Public Policy and the Preemption of State Tort Claims against Medical Device Manufacturers (cont'd)
How are Medical Devices Different from Prescription Drugs?[index]
Even if state common law claims had no adverse impact on pharmaceutical manufacturers, there is a fundamental difference between drugs and medical devices: the potential market for most medical devices is much smaller than that for drugs.
The most extreme case is devices that are tied to specialized medical care that is only delivered in a limited number of facilities. For example, there are only a few thousand neonatal intensive care beds the United States. If ventilators used in these facilities have a five year life, the total market for ventilators might be less than 1500 units a year. Given that these are relatively low cost devices, a company with the majority of the market share would still be a very small company.
Even devices with a large potential market, such as IOLs, have no continuing sale potential. What makes the market for prescription drugs so much larger is that drugs that treat chronic conditions such as hypertension must be taken for the rest of the patient's life. Those that are curative, such as antibiotics, treat conditions that are recurrent. It is not unusual for children to receive three or four antibiotic prescriptions a year during their childhood.
There is also a thriving international prescription drug market. While the United States remains the largest single market, the worldwide demand for pharmaceuticals is much larger than that in the United States. Since no other countries have a level of technological medicine comparable to that in the United States, the worldwide demand for medical devices is small, and many devices have only a limited international market. There are many drugs that have a market in developing countries that have not appreciable medical devices market. This means that medical device industry in the United States tends to drive innovation in the world market, and trends that adversely impact the United States medical devices industry chill innovation throughout the world.
This disparity in markets is reflected in the Orphan Drug Act, which was passed to address the problem of assuring the development of drugs and devices for persons with rare conditions:
"The term "rare disease or condition" means (1) in the case of a drug; any disease or condition which (a) affects less than 200,000 persons in the United States, or (b) affects more than 200,000 in the United States and for which there is no reasonable expectation that the cost of developing and making available in the United States a drug for such disease or condition will be recovered from sales in the United States of such drug..."
The threshold of 200,000 for a rare condition does not take into account that, as is often the case, the affected individuals will have to take the drug for the rest of their lives. AZT was an orphan drug because when it was developed AIDS/HIV infection was thought to affect fewer than 200,000 people in the United States. In contrast, the language for medical devices is more restrictive:
"...in the case of a medical device, any disease or condition that occurs so infrequently in the United States that there is no reasonable expectation that a medical device for such disease or condition will be developed without assistance under subsection (a)"
Very few complex devices can reach the 200,000 potential affected persons that defines an orphan drug. Those that do are usually one time purchases, unlike most orphan drugs. Since the potential market for most medical devices would trigger the incentives for orphan drug development, it reinforces the policy that the MDA should be construed to encourage the development of new medical devices. This strongly argues for upholding the preemption of state tort actions against medical device manufacturers, especially for investigational devices that have not yet been approved for marketing and are still governed by an IDE.
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