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Big biotechs rebuffed over health app carve-out push

Ms Le Grice’s comments come as medtech giants including Cochlear and Roche have told the Therapeutic Goods Administration certain classes of apps and software products should be exempt or excluded from regulation, provided they do not cause harm to patients.

The TGA is currently considering where to draw the line on carve-outs to exclude medical device software products from its regulation or exempt them from certain regulatory requirements.

Cochlear had suggested to the watchdog that apps for individual use and products where there is “no potential harm to the patient” could be exempt from being included in the nation’s register of therapeutic goods. It said inconsistencies in regulation gave overseas player an advantage.

Other global biotechs including $280 billion Roche Diagnostics said products including those for managing specific diseases, like diabetes or heart disease, should also be excluded.

Ms Le Grice warned that even apps used to manage chronic conditions have the potential to influence patient behaviour. Regulators must keep in mind that any app which drives patients to behave in a certain way has the potential to carry risk, and a product without sound clinical backing can have a negative impact, she said.

The rise of digital healthcare in the COVID era is prompting regulators to consider the best path forward.

The rise of digital healthcare in the COVID era is prompting regulators to consider the best path forward. Credit:iStock

“The outcome can be, at its worst, fatal.”

Cochlear chief executive Dig Howitt said his company’s key concern was that there was a lack of consistency between countries for regulation.

“We believe it is possible to review and categorise software-based products based on their individual benefits and risks. Examples of low-risk software could include patient-engagement and telemedicine tools, such as apps that help people with hearing implants appreciate music through games and videos or communicate with their health care provider,” he said.

Ms Le Grice said regulation of medical software in Australia would be costly but argued major benefits would also flow from a clear regulatory system where commercial entities had to prove their clinical claims.

Tighter regulation of the booming medtech sector could mean more clinicians buy in, which would in turn lead to better reimbursement settings from governments and insurers for digital health products, she argued.

“At the moment one of the biggest barriers is finding a viable business model in digital health the absence of reimbursement.

“Those bigger guys will also stand to benefit from changes to reimbursement.”

The Australian Medical Association has also flagged its apprehension about automatic carve-outs for low-risk products. In its submission to the TGA earlier this year, it argued it’s hard to find software products which pose “no risk” to patients.

“If a software satisfies the legal definition of a medical device, it is unlikely, to impose nil
risk of potential patient harm,” the association said.

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