m.): From BusinessWeek, “Obama Regulatory Review Could Spur Product Lawsuits

This Bill Would Kill Innovation

By | Briefly Legal, Health Care, Regulations | No Comments

The Washington Times today takes editorial notice of Michael Kinsley’s testimony Tuesday in a House committee on the Medical Device Safety Act, legislation that would encourage litigation against manufacturers of FDA-approved devices. From “Patients in the crossfire“:

Mr. Kinsley’s testimony on Tuesday reminded lawmakers that patients other than a plaintiff in a particular courtroom can be seriously affected, and victimized, by such trials.

Mr. Kinsley suffers from Parkinson’s disease. He testified that his disease is controlled – and his quality of life considerably enhanced – by “wires in my head and two pacemaker-type batteries in my chest,” which are the result of surgery called deep-brain stimulation.

“So here’s the problem,” he said. “We all want the government to protect us from dangerous drugs and devices. But we don’t want the government to prevent us from getting helpful or even lifesaving drugs and devices. Yet the most important drugs and devices are both. They save lives, and they can cost lives. The government’s job is to weigh the risks against the benefits . . . [The FDA] set* a uniform standard for everyone in every state.

And if the bill passes?

This bill would kill innovation. If manufacturers know they will be subject not just to regulation by the FDA but to uncertain justice under 50 different state standards, the manufacturers are far less likely to bring that device to the market. All those other beneficiaries – the Michael Kinsleys of the world – would be harmed by a law undermining the FDA’s authority.

Preemption and Medical Devices: Saving Lives

By | Briefly Legal, Health Care, Regulations | No Comments

One of the witnesses at the House Energy and Commerce subcommittee hearings on medical devices and federal preemption (see earliers posts) was a woman whose pacemaker had malfunctioned, causing her great distress, surgery and continued medical problems. In a similar fashion, Diana Levine became the public image of the preemption issue as it relates to labeling of medicines; a musician, she had lost her arm after an anti-nausea medication was improperly administered intraveneously.

The ones damaged have compelling stories, used by advocates (and trial lawyers) to promote a cause. We should certainly listen to them. But how about those saved? As the columnist Michael Kinsley noted in his testimony yesterday, “Lawsuits focus on the victim of some medical product. By their nature, they undervalue the benefit that same product has brought to other users, or even to the victim herself.”

So we note with appreciation this news release from AdvaMed, the Advanced Medical Technology Association, which organized remarks in Washington by a group of patients who had benefitted from medical devices. From “Patients Call for Continued FDA Preemption Authority“:

“Without my medical device, I would not be here today,” said Laura Doud of Arlington, Virginia, who received life-saving implantation of cardiac resynchronization therapy with defibrillation in 2004 after suffering almost fatal viral cardiomyopathy. “If the proposed legislation were passed, would the lawsuits facing inventors and manufacturers prevent devices like mine or future medical innovations from ever making it to patients like me?

And then there’s Olivia Vervaeke, a senior from Detroit, Michigan, graduating this week from the University of Notre Dame, born with a congenital heart defect that severely worsened in high school. Olivia required an implantable cardioverter defibrillator (ICD) in 2005.

“This device saved my life,” said Olivia Vervaeke, who is graduating from college on Sunday, May 17 but took a break from wrapping up her final days at Notre Dame to come to Washington to tell her story. “I can run five miles a day now; I could never do that before.”

The news release includes testimonials from other people helped by medical devices, and although they did not testify at the committee, their experiences need to be heard. Replacing a consistent, predictable and expert-based FDA regulatory system for medical devices with 50 different state systems determined by juries would discourage the innovation that helped save these people’s lives.

Michael Kinsley on Preemption, Medical Devices

By | Briefly Legal, Health Care | 2 Comments

From the hearing now under way, Energy and Commerce Subcommittee Hearing on H.R. 1346, the Medical Device Safety Act of 2009, the prepared testimony of liberal columnist Michael Kinsley, who notes the benefits he has received as a Parkinson’s sufferer from FDA-approved medicines and a medical device, an implant that provides Deep Brain Stimulation. As a journalist, Kinsley has also covered the impact of litigation on health care.

In his testimony, Kinsley remarks upon the dual approach toward drug and medical device regulation, one embodied by the FDA, the other by litigation.

The other system is tort law, administered by thousands of non-expert judges and jurors in 50 state courts. The same issue can and does get relitigated dozens of times. Differences in state law or just the randomness of juries produce dozens of different answers. Some plaintiffs hit the jackpot; most victims never even sue. The direct cost is horrendous: delivering a dollar to a victim costs far more than a dollar in expenses—mostly lawyers’ bills.

The indirect cost is immeasurable. Lawsuits focus on the victim of some medical product. By their nature, they undervalue the benefit that same product has brought to other users, or even to the victim herself.

Forced to choose between these two systems for making essentially the same decision, I believe that anyone sensible would choose the FDA. But in real life, the situation is even crazier: we have both systems simultaneously. And basically, whichever one draws a more restrictive line, wins. Add to this the fact that product manufacturers have no idea when or how the standard might change, and you have a perfect arrangement for discouraging drug and device manufacturers from developing new products, like the ones that allow people like me to go about our business, which is making trouble for people like you.

The Medical Device Litigation Act, a Hearing

By | Briefly Legal, Health Care, Regulations | One Comment

Balanced story in today’s Cleveland Plain Dealer on a House committee hearing scheduled this afternoon on H.R. 1346, the Medical Device Safety Act. This is the bill that would end what’s called “preemption,” the federal liability protection for FDA-approved medical devices, opening the gates wide for product liability suits in state courts.

The bill comes in response to the Supreme Court’s ruling in Riegel v. Medtronic, and has long been a priority of the trial lawyers at the American Association for Justice.

The Plain Dealer’s headline represents the pro-lawsuit arguments, “Patients injured by faulty medical devices want laws to hold manufacturers accountable,” and the story leads with the claims of the injured party. Still, the Plain Dealer provides space for manufacturers and others to comment on innovation-stifling effects of the legislation.

“This bill does not in any way improve patient safety,” said Steris spokesman Stephen Norton. “It will, however, restrict patient access to essential medical technologies, produce a chilling effect on medical innovation, create more lawsuits, and ultimately result in higher health-care costs for all Americans.”

And from Medtronic spokesman Rob Clark:

“When you regulate through litigation, which is the recipe the Medical Device Safety Act is aimed at, it places decisions in the hands of a 12-person jury that’s only looking at one particular patient, and one particular situation and not evaluating the safety and efficacy and risk benefit of that device for everyone,” Clark said.

Washington Post columnist Michael Kinsley, who is testifying at today’s House Energy and Commerce subcommittee hearing, made that important point last year when commenting on the high-profile preemption case, Wyeth v. Levine.

The flaws of litigation as a method of making important government decisions are well rehearsed. It is ungodly expensive: The lawyers typically cost more than even the most worthy plaintiff ever gets. It is arbitrary: The same issues get litigated again and again, usually with a different result each time. Most people who suffer never sue and get nothing. While the FDA has scientists, the courts have jurors, for whom ignorance of the subject at hand is not merely the norm but a virtual requirement. And because trials occur only when a risk has gone wrong, they inevitably overemphasize the risk and undervalue the benefit.

The Subcommitte on Health holding the hearing is chaired by Rep. Frank Pallone (D-NJ), sponsor of the bill, so the agenda is clear enough. We trust that agenda allows space for the argument that undermining preemption will create a chaotic, expensive and capricious regulatory system ruled not by medical experts and the disinterested FDA but by juries in the 50 different states. And that’s a regulatory regime that does not serve the public.

For more on the hearing, see our post at Point of Law.com, “Medical Device Safety Act hearing, the PR angle.” It’s an interesting witness list.