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Implementation of Shared MDR Economic Operator Resources

Posted 01 October 2019 | By Agnes SzoboszlaiErik Vollebregt 

Implementation of Shared MDR Economic Operator Resources

This article discusses how the Economic Operators (EOs) under the EU’s new MDR and IVDR regulations can organize themselves and cooperate in such a way that each of their obligations can be fulfilled without unnecessary repetition of action while providing objective evidence of completion and ensuring compliance. The authors suggest how cooperation can be realized, both in the case of internal and external economic operators (i.e., internal—forming part of the same corporate group of companies; external—independent third parties) by using shared resources and tools. They discuss the obligations of manufacturers, authorized representatives, importers and distributors and describe the shared tools which can be either realized by shared quality management systems or agreements.
 
Introduction
 
The EU Medical Devices Regulation (MDR)1 and In Vitro Diagnostic Medical Devices Regulation (IVDR)2 introduce a complete economic operator regime for medical devices. While the old directives replaced by these regulations (i.e., 93/42/EEC and Directive 98/79/EC) regulated only the manufacturer and the authorized representative; additionally, the MDR and the IVDR regulate the importer and the distributor, covering the supply chain up to the end-user.
 
The Economic Operator (EO) regime under the MDR and IVDR is not new, It is based on the Goods Package as set out in Regulation 765/2008,3 which provided a template for regulation for CE-marked goods and established the “New Legislative Framework.” The MDR and IVDR strengthen and make more explicit the obligations of economic operators with substantial overlap and repetition.
 
Economic Operator Regime Under MDR and IVDR
 
The EO regime is based on Regulation 765/2008 which defines EO roles and responsibilities for the first time.4 That regulation is accompanied by Decision 768/2008, which provides a regulatory template for European Union (EU) legislation in the area of goods, taking into account the concepts in that regulation. The functioning of the CE marking system and all concepts relating to economic operators, such as the core concept of ‘placing on the market,’ ‘making available,’ as well as the economic operators in the product supply chain and their obligations, are explained in detail in the Blue Guide, a European Commission guidance document often updated over the years. The 2016 version is currently the most recent.5
 
In addition to the Blue Guide, in 2010 the Commission issued a guidance note specifically concerning the medical devices industry addressing only the interpretation of the concept of placing products on the market.6
 
The MDR and IVDR now explicitly define and list the obligations of Manufacturers, Authorized representatives, Importers and Distributors (MAID). The obligations require manufacturers to re-interpret their supply chain in terms of the MAID paradigm and companies are currently in the process of understanding what entities and persons have what roles in their supply chain. Each role of the MAID is defined in the MDR and IVDR along with crucial concepts of ‘placing on the market’ and ‘making available.’ These concepts are determinative for the regulatory responsibilities imposed by the MDR and the IVDR on the various EOs in the medical devices supply chain.
 
Key Concepts in the new Legislative Framework
 
The new legislative framework introduces the logic that all EOs (except the authorized representative) make products available on the EU market, either for the first time, which is referred to as ‘placing on the market’ or by a successive “hop” of a product down the supply chain after being placed on the market up until the end-user.
 
The central role that the concept of ‘making available’ plays in EU harmonization legislation is related to the fact that all EOs in the supply chain have traceability obligations and need to have an active role in ensuring only compliant products are made available and circulate on the market. Making available on the market means:
 
“…any supply of a device, other than an investigational device, for distribution, consumption or use on the Union market in the course of a commercial activity, whether in return for payment or free of charge.”7
 
The making available of a product presumes a written or verbal offer or agreement between two or more (legal or natural) persons for the transfer of ownership, possession or any other right after the stage of manufacture has taken place.8
 
Such operation also may take place between affiliates of group companies in case of an internal supply chain which is typically the case in the operation of (international) group companies. In such case, internal invoicing can be the mark of such a transfer. Although the MDR has been written with the assumption—or at least presents it as the standard case—that members of the MAID chain are independent third parties, both the Blue Guide and the Commission Guidance discuss—in practice probably even more typical cases—where these are affiliates within the same group company:
 
The distribution chain can also be the commercial chain of the manufacturer or the authorised representative.9Where a manufacture operates an own distinct distribution chain, the transfer can also occur to that distribution chain.”10
 
It is common knowledge that affiliates of the same group can interact with each other as third parties and their transactions are regarded commensurate with transactions between two independent companies.
 
Placing on the market means “the first making available of a device, other than an investigational device on the Union market.”
 
The operation of placing on the market is reserved for—and can only be done by—a manufacturer or importer because only they can make available a product on the EU market for the first time when they supply a product to a distributor or an end-user for the first time. Subsequent transferring of the product to another distributor or end user is making available. This helps identify and distinguish between the importer and the distributor in the supply chain, a distinction only relevant, however, in cases of products imported from third countries into the EU market. In the case of an EU-based manufacturer, the importer role will “fall away” and the first making available will take place when the manufacturer transfers the product to its distributor or the end-user.

The placing on the market is the most decisive point in time in the new legislative framework, which says:
 
Products made available on the EU market (at the first and any subsequent time thereafter) must comply with legislation applicable at the time of placing on the market.”
 
While until now companies analyzed and interpreted this notion to identify if and as of when a product must be RoHS-compliant (i.e., in 2014, when the Restriction of Hazardous Substances (RoHS) Directive (2011/65/EC) became applicable to medical devices which were placed on the market from 22 July 2014) or compliant with a new revised standard (e.g., when the fourth edition of Standard for Medical Electrical (ME) Equipment, IEC/EN 60601-1-2:2018 became mandatory for medical electrical products placed on the market from 30 December 2018), the question now is about a much bigger stake: MDR or MDD compliance, grace period or no grace period.
 
Various—but sometimes still not enough—guidance documents and literature exist to analyze specific circumstances affecting the conclusion when and where in the supply chain placing on the market happens. For example, the Blue Guide explicitly states it cannot take place before manufacturing is completed,11 which leaves the industry with the unanswered question: what date is ‘the date’ (of placing on the market) if manufacturing is completed after the sales order/agreement is concluded.

Another question being often differently interpreted is whether the release for free circulation by customs is a precondition for the product to be placed on the market. The authors of this article regard customs release as an additional topic economic operators have to deal with in addition to, instead of affecting, the placing on the market question, meaning the relevant economic operator must be prepared with documentation at hand to prove to the customs authorities that the product is compliant with the Union legislations’ requirements and can be released for free circulation as it meets the legislation applicable at the point in time it was placed on the market. According to the Commission, customs release can play a role in the determination if a product has been placed on the market, but it not as such determinative for placing on the market.12
 
Above criteria (i.e., customs release) could be interpreted as a “condition precedent” to the effect of “placing on the market,” meaning the product can be regarded as placed on the market once this condition is fulfilled, but the actual date of “placing on the market” will not be “delayed” to the date of occurrence of the conditions but remain the date of actual transfer (agreement, order date). Otherwise one could sell products not yet meeting essential requirements at the time of contracting, only later at the time of customs clearance, the buyer’s expectation cannot be other than, unless explicitly agreed upon, that the product is compliant with EU harmonization laws at the time of signing the contract, not when it is customs released and finally, for evidence and administrative purposes as well, one must be able to rely on the registered date of the contract/order.
 
Manufacturers, Authorized Representatives, Importers and Distributors (MAID)
 
The importer is the EO who places a product from a third country on the EU market. The importer must be a natural or legal person established within the EU. The importer’s responsibilities are built on the type of responsibilities to which a manufacturer based in the EU is subjected.13 While there is another EO role, i.e., the EU Authorized Representative (EU AR), specifically dedicated for having a Union based representative of a non-EU-based manufacturer, which is often a requirement of many EU laws, having an EU AR is not mandatory for all product types, but only for medical devices. Thus, in many cases, the importer may be perceived as the company closer to the EU authorities, being the EU base and first contact point for EU compliance. However, there are substantial differences for the importer when compared to the EU AR. For example, the importer has no joint and several liability with the manufacturer, as is the case with the EU AR. Rather, the importer’s obligations are mainly to ensure the manufacturer has complied with its obligations and can ensure importers are aware of the responsibility related to placing products on the EU market.
 
The Blue Guide points out these obligations do not necessitate systematic quality control over the manufacturer. However, it is good practice to establish contractual arrangements with the manufacturer to ensure the importer has access to files required by local authorities. Even without MDR’s more explicit listing of the importer’s obligations, the authors wonder if a responsible importer shall not always—and is not better off in any case—to have extensive and explicit arrangements with its product supplier, its principal whose products the importer places on the market, to ensure the importer will not risk placing noncompliant products on the EU market.
 
The last element in the supply chain is the distributor, who makes the product available on the market. The list of obligations is the shortest for this EO, who plays a crucial role in the supply chain by being the direct contact and contracting party for the end-user and the logical first contact point in the event of product problems, and the manufacturer, who is the critical source of information for customer complaints.
 
Figure 1. Economic Operators in the Supply Chain

Vollebregt-fig-1.png
 
Despite the limited number of obligations listed in the MDR, distributors must act with due care and be able to prove to competent authorities they have acted with due care to ensure the manufacturer and/or importer have complied with their obligations under EU legislation. Besides administrative/“checklist-type” of obligations to verify the product is appropriately labelled and accompanied with the required documentation, and that all necessary administrative registration of the product and manufacturer have been taken care of, distributors have the material obligation to not put a product of the market if it has reason to believe that the product is not compliant. Second, if the product is already placed on the market, action must be taken to inform other EOs and authorities in the chain and cooperate with them in solving issues of noncompliance. Finally, distributors also must monitor and register complaints, oversee non-conforming devices recalls and withdrawals and inform the manufacturer and authorities.
 
Who is the critical supplier (of whom)?
 
In the context of the EO’s regulatory obligations, it is interesting to point out what probably most lawyers have experienced in negotiations between manufacturer is how the regulatory view and the commercial/contracting view interconnect or rather do not connect because of conflicting perspectives. Regarding contracts in relation to EOs, one cannot forget the notion critical supplier, which is established by guidelines and guidance documents:14-16
 
“A critical supplier is a supplier delivering materials, components or services that may influence the safety and performance of the device...This can include suppliers of services, which are needed for compliance with QMS or regulatory requirements, e.g., Authorized Representatives.”
 
Further, competent authorities are publishing guidance communications pronouncing distributors critical suppliers and defining minimum contractual provisions to be included in distributor agreements.17
 
International companies or larger companies ensuring a presence in remote markets and installing remote distribution channels by means of distributor agreement with its ‘partners’ take care to ensure proper distance from their distributors as distributors act in their own name and at their own risk. By no means are they regarded from a commercial/procurement perspective a ‘supplier.’ On the other hand, due to the above crucial role of the distributor of being in direct contact with the end-user/installed base, and so enabling traceability and implementation of corrective actions companies shall, based on the above position of competent authorities, have the view that their partners are also critical suppliers, affecting their compliance with their regulatory obligations. On the other side of the table, the distributor shall regard its ‘principal,’ the manufacturer/importer providing him with the product, as a supplier of products and apply certain quality/regulatory obligations (quality agreement) on the manufacturer/importer. Still, distributor agreements, in most cases, lack the quality control necessary in this regard. It may change with the MDR’s more explicit MAID provisions, reminding distributors of their responsibilities regarding product compliance and the need for quality control.
 
The need for quality control in these relationships is mutual and reciprocal. Both the distributor and principal are (critical) suppliers of each other, each having the need to apply a certain type of quality control over the other. Therefore, there must be contractual arrangements between them, both regarding the commercial and quality control aspects.
 
The above awareness and ‘awake-ness’ is needed also in connection with other partner types who may not look like economic operators at first sight, but pure service providers for the manufacturer, such as sales agents, fulfilment houses and providers, etc., who can perform activities in practice putting them within the scope of being importers or distributors.
 
A single, standardized ‘label’ put on a partner may not reveal their exact role or their regulatory qualifications and responsibilities. A separate assessment is necessary by experts and a separate quality/technical agreement must register and clarify the party’s regulatory roles, obligations and responsibilities beyond the commercial ones.
 
An Economic Operator’s Overlapping Obligations
 
The economic operator’s obligations under the MDR and IVDR are characterized by overlapping obligations imposed on the respective economic operators. However, the number and scope of obligations diminishes the further down the supply chain the EO is located. Figure 2 shows the logic of supply chain regulation under the MDR and IVDR and where overlapping obligations occur.
 
Figure 2. Supply Chain Controls and Overlaps

Vollebregt-fig-2.png
 
The specific obligations of the respective EOs are set out in more detail in Figure 2. As is clear from this overview, obligations may overlap to a large extent. As recital (27) of the MDR states, setting out clearly the obligations of the EOs is meant “…to enhance understanding of the requirements laid down in this regulation and thus to improve regulatory compliance by the relevant operators.
 
It is certain that the system of repeated backward verifications and the fact that each EO retains its own responsibility regarding its own (verification) activities, does serve the purpose of increasing the chance of identifying any possible noncompliance. While one may sense a ‘mutual distrust’ atmosphere behind the double or triple verifications between the EO partners in practice, the need to check each other forces them toward closer cooperation. Efficiency driven companies will strive to find the most efficient ways of achieving what the regulators expect from them. Accordingly, there is a shared interest between economic operators to cooperate more intensively, including sharing resources to avoid duplicating work. Further, sharing resources also facilitates compliance, both proactively and preventively, as opposed to reactively and correctively, as verification does. Verification is a kind of audit. Audit rights are a powerful right, but retrospective in most cases. Continuous cooperation and communication is more effective and goal-driven. In the case of manufacturers with an integrated supply chain they partially or wholly control, this interest is even more evident.
 
Figure 3. Specific Obligations Economic Operators

Vollebregt-fig-3.png

 
Internal and External Economic Operators
 
Which resources can be shared?
 
At first sight, the MDR, as well as any guidance document, is written for the standard, straightforward case where the EOs are independent third-party entities. However, in most of the cases, these companies belong to the same group of (international) companies and are affiliates of each other. Thereby, in many cases, either the entire or part of the supply chain belongs to the same company.
 
Below, the differences and similarities between the implementation possibilities of fulfilling the EO obligations in case of internal and external supply chain are discussed. When defining the EOs, this article suggested there is the common practice among EOs of having detailed agreements setting forth the exact roles and responsibilities of the parties as ‘critical suppliers’ to each other. The need for this practice is confirmed in the Health Products Regulatory Authority’s (HPRA’s) Guide for Distributors of Medical Devices,18 which addresses the obligations of EOs in the supply chain with regard to ensuring continued compliance of the medical device as is makes its way down the supply chain:
 
It is recommended that a distributor of medical devices has a technical or contractual agreement in place with their supplier.”19
 
The guidance makes a distinction between technical and contractual agreement separating the commercial contract from the quality agreement and states “The technical agreement serves as a basis for defining the division of responsibilities between the parties…”20 and continues with a non-exhaustive list of elements of requirements expected in such agreements. They include the relationship of parties, storage and transport requirements, device traceability requirements, responsibilities and procedural aspects in terms of recall/withdrawal procedures, handling returns and complaints.
 
In a technical contract, one can expect not only the allocation of responsibilities, but also the details of how the obligations will be fulfilled, namely the procedural aspects where the use of tools and communication channels and platforms will be unavoidable.
 
Where the supply chain is completely controlled by the manufacturer or to the extent that the supply chain is controlled by the manufacturer, the resources required for meeting obligations can be shared. The manufacturer can cover all of this in its Quality Management Systems (QMS). This is also confirmed by the HPRA Guide for Distributors of Medical Devices.21 The HPRA guidance states “[w]here the distributor is a subsidiary of the manufacturer or supplying company, tasks and responsibilities may be defined within procedures in a common quality management system.”22
 
However, even subsidiaries of the same parent company may follow and are covered by different QMSs, so the company law control does not presume shared organization in terms of ISO 13485, making the affiliates internal suppliers to each other and so requiring the (intracompany) quality agreements between concerned entities, leading back to the contractual arrangements discussed above.
 
Therefore, there is little difference between the implementation of roles and responsibilities between internal and external EOs. In both cases, it mainly boils down to either intercompany or intracompany contractual arrangements. So long as the responsibilities are assumed in accordance with the regulations, which cannot be subcontracted, it is up to the contractual freedom of the parties to agree on ‘how’ and ‘by whom’ the required actions are to be completed. The EOs and their organizations may, in theory, subcontract the execution of their obligations to each other. Such subcontracting may take place at different levels of outsourcing depending on the “risk appetite” and trust between the parties. Two aspects should never be forgotten: first, the more critical activities outsourced, the more quality controls need to be in place; second, as mentioned in the above guidance:
 
“…it is important to highlight that each distributor retains ultimate responsibility for ensuring that the operations are compliant with legal requirements.”
 
Accordingly, implementation can take place in the QMS of the manufacturer or by means of quality agreements. These approaches can be mixed insofar as EOs do not form part of the same QMS.
 
Figure 4 shows how the procedures can be implemented by means of agreements, but where agreements are used QMS controlled procedures under the manufacturer QMS could be used as well.
 
Figure 4. Implementation by Means of Agreements

Vollebregt-fig-4.png
 
Sharing Resources Between Internal and External Economic Operators
 
Shared Tools and Resource for Vigilance Related Obligations
 
Postmarket surveillance and vigilance is a “cornerstone” of the medical device industry. In this regard, as visualized on the above Figure 3, manufacturers must, among other obligations keep a system for recording incidents and field safety corrective actions. Second, when suspecting device nonconformity, inform the distributors and other EOs. Third, they must immediately take corrective action if they suspect a device presents a serious risk and informing the competent authorities.

At the same time, distributors shall also:
 
  1. Keep a register of complaints, nonconforming devices and recalls.
  2. When suspecting device non-conformity, it also shall inform the manufacturer and other Eos.
  3. Co-operate with the manufacturer in the corrective action.
  4. When suspecting the device presents a serious risk, it also shall inform the competent authorities.
  5. Inform the manufacturer of received complaints about suspected incidents.
     
The overlap speaks for itself and asks for resources, tools and procedures shared between the manufacturer and distributor (as well as other EOs).
 
The above obligations for both EOs already existed under the new legislative framework. Each responsible manufacturer has standardized procedures and tools to register and address complaints and suspected incidents and possible incompliances. Such tools have long been shared and jointly used by and between manufacturer and their distributors, enabling timely and documented sending and receipt of information, thus enabling both sides to comply with their own obligations regarding vigilance and taking the appropriate corrective action to eliminate nonconformance. Now, the MDR makes these obligations more explicit, strict and burdensome, with firm deadlines and broadened scope (e.g., immediately inform manufacturer, complaints of suspected incident) making communication flow an everyday activity. Further, the communication is not only between the manufacturer and distributors, but also to all other EOs in the chain. This multiplier element in the obligations calls for shared resources, not only between two EO directly contracting with each other, but for all EOs involved in the sale of the same device. Realizing the practical meaning of such multi-channel/multi-direction information sharing obligation, every responsible distributor must feel relieved if the manufacturer (or any other EO but the most possibly the manufacturer will take such role) offers access to a system ensuring compliance with the multi-direction information sharing with one single action but possibly by sharing on a SharePoint-like tool shared and accessed by all the EOs. It is in the interest of all parties to standardize and streamline the flow of such information and the necessary follow up actions.
 
Depending on the parties appetite for yet stronger cooperation and/or more control over the other, the manufacturer may consider providing training, instructions, checklists and other enablers for its distributor to standardize their way of working according to its own interpretation of its compliance needs rather than rely on the interpretation of its EO partners. Such approach also can be incentivized by the intent of sharing the workload and trusting the other EOs with certain actions originally expected from the manufacturer. For example, upon being informed of a complaint about a suspected incident, the manufacturer needs to asses if the event qualifies as serious incident reportable under Article 89 MDR. In principle, the manufacturer could agree with the distributor that the distributor completes a (pre)assessment and (pre)classifies the event to share it under the matching title in the shared tool. This would filter out a substantial percentage of all forwarded cases, enabling the manufacturer to pay more attention to those communicated under the title “suspected serious incident.” The parties also may agree on other risk qualifications to flag the level urgency of all forwarded cases.23 However, outsourcing comes with certain pros and cons: getting rid of workload may save time, but may cost money and may mean additional risk since the ultimate responsibility for the acts of the supplier (distributor) remain with the outsourcer (manufacturer); but it might as well limit risk in case the other party is more capable or better equipped/staffed to execute the relevant tasks. Further, “double-stitching” is also a possible solution to give more comfort to the parties. The assessment of an event made by the distributor, ideally, is truly a pre-assessment and the manufacturer also has its own processes to regularly check and monitor the information provided under any of the titles, such as “complaint,” “suspected incident,” “incident” or “serious incident.”
 
Shared Tools and Resource for Verification Related Obligations
 
The new, also multiplied, overlapping obligation introduced by the MDR for each EO, namely verifying compliance of the products at-hand and compliance of the foregoing EO with regard to selected requirements and obligations, calls for another set of shared resources, shared tools and aligned communication. Instead of each EO accomplishing its own verification obligation according to its own ways and a manufacturer exposing itself to diverse requests for information necessary for the EOs to very compliance, the manufacturer can proactively prepare documentation, a checklist or other objective evidence of its product compliance and contractually agree on sharing such with its EOs. Depending on the level of matureness and sophistication, the method of sharing may be manual or automated, based on a ‘push’ or ‘pull’ system, i.e., shared by the manufacturer proactively or sent at the request of the distributor. Or the entire verification process can be executed centrally according to standardized processes on behalf of the EOs concerned and the results documented centrally and made accessible for the distributor and any other EO needing access at any time.
 
Shared Tools and Resources for EUDAMED Registration Purposes
 
Article 31 requires the manufacturer, the EU AR and the importer to register in EUDAMED—the EU’s electronic database. Although the technical details about the realization of the EUDAMED database still remain to be seen, manufacturers may wish to manage and coordinate the upload of such information in relation to their devices as far reaching as possible, meaning 1. the centralization of registration efforts with regard to internal EOs seems to be a rather simple business decision for efficiency reasons and 2. centralization also can be agreed upon between external EOs (depending on the technical details expected by EUDAMED); however, less crucial/logical to strive for from a contractual liability perspective.
 
Again, the wish for control over these activities and the level of outsourcing is a question of agreement between the parties with associated allocation of payments and liabilities. Either way, a manufacturer may build an infrastructure and establish a central team to assure that all its EOs are registered in EUDAMED. This infrastructure should include the creation of standardized processes to collect master data, to register EOs with EUDAMED and to keep registration current by managing changes in the status of the EOs. The infrastructure also should include unambiguous contractual arrangements regarding information on sharing and change management between external EOs.
 
The Special Case of the Authorized Representative (AR)
 
While the Authorized Representative (AR) is an EO under the MDR and IVDR, the AR is a special case since the AR has increased surveillance obligations on the manufacturer itself and is not part of the supply chain for the medical devices. When the manufacturer does not meet the obligations under the MDR or IVDR, the AR must terminate the mandate and notify the competent authority.24,25
 
Currently, there is no guidance confirming or prohibiting it, but it is a common understanding and practice that a manufacturer within a group of companies can appoint a legal entity within its corporate group to serve as the AR. However, it is immediately clear that corporate governance duties could make it difficult for a group of companies controlled under the same ultimate parents to have a subsidiary who must monitor manufacturer compliance and take action against the manufacturer as if it was an independent entity. At the same time, however, truthful monitoring can be achieved by practicing appropriate business ethics and respecting the roles of the dedicated functions, as it is also a ‘must’ in connection with the ‘person responsible for regulatory compliance’ acting within the manufacturer’s own organization and eventually the entire regulatory function. Also, the EU MDR and IVDR are neither the first, nor the only EU regulations requiring commercial companies to appoint internal officers26 assigned with internal monitoring and auditing responsibilities, etc. If, in the view of the regulator, a natural person can be trusted with such responsibility requiring certain independence and objectivity, it must be a defendable arrangement to trust a legal person (i.e., an affiliate of a group company) with a role requiring the same independence and objectivity.
 
However, one shall be cautious with what information these officers—and in this case the AR—will be exposed to. While sharing resources with the AR in the sense described in this article, shall be possible and practical to enable the AR to fulfil its function, it does not seem advisable to concentrate more activities on the AR, such as verification on behalf of the importer or distributor, than its own MDR obligations. Having additional activities may provide the AR with information that might give rise to a duty to terminate the AR agreement and report to the authorities. Also, the authorities concerned may direct information requests to the AR about the manufacturer’s compliance, which may make it less of a good idea to concentrate any additional activity or information on the AR than those prescribed by the MDR. Therefore, should any company consider concentrating verification activities at the AR, we believe it a more robust solution to assign verification tasks to either the importer or distributor or have them performed by a shared resources function in the group acting on behalf of the EOs within the group. The AR function itself should remain with and completed by the AR entity. Other legal entities in the manufacturer’s corporate group can provide resources for the AR to use, such as personnel and systems. Lastly, to mitigate the risk of immediate termination by the AR, thereby paralyzing the manufacturer, appropriate contractual arrangements can play a role clearly laying down the procedures for timely raising and discussing concerns and resolving disagreements in good faith prior to termination as well as for the cooperation the AR.
 
Conclusion
 
The MDR and IVDR necessitate larger medical devices companies re-orient themselves on how they organize their supply chain in the light of the economic operator requirements in the MDR, which are drafted on the model of a supply chain comprised of commercially independent entities. As a result of this model, obligations of economic operators overlap to a significant extent.
 
To avoid duplication of work, overlapping responsibilities in the supply chain of a medical devices manufacturer can be managed by means of either QMS procedures, (quality) agreements and/or a mix of these. We advise discretion with the AR, as this entity has a more independent supervisory role under the MDR and IVDR. Finally, but not less importantly, we emphasize that the means, as explained in this article, can be equally applied both among external and internal EOs regardless of their affiliation or independence.
 
References
 
  1. Regulation (EU) 2017/745 of the European Parliament and of the Council of 5 April 2017 on medical devices, amending Directive 2001/83/EC, Regulation (EC) No 178/2002 and Regulation (EC) No 1223/2009 and repealing Council Directives 90/385/EEC and 93/42/EEC (1).
  2. Regulation (EU) 2017/746 of the European Parliament and of the Council of 5 April 2017 on in vitro diagnostic medical devices and repealing Directive 98/79/EC and Commission Decision 2010/227/EU.
  3. Regulation (EC) No 765/2008 of the European Parliament and of the Council of 9 July 2008 setting out the requirements for accreditation and market surveillance relating to the marketing of products and repealing Regulation (EEC) No 339/93 (OJ L 218, 13.8.2008, pp. 30-47).
  4. Ibid.
  5. Commission Notice: the Blue Guide on the Implementation of EU Products Rules 2016 (2016/C 272/01) (OJ C 272, 26.7.2016, p. 1–149).
  6. Interpretative Document of the Commission's Services: Placing on the Market of Medical Devices, Brussels, 16 November 2010 SANCO/B/2/PBE/pdw Ares(2010) 332016.
  7. Op cit 1, (MDR) Article 2 (27), (28).
  8. Op cit 5, (Blue Guide), p. 18.
  9. Op cit 5, (Blue Guide), p 18 footnote 50.
  10. Op cit 6, Para (11).
  11. Op cit 5, (Blue Guide) p 18 footnote 51.
  12. Op cit 6, Para (15) – (18).
  13. Op cit 5, (Blue Guide), p 33.
  14. GHTF SG4/N33R16: 2007: Guidelines for Regulatory Auditing of Quality Management Systems of Medical Device Manufacturers Part 3: Regulatory Audit Reports.
  15. GHTF/SG4/N84 R13:2010: Guidelines for Regulatory Auditing of Quality Management Systems of Medical Device Manufacturers Part 5: Audits of Manufacturer Control of Suppliers.
  16. NBOG's Best Practice Guide 2010-1: Guidance for Notified Bodies Auditing Suppliers to Medical Device Manufacturers.
  17. The French Competent Authority (ANSM) has been communicating such position in certain cases.
  18. Health Products Regulatory Authority (HPRA): Guide for Distributors of Medical Devices, IA-G0004-1. 8 February 2018. HPRA website. https://www.hpra.ie/docs/default-source/publications-forms/guidance-documents/ia-g0004-guide-for-distributors-of-medical-devices-v1.pdf?sfvrsn=13. Accessed 19 September 2019.
  19. Ibid p 15.
  20. Op cit 18.
  21. Op cit 18.
  22. Op cit 18.
  23. Note: taking into account the MDR definition of “incident,” the obligation of the distributor to report any complaint about a suspected incident covers a substantial range of events/feedback to be reported, thereby possibly causing ‘jam’ in the reporting channels. Therefore, any possible filtering, selection and channeling is useful to be considered.
  24. Op cit 1.
  25. Op cit 2 (IVDR) Article 10 (3) (h).
  26. General Data Protection Regulation (EU) 2016/679 (GDPR) also introduces the data protection officer with comparable responsibilities and position as the ‘person responsible for regulatory compliance’ under the MDR.
 
About the Authors
 
Agnes Szoboszlai is senior legal counsel at Philips in the Netherlands, providing legal support to the regulatory function and businesses within Philips with special focus on the EU MDR and European regulations for medical devices. She also advises on the legal aspects of clinical testing/evaluation activities, such as contracting with clinical partners. Throughout her 10 years at Philips, she has gained experience with a variety of legal and regulatory challenges a medical device manufacturer has to deal with during the entire lifecycle of a product. Szoboszlai obtained her law degree in Hungary, studied International and European business law at the University of Tilburg and earned a Master of Laws degree (LLM). She can be contacted at agnes.szoboszlai@philips.com.
 
Erik Vollebregt is partner at Axon Lawyers in the Netherlands and specializes in EU and national legal and regulatory issues relating to medical devices, including eHealth, mHealth, software and protection of personal data. He is an expert in life sciences regulation at EU and Dutch level, with a focus on contracts, regulatory litigation against competent authorities and M&A. Vollebregt actively contributes to law and policy development at national and EU level via membership of specialized committees at branch associations and the European Commission. He also works as arbitrator in medical devices related disputes and is regularly retained as expert witness in foreign litigation. He can be contacted at erik.vollebregt@axonlawyers.com.
 
Cite as: Szoboszlai A and Vollebregt E. “Implementation of Shared MDR Economic Operator Resources.” Regulatory Focus. September 2019. Regulatory Affairs Professionals Society.

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