Bridging The FDA-CMS Divide: An Optimized Route To Market For Medical Devices, Part 2

By Jim Pomager, Executive Editor

In the crucible that is today’s healthcare environment, medical device companies can no longer wait until they have regulatory approval or clearance to begin pursuing reimbursement for their products. Nor can they approach regulatory and reimbursement activities as completely independent initiatives. A more tactical, integrated methodology is required.

In Part 1 of this series, we looked at some of the ways medical device manufacturers are adapting — working collaboratively with both FDA and CMS to pave new pathways to market for their novel technologies. One example was Exact Sciences’ Cologuard noninvasive colon cancer screening test, which became the first product to successfully navigate the FDA-CMS parallel review process (under a pilot program) earlier this month. Another is Edwards Lifesciences’ Sapien transcatheter heart valve, whose CMS national coverage determination (NCD) automatically expands along with all FDA label expansions.

While device makers should certainly be encouraged by these (and other) examples, they shouldn’t delude themselves into thinking the road ahead to commercialization of their device will be easy. This article will explore the unique challenges posed by working simultaneously with FDA and CMS. Along with those challenges, it will also share best practices for achieving success in this new era of industry-government collaboration. Finally, we’ll hear from some of the major players involved in these collaborative efforts about what the future might hold.

Obstacles To Concurrent Review
As Michael Tarnoff, M.D., corporate chief medical officer for Covidien, pointed out during a panel session at the AdvaMed 2014 conference earlier this month, although the parallel FDA-CMS review strategy is fairly easy, the execution (currently) is anything but.

“We’ve had some challenges with getting the agencies to work together,” Tarnoff said. “Getting FDA and CMS in a room together might not be as simple as it sounds.”

Obviously, adding more organizations and people and communications to a process necessarily increases the level of complexity, Murray Sheldon, associate director for technology and innovation at FDA’s Center for Devices and Radiological Health (CDRH), pointed out. Even routine tasks, like simply scheduling a meeting or a conference call, can become much more difficult.

But there are also bigger obstacles to overcome. Tamara Syrek Jensen, director of the Coverage and Analysis Group at the Centers for Medicare & Medicaid Services (CMS), called attention to two significant issues. First, CMS will need more resources to support increased interaction with the FDA and industry. “Having people [from CMS] go to the FDA and listen in to these conversations requires additional resources,” she explained. “I think we're moving in the right direction, just trying to get somebody at that meeting. It's not that we don't want to be there, because we do.”

Second, we need to answer an important question: When is the appropriate time for CMS to get involved? If CMS gets involved too early — for example, when a device maker first enters talks with FDA regarding a Phase 1 trial — it could end up being a waste of everyone’s time. “You need to have FDA approval, and that's the case for all payers,” Sheldon said. “Coming in and talking a lot with the payer early on, when a device that may or may not be approved, would be a resource waste for the payer group.”

On the other hand, you don’t want CMS to join too late, either. “What is the right time for CMS to come in and be part of those conversations, where we can help shape the trial so you can have the clinical outcomes that we might be interested in, depending on your particular device?” Syrek Jensen asked.

The industry side brings its own set of problems to the relationship. Larry Wood, corporate VP and GM of the transcatheter heart valves business at Edwards Lifesciences, said many manufacturers are suspicious of such arrangements, questioning the benefit of having FDA and CMS in the same room, conversation after conversation.

“I don't know that a lot of us in the industry can sit here and say, ‘We’re dealing with one government agency, but you know what would make it better? Two government agencies — that would be great,’” he quipped. “I think there are people who are against it. They're scared of anything new and different, because they feel like the process of getting a medical device approved and paid for is already complicated enough.”

Tips For Collaborating With FDA And CMS
Despite the challenges and the naysayers, increased collaboration with regulators and payers throughout the medical lifecycle is quickly becoming a necessity. Fortunately, the AdvaMed panelists shared a number of best practices to help you implement this approach at your company.

Consider the payer perspective: Developers often consider what FDA needs to approve or clear a device without giving much thought to what a payer might view as important. “It’s just a sense of awareness of what the payer does as well, beyond whether something is safe and effective,” CMS’s Syrek Jensen said. “Does it actually improve health outcomes for our population, for example?”

Start early: It’s important to start thinking about where your device is going to end up, who it's going to be used on, and who's going to pay for it — at the very earliest phases of development. “If you make assumptions at the very beginning and think, ‘I already know this will get covered because of X,’ and then you find out after FDA approval that it is not, your replacement will reflect back that that was a poor decision on your part,” Edwards’ Wood warned.

Don’t be afraid of CMS: Syrek Jensen encouraged device makers to reach out to her group after you start talking to the FDA — even invite them to attend meetings, when appropriate. “CMS is a friendly group. I'm a friendly person. Come talk to us. We really will have conversations. Please call. We're very open,” she said.

Communicate outside of meetings: Don’t expect to hash out every detail of your trial during your meetings with FDA and CMS. Wood suggests doing 90 percent of the work “interactively,” through teleconferences, email, and other forms of communication. “People want time to be able to digest the information before they come back with a view,” he explained. “And then you save that 1-hour meeting for the two or three main issues that you really need to hammer out.”

Be open and honest: Several of the panelists cited honesty between FDA, CMS, and the manufacturer as the key to successful collaborations. Wood provided an example: “Not sharing slides with FDA before showing up for meeting, because we wanted to spring everything on them and try to get an answer — is probably not a best practice,” he said. “Now we trade slides two weeks in advance. It’s a totally different process.”

Make sure your device is eligible for coverage: According to Syrek Jensen, many parallel review applicants were turned away in the early going because their devices didn’t have a CMS benefit category or determination. “It needs to be something that falls within the Medicare statute that we even have authority to pay for,” she explained. “You'll know that right up front. A lot of it can be how you label something, as well.” If you are unsure whether your device fits within the Medicare statute, contact CMS.

Kill off a project, if necessary: When Wood’s group at Edwards starts a project, it first asks three questions: What level of evidence will be required? How expensive is it going to be to get that level of evidence? And who's going to pay for it? If, based on the answers, the group decides that the risks are too high, it will let go of even potentially good projects. “That's just the reality of where we are today,” he added.

Spread the good news: Exact Sciences’ Conroy pointed out that CMS and FDA have showed the industry a very innovative path forward, and it is incumbent upon CEOs and other leaders from the industry to share success stories with representatives on Capitol Hill. “We don’t know if this program is going to continue to be funded, and we want to build support from an industry standpoint to keep it going,” he said. “We could help ourselves when good things happen if we actually go sit down and have a conversation.”

Take care not to ruin it for everyone: Wood warned that all it will take is one bad actor for concurrent review to end as quickly as it started. “All it's going to take is one person rushing something through, playing fast and loose with the rules, and bringing a disaster on, and all this collaboration we've been trying to build is going to go up in a puff of smoke,” he said. “As they open the doors and become more collaborative, I think we have to redouble our efforts to make sure we’re doing good research and running good programs.”

Interagency Coordination: Today And Tomorrow
Before looking to the future, it’s worthwhile to take stock of where things currently stand.

First, it’s important to recognize that reimbursement now represents at least as big a hurdle as regulations for medical devices to clear on the path to market. And rightly so, according to Covidien’s Tarnoff: “People in the industry like to say that the bar is getting higher, that it's becoming harder to get products approved and paid for. As a physician, I just look at it and say, ‘Well, actually, I think the bar is coming up to where it probably always should have been.’” Whether you agree with that sentiment or not, it’s undeniable that the problem won’t go away any time soon.

The good news is that parallel review represents a possible light at the end of the tunnel for device makers. The first pilot project (Exact Sciences’ Cologuard) is now complete, and all parties involved are speaking very highly of their experiences. Plus, the program is still open — until at least December 2015 — so if your technology meets the FDA-CMS requirements, you can still apply. And as the Edwards Lifesciences example in Part 1 demonstrated, there are ample opportunities for collaboration outside the formal parallel review program.

What’s next? For FDA and CMS, it’s reviewing the recently completed Exact Sciences pilot project to assess what worked and what didn’t, and determining what modifications should be applied to other parallel review pilot projects. “We have gotten through an entire [pilot project], so we’ve had one experience,” Syrek Jensen of CMS said. “Now, I think CMS and FDA need to look at the program and evaluate its successes, areas that can be improved, and where we are doing okay, and then the pilot program needs to move forward.”

As the pilot program continues, both groups will continue to learn through the various projects. “I believe that FDA has learned a whole lot more about the issues of coverage and reimbursement by having these discussions,” said CDRH’s Sheldon. “For FDA to have a better understanding of the challenges that the device developer may face beyond approval or clearance we thought was very, very important.”

FDA is also starting to connect with private payers and providers. “For those folks that are making devices that clearly are not for Medicare beneficiaries, we have a similar issue,” Sheldon explained. “So we are beginning to engage private payers and providers, to have them weigh in and communicate with device developers early enough in the process that adjustments can be made to how the evidence is collected. You can't collect the right evidence if you don’t know what will be required.”

Now it’s your turn. It’s time for device makers to reach out to what Edwards’ Larry Wood described as an FDA that “is more collaborative now, in my experience, than they've ever been in their history.” To connect with a “friendly” CMS — the rare insurance company that supports preventive research through coverage of evidence development. (Related, CMS will begin centrally reviewing Category A & B investigational device exemption [IDE] trials for Medicare coverage starting in January 2015.) As a stakeholder, it’s your responsibility to play an active role in helping develop new solutions to the problem.

“It's all about getting people to talk to each other,” Tarnoff said. “These are very nontraditional partnerships; these are nontraditional relationships. They were, at one time, adversarial, and that really has to change if we're going to move this forward.”

“We have to find ways that we can bring new technologies forward — that they can be paid for, they can be practiced, they can evolve, and they become the standard of care,” Wood added. “We have to have a system that allows for these sorts of innovations to happen, or we'll just keep doing the same exact procedures today that we did yesterday. Without change, minimally invasive surgery never happens. Mitral valve repair never happens. All of these novel procedures never happen.”