3 ways Trump’s FDA nominee could reshape digital health

Thursday, March 16, 2017

Source: FierceHealthcare

President Donald Trump’s nominee to lead the Food and Drug Administration is a strong proponent of deregulating the drug industry, an approach that could be equally beneficial for the digital health industry that has occasionally butted heads with the federal agency.

Last week, Trump announced his intent to nominate Scott Gottlieb, M.D., a resident fellow at the conservative-leaning American Enterprise Institute and a former deputy commissioner for medical and scientific affairs at the FDA during the George W. Bush administration. Gottlieb, who has close ties to the pharmaceutical industry and has been vocal about the need for a new, streamlined approach to drug approvals, was applauded by PhRMA, the industry’s leading lobbying group.

Gottlieb is likely to adopt a similar, modernized approach for digital health, industry experts told FierceHealthcare.

Digital health CEOs and investors see him as someone who has sat at both sides of the table—both as an FDA administrator and as a partner with venture capital firm New Enterprise Associates, where he specialized in healthcare investments. In a 2014 op-ed for the Wall Street Journal, Gottlieb argued that the “FDA’s regulatory dysfunction” was slowing innovation. A year later, in a post contributed to Forbes, he criticized the FDA’s attempts to deregulate digital health technology and argued that the agency was “scaring away digital entrepreneurs” that would redirect their skills to another industry when faced with onerous regulations. 

“Regulatory pathways should distinguish between digital tools that are trying to function like an existing medical device, versus those that are performing patient-specific analyses and provide patient-specific information,” he wrote.

In a subsequent Forbes post published last year, he argued that the FDA needs to adopt more of a risk-based approach to novel technologies and not get distracted by “iPhone apps that … pose relatively low risks and could be ably addressed by other regulatory agencies.”

That perspective bodes well for the industry, David Vinson, founder and chairman of DHX Group, a nonprofit organization devoted to accelerating digital health innovation, told FierceHealthcare. DHX recently partnered with the American Medical Association, the American Heart Association and HIMSS to form a collaboration focusing on the safety and quality of mHealth.

“He’s someone who brings a balance of industry needs and [knows] the regulation side of the business does not need to have an overreach,” said Vinson, who also serves as founder and CEO of SocialWellth.

Bob Kocher, M.D., a partner with the venture capital firm Venrock, told FierceHealthcare he expects that Gottlieb will be “open-minded and optimistic about the potential for digital health applications” and will make the FDA “predictable and logical” for healthcare IT companies.

Experts say Gottlieb’s influence is likely to lead to subtle enforcement changes rather than an overt policy shift, particularly during a time when the FDA has just established new guidelines regarding mHealth regulation, is in the midst of developing guidance for clinical decision support systems and has been tasked with rolling out provisions of the 21st Century Cures Act that specifically address digital health.

Here are three ways he could reshape the future of digital health.

Recent guidance interpretation

Gottlieb’s nomination comes less than a year after the FDA released a guidance document loosening regulatory oversight of low-risk general wellness apps and devices.

There’s a chance that Gottlieb could make changes to that guidance, according to Bethany Hills, chair of Mintz Levin’s FDA practice. More likely, however, Gottlieb will alter the way those guidance documents are interpreted. That may extend to the long-awaited guidance surrounding clinical decision support systems.

Even in the wake of the guidance document that provided more clarity and flexibility to the digital health industry, some companies still find themselves trying to guess when the FDA will flex its enforcement muscle.

“Even if there is literally no change to the guidance document, it’s very possible you would see a new direction in how things are enforced,” Hills said.

Given Gottlieb’s publicized views on streamlining drug approvals, that direction is likely to skew toward a more hands-off approach.

“He will probably support even more market efficiency and even less regulation in the medical device arena,” Michael H. Cohen, who runs his own healthcare and FDA legal practice in Palo Alto, California, told FierceHealthcare.

Changing the FDA’s enforcement culture may be easier said than done, according to Bradley Merrill Thompson, an attorney with Epstein Becker & Green. Thompson declined to comment on Gottlieb’s nomination but noted that although the FDA’s guidance documents offer additional leniency for digital entrepreneurs, they are also written broadly to allow for significant latitude. Those companies that run up against FDA oversight are often stymied by the agency’s conservative psychology.

“Very few people at FDA get patted on the back for approving things quickly,” he said. “But they get congratulated if they keep an unsafe product off the market.”

21st Century Cures implementation 

Two notable provisions of the recently enacted 21st Century Cures Act could be subject to Gottlieb’s interpretation.

The first is under a section clarifying medical software regulations that lists five FDA medical device exemptions. One of those exemptions references clinical decision support systems that provide recommendations about “prevention, diagnosis or treatment of a disease or condition.”

That statutory language only applies to a certain set of circumstances, so the agency is limited by the structure of the law. But when it comes to implementing the law, “there’s a lot of discretion,” Hills said. A broader interpretation from Gottlieb could increase the number of digital health products that meet those exemptions.

The second area where Gottlieb could apply a looser approach to 21st Century Cures is in establishing one or more disease-specific Intercenter Institutes designed to streamline the review of medical products developed for certain diseases. Just before President Trump took office, the FDA formally established the Oncology Center of Excellence, initiated through President Obama’s Cancer Moonshot initiative.

But Hills says she and others have been critical of the disease-specific centers because reviewing devices through the scope of a single disease or in conjunction with specific drugs attaches the wrong level of risk and adds an unnecessary regulatory burden.

“I’m really interested to see how he handles the Oncology Center of Excellence and what kind of meat he puts on that and how the process is really established,” she said.

General enforcement and greater collaboration              

Many of these subtle changes will be virtually unnoticeable for several years into Gottlieb’s tenure. Hills says she distinctly remembers the transition between the Bush and Obama administrations, when FDA officials were suddenly less responsive and less likely to engage in informal interactions.

“It’s such an amorphous thing,” she said. “There’s no policy saying we’re no longer going to talk to industry; it just happens.”

Those in the digital health industry are hoping for a behind-the-scenes shift that emphasizes collaboration and removes barriers to innovation, but also prioritizes enforcement for bad actors.

“Technology is moving so fast, I think it will shift from specific regulations to being aggressive in pursuing people who are going out of bounds that are not in the best interest of patient safety,” said Mark Vermette, principal consultant at Halloran Consulting Group in Boston.

Vinson believes the industry needs to do more to self-regulate, noting that market forces will drive out apps or devices that aren’t useful to patients or doctors. But he also recognizes that the FDA can play an important enforcement role, particularly when it comes to the way developers use patient data. 

“If data is being manipulated inappropriately, there needs to be consequences for that, like we see in the financial services sector,” he said.

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