Apple’s apps store lists close to a 100,000 health apps. Together with wearable technology, direct-to-consumer testing services, and greater consumer participation in the decision to purchase health insurance, the healthcare market in the United States is undergoing a significant transformation. Whether and how to regulate this evolving market is subject to substantial discussion and debate.
On September 23, 2013, the U.S. Food and Drug Administration (the “FDA”) issued its final guidance for developers of mobile medical applications (or “mobile medical apps”) used on smartphones and other mobile devices. The final guidance was published in the form of nonbinding recommendations and reflected a tailored approach by the FDA to analyzing mobile medical apps. It indicated the FDA’s intention of exercising enforcement discretion for most mobile medical apps and expressed the FDA’s opinion that such apps pose minimal risk to consumers (see our previous post which discusses the FDA’s guidance on mobile medical apps).
Nevertheless, the FDA’s seemingly targeted approach at regulating mobile medical apps has instigated a reaction on Capitol Hill as members of Congress question the appropriateness of FDA oversight of mobile medical apps. In October 2013, the Sensible Oversight for Technology which Advances Regulatory Efficiency Act of 2013 (the “Software Act”) was introduced in the House of Representatives. The Software Act is focused on differentiating between “health software,” “clinical software” and “medical software.” If passed, the Software Act would limit FDA oversight to medical software which would be defined as software that is intended to be marketed:
- to directly change the structure or any function of the body of man or other animals; or
- for use by consumers and makes recommendations for clinical action that includes the use of a drug, device, or procedure to cure or treat a disease or other condition without requiring the involvement of a health care provider and which, if followed, would change the structure or any function of the body of man or other animals.
For clinical and health software, the Software Act would require the President and Congress to work together to develop a regulatory framework for addressing appropriate oversight of these markets.
On February 10, 2014, the Senate introduced a bill named the Preventing Regulatory Overreach To Enhance Care Technology Act of 2014 (the “PROTECT Act”). By amending Section 201(h) of the Federal Food, Drug and Cosmetic Act, it clarifies that the term “device” does not include clinical software or health software thereby stripping the FDA of its authority over clinical and health software.
If passed, the PROTECT would nullify the FDA’s recently published final guidance as well as the FDA’s efforts to regulate medical devices as they relate to digital health. Commentators have expressed concern that all mobile medical apps will be unregulated if the PROTECT Act is passed because the proposed bill passes the oversight authority to the National Institute of Standards and Technology (NIST). Currently, NIST is a non-regulatory federal agency that works with U.S. industries to promote innovation and industrial competitiveness by advancing measurement science, standards and technology. Because it is not a regulatory body, NIST does not have the power to investigate wrongdoing.
Although the Software Act and the PROTECT Act have many supporters, it is unclear at this time whether either will ultimately become law in the United States. With two bills in play and a healthy (no pun intended) debate surrounding the advent and regulation of mobile health technology, we can be assured that many new health technologies, products, and challenges will appear in the market to further refine the key issues in the debate as well as the focus of legislative and regulatory oversight before a final position is established.
In the meantime, companies in the clinical software and mobile medical apps industry should follow the final guidance recently published by the FDA with respect to regulation of their products.
Please contact Stephanie Zeppa at (650) 815-2646 or email@example.com, or Lauren Lewis at (650) 815-2672 or firstname.lastname@example.org regarding corporate matters, and Peter Reichertz at (202) 772-5333 or email@example.com regarding FDA regulation.
This update has been prepared by Sheppard, Mullin, Richter & Hampton LLP for informational purposes only and does not constitute advertising, a solicitation, or legal advice, is not promised or guaranteed to be correct or complete and may or may not reflect the most current legal developments. Sheppard, Mullin, Richter & Hampton LLP expressly disclaims all liability in respect to actions taken or not taken based on the contents of this update.
 “Clinical software” would be defined as software that: (1) captures, analyzes, changes, or presents patient or population clinical data or information and may recommend courses of clinical action, but does not directly change the structure or any function of the body of man or other animals; and (2) is intended for use only by a health care provider in a health care setting.
“Health software” would be defined as software that is not medical software or clinical software and that: (1) captures, analyzes, changes, or presents patient or population clinical data or information or supports administrative or operational aspects of health care and is not used in the direct delivery of care; or (2) has as its primary purpose to act as a platform for a secondary software, to run or act as a mechanism for connectivity, or to store data.