Healthtech and regulations

I often get questions from other founders in early stage healthtech startups on how to tackle the regulatory aspect of being a healthtech startup. Their concerns are almost always the same so I decided to gather my thoughts based on my previous experiences. There are many different regulations depending on your product and your market, for example GDPR (EU), Patient Data Laws specific for each country, HIPAA (US), IVDR (EU), MDR (EU) and more. I’ve decided to focus on The Medical Device Regulation, MDR because it’s the most challenging one for newly founded healthtech startups planning to sell their product in Europe and it’s crucial to have a strategy on how to approach it.

MDD vs MDR

Healthcare is a very regulated space and for healthtech startups planning to sell their product within Europe it became even more regulated with the introduction of MDR, The Medical Device Regulation, in 2017. This is because MDR puts more focus on software as a medical device than the previous MDD (Medical Devices Directive) which has led to an increased number of health tech applications falling under the definition of a medical device as well as within a higher class. MDR also includes enhanced requirements on the whole life-cycle, clinical data and increased post market surveillance. The transition from MDD to MDR affects all medical devices sold within the EU. This includes legacy products that are certified according to MDD, however legacy products have been given an exemption until 2025.

How to deal with the regulations as a Startup

First of all, if you are a start-up within healthtech - embrace the regulations. There is no way around them and even if they may seem discouraging, remember that they are for a good cause, to ensure patient safety and privacy. If you are well familiar with the regulations and include them in your business strategy, it will give you a competitive advantage.

Software as a Medical Device

Does your product fall under the definition of a medical device? To determine if your product is a medical device you need to define the intended use of your product and its indications. Intended use is defined by FDA as “The general purpose of the device or its function. This includes the indications for use.” and indications for use “Describes the disease or condition the device will diagnose, treat, prevent, cure or mitigate, including a description of the patient population for which the device is intended. This decision chart can guide you. If your product is a medical device, the next step is to classify it and most medical devices fall into at least class IIa. If this is the case, you will have a lot of requirements to fulfill before you can offer your product on the European market and that can be very difficult for a typical startup where speed and market coverage is important.

Therefore, one strategy can be to release a first slimmed down version of your product that is not classified as a medical device. Analyze your product and all its features, usually there are specific features that turn your product into a medical device. Is it possible to release a first version without these features?

With this approach, you can release your product on the market, get feedback from customers, iterate and improve from the beginning without having to be dependent on a certification, which can take years considering both preparing your company, gathering data on your product and then waiting for the certification itself. You also need to be very strategic with your entire product roadmap because for every new feature you plan to release you need to ask yourself if it will turn your product into a medical device. If yes, then ask yourself again, is this feature crucial right now, or can it wait until we are better established on the market?

That being said, legal compliance, patient safety and privacy are still top priorities when you are in healthtech. This strategy only means that you will start with a slimmed down version of your product without the complexity of a medical device. 

What you need to know as a healthtech startup

• embrace the regulations, they are a part of the healthtech industry.

• define your product's intended use and its indications for use to sort out if your product is a medical device.

• study the regulations that are applicable to your product, you can read a lot yourself, and invest in advising experts in strategic decisions.

• try to avoid building an initial product that classifies as a medical device, it will enable you to start building your healthtech company much earlier.

Hopefully this can be helpful to you if you are in the healthtech space. I’d be happy to hear your thoughts!