The CMS/FDA Proposed Parallel Review Process: Can One Clinical Trial Really Satisfy Two Agencies?

Readers: After this story was published, FDA and CMS launched a Pilot Program for Parallel Review of Medical Products. Current information can be found on FDA's web site. −Editor


Medically necessary vs. safe and effective. Can clinical trials, by design, realistically satisfy the needs of two Federal agencies with fundamentally different missions? Possibly.

Over the years, FDA and CMS (Medicare) have published numerous independent regulations, memorandums, guidance documents, policies, provisions and reviews of medical technologies independent from one another. Additionally, each has its own perspective on what defines an accepted proof source and what level of information is necessary to achieve their individual objectives.

The end result from these independent agency reviews and considerations? Time! Time to market, time to increased clinical adoption, time to patient accessibility of a new technology and time to revenue generation. In the end, who is the bearer of the burden of the independent review conundrum? The device manufacturer.

The impact of time on device approval and subsequent reimbursement is not new to either agency, nor is its consequence new to device manufacturers. Unfortunately, it has taken several years for this concern to be officially recognized, acted upon and a solution proposed.

On June 24, 2010, Dr. Jeffrey Shuren, Director of the Center for Devices and Radiological Health (CDRH), announced that a Memorandum of Understanding (MOU) had been initiated between FDA and the Centers for Medicare and Medicaid Services (CMS). The goal? To promote “data sharing” for new medical technologies. The intention of the MOU is to establish collaboration between the two agencies to create a new, parallel review process for medical technologies to achieve each agency’s respective mission: market clearance and Medicare coverage for a new technology. This initiative may also be the first step towards the decision of the agencies to consider defining certain circumstances when an FDA determination on safety and effectiveness is adequate for CMS to begin covering and paying for a new technology "without additional evidence."

However, is this concept really “new”? The idea of data sharing between agencies has been forthcoming for some time. In 2005, Tommy Thompson, the Health and Human Services Secretary, stated that a broad interagency information-sharing initiative was in place that included a parallel review of a technology at the request of an applicant and with the concurrence of both agencies. Unfortunately, the details of such a project and the underlying value of this type of program remained virtually unknown to those within the respective agencies, as well as the device sector. As a result, adoption of this government initiative did not occur. If the value proposition and details of such a program had been better communicated to the device industry, there might have been more examples of products that received simultaneous Medicare coverage and FDA clearance other than drug eluding stents and human recombinant erythropoietin for chronic dialysis patients.


Overview of MOU-225-10--0010

The intent of the MOU is to create a method in which to exchange information between FDA and CMS. Specifically, the agencies state that the general purpose is to promote collaboration and enhance knowledge and efficiency by providing for the sharing of information and expertise between the two Federal partners. Parallel review would allow CMS to initiate its national coverage determination process (NCD) during FDA’s premarket review of a new medical product.

The broader purpose of the MOU will be to create a mechanism by which the agencies can potentially work together to review new products simultaneously, allowing consumers access to new medical products sooner. In addition, CMS and FDA feel that a parallel review will create incentives for venture capitalists and companies to increase their investments in innovative medical products by reducing the time to return on investment for those products eligible for parallel review. The Memorandum does not specifically address how the information will be used, the defined product standards for qualifying for parallel review or the construct of the agency infrastructure.

The MOU will remain in effect for five years, terminating on June 25, 2015. No final determinations on the program have been confirmed. CMS and FDA are still reviewing public comments submitted last year in response to this proposal.

Industry’s Perspective

During the public comment period in 2010 for the parallel review process, CMS received responses from a variety of organizations citing their concerns, including device manufacturers, patient advocacy groups, healthcare providers and professional medical societies. The majority of the comments expressed concerns that the device industry would suffer from severe implications including, but not limited to, the following:

  • Companies will be at risk for a possible breach of confidentiality and company trade secrets due to Medicare’s practice of making information publically available for comment
  • The National Coverage Determination process is not the appropriate pathway to patient accessibility for innovative, emerging new technologies
    1. most decisions are made at the local level
    2. a negative NCD will limit access of products nationwide and across all patient demographics depriving market opportunities and revenue generation
  • A distortion may arise in the distinct roles of FDA and CMS
    1. safe and effective
    2. medically necessary
  • The review process must be completely voluntary and requests should only be accepted if made by the product manufacturer
  • Staffing and resource availability at both agencies may prohibit effective engagement in the process
  • Clinical trials will become burdensome and prohibitively expensive in order to produce the required results of the individual agencies

One Trial, Two Agencies

The mission of FDA is to protect and promote the public health. It assures the safety, efficacy and quality of drugs, devices and biologics. The mission of CMS is to ensure effective, up-to-date medical coverage and promote the continual improvement in the quality of care for its beneficiaries. It accomplishes this by fostering accurate and predictable payments, while ensuring high-value health care. Exhibit 1 illustrates each agency’s needs, side by side.

Exhibit 1: Different Agencies, Different Perspectives



Coverage Decisions

Guidance Documents and prior approvals

Focus on clinical relevance

Focus on device function and clinical risks vs benefits

Determine limitations for use

Determine indications for use

Trials support medical necessity

Trials prove safety and efficacy

Economic data is important

Economic data not relevant to product approval

Control is standard of care

Control is approved device, sham, placebo, or historical

Superiority endpoint required for coverage

Non-inferiority endpoint acceptable for approval

Inclusion criteria represents Medicare population

Strict requirements for inclusion/exclusion criteria

Long term follow-up necessary for coverage

Short term follow up to satisfy endpoints for approval

Although CMS and FDA have different needs for their individual approval processes, both agencies believe they should address the growing need to improve public health by speeding patient access to, and spurring the development of, new, affordable, reliable, safer and more effective medical products and services. Contrary to belief, medical device companies can engage in early activities that will produce results that satisfy the needs of both FDA and CMS. Although their missions may be different, both agencies share a common interest in improving the health of patients through the availability of safe, effective and affordable medical products and the fostering of medical product innovations. It is still unclear how CMS and FDA will finalize and proceed with their proposed parallel review process for medical products. In the interim, there are initiatives device manufacturers can incorporate into their strategic planning which will produce data that will meet needs of both agencies.

  • Start the initial trial design EARLY in the product development phase
  • Formulate the product’s economic value proposition
    1. cost savings to all stakeholders
    2. cost offsets and net health outcomes
    3. cost effectiveness
  • Design the clinical trial with the needs of BOTH agencies in mind
    1. safety and efficacy
    2. medically necessary to diagnose or treat an illness or injury
    3. include Medicare beneficiaries in the clinical trial
  • Understand evidence hierarchies and accepted proof sources
    1. trial designs
    2. validation measures
    3. comparator
  • standard of care
  • sham
  • placebo
  • historical control
  • Incorporate substantial clinical improvement in patient outcome measures
    1. quality of life (QOL)
    2. reduced medications
    3. return to activities of daily living (ADL)
    4. reduction in follow up procedures and medical services
  • Engage in dialogue with both FDA and CMS
    1. discuss trial design, endpoints, patients benefits, statistical plan and technology
    2. incorporate CMS recommendations to ensure positive coverage and payment
  • Collect critical procedure economic data
    1. UB04 forms
    2. HCFA 1500

Although there is no formal process in place, clinical trials can be designed to meet the varying needs of both CMS and FDA. Early dialogue with both agencies is imperative and will assist companies in determining the critical data necessary to ensure market approval, coverage and payment. True, there is still some time before an interagency parallel review is available. However, companies can begin best practices today in their clinical trial design to prepare for inevitable changes ahead, ensuring patient access to their innovative, new technologies.


Parallel Review of Medical Products. The Federal Register, 17 September 2010.

Memorandum of Understanding Between United States Food and Drug Administration and Centers for Medicare & Medicaid Services., 28 September 2010.

Comments provided in response to CMS request for comments to proposed parallel review of medical products, December 16, 2010.

Kelli Hallas is the Executive Vice President of Reimbursement at Emerson Consultants, Inc. in Minneapolis. With over twenty years of experience in the Medical Device sector, she has developed and implemented strategic initiatives for both start-up and established companies in the areas of reimbursement, sales and marketing and clinical research. In addition, Kelli has worked with the Centers for Medicare and Medicaid Services and the American Medical Association to establish new coding categories for emerging technologies. Contact the author at This email address is being protected from spambots. You need JavaScript enabled to view it..

Emerson Consultants, Inc.