The time and cost required to bring a device to market through the 510(k) pathway versus PMA make the 510(k) pathway the more popular option, if available. He is founder and former executive director of the North Carolina Medical Device Organisation, which became a North Carolina Biotechnology Innovation Center. The United States, one of the world's largest markets for pharmaceuticals and medical devices, is also one of the few industrialised countries that does not regulate device prices. He said that as long as these medical products are properly labelled, and as long as there are reasonable assurances of safety and efficacy for those products, physicians will use them appropriately.
The proposal would implement Europe-wide clinical evaluation for technologies, including certain medical devices, while authority for coverage and reimbursement decisions would remain at the national level. According to the Medicare Payment Advisory Commission, medical devices are a major contributor to rising healthcare spending, and spending on devices has increased twice as fast annually as spending on drugs (4 to 5 percent versus 2 percent). According to Betten, medical device companies often face considerable financial constraints that make it difficult to create revolutionary products, or even to manufacture devices that are substantially less expensive but functionally equivalent to older technology. However, medical devices range from scalpels to PET scanners to medical software, and are used in all sectors of the healthcare system, so it remains difficult to accurately quantify spending on devices.
There are many reasons for the rise in medical device prices in the US, similar to that of prescription drug prices. According to Makower and colleagues, patients are denied or delayed access to major medical devices that are first (or exclusively) marketed in other countries. Yet medical device companies routinely shell out tens or hundreds of millions of dollars to settle product liability claims. Despite the enormous need to develop medical products that are considerably less expensive than traditional technologies, there are relatively few companies developing such products.
Josh Makower surveyed more than 200 medical technology companies about the regulatory process in the states. The vast majority of sophisticated medical devices are marketed through the 510(k) pathway, which requires a device to be substantially equivalent to another device already on the market. In both Europe and the US, policymakers are increasingly relying on medical device regulatory policies, such as market approval mechanisms, post-market surveillance systems, reference pricing and health technology assessments. The National Evaluation System Coordinating Centre for Health Technology Assessment (NESTcc) is a public-private partnership that aims to advance the regulatory science of medical devices.
Many medical device companies are being forced to reduce the costs of their products to accommodate increasingly cost-conscious hospitals.