Medical Devices. Failed or delayed designation: what liability for notified bodies?

Organisations wishing to be designated as notified bodies must, on the basis of the new European Regulations, obtain a new designation in accordance with the requirements set out by the new provisions. This is a very long and complex process. What is the risk of liability for notified bodies failing to obtain the new designation within the required time limit?

The new European Regulations on Medical Devices (MDR) and In Vitro Diagnostic Medical Devices (IVDR) introduce, among other innovations, more stringent requirements for notified bodies, i.e. bodies responsible for assessing and issuing the certificates of conformity necessary for placing devices on the market.

Member States will have to supervise more closely the process of designation and monitoring of notified bodies. The latter will have to go through a rather long and complex procedure, which can take up to 18-20 months to obtain a new accreditation.

According to data recently released by Assobiomedica, the number of notified bodies that have applied for designation under the MDR and the IVDR is still small (i.e. 21 out of 58 for medical devices and 7 out of 22 for in vitro diagnostic medical devices). The first designations are expected for 2019, i.e. less than one year before the MDR becomes fully applicable. Notified bodies that are re-designated may therefore not be able to properly handle the workload resulting from the large number of products to be certified under the new legislation (i.e. products already on the market today, products on the market that will require supervision for the first time (e.g. 85% of all IVDs) and new and innovative products).

If one considers, on the one hand, the complex process required to obtain the new designation and, on the other, the growing demand for services from notified bodies, there is a real risk that some notified bodies will not be able to obtain designation under the MRD and IVDR Regulations or that, if re-accredited, they will not be able to cope with the increased workload.

It is therefore easy to understand the concern, recently expressed also by Assobiomedica1, that the possibility of placing products on the market within a reasonable time limit and therefore the access by patients to such products may be seriously jeopardised. Several players are calling for an interruption of the transitional period for both Regulations or for an extension of the deadline for their implementation (i.e. 26 May 2020 for MDR and 26 May 2022 for IVDR) for all products or only for products already on the market. Considering the long and troubled process that led to the adoption of the Regulations and the current delicate European political situation, it is considered very unlikely that the European Legislator may revise the Regulations.

The question, therefore, is what would happen if some notified bodies did not obtain the new designation in time or were unable to meet the manufacturers' requests, and what liability they would face vis-à-vis both manufacturers and patients.

As is well-known, the European Court of Justice has recently ruled on the issue of the liability of notified bodies under Directive 93/42 on medical devices. In its judgment of 16 February 2017 (Case C-219/15) the European Court ruled that the breach by the notified body of its obligations under the Directive may give rise to liability towards the end users of medical devices, in compliance with the relevant provisions of domestic law.

In Italy there are very few case law precedents on the third party liability of notified bodies, none of which concerns the certification of medical devices. The only decision that established liability of a notified body towards the manufacturer due to non-compliance with its duties was handed down by the Court of Piacenza in 2012, and raises some interesting points as to whether, and to what extent, the failed or delayed designation of the notified body under the new legislation may give rise to any liability on the part of such body.

Indeed, although the case submitted to the Piacenza Court regarded inaccuracy of the certification, the principle laid down in this decision – i.e. that the notified body has the burden to prove that such non-compliance was due to unforeseeable circumstances for which it is not responsible – could also apply in the case of withdrawal, restriction or suspension of certificates resulting from the failed or delayed designation of the body under the new legislation. In this case, it may not be easy for the notified body which has not obtained the new designation within the required time limit to claim that the withdrawal of the issued certificates is not attributable to it. Similarly, the increased workload faced by the few notified bodies that will have obtained the new designation could jeopardise the quality of the services they provide, and increase the risk of non-compliance with the duties undertaken via-à-vis manufacturers and of liability arising towards patients affected by such non-compliance.

The decision of the Piacenza Court also addresses the additional issue of compulsory insurance coverage against third party liability under the relevant legislation. Annex VII of both Regulations requires notified bodies to take out adequate insurance for conformity assessment activities, the scope and financial value of which correspond to the level and geographical scope of the notified body's activities and are proportional to the risk profile of the devices certified by the notified body. However, the Regulations do not contain any detailed provision setting out the minimum requirements for compulsory insurance contracts and their mechanism of operation (e.g. whether or not a third party damaged by incorrect certification or by the withdrawal, suspension or restriction of certifications is entitled to take direct action against the insurer).

Although the Italian regulatory framework and case law still offers little evidence to assess the risks of a possible liability for notified bodies vis-à-vis manufacturers and third parties, given the high complexity of the re-designation procedure it is essential that all economic players take action as soon as possible to comply with these several requirements. In addition, we have welcomed Assobiomedica's initiative to prompt companies to obtain updated information on the accreditation of notified bodies in order to identify the most appropriate one, bearing in mind that there are no exemptions in terms of conformity? for products that have been on the market for quite some time, or for new technologies.

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