Classification of medical devices and regulatory processes in the United States

Translation: Original published in Finnish on 9/3/2025 at 7:30 am EEST.

We continue our series of articles focusing on Life Science investing, the first four parts of which focused on drug development (links at the end of the article). Subsequent articles will cover medical devices, and this first part will review device classification and regulatory processes in the United States, the core market. Classification plays a crucial role in determining the duration of the regulatory process, the risks associated with obtaining marketing authorization, and the costs and timeline for market entry. Investors should therefore be familiar with the basics of this topic. The table below summarizes the article's key points.

Classification of medical devices and processes in the United States

Source: www.fda.gov; annual reports of companies

Medical devices are classified into three categories in the United States

In the world's largest market for medical devices, the United States, the regulatory authority, the Food and Drug Administration (FDA), divides medical devices into three classes: I, II and III. Classification depends on the risks associated with the device and the extent and quality of regulatory controls required to demonstrate safety and effectiveness. Device classification determines the type of FDA review required for marketing clearance. The type of review, in turn, has a key impact on the length of the regulatory process and the resources required from the company applying for marketing authorization.

Class I devices are low-risk devices whose safety and effectiveness can be reasonably assured by complying with general controls. This includes compliance with the FDA's Quality System Regulation, facility registration and product listing, reporting of adverse medical events, and appropriate labeling, advertising, and promotional materials. The process is therefore relatively streamlined. Generally, Class I devices do not require the so-called 510(k) process, unlike Class II devices (more information on the 510(k) pathway below). Examples of Class I devices include gauze and hot-water bottles. The review process typically takes a few weeks.

For Class II devices, general controls alone are insufficient to ensure safety and effectiveness. The FDA also requires special controls, which may include, for example, performance standards, post-market surveillance requirements, patient registries, and FDA guidance documents.

Most Class II devices in the United States require the 510(k) process before they can be sold and marketed. To obtain 510(k) clearance, the manufacturer must demonstrate that the device is "substantially equivalent" to a predicate device already on the market. If the FDA agrees with the manufacturer that the device is substantially equivalent, the FDA will grant 510(k) clearance, i.e., marketing and sales approval. The review process typically takes about 6 months. If no predicate device is available, the proposed device is automatically classified as Class III. In this case, the manufacturer must either comply with the more rigorous PMA requirements or request reclassification of the device through a de novo process to Class I or II.

Most stringent PMA procedure for high-risk Class III devices

Devices that are high-risk or not "substantially equivalent" to a predicate device are classified as Class III. These devices typically require FDA approval through the Premarket Approval (PMA) process. The PMA pathway is more demanding than the 510(k) pathway. In a PMA application, a manufacturer must demonstrate a device's safety and effectiveness by presenting extensive data from preclinical studies and clinical trials. The application must also contain a detailed description of the device and its components, a full explanation of the methods, facilities, and controls used for manufacturing, and proposed labeling, advertising, and marketing materials.

Once the FDA receives a PMA application, it first determines if the application is complete enough for a substantive review. If the application is accepted for review, the FDA has 180 days to complete it. In practice, the review often takes significantly longer – typically 1-3 years. Before approving a PMA, the FDA usually also performs an on-site inspection of the manufacturing facilities to ensure they comply with the Quality System Regulation (QSR). One example of a high-risk device requiring PMA approval is a heart pump.

De novo pathway can streamline process compared to PMA

The de novo process means that a device automatically classified as Class III can be moved to Class I or II. For reclassification to occur, the manufacturer must demonstrate that the device presents only a low or moderate risk, thus avoiding the more rigorous PMA process. The FDA will make a decision on the de novo classification within 120 days of receiving the request. The total duration of the review process is typically around one year. If the manufacturer seeks reclassification of the device into Class II, they must submit a draft proposal for special controls to ensure the device's safety and effectiveness. The FDA may reject a classification request if a suitable predicate device is already on the market or if the agency determines that the device's risk level is too high for the de novo pathway. One example of a device approved through the de novo pathway is the RemeOs trauma screw by Bioretec.

Clinical trials are generally required for PMA and sometimes 510(k) submissions

Clinical trials are almost always required for PMA approval and may also be required for 510(k) processes. All clinical investigations of devices to determine safety and effectiveness must comply with the FDA's investigational device exemption (IDE) regulations. These govern matters such as investigational device labeling, the prohibition of promotion during the investigational phase, and the recordkeeping, reporting, and monitoring responsibilities of study sponsors and investigators.

If the device poses a significant risk as defined by the FDA, the sponsor must submit an IDE application to the FDA before commencing study in humans. If the FDA identifies deficiencies or other concerns with the study, it may permit the clinical trial to proceed under conditional approval or suspend it. In addition, the study must be approved by an institutional review board (IRB) operating at each clinical site.

Regulation of biologics in brief

Biological products, such as human cells, tissues, and cellular and tissue-based products (HCT/Ps), are subject to specific regulations. HCT/P products are regulated by the FDA's Center for Biologics Evaluation and Research (CBER) or Center for Devices and Radiological Health (CDRH), depending on the type of product, manufacturing method, and intended use. So-called "361 products" (e.g., blood products) do not require actual FDA approval but are subject to a number of other requirements and guidelines. For example, manufacturing must comply with current Good Tissue Practices (cGTP). So-called "351 products" (e.g., genetically modified cells), which are classified as biological drugs, on the other hand, require FDA approval (biologics license application, BLA). For more information on this topic, see our article Regulation of drug development .

Postmarket regulation

After a device has been approved, numerous regulatory requirements apply to the various entities involved in its distribution. These entities include contract manufacturers, repackagers and relabelers, sterilizers, and the initial importer. If the FDA finds that there are regulatory violations, it can take a variety of enforcement actions, ranging in severity from a warning letter to withdrawal of approval and criminal prosecution.

 

Previously published articles in the series:

Clinical phases of drug development

Probabilities of success in drug development

Regulation of drug development

M&A and licensing agreements in drug development