Is an R&D company subject to FDA regulation when licensing and not manufacturing?

#1
My company recently changed its business plan from intending to manufacture and market a medical device for the ICU, to now developing the technology and then licensing it to Partners. The Partners would then manufacture and market the product for various markets, some of which would be regulated by FDA and others. As the R&D company who is licensing the technology, will we be audited and required to submit to the FDA, or will only our Partners?

I apologize for being vague on the product details, but I don't think it is relevant to the question.

Thanks in advance for your help.
 
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Ronen E

Problem Solver
Staff member
Moderator
#2
Hi,

It mostly depends on whose name the devices are going to be marketed under, i.e. who will be the regulatorily responsible Manufacturer. If it's going to be the licensees, your company will merely be a supplier - of the design. As such it won't be subject to the regulations directly, under most regulatory systems I know, but nevertheless it may still be answerable indirectly for design related issues.

Cheers,
Ronen.
 

somashekar

Staff member
Super Moderator
#3
Specification Developer - Develops specifications for a device that is distributed under the establishment's own name but performs no manufacturing. This includes establishments that, in addition to developing specifications, also arrange for the manufacturing of devices labeled with another establishment’s name by a contract manufacturer.
Are you this above .... ?
Then you are to register, list and pay fee
see 807.20 (a)(1)
THIS page could help you more
You will then be open to be inspected by FDA.
 
#4
Thank you for your responses.

Somashekar, Specification Developer looks like a good description.

It isn't clear though what the regulatory burden is for a Specification Developer besides registering, listing and paying the fee. Would we be subject to an FDA audit? Would there be a certification approval process with verification testing or validation requirements, etc.?
 

Ronen E

Problem Solver
Staff member
Moderator
#5
Thank you for your responses.

Somashekar, Specification Developer looks like a good description.

It isn't clear though what the regulatory burden is for a Specification Developer besides registering, listing and paying the fee. Would we be subject to an FDA audit? Would there be a certification approval process with verification testing or validation requirements, etc.?
Your company will only be a Specification Developer if it distributes the devices (made elsewhere) under its own name. Not the typical arrangement I understand as "licensing".
 
#6
Ronen, you are correct; that is not what we envision. The product would be manufactured and marketed by other companies under their own names, with us being paid a royalty for each product. We may supply one part of the system which we would probably have contract-manufactured; the marketing strategy is still in the conceptual planning phase.
 

Ronen E

Problem Solver
Staff member
Moderator
#7
We may supply one part of the system which we would probably have contract-manufactured;
1. Is this "part" merely a component, or can it be put to use on its own, as a medical device?

2. Supply to who - manufacturers or distributors/users?
 
#8
Hi Ronen,

The product is a combination of a skin abrasion device, a glucose biosensor, a Bluetooth transmitter and mobile software to connect to a smartphone/tablet. It will be marketed as a health wellness device to allow people to use their glucose readings or trends to make better wellness decisions, but not clinical decisions. The exact language and intent seems to be critical with regard to the guidance docs.

The skin abrader could possibly be used on its own and it still remains to be seen as whether it will qualify for the dermabrasion exclusion for Class 1 devices. [On a side issue, I haven't been able to figure out how to see a listing of all the predicates of these devices (code 878.4820).] We may or may not decide to manufacture this, contract it out or allow the partners to manufacture.

The API and Encryption software would be supplied by us, while the partners would make the smartphone/tablet apps.

The biosensor and transmitter would be manufactured by the partners, but we would supply an encryption chip that makes it all connect properly.

The goal is for the product to be marketed for General Wellness, but there are several issues to clear with FDA first. Later, we would look at the hospital clinic and out-patient market for use as a CGM.

Supply would be to the manufacturers, but we also are looking at possibly supplying one of the consumables, and that could possibly be to distribution.

I hope I didn't overwhelm you with TMI.
Thanks.
 
M

MIREGMGR

#9
Your company will only be a Specification Developer if it distributes the devices (made elsewhere) under its own name. Not the typical arrangement I understand as "licensing".
Just to muddy the waters a bit, note that your business agreements should address actual regulatory responsibility as opposed to only discussing the name under which the devices are marketed...because it could be the case that your business partners would see themselves as subject to the US FDA "Private Label" exception, in which case their view would be that you are the regulatorily responsible party even though the devices are marketed with their name on the top line and your name likely not on the labeling at all.
 

Ronen E

Problem Solver
Staff member
Moderator
#10
Hi Ronen,

The product is a combination of a skin abrasion device, a glucose biosensor, a Bluetooth transmitter and mobile software to connect to a smartphone/tablet. It will be marketed as a health wellness device to allow people to use their glucose readings or trends to make better wellness decisions, but not clinical decisions. The exact language and intent seems to be critical with regard to the guidance docs.

The skin abrader could possibly be used on its own and it still remains to be seen as whether it will qualify for the dermabrasion exclusion for Class 1 devices. [On a side issue, I haven't been able to figure out how to see a listing of all the predicates of these devices (code 878.4820).] We may or may not decide to manufacture this, contract it out or allow the partners to manufacture.

The API and Encryption software would be supplied by us, while the partners would make the smartphone/tablet apps.

The biosensor and transmitter would be manufactured by the partners, but we would supply an encryption chip that makes it all connect properly.

The goal is for the product to be marketed for General Wellness, but there are several issues to clear with FDA first. Later, we would look at the hospital clinic and out-patient market for use as a CGM.

Supply would be to the manufacturers, but we also are looking at possibly supplying one of the consumables, and that could possibly be to distribution.

I hope I didn't overwhelm you with TMI.
Thanks.
No, it's not too much information...

I'm only a little confused by your initial phrasing:

As the R&D company who is licensing the technology, will we be audited and required to submit to the FDA...
... while now you describe a plethora of manufacturing roles your company might assume. I'm almost tempted to say that the licensing in this case is irrelevant to the issue of being subject to FDA submissions or inspections. You should review each activity / product that you are actually going to realize carefully and separately, to see what your obligations are under each.

Regulation 878.4820 includes various product codes under it, and I think most of them are irrelevant to the specific device type you mentioned (see here for example). You probably better narrow your search to the specific product (3-letter) code.

Cheers,
Ronen.
 
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