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Technology outpacing regulation

Technology outpacing regulation

18 May 2015

Healthcare services and products are highly regulated throughout their life cycle – from product development to market entry, distribution and post-market supervision. Medical regulators have begun to address the question of whether e-health products are caught by these existing regulatory frameworks, but in many cases have yet to finalise their positions. 

Regulators are tussling with a need to balance the benefits that come from increased access to health information for patients with the risks that arise from a reduced reliance on physicians in diagnosis and treatment. On the other hand, the lack of a clear regulatory framework itself risks inhibiting new market entrants and limiting the interoperability of products.  

European Union

A need for greater legal certainty

The regulation of e-health products and services increasingly features on the radar of EU regulators. The European Commission’s report on the public consultation on its green paper on mobile health indicated respondents’ desire for greater legal certainty and harmonised standards without this coming at the price of stifling innovation.  

The current regime is difficult to navigate and places stringent requirements on companies that seek to enter the European Union. Many respondents stated the need to clarify the borderline between apps that are medical devices and those that are lifestyle and wellbeing apps. The European Commission also reported a consensus that the current EU legal framework did not adequately cover the safety requirements of lifestyle and wellbeing apps.  

Why does it matter?

The regulation of a medical app or wearable device as a medical device has a huge impact on the business model. Companies manufacturing and selling medical devices require an understanding of complex medical device regulations and an ability to navigate onerous validation and testing requirements.  

Under the regulatory framework in the EU, medical devices are subject to strict requirements on product marking (CE marking), conformity assessments and market surveillance. All these place significant administrative and financial burdens on market operators.  

However, it is not always obvious whether any individual product will be classified as a medical device and must therefore meet these requirements. For instance, both embedded and stand-alone software can qualify as a medical device if the programmer’s intention was that the software should be used for the specific purpose of diagnosis, prevention, monitoring, treatment or alleviation of disease (under MEDDEV guidelines). Respondents to the European Commission consultation supported the introduction of guidelines that provide rules and examples for clarifying when an app qualifies as a medical device.  

There are examples of borderline cases. Are wellbeing apps that, for example, allow users to chart weight loss over time properly classifiable as medical devices? Or does the regime only cover more sophisticated apps, such as those that tell diabetics when and in what doses to take medicine?  

The Commission’s green paper on m-health of 10 April 2014 recognised this problem, commenting that: ‘In the EU, there are no binding rules as to the delimitation between lifestyle and well-being apps and a medical device or in vitro diagnostic medical device’.  

Shifting sands of regulation

The EU proposes to introduce a new Medical Devices Regulation that is expected to be adopted in late 2015. It will clarify and adapt the existing regulatory framework to the rapid technological advances seen in this field in the past few years. Certain medical apps are likely to be classified under EU law as medical devices, which will require them to be CE marked. Apps that the directive will cover are likely to include, for example, apps that are accessories to medical devices, apps for diagnosis and treatment, apps intended to monitor physiological processes and apps to administer medicine.  

E-health players will benefit from clearer rules, easier trading between EU countries and a level playing field that excludes those who do not comply with the regulatory requirements. While this revision offers the possibility of greater legal certainty, further technological progress will not abate and the status of borderline cases will remain in question. It is therefore crucial that actors in this sector continue to monitor their products against the rules then prevailing.  

United States

A Risk-based regulatory oversight approach

The US Food and Drug Administration (FDA) recently confirmed its regulatory oversight approach under a risk-based framework. The FDA’s policy is designed to balance encouraging technological innovation while managing the potential risks posed to patients and consumers.  

FDA issues new guidance on m-health

In February 2015, the FDA issued two guidance documents, one on Mobile Medical Applications (MMA or mobile apps) and the other on Medical Device Data Systems (MDDS) and other related devices. In both guidance documents the FDA recognised the increasing variety of e-health products, their rapid innovation and the potential for these products to benefit public health, including via more efficient patient care.  

The FDA explained that it does not intend to apply its authority over mobile apps that pose a lower risk to the public (even if they in fact meet the definition of a medical device) as well as to a specified sub-category of MDDS. As for MDDS, the FDA stated that compliance with regulatory controls, such as registration and listing, pre-market review, post-market reporting and quality system regulation for manufacturers of these types of devices will not be enforced in relation to this category of MDDS for the time being.  

On mobile apps, the FDA stated that it will only apply regulatory oversight to apps whose functionality could risk patient safety if the app were not to function as intended. The FDA gave examples of mobile apps that will be regulated. These include apps that transform a mobile platform into a regulated medical device by using attachments, sensors or by including other functionalities similar to those of currently regulated medical devices in a way that could be used by a licensed medical practitioner to diagnose or treat a disease. Apps that are used in active patient monitoring or analysing patient-specific medical device data from a connected device will also be regulated.  

MDDS and mobile app developers should therefore consider how the FDA plans to exercise its oversight authority over their specific MDDS and/or mobile applications.  

New draft guidance confirms oversight approach

The MMA and MDDS guidance documents are only two examples of the FDA’s recent attempts to clarify its regulatory approach to e-health products. Two draft guidance documents recently issued for industry comment, in relation to medical accessories and general wellness products suggest that the FDA may pursue a light-touch approach for its regulatory oversight of products considered a low risk to users.  

We expect that, in light of the rapid innovation taking place with respect to e-health products, such as mobile apps, the FDA’s guidance will evolve and be subject to frequent updates. As a result, medical device and e-health providers must stay on top of the regulatory treatment of new e-health products.  


The importance of e-health products and services within the Chinese market is accompanied by an evolving, but still piecemeal, regulatory framework.  

Online drug sales

Selling drugs online requires an Internet Drug Transaction Service Institution Permit (IDTSIP). IDTSIPs are broken down into Types A (for drug sales platforms), issued at national level, and B (for drugs manufacturers) and C (for drug chain store distributors), both issued at provincial level.  

China has only issued three licences for online sales of over-the-counter drugs to date. Online sales of prescription drugs are not permitted, although the Chinese Food and Drugs Administration published draft measures in May 2014 that would permit online business-to-customer prescription drugs sales if they are brought into effect as expected. This is viewed as a progressive step from a traditionally conservative regulator.  


Telemedicine services are not regulated at present, but the National Health and Family Planning Commission has published binding guidelines relating to remove medical services provided by a hospital. Draft measures published for public comment in 2011 have yet to be brought into effect.  

Mobile medical applications

Chinese law is silent on mobile medical apps. Mobile app developers must therefore make sure the medical service providers they rely on meet the necessary regulatory requirements for both online drug sales and telemedicine services.  

Health and telecoms are both heavily regulated in China, and new regulations can be issued with little notice. Given the evolution of products that straddle the two sectors, it will be important to keep a close watch on China’s e-health regulatory framework.