Bridging The FDA-CMS Divide: An Optimized Route To Market For Medical Devices, Part 1

By Jim Pomager, Executive Editor

When Kevin Conroy sat down with the Coverage and Analysis Group at the Centers for Medicare & Medicaid Services (CMS) in May 2009, he was a desperate man.

Conroy had just joined Exact Sciences, a molecular diagnostics company focused on early detection and prevention of colorectal cancer, a month prior to that CMS meeting. And while his new company had a novel, highly accurate, noninvasive technology with a potentially huge market — regular colorectal cancer screening is recommended for everyone beginning at age 50 — it was also low on capital and was in danger of having its stock delisted from the NASDAQ. (The company ultimately retained its NASDAQ listing.)

The path forward would be arduous, at best. Conroy and his team estimated a product development program would require an investment of about three years and $50 million, and clinical trials for FDA would add another three years and $50 million. And then came the realization that obtaining Medicare coverage would require yet another clinical trial, more time, and more money.

“That was going to take another three years, and there was no way for us to finance the company for a decade, to bring our product to market,” Conroy recalled during a panel session at the AdvaMed 2014 conference in Chicago this month.

Yet here we are less than six years later, and Exact Sciences’ Cologuard stool DNA-based test has obtained not only FDA approval, but a CMS national coverage determination (NCD) as well, making it the first product of its kind to achieve both feats.

How did Exact Sciences’ prospects shift so dramatically, so quickly? It all began during that fateful meeting with CMS back in 2009.

The Advent Of The Parallel Review
According to Conroy, the meeting began with a “forthright conversation” about colorectal cancer testing and how Cologuard technology had evolved. However, the topic quickly shifted to the real-world problem that Exact Sciences faced: the need to conduct two big clinical trials, one to satisfy FDA evidentiary requirements and another for CMS. The company then proposed an alternative, Conroy said: “We told the Coverage and Analysis Group that we were committed to doing one really large clinical trial — and getting it done right.”

CMS didn’t exactly say “yes” to Exact Sciences’ proposal during that meeting, but it did start a conversation that would eventually pave a new path to market for innovative medical devices. In a subsequent meeting, CMS asked the company if it was willing to be the guinea pig for a program that would allow concurrent product review for premarket regulatory approval and Medicare coverage.

“The parallel review was always something in the back of our minds that we wanted to do,” Tamara Syrek Jensen, director of CMS’s Coverage and Analysis Group, said during the AdvaMed panel session. “When we talked to Exact Sciences, it was before we officially had anything written out.”

Earlier this month, Exact Sciences' Cologuard received a final coverage determination from CMS — following August's FDA approval — becoming the first product to complete parallel review. (Image courtesy of Exact Sciences)

FDA and CMS solicited comments from industry on the concept in 2010, and in 2011, they officially launched the Pilot Program for Parallel Review of Medical Products with Exact Sciences as its first participant. Particulars of the program are as follows:

• Only devices under FDA premarket approval or de novo review are eligible.
• Devices must fall within the scope of an existing Medicare Part A or B benefit category and should not be subject to an existing NCD.
• Up to five devices per year can participate in the program.
• It is expected to shave about six months from the NCD timeline.

While the pilot program was originally intended to run through the end of 2013, FDA and CMS announced last December that it would continue through December 18, 2015. In addition to Exact Sciences, the only other known participant is Medtronic’s Symplicity renal denervation system. You can find more information on the program here.

Overturning An Outdated Paradigm
The goal of parallel review, as stated by CMS and FDA, is to shorten the time it takes to bring innovative new medical technologies to patients by “reducing the interval between FDA marketing approval and Medicare coverage.” The program seeks to accomplish this by upending the traditional model, where regulatory approval and reimbursement processes occur in separate silos —with little or no communication between FDA, CMS, and the medical device manufacturer.

“The problem we are trying to solve is an ecosystem one, recognizing that if you have a weak link anywhere in the chain, it will delay patient access to important medical devices that are necessary to help them get well or save their lives,” Murray Sheldon, associate director for technology and innovation at the FDA Center for Devices and Radiological Health (CDRH), explained during the panel. “That was the position we came from with [parallel review], and we had the notion that if we could collaborate and work better with payers, we would be able to help influence and improve it."

Thus, the linchpin of parallel review is increased interaction between the primary stakeholders, ideally leading to a clinical trial design that meets the needs of all parties involved. “These conversations are very different and in the past have been very disconnected,” said Michael Tarnoff, M.D., Covidien’s corporate chief medical officer and moderator of the AdvaMed panel. “You can end up spending millions of dollars on a clinical trial only to have Medicare say that your endpoints are relevant to the regulator, but they are not as relevant to the payer.”

The parallel review model endeavors to avoid this scenario by bringing everyone together during the very early stages — starting with (or even before) an investigational device exemption (IDE) submission. For example, CMS may attend a pre-IDE meeting in what CMS’s Syrek Jensen called “listening mode” to get a better idea of what the proposed trial will look like. Then, it will provide its input and have conversations with the device maker and FDA later, often via email or over the phone. Suggestions might include enrolling older patients in the study or taking into account endpoints that you normally wouldn’t in a safety/efficacy-focused trial, like quality-of-life and economic measures.

In the opinion of Exact Sciences’ Conroy, this collaborative approach informed a much better result than going through two processes independently. “It was pretty straightforward —FDA gave its inputs on the clinical trial design, and CMS gave its inputs. They were really logical, and we incorporated them fairly quickly,” he said. “We ended up enriching the patient population for Medicare, which actually had the unintended consequence of shortening the trial.”

That’s the appeal of the parallel review concept. Everyone benefits from a more efficient process. Manufacturers avoid additional clinical trials and realize quicker returns on their product development investments. CDRH achieves its vision statement by providing U.S. patients with high-quality, safe, and effective medical devices — “first in the world.” And CMS delivers new technologies that have a meaningful impact on health outcomes to its population.

“If your particular device is something that Medicare should cover, because it’s appropriate for the Medicare population, I really don't want you to do another however-million-dollar trial,” Syrek Jensen explained. “I would prefer to get all of that answered up front, so we can get new medical innovation to the Medicare population quicker.”

And for a small company like Exact Sciences, a tighter reimbursement and regulatory review process could mean the difference between life and death. “Without [parallel review], there was no hope for Cologuard to get out of the starting gates,” Conroy added.

Interagency Coordination Outside Parallel Review
Today, very few manufacturers have the opportunity to participate in the official parallel review pilot, since eligibility is extremely restricted and the program is accepting no more than five devices per year. However, its two basic tenets — (1) engaging both CMS and FDA early and often in the process, and (2) addressing each organization’s unique requirements in your clinical trial design — are successfully being applied outside the formal program.

Take, for instance, the Sapien transcatheter heart valve from Edwards Lifesciences. The U.S. became the 43^rd country in the world to gain access to transcatheter aortic valve replacement (TAVR) when Sapien was approved in November 2011. This fact was the butt of jokes throughout the AdvaMed conference (CDRH’s Sheldon quipped that at least we were ahead of Albania when it came to approving TAVR) and was used to illustrate the challenges associated with bringing new products to market in the U.S.

Thanks to collaboration between FDA and CMS (outside the parallel review program), all label expansions for Edwards Lifesciences' Sapien transcatheter heart valve automatically receive Medicare coverage. (Image courtesy of Edwards Lifesciences)

On the other hand, Sapien is also a great example of how device makers, FDA, and CMS are continually adapting to streamline the pathway to market for innovative technologies. While Sapien wasn’t part of the parallel review program proper, Edwards did emulate aspects of the process by regularly connecting with FDA and CMS prior to initiating its clinical trial — and by so doing reaped some important benefits.

Speaking in the AdvaMed panel, Larry Wood, corporate VP and GM of Edwards’ transcatheter heart valves business, said that based on early conversations with CMS, the company went out of its way to make health outcomes a focus of its clinical studies for Sapien. “Those discussions were very helpful, because we always focus on mortality and complications, but we found out that quality of life was maybe the most important thing for CMS,” he explained.

Plus, he said, it would be naïve for manufacturers to think that FDA and CMS don’t talk to one another about devices that fall outside the purview of the parallel review program. “They’re going to be talking anyway,” he added. “You either want to have a seat at the table or not.”

As a result of Edwards’ continual engagement with the agencies, and its attention to their wishes in its clinical studies, CMS ended up initiating an NCD for TAVR two months before Sapien had even received approval from FDA. This highly unusual circumstance (CMS rarely covers devices that are yet to receive FDA approval) ensured that Sapien would be reimbursed when it hit the market.

What’s more, the agencies decided that any future label expansions for Sapien approved by FDA would automatically receive Medicare coverage. The device was initially approved for use in inoperable aortic stenosis (AS) patients but has since received several indication expansions, each covered by CMS the minute FDA gave its approval.

CMS’s Syrek Jensen believes the TAVR NCD could serve as a template for expediting Medicare coverage for other types of devices, and pointed to postmarket data analysis as key to its success. “The reason we allowed for the NCD to expand along with the label is because we were confident that the post-approval studies — the registry in this case — was a way for us to continue to look at the data as that happened,” she said. “I think this NCD is a model, potentially, of what we could do. It doesn’t seem efficient to continually reopen an NCD every time the FDA expands the label.”

Speaking of labels, another advantage of interagency collaboration is that CMS can provide input on the label, weighing in on how its wording could impact CMS coverage. According to Syrek Jensen, while labels don’t fall within CMS’s jurisdiction (that’s FDA’s turf), several manufactures have found it advantageous to seek the center’s perspective on them.

Count Exact Sciences’ Conroy among the believers.

“I think this is a good example of where having multiple parties in the room at the same time is helpful,” he said. “The FDA comes up with a label that is very clinically oriented, and in that room is a trusted party from the other side of town that is able to weigh in on what it means in the real world.”

In Part 2, we’ll explore some of the challenges posed by working simultaneously with FDA and CMS, best practices for overcoming those challenges, and what the future will hold for parallel review and the industry.