This post originally appeared on our sister blog, InsideMedicalDevices.

The European Commission has proposed a revision to the regulatory framework for in vitro diagnostic medical devices (IVDs) that could have a significant impact on the operations of commercial laboratories in the EU or those offering testing services to customers in the EU.

Laboratory-Developed Tests

Under current EU rules, laboratory-developed tests (colloquially known as “home brew” tests) meet the definition of an IVD.  However, there is an exemption from the requirements under the current IVD Directive for certain laboratory-developed tests: Article 1(5) excludes from the scope of the Directive devices“manufactured and used only within the same health institution and on the premises of their manufacture or used on premises in the immediate vicinity without having been transferred to another legal entity.”  ‘Health institution’ is not defined by the Directive, leading to significant variation in interpretation at the member state level as to when this exemption should apply, particularly in its application to free-standing commercial laboratories.

The proposed Regulation seeks to clarify and limit the scope of the exemption.  The exemption will only available to laboratories that have been accredited to ISO 15189 or an equivalent recognized standard.  The exemption will not be available at all for the highest risk class of IVDs (Class D in a new classification scale). Perhaps most significantly, the exemption is only available to laboratories that meet a new definition of ‘health institution’: “an organisation whose primary purpose is the care or treatment of patients or the promotion of public health.”  A European Commission impact statement explaining the reasoning behind this new definition states that “it would exclude free-standing laboratories which provide diagnostic services for which the exemption has never been intended”i.e. only hospital laboratories and certain public health laboratories will be able to take advantage of the exemption.

Since commercial laboratories will not be exempt from the requirements of the Regulation, they would only be allowed to use laboratory-developed tests that comply with the Regulation.  This means that the tests would need to comply with the so-called “essential requirements” set out in the Regulation and undergo a formal conformity assessment procedure to confirm compliance with those requirements.  For higher risk IVDs, the conformity assessment procedure would involve a “notified body,” an independent third party licensed by the local regulatory authority to perform such assessments.  The test would also need to be CE marked, unless it is to be used only in the laboratory in which it has been manufactured.

This clarification of the EU rules for laboratory-developed tests will therefore have a significant impact on any commercial laboratories in the EU that previously have been able to rely on the exemption for in-house tests used in health institutions.

Distance Sales

The proposed Regulation includes a new section on distance sales regulating tests used outside the EU to provide a diagnostic or therapeutic service in the EU.  Article 5(2) of the proposed Regulation states that:“Without prejudice to national legislation regarding the exercise of the medical profession, a device that is not placed on the market but is used in the context of a commercial activity for the provision of a diagnostic or therapeutic service offered by means of information society services as defined in Article 1(2) of Directive 98/34/EC or by other means of communication to a natural or legal person established in the Union shall comply with this Regulation.”

It appears to be the intent that a laboratory located anywhere in the world will need to comply with the requirements of the Regulation if it provides diagnostic testing services to a person located in the EU.  For example, if samples are sent from patients in the EU to a laboratory in the US with the intent that the results would be transmitted back to the EU, that laboratory will only be permitted to use tests that comply with the EU rules (i.e., the tests would need to be CE marked, or at least have undergone a conformity assessment procedure to verify compliance with the essential requirements in the new Regulation).  Clearly, the new rules could have a significant impact on any non-EU commercial laboratory’s business model.  However, it should be noted that enforcing the rules in non-EU countries may be challenging, especially if the exchange is exclusively between the patient or physician and the foreign commercial laboratory, so that there no commercial operator in the EU whom regulatory authorities could target.

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Photo of Robin Blaney Robin Blaney

Robin Blaney is a partner in the firm’s Life Sciences practice.  He advises pharmaceutical, biotechnology, medical device and cosmetic manufacturers and trade associations on a wide range of regulatory, compliance, transactional and legislative matters, as well as the full range of commercial agreements…

Robin Blaney is a partner in the firm’s Life Sciences practice.  He advises pharmaceutical, biotechnology, medical device and cosmetic manufacturers and trade associations on a wide range of regulatory, compliance, transactional and legislative matters, as well as the full range of commercial agreements that span the product life-cycle in the life sciences sector.  His expertise includes clinical trial agreements, manufacturing and supply agreements, distribution and other marketing agreements, regulatory services agreements, and tenders.  He has particular experience structuring and documenting EU pharmaceutical distribution arrangements and transitional arrangements relating to product acquisitions.  Robin writes and speaks regularly on subjects such as medical device regulation, pharmacovigilance and clinical trials.