A "Private FDA" to Evaluate Medical Devices?

Alexander Volokh
Privatization Watch, January 1996

Congressional advocates of FDA (Federal Food and Drug Administration) reform call for farming out the FDA's drug and medical device approval process to private organizations. (See "FDA May Contract Out Drug and Device Approvals," Privatization Watch, July 1995.) Reformers suggest that a system of competing, private device reviewers would reduce FDA backlogs, cut the delays in the approval of life-saving products, and do a more effective job of evaluating the safety and effectiveness of drugs and devices. Many medical device companies are trying to escape the FDA's burdensome regulatory regime by moving to Europe, where such a private review system is already in place.

In the United States, ECRI is one possible model of how a private device-reviewing organization might work. ECRI (originally the Emergency Care Research Institute), run by Dr. Joel Nobel out of Plymouth Meeting, Penn., has been in existence for over 25 years. ECRI is the world's largest independent evaluator of health care technology, and is a Collaborating Center of the World Health Organization. ECRI is also a leader in accident investigation.

Dr. Nobel explains ECRI's motivation: "ECRI's mission was defined and its programs implemented prior to device legislation and the existence of [the FDA Device Center]. Congress had not yet entered the lists. Our purpose was to redress the obvious power imbalance between buyers and sellers of medical devices through a product testing and publication program analogous to Consumer Reports. . . . But ECRI's formal charter actually charges us to improve the quality and safety of health-care. Today the power imbalance is between Congress and the FDA on one hand and industry and health-care providers on the other. All such power imbalances trap patients in the middle and harm them."

ECRI goes to great pains to keep its aura of objectivity. ECRI has extremely stringent conflict-of-interest rules. It takes no money from the device, drug, or biotech industries. 65 percent of its money comes from selling its publications; most of its customers are hospitals and government agencies worldwide. The other 35 percent comes from consulting work for hospitals and government agencies. No ECRI employee can work for, consult for, own stock in, or get payments or gifts from the device, drug, or biotech industries. Industry can't pay any employee's travel expenses or use ECRI's results in their advertising. ECRI audits every employee's tax returns before they are submitted to the IRS.

Nobel accuses the FDA of being too focused on paperwork rather than on actual product performance. Many reformers are pointing to ECRI as an example of how private-sector device review could improve the process.