Full article reprinted from "The Gray Sheet" - April 20, 2009
Find out how orthopedic device maker Endotec's Buechel-Pappas ankles are not custom devices and therefore not exempt from pre-market requirements, according to a recent U.S. appeals court decision.
On March 30, the U.S. Court of Appeals for the Eleventh Circuit ruled in FDA's favor, affirming the agency's contention that Endotec was illegally manufacturing devices that should be subject to pre-market approval. The ruling settles a seven-year debate between FDA and Endotec on the nature of some of its "custom" products.
But the court also missed an opportunity to further clarify the difference between custom and commercialized devices, one legal expert laments.
The Food, Drug & Cosmetic Act defines custom devices as products that meet a physician's individual order; are not generally available to other physicians or generally available in finished form for purchase; are not offered for commercial distribution through labeling or ads; and are intended for use by the individual patient indicated in the physician's order.
Custom devices are exempt from pre-market review because the studies that would otherwise be required for FDA clearance or approval would be impossible for unique, one-off products.
Device makers, however, remain confused about the scope of Congress' definition, and with no FDA guidance in sight, too much is left up to the agency's discretion, Fredrikson & Byron attorney Robert Klepinski says.
"They prefer to keep the area uncertain so they can take action against cases they believe are improper," Klepinski asserted. "For industry, of course, this is an extremely uncomfortable position."
On the one hand, people "will take chances, pushing and calling things 'customs,' which logically are not" custom devices. "On the other hand, people aren't getting custom devices to doctors who could use them and patients who could use them because they are afraid."
The March 30 appellate court decision affirmed district court Judge G. Kendall Sharp's April 2008 ruling that Endotec's jaw implant was a legitimate custom device while its B-P knees were not; and it reversed Sharp's ruling that B-P ankles qualified for the custom device exemption. The court left it up to Judge Sharp to "craft the proper permanent injunction" (1"The Gray Sheet" Sept. 1, 2008, p. 7).
Appellate Decision Hinges On Advertising Ban
The court's decision on the B-P ankles hinged on the ban on advertising in the statutory definition. Circuit Judge Charles Wilson cited two examples of apparent advertisements for the custom ankles as proof that the products are not bona fide customs.
That decision was sound, Klepinski said, "but I am disappointed that the court did not engage in more of a discussion of the other custom devices factors."
Specifically, the lawyer had hoped the court would discuss the differences between "custom" devices provided as a result of a doctor's request and those provided following a manufacturer's suggestion, as well as how many devices sold would constitute commercialization and what it means for a device to be "generally available."
One takeaway, however, is that "devices that come out of company development plans rarely are going to end up as customs."
FDA sued Endotec in 2006, alleging distribution of the ankle, knee and jaw implants without proper approval, after sending a warning letter in 2002. The appeals court ruling "upholds FDA's mission to protect consumers through the pre-market approval process," the agency's Office of Criminal Investigations said April 7.
Defendants Michael Pappas and Frederick Buechel, who founded the company and designed the implants, plan to file a motion to reconsider, though they sold the Endotec business to Korean biotechnology firm Korea Bone Bank in February. Furthermore, "we're going to work with Judge Sharp to come up with an injunction which is reasonable," former Endotec president Pappas said.
Wright Medical holds a license to the B-P ankle technology and may be interested in pursuing a U.S. clinical trial, Pappas suggested. Endotec also gained 510(k) clearance for its Fenning-Pappas modular knee bearing Feb. 20.
- Jessica Bylander
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