Supreme Court Clears Path for Medical Device Manufacturers but Leaves Dangerous Stones Unturned

By Madina Axelrod and Gregory N. Harris


In the Medical Device Amendments of 1976 (MDA)1 to the Food, Drug and Cosmetics Act (FDCA), the U.S. Congress initiated testing and Federal Drug Administration (FDA) approval of medical devices2 Under the regulatory scheme of the MDA, Class III (high risk)3 medical devices are required to undergo a stringent pre-market approval process by the FDA to ensure that valid scientific evidence exists to support the safety and efficacy of the device for its intended uses.   This pre-market approval (PMA) process requires the applicant to demonstrate a “reasonable assurance” that the device is both “safe . . . [and] effective under the conditions of use prescribed, recommended, or suggested in the proposed labeling thereof.”4

The MDA also contains a clause that preempts state law personal injury suits against manufacturers of medical devices that underwent the PMA process.  Prior to the U.S. Supreme Court’s February 2008 decision in Riegel v. Medtronic5, however, courts declined to give effect to the MDA’s preemption clause.  As a consequence, lawsuits alleging personal injury from FDA approved medical devices have cost the medical devices industry billions of dollars in damages awards, liability insurance, legal settlements, and fees spent defending lawsuits that should never have been allowed to proceed.  Although Justice Stevens writes in his concurrence in Riegel that “[t]here is nothing in the preenactment history of the MDA suggesting that Congress thought state tort remedies had impeded the development of medical devices,”6 the real-world impact of lawsuits on the medical device industry says otherwise. 

The tort industry that arose has had the unintended effect of retarding the advancement of medical device technology in the United States because of the risks and costs inherent in developing a new device, putting it through the FDA required PMA process, and then being faced with unpredictable litigation in state courts nationwide.7  “As a practical matter, complying with the FDA’s detailed regulatory regime in the shadow of 50 States’ tort regimes will dramatically increase the burdens facing potential applicants--burdens not contemplated by Congress in enacting the FDCA and the MDA.”8

Trying to navigate the tangle of state tort laws “generates substantial costs of compliance and . . . uncertainty and economic inefficiency.  The uncertainty may force manufacturers to forgo development, production, and marketing of otherwise valuable products that might expose them to unpredictable risk.  This risk, in turn, may negatively affect the variety of products available to consumers.”9

Research and development of new medical devices has consequently been slow, with many manufacturers preferring to create or update devices that are “substantially equivalent”10 to pre-amendment devices, rather than to create entirely new devices that would be subject to the FDA’s rigorous pre-market approval process, and potential targets of expensive litigation under the tort regimes of the different states.  Such pre-amendment devices have established records of safety and efficacy and well-understood risk profiles, substantially reducing the risk of prospective litigation.  As a consequence, fewer than 5% of medical devices in use today have undergone pre-market approval as new devices created since 1976.

Post-Riegel Opportunities

In Riegel v. Medtronic, the Supreme Court has at last given effect to the MDA’s preemption clause, and reduced the litigation induced economic barriers to research and development of new medical devices to benefit mankind.  The decision in Riegel applies only to devices that have been granted pre-market approval, generously estimated at 10% of existing medical devices.11  The benefit of the decision however, will far outweigh its impact on the limited number of devices that are directly affected, as conscientious companies now have an opportunity to expand their research and development without the economic uncertainty of state lawsuits.    

The variety and uses of medical devices are also likely to expand, as companies have previously focused on only those devices where economies of scale provided a cushion against development costs and litigation risks.  Some commentators have noted that “pre-marketing review for new medical devices is a rare event indeed,”12 and history supports that conclusion.  During the first decade under the Medical Device Amendments, roughly sixty percent of all pre-market approval applications were not for new devices, but for “transitional devices.”13 

Riegel grants medical device manufacturers a new realm of opportunity to expand and develop new devices unhindered by the structural economic limitations that mitigated against such development before Riegel.  After Riegel, companies are freer to expand development into new technologies, such as nanomaterials, both to modify existing devices and to create entirely new categories of medical device.14  In addition to the decreased litigation costs and expanded opportunities that Riegel represents, recent legislation further increases the opportunities for innovation.  Changes to the Medical Devices User Fee Modernization Act (MDUFMA), as enacted in the FDA Amendments Act of 2007 (FDAAA)15 significantly reduce medical device application fees, increase fee discounts for small manufacturers, and allow businesses earning up to $100 million in annual sales to qualify for the discounts, up from the previous $30 million ceiling. This is intended to spur greater medical device innovation by providing a measure of assistance to smaller companies, which tend to focus on creating novel technologies,16 by not penalizing their growth.  Significantly, the FDA has also committed to streamlining and making more predictable the pre-market approval process, with the intention of reducing associated costs and thereby further stimulating development of new medical devices and technologies.17

Avoiding Pitfalls

To take full advantage of the legislative developments and the promise that Riegel holds however, manufacturers must proceed with care, and are best advised to continually review and, where necessary, revise their manufacturing processes to ensure compliance with all FDA manufacturing regulations.  Fortunately, the FDAAA has made it easier for companies to do so and, for practical reasons, has given manufacturers a much greater level of autonomy and influence in determining how they fare in FDA inspections and compliance with FDA regulations.  For example, under the FDAAA, device manufacturers may request FDA permission to undergo inspection by a third-party inspector if it received a “no action indicated” or “voluntary action indicated” rating for its most recent FDA inspection and notifies the FDA of its intention to use a third-party inspector at least thirty days prior to the inspection.

The degree of regulatory affirmative action the FDAAA cedes to manufacturers will allow manufacturers to proceed with development of new products at a much more rapid pace and at decreased expense.  It will also give manufacturers the ability to avoid negative FDA assessments of manufacturing processes or facilities by making preemptive self-assessments (by approved third-parties engaged by the manufacturers), and necessary corrections or modifications.  In conjunction with Riegel’s preemptive effect,this expansion of individual manufacturers’ ability to influence the process of FDA facility inspections can provide a significant reduction in a manufacturer’s litigation costs by forestalling the avenue of litigation left open by Riegel –liability for failure to comply with FDA regulations.

At the same time, the removal of the layer of consumer protection afforded by state lawsuits, coupled with a spate of high profile cases involving contamination of FDA approved drugs manufactured in foreign countries, and defects in FDA approved devices manufactured in foreign countries, will likely to cause the FDA to step up efforts to police facilities that manufacture drugs and devices.  Under the MDA, all establishments that manufacture medical devices for marketing in the United States must register with the FDA18 and, prior to obtaining pre-market approval to manufacture a device, provide “a full description of the methods used in, and the facilities and controls used for, the manufacture, processing, and, when relevant, packing and installation of, [a] device.”19  As has been widely noted, the FDA’s ability to enforce regulations has heretofore been hampered by inadequate funding, but FDAAA contains numerous provisions specifically intended to increase the money available to FDA to carry out its duties. 

For example, FDAAA adds several new fees that did not exist under the original MDUFMA, and eliminates the administrative requirements of providing review cycle status updates to manufacturers, freeing FDA reviewers to devote more time to completing reviews, and providing more money to support FDA’s other responsibilities.20  FDA advisers proposed a $375 million increase in the agency’s budget for FY 2009, a 5.7% increase over the FY 2008 budget.  The FDAAA also expands participation in the program of accredited third-party inspections that the FDA first began in 2002 under the MDUFMA, and streamlines the process to allow more inspections to be completed.  Among the new fees are a $2,960 fee for 30 day notices of modifications to manufacturing processes, and a $1,706 annual establishment registration fee for each facility that is registered with the FDA.  The latter fee is scheduled to increase to $2,364 in 2012.  Under the FDAAA, the FDA should collect $287 million in device manufacturer fees between 2008 and 2012, a $122 million increase over what would be collected under the original legislation.  “MDUFMA II [enacted as FDAAA] will also give the agency the resources it needs to maintain cutting-edge scientific expertise necessary to provide the timely review, and to ensure the safety of increasingly complex devices of tomorrow . . . It’s also for device safety.  It goes for the whole program.  In fact, the scope of MDUFMA covers a variety of device safety activities.”21 The FDAAA also expands participation in the program of accredited third-party inspections that the FDA first began in 2002 under the MDUFMA, and streamlines the process to allow more inspections to be completed.

What Claims Will Survive Riegel?

That litigation regarding manufacturing processes may survive Riegel is explicit in the language of the Court’s decision. “[The MDA preemption clause] does not prevent a State from providing a damages remedy for claims premised on a violation of FDA regulations; the state duties in such a case ‘parallel,’ rather than add to, federal requirements.”22  Further, claims alleging injury as a result of a manufacturers’ failure to adhere to approved manufacturing processes are distinct from state law “fraud on the FDA” claims that are preempted by the MDA under Buckman Co. v. Plaintiff’s Legal Cmte.23Although it is possible that an enactment of positive law by legislative or administrative bodies is required for a state to have “provid[ed] a damages remedy for claims premised on a violation of FDA regulations,” such a conclusion is not a certainty, and given the general unpopularity of the Riegel decision, state legislatures may certainly be expected to enact such laws in the near future.

A further indication of the importance that manufacturers’ adherence to approved manufacturing processes will assume in obtaining maximum benefit from Riegel, is Justice Ginsburg’s observation that, “[t]he Court’s holding does not reach an important issue outside the bounds of this case: the preemptive effect of [the MDA’s preemption clause] where evidence of a medical device’s defect comes to light only after the device receives pre-market approval.”24 Such defect becoming obvious or arising after pre-market approval is received clearly encompasses violations of approved manufacturing processes.  The Supreme Court has stated that “the presence of a state-law damages remedy for violations of FDA requirements does not impose an additional requirement upon medical device manufacturers, but ‘merely provides another reason for manufacturers to comply with . . . federal law,’”25 and the advice and warning contained therein, is well heeded.

Investigational Device Exception

Medical devices marketed under the investigational device exception (IDE), represent another gray area open to future legislative or judicial action to clarify and define the impact of Riegel.  The IDE permits a manufacturer to market a device without undergoing the rigorous PMA process, so long as the device is enrolled in a qualified clinical study to investigate potential efficacy.  IDEs “encourage, to the extent consistent with the protection of public health and safety and with ethical standards, the discovery and development of useful devices intended for human use.”26  For its comprehensiveness, the Riegel decision also did not address whether the preemption clause in the MDA applies to IDEs and the courts remain split on the issue.27  The question remains – if and when the Congress and/or the U.S. Supreme Court voice their opinion regarding this issue, will the scale tip in favor of federal immunity?

To further complicate the issue, certain components of an IDE-marketed product may be approved through a 510(k) process.  Martin v. Telectronics Pacing Systems, Inc.28 involved an IDE approved pacemaker with 510(k)-approved component parts.  Appealing the District Court’s decision that the claim was preempted by the MDA, plaintiff argued that these 510(k) approved components alone were defective and, as such, should be exempt from preemption.  In this case, the Sixth Circuit viewed the product as a whole [approved investigational device] and held that “[a]lthough investigational devices are not subject to the rigorous PMA process, they are subject to a different set of complex and comprehensive regulations which set forth detailed procedures for determining whether investigational devices are safe and effective.”29


It is clear that Riegel will bring about positive changes by largely freeing the industry from the burden of defending lawsuits in state court.  The greater freedom, however, will likely be balanced against greater responsibilities stemming from legislative action narrowing the scope of the preemption immunity, and administrative action toughening the FDA supplemental application procedures, reporting requirements and IDE reviews.  Shortly after the Riegel decision was handed down, The New York Times editorialized, “Congress should move quickly to pass corrective legislation and be prepared to do the same in other areas if the Supreme Court extends its preemption doctrine to drugs and other products.”30  The ultimate resolution of the issue remains to be seen.



1 21 U.S.C. § 360(k)(a).

2 Medical devices include instruments, apparatuses, machines and implants that are intended for use to diagnose, cure, treat or prevent disease, or to affect the structure or any function of the body.  21 U.S.C.  § 321(h).

3 “Class III devices are those that support or sustain human life, are of substantial importance in preventing impairment of human health, or which present a potential, unreasonable risk of illness or injury.”

4 21 U.S.C. § 360(e)(d)(2)(A) and (B).

5 Riegel v. Medtronic, Inc., 128 S. Ct. 999, 1012 (2008).

6 Id. at 1012.

7 “There are four major barriers to innovation that are responsible for hindering the development of new medical technologies in the United States: (1) unpredictable and inappropriately focused U.S. regulatory practices, (2) controls on the export of unapproved devices, (3) restrictive reimbursement policies, and (4) the effects of widespread product liability lawsuits.”  William W. George, Medical Technology and Competitiveness in the World Market: Reinventing the Environment for Innovation, 50 Food & Drug L. J. 477, 479 (1995)

8 Buckman v. Plaintiff’s Legal Cmte., 531 U.S. 341, 350 (2001).

9 Michael Ena, Choice of Law and Predictability of Decisions in Products Liability Cases, 34 Fordham Urban L.J. 1417, 1418-19 (Oct. 2007).

10 21 U.S.C. § 510(k) permits commercial distribution, without completion of the PMA process, of medical devices that are “substantially equivalent to” devices in commercial distribution prior to the effective date of the MDA.

11 Eighty to ninety percent of medical devices receive approval under 510(k) substantial equivalency.  Robert A. Gerberry, Medtronic v. Lohr: State Lawsuits May Proceed Against Medical Device Manufacturers, 11 J. L. & Health 221, 223 (1997).

12 Michael D. Green, William B. Schultz, Tort Law Deference to FDA Regulation of Medical Devices, 88 Geo. L.J. 2119, 2136(July 2000).

13 Id.  Transitional devices are products that were already on the market before the MDA, but were regulated as drugs because the FDA’s only pre-marketing regulatory authority was for drugs.

14 See, e.g. Drew L. Harris, Mark J. Graffagnini, Nanomaterials in Medical Devices: A Snapshot of Markets, Technologies and Companies, 4 Nanotechnology L. & Bus. 415 (Winter 2007).

15 21 U.S.C. §§ 212 et. seq.

16  See, Shawn Rea, Devising A New Approach; Proposed Changes To Device Law Aim To Boost Funding, Streamline Product Review, Modern Healthcare, Vol. 37, Issue 22, May 2007, at 2.

17 1.

18 21 U.S.C. § 360(b)(i).

19 21 U.S.C. § 360e(c)(1)(C).

20 Shawn Rea, Devising A New Approach; Proposed Changes To Device Law Aim To Boost Funding, Streamline Product Review, Modern Healthcare, Vol. 37, Issue 22, May 2007, at 2.

21 Comments of Dr. Shuren, FDA Assistant Commissioner for Policy, at MDUFMA Public Stakeholder Meeting (April 30, 2007)

22 Riegel, 128 S. Ct. at 1011.

23 531 U.S. 341 (2001).  Buckman upheld MDA preemption of state law claims alleging “fraud on the FDA”, e.g. where manufacturers misrepresented the intended uses of a device.

24 Riegel, 128 S. Ct. at 1013, fn 1 (Ginsburg, J. dissenting).

25 Buckman, 531 U.S. at 354 (2001)(internal citation omitted) (Stevens, J., concurring and describing the holding of Medtronic v. Lohr, 518 U.S.470).

26 21 U.S.C. § 360j (g)(1). 

27 Supporting preemption see, Chambers v. Osteonics Corp., 109 F. 3d 1243 (7th Cir. 1997); Berish v. Richards Medical Co., 937 F.Supp.2d 181 (N.D.N.Y. 1996); Touchet v. Ace Medical Co., 1998 WL 531887 (E.D. La. 1998); Blin v. Mith & Nephew Richards, Inc., 55 F.Supp.2d  1353 (M.D. Fla. 1999).  Opposing MDA preemption for IDE related claims, see, e.g., Oja v. Howmedica, 111 F. 3d 782 (10th Cir. 1997); Shea v. Oscor Medical, 960 F. Supp. 246 (N.D. IL 1996); Niehoff v. Surgidev, 950 S.W. 2d 816 (Ky. 1997), cert. denied, 523 U.S. 1005 (1998).

28 Martin v. Telectronics Pacing Systems, Inc., 105 F.3d 1090 (6th Cir. 1997), cert denied 522 U.S.1075 (1998).

29 Id. at 1097. 

30 No Recourse for the Injured, N. Y. Times, February 22, 2008 at