On May 21, 2013, the Food and Drug Administration (“FDA”) issued an “It Has Come to Our Attention Letter” to Biosense Technologies Private Limited, the developer of the uChek Urine Analyzer app. The app, available since April 26, 2013, through the iTunes App Store, enables an iPhone camera to analyze urine dipsticks used to measure analytes such as glucose, ketone, bilirubin, and others.
This type of letter appears to be a practice that the Office of In Vitro Diagnostics and Radiological Health ("OIR") uses when addressing areas of regulatory uncertainty. For example, OIR has previously disclosed a limited number of such letters with regard to diagnostic tests marketed as lab developed tests (“LDTs”) or “home brews.” We are aware, however, that OIR has issued similar letters to other companies without publicly disclosing their existence, which suggests that OIR may be selectively deciding to publicize certain of these letters.
The publicly disclosed Biosense letter, which is not a Warning Letter and does not expressly allege a violation of law, asks the app developer to provide the basis for determining that the product is not a medical device subject to clearance pursuant to Section 510(k) of the Federal Food, Drug, and Cosmetic Act (“FFDCA”).
Specifically, the letter states:
Since your app allows a mobile phone to analyze the dipsticks, the phone and device as a whole functions as an automated strip reader. When these dipsticks are read by an automated strip reader, the dipsticks require new clearance as part of the test system. Therefore, any company intending to promote their device for use in analyzing, reading, and/or interpreting these dipsticks need to obtain clearance for the entire urinalysis test system (i.e., the strip reader and the test strips, as used together).
Although FDA does not indicate why it opted to publicly disclose the existence of a “It Has Come to Our Attention Letter” in this case, it would be reasonable to assume that OIVD did so due to the regulatory uncertainty in this area and the desire to put other app developers on notice of the issue. The decision to issue an “It Has Come to Our Attention Letter,” of course, does not preclude the agency from subsequently issuing a Warning Letter if it is not satisfied with the company’s response.
FDA Regulation of Mobile Medical Apps – Expected Release of Final Guidance
Section 201(h) of the FFDCA defines a medical device as including “an instrument, apparatus, implement, machine, contrivance, implant, in vitro reagent, or other similar or related article, including any component, part, or accessory” that is either intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease or intended to affect the structure or function of the body. Accordingly, healthcare-related apps that are intended to aid in the diagnosis of disease may – in certain circumstances – fall under the definition of a medical device under the FFDCA.
In July 2011, FDA released a draft guidance outlining the agency’s intent to regulate a small subset of mobile applications termed “mobile medical apps.” Specifically, the draft guidance defines a mobile medical app as an app meeting the definition of medical device that either acts as an accessory to a regulated medical device or transforms a mobile platform into a regulated medical device.
Following the release of the draft guidance, FDA received over 130 comments and held a public workshop to address outstanding issues. On March 19-21, 2013, the House Energy and Commerce Committee held a three-day hearing on health information technologies, during which the committee questioned the agency’s delay in releasing final guidance. FDA subsequently indicated that the final guidance was in the “final stages” of review and should be published this fiscal year. A blog post on FDA’s website on March 21, 2013 indicated the final guidance would be released in the “coming weeks.” To date, the agency has still not disseminated the final guidance.
Applicability of Medical Device Excise Tax
A heated political issue raised at the March 19-21, 2013 House Energy and Commerce Committee hearing was whether the 2.3 percent medical device excise tax, which went into effect on January 1, 2013, would (or should) apply to mobile medical apps. Unless subject to specified exemptions, the tax generally applies to any medical device intended for human use required to be “listed” under section 510(j) of the FFDCA.
According to FDA’s draft guidance, certain developers of mobile medical apps would be required to “list” their apps as medical devices. Based upon a “retail exemption” to the excise tax, however, medical devices generally purchased by the public at retail for individual use are not subject to the tax. Many mobile medical apps intended for individual consumer use may fall under this exemption.
Accordingly, lawmakers at the recent House hearing pressed FDA for confirmation as to the inapplicability of the tax to mobile medical apps. FDA, however, deferred to the Internal Revenue Service (“IRS”) and the Treasury Department to resolve the taxation issue.
As a result, mobile medical app developers, as well as mobile platform developers seeking to invest in healthcare-related apps, still do not have the preferred degree of regulatory clarity from FDA, IRS, and the Treasury Department.
Recent Supreme Court Decision May Make it More Challenging for Interested Stakeholders to Challenge FDA’s Assertion of Jurisdiction over Mobile Medical Apps
A recent Supreme Court decision, issued on May 20, 2013, may make it more challenging for interested stakeholders to challenge the agency’s assertion of jurisdiction over mobile medical apps. The Supreme Court held, in City of Arlington v. FCC, that administrative agency assertions of jurisdiction are subject to the same degree of judicial deference as other types of agency decisions.
Based upon the Supreme Court’s seminal decision in Chevron, U.S.A. Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (1984), if Congress has not clearly spoken on a subject, a court must grant deference to an agency’s interpretation as long as the interpretation “is based upon a permissible construction of the statute.” In other words, as long as an agency’s interpretation is “permissible,” a court should not overturn the interpretation even though there may be other preferable or more logical interpretations of the statute. For many years, legal scholars have questioned whether Chevron deference should apply to situations where an administrative agency interprets its own jurisdiction – as contrasted with more mundane interpretations of statutory authority.
In City of Arlington v. FCC, however, the Supreme Court held that assertions of agency jurisdiction are subject to Chevron deference rather than stricter judicial scrutiny. Consequently, entities seeking to challenge FDA’s assertion of jurisdiction over mobile medical apps may need to overcome significant judicial deference to the agency’s asserted authority.
The Biosense letter suggests that FDA might not wait until issuance of final guidance on mobile medical apps before taking regulatory action in certain cases. Ropes & Gray will be closely monitoring this still-developing area of FDA regulation.
If you would like to discuss the foregoing or any other related matter, please contact the FDA Team: Greg Levine, Alan Bennett, Al Cacozza, Joy Liu, Paul Rubin, Kellie Combs or your usual Ropes & Gray advisor.