Medical devices and coronavirus Part II: Supply chain issues and minimizing the impact

As the number of cases of COVID-19 (coronavirus) grows in the U.S. and around the world, so too have questions regarding the potential impact of the pandemic on the medical device industry.  At this time, projections of a deleterious impact on the U.S. health care system and supply of medical devices are becoming more of a reality.  This is the second of two client alerts which have been developed to provide medical device manufacturers with resources and information regarding how to address an evolving pandemic in real time.  Part I of this series covered the regulatory and business options available for companies to bring new (unapproved) products to market that are essential to address the public health need under Emergency Use Authorizations (EUAs).  This Part describes how medical device companies can plan for shortages and other challenges to their supply chains for both essential and non-essential devices.

Scope of the potential supply chain impact 

In mainland China, while COVID-19 (coronavirus) is affecting tens of thousands of lives, the economic impact on global supply chains is expanding daily.  With the medical device industry being so heavily reliant on China for manufacturing of both critical components, such as printed circuit boards, as well as complex finished medical devices, the impact of shuttered manufacturing facilities is likely to be felt in both the near and long term.  China is currently the U.S.’s fourth largest supplier of medical technology.  The U.S. Food and Drug Administration (FDA) has noted that over 60% of FDA-regulated products imported from China are medical devices.[1]  Over the past 15 years, U.S. firms have invested more than $800 million into China’s medical technology sector.  These investments reflect a focus on constructing new manufacturing facilities or expanding upon existing factories.[2] As a result, the US medical device industry is highly dependent on China’s supply chain. Recent developments such as the trade wars and COVID-19 have highlighted the downside of this dependence.

Contract manufacturers of both components and finished devices in China are struggling to keep plants open and staffed.  It has been reported that as a result, the volume of devices being manufactured has dropped.  Transportation of these devices is being delayed as flights to/from impacted geographies are cancelled.  Further, even when products are exported, once those products reach their destinations, concerns regarding the source of those goods and even, some reluctance by workers to open boxes that originated in China are triggering delays on import release.  That said, U.S. companies should view this as more than a China problem.  These phenomena and associated concerns are starting to arise in numerous geographies beyond China and may well extend into North America, further hampering the production and availability of medical devices.  As the list of affected countries grows, so too does the potential for impacts to the supply chain, regardless of the country in which the manufacturing occurs.

Air cargo and shipping

Medical Device companies have historically relied upon both air and sea transport to move products around the world.  Companies reliant on air cargo shipments out of China may find it increasingly difficult to find space on flights out of China as flight restrictions have increased.  In mid-February, it was reported that there are 25,000 fewer flights operated to, from and within China when compared to before the Chinese New Year (January 25, 2020), with 30 airlines halting services completely.  England, Singapore, Korea, France, Russia, Japan, Netherlands, Israel, Sweden, and Switzerland have all suspended flights.  At the same time, major carriers such as DHL and UPS have stated they would not be adding freight flights to take up the lost supply. Companies that are dependent on air cargo shipments traveling to China, particularly in passenger planes, should immediately search for alternatives.  Additionally, where companies need to use surface transport, timelines for delivery may become elongated as container space is booked.

Due to the highly regulated nature of the medical device industry, making rapid changes to a supply chain or making changes to manufacturers can be difficult and may not be manageable in the near term.  But given the uncertainty as to the duration of impacts, starting to provide for potential transitions now may be time well spent as we see longer term impacts on the supply chain. There may be some opportunity to work with FDA where the products are critical devices as explained above, which would allow FDA to waive certain FDA Quality System requirements (QSR) to curtail shortages and ensure availability, but companies would either need to be making a device that would qualify for emergency use or otherwise satisfy the criteria for FDA to grant such exemption waiver, as discussed in further detail below.

Importing medical devices 

Even where product is able to reach its destination, in response to the crisis, many countries are imposing additional screening or quarantine measures for vessels/cargo from China/Wuhan.  For instance, vessels that have visited China before also need to go through enhanced inspection in Australia, Indonesia, South Korea and some other countries.

FDA has noted that it is not seeing the impacts of this outbreak resulting in an increased public health risk for American consumers from imported products.  There is no evidence to support transmission of COVID-19 associated with imported goods and there have not been any cases of COVID-19 in the United States associated with imported goods, but the agency notes the situation remains dynamic.  And while the agency has indicated that it will continue working with U.S. Customs and Border Protection to target products intended for importation into the U.S. that violate applicable legal requirements for FDA-regulated products generally, the agency has not formally announced a program specifically designed for COVID-19, other than that it may use its existing authority for increased import sampling and screening or request records regarding the products more frequently.

FDA regulatory implications and solutions for supply chain shortages

Medical device manufacturers distributing products in the U.S. are not required to report actual or potential supply chain shortages to the agency, unlike pharmaceutical companies.  Although FDA’s 2021 budget request to Congress included language seeking to obtain the authority to mandate such reporting, to date, no such authority exists.  This issue also was addressed in FDA’s February 27, 2020 Coronavirus (COVID-19) Supply Chain Update.  Despite the lack of such authority, FDA has been active in addressing potential shortages in the medical device supply chain.  For example, in the agency’s update, FDA recognized that the COVID-19 outbreak would likely impact the medical product supply chain, including potential disruptions to supply or shortages of critical medical products in the U.S.  Focusing initially on China, FDA noted that it had been in contact with  63 manufacturers representing 72 facilities in China that produce “essential” medical devices (those that may be prone to potential shortage if there is a supply disruption. For any company that FDA has not contacted, the agency is encouraging ongoing proactive communication from device manufacturers where potential shortages are anticipated or could be possible.  Specifically, FDA is requesting that any supply shortages be reported to the device shortages mailbox,

On February 24, 2020, FDA announced that it is not currently conducting inspections in China due to the State Department warning advising against travel to China.  Although currently limited to China, as the coronavirus spreads across the world, there is a chance that FDA could expand the scope of its travel restrictions thereby further reducing the number of inspections being conducted globally.  Even if the number of foreign (or domestic) inspections is reduced, FDA still has numerous tools available to monitor devices entering U.S. commerce, including import alerts, increased import sampling and screening, and requesting records, in advance of or in lieu of an inspection to allow it to continue to keep eyes on imported medical devices.  With the limitations on in-person inspections, it is likely that FDA could increase the use of these other tools for imported products.  Thus, if you are using contract manufacturers in China or possibly elsewhere around the world, you should anticipate that FDA may well conduct increased import sampling and screening or request additional records regarding the products.  You may even consider including additional information in your entry information.  With potential increased scrutiny of products imported from China it is more important now than ever that your paperwork is in order to avoid unnecessary delays.

Medical device manufacturers, particularly those who produce and supply devices which may be critical for various sub-populations when facing a global pandemic, may be forced to find new suppliers, or even to move manufacturing activities to new or different facilities in areas that are less impacted by outbreak.  Although there are steps necessary to qualify new suppliers or production facilities, as required by the QSR, companies may be challenged in executing such measures in compliance with regulatory requirements when limited in available personnel – or challenged to do so in a timely manner to quickly address a growing demand.  Moreover, moving manufacturing operations for class III life sustaining and life supporting devices may require the submission and approval of a 180-Day Supplement to FDA.  As a result, it is important for companies to understand what options exist to implement such changes in times of crisis.  With such knowledge, companies can take actions to prepare for potential supply disruption, particularly by understanding FDA’s authority to allow medical products to be used under Emergency Use Authorizations (EUAs), or even, in some circumstances, without EUAs, and how the use of such authority could impact medical device manufacturers. 

Planning for a potential shortage

For medical device manufacturers, especially those that have raw materials, components, supplies, and finished devices coming out of China or other highly impacted areas, companies should consider taking the following actions, among others:

  • Reach out to suppliers and get an understanding of current or anticipated supply constraints and their projections for fulfilling contract orders.
  • Place orders to make sure you are on schedule for the facility’s available production capacity.
  • Consider whether you can stockpile inventory in anticipation of potential shortages.
  • Consider whether there are alternative suppliers that can be qualified and brought online.  See discussion in Section II.B below.
  • For companies that have critical components that can only be obtained from a single supplier (in China or elsewhere), consider placing orders now to move materials and supplies to the manufacturing site.
  • Consider having contract manufacturers (if any) ship any stockpiled inventory to the distribution site in anticipation of potential work stoppages or additional shipping complications.
  • Consider whether you can establish new secondary production lines in alternative geographies, including the U.S., for any 510(k) cleared product.
  • For PMA approved products, consider what would be necessary to establish a new production line/facility, including both logistical planning and regulatory submissions, and whether there are opportunities to expedite the approval path with FDA (e.g., if you have an emergency use device).    
  • If you already have secondary production lines, consider placing orders or ramping up production at those sites.
  • Under your contracts, evaluate whether you have any recourse for failure to deliver (or what potential financial impact may be for suppliers who fail to deliver), as some contracts have Force Majeure provisions that may be invoked during a global pandemic.
  • Evaluate how travel disruptions will fit into your supplier audit planning and consider whether there are alternative methods you can apply to gain insight into your supplier’s performance or to qualify a supplier.
  • For products that have the potential for reuse, consider whether you should prepare for refurbishing those products, and if so, what infrastructure and supplies will be needed to perform that service in relevant jurisdictions.  Also, consider whether any interaction with regulators will be necessary.
Qualification of alternate suppliers

In situations where an existing contract manufacturer or component supplier is closed or at risk of not being able to supply product due to workforce challenges or extended periods of shut down, it may be necessary to on-board a new supplier of components or to qualify a new contract manufacturer (or new manufacturing facility) for a finished medical device.  Regardless of the product being supplied or the services rendered, retaining a new supplier or moving production to a new facility requires compliance with FDA’s QSR and may also require FDA clearance or approval, as well as an inspection of the new facility.  Each issue is addressed generally below along with options to consider in times of emergency need.    

Qualification of a new component supplier – QSR requirements

In accordance with the Purchasing Control provisions of the QSR, manufacturers of finished medical devices must qualify all suppliers and vendors retained to provide raw materials, parts, sub-assemblies, components, or services.  The degree of supplier control necessary to establish compliance may vary with the type and significance of the products and services purchased and the impact of those products and services on the quality of the finished device.  In general, Purchasing Control requirements for new suppliers require three steps:  initial qualification, ongoing controls, and the provision of purchasing data.  Each must be performed in accordance with an established procedure.

  • Initial Qualification:  In order to use a new supplier, that supplier must first be qualified.  The type of evaluation is typically determined by the risk, or criticality, of the products or services being provided.  For example, the initial evaluation of a supplier of off-the-shelf hardware screws used to assemble a piece of capital equipment, the failure of which would not independently cause the device to malfunction, would likely not need to be as extensive as the assessment of a contractor that is used to assemble a ventilator or other life sustaining or life supporting device.  The key to complying with this provision is that the evaluation must include the supplier’s ability to meet the finished device manufacturer’s requirements, including quality requirements. 
  • Ongoing Controls:  As with vendor qualification, the level or extent of control to be exercised over a supplier should be defined in a procedure and determined by supplier type, risk and criticality of the component, function or service being provided.  Control of suppliers can range from periodic audits to 100% inspection of all incoming goods or materials.
  • Purchasing Data: In addition to evaluating and approving suppliers, finished device manufacturers must provide sufficient information to their suppliers so that the suppliers know what specifications and requirements they need to meet.  In general, FDA expects that the new supplier be able to meet the specifications for the product being supplied and that there be controls in place to ensure that such specifications are indeed being met. 

It should be noted that if the new supplier is providing components, FDA generally does not require that the components be manufactured in accordance with the QSR as components are exempt from the QSR.  That is, if a supplier is only providing components, that supplier is not per se required to comply with QSR.  Rather, it is the finished device manufacturer that is ultimately responsible for the quality of the finished device.

Moving production of a finished device – QSR requirements

In situations where production of a finished medical device is being moved to a new facility, the process is more complicated.  When production is being moved to a new or different contract manufacturer, the same general processes described above would apply from a QSR and Purchasing Controls perspective.  However, because the production involves a finished medical device, FDA’s expectations are significantly higher.  Unlike component suppliers, finished device manufacturers and contract manufacturers of finished devices must comply with the QSR. 

The steps involved with the transfer of production from one facility to another can vary depending on the complexity of the device, the number of production steps involved, and the amount and complexity of equipment used to produce the device.  Timing can also vary depending on whether the new facility will utilize equipment already installed on-site, equipment from the initial facility is being transferred to the new facility, the same or similar equipment will be used in the new facility, or whether new equipment must be purchased and installed.  The following provides a general roadmap of the processes used to transfer such production to a new facility.  These steps would be applicable whether the production is moving to an external supplier or to a new or different in-house facility.   

  • Regardless of whether new or existing equipment is to be utilized in the new facility, all appropriate production processes must be validated.  All such validations must be performed pursuant to appropriate protocols as described in the facility's Validation Master Plan and applicable procedures.  Again, timing of completion for validations can vary depending on the complexity of the systems, number of processes that require validation, and whether legacy validation can be utilized. 
  • In addition to process validations, certain equipment also may need to be qualified (e.g., performance of IQ and OQ).  Again, timing can vary based on the number of units that require qualification and whether such qualification has been performed in the past.  For example, if existing equipment is being utilized, prior qualification data may be used in lieu of performing new qualifications.
  • It is likely that SOPs and work instructions also will need to be revised or established to ensure that the personnel have accurate procedures to follow. 
  • Personnel training is also typically required to ensure that procedures are followed consistently.
  • Quality Agreements should be negotiated to make clear the roles and responsibilities of the parties; however, if the production is being transferred to an in house facility operating under the same Quality System, such an agreement may not be necessary.

Regulatory requirements – Product submissions

In general, FDA does not require the submission of a new 510(k) notice to utilize a second source supplier of parts or components that are incorporated into a finished device.  The transfer of the production of a class I and class II device also does not typically require FDA notice or clearance unless the change could significantly affect the safety and effectiveness of the device.  When that is the case, a new 510(k) submission would be required. 

For class III devices, a PMA Supplement, such as a 30-Day Notice or 180-Day Supplement (“Site Change Supplement”) may be needed to qualify a new supplier of a critical part or component.  To facilitate the transfer of production of a finished device to a new facility, FDA requires the submission and approval of Site Change Supplements.  For example, FDA’s Final Modifications Guidance states that a PMA Supplement is required prior to making a change that affects the safety or effectiveness of the device, including a change that uses a different facility or establishment to manufacture, process, or package the device.  FDA considers Site Change Supplements to be 180-Day PMA Supplements.

FDA has issued guidance intended to help manufacturers determine the appropriate PMA supplement reporting pathway for implementing changes in the manufacturing sites used for a PMA approved device, Manufacturing Site Change Supplements: Content and Submission.  

Potential for QSR exemption for essential devices during a public health emergency

Due to the time that it takes to qualify a new supplier in accordance with the QSR, and when necessary, to seek and obtain FDA clearance or approval of a new supplier or manufacturing facility, the current regulatory paradigm would serve as an impediment to the timely resolution of a supply shortage during critical time of need.  In times of crisis, FDA has the authority to expedite these processes.  As noted in more detail in Part 1 of this client alert series, FDA’s January 2017 guidance document entitled Emergency Use Authorization of Medical Products and Related Authorities outlines the processes applicable to the authorization of the emergency use of medical products (medical countermeasures or MCMs).  However, even under these existing authorities, it is unclear whether sufficient flexibility is granted to the agency to address challenges and strains to the supply chain.  These authorities focus primarily on the release of new products necessary to address the crisis (e.g., pandemics, etc.). Due to the unique impact that the Coronavirus could create (e.g., shut downs of manufacturing facilities, component suppliers, etc.) FDA may be faced with the need to utilize its emergency use authorities in new or creative ways.

FDA’s authorities allow the agency to facilitate certain emergency activities involving FDA-approved MCM, or approved medical devices.  These emergency authorities apply only to those medical products that are “eligible,” meaning that they must be:

  • Approved by FDA;
  • Intended for their approved use to prevent, diagnose, or treat a disease or condition involving a CBRN agent(s), or a serious or life-threatening disease or condition caused by a product used for such a purpose; and
  • Intended for use during circumstances in which there has been either:
    • A determination of an emergency or a significant potential for an emergency made by the Secretary of Homeland Security, the Secretary of Defense, or the Secretary of HHS (i.e., one of the three EUA determinations that may support issuance of an EUA declaration); or
    • A material threat identified by the Secretary of Homeland Security pursuant to section 319F–2 of the PHS Act that is sufficient to affect national security or the health and security of U.S. citizens living abroad (i.e., a Department of Homeland Security (DHS) material threat determination, which may also support issuance of an EUA declaration).

Of particular importance:

FDA may authorize deviations from otherwise applicable [QSR] requirements for the manufacture, processing, packing, or holding of eligible, FDA-approved products without issuing an EUA (section 564A(c)).  Products that receive a waiver from applicable [QSRs] will not be considered adulterated or misbranded under the FD&C Act.  This includes requirements under section 501 or 520(f)(1) or applicable conditions prescribed with respect to the eligible product by an order under section 520(f)(2).

Although we are not aware of any instances where such a waiver has been issued for qualifying a new component supplier or to move the manufacture of a device to a new facility to address actual or anticipated supply shortages, FDA’s guidance states that such waivers will be driven by the exigencies and other demands of responding to the particular emergency.  For example, manufacturers of products intended for use in a pandemic may submit a request for a CGMP waiver for eligible products based on actual or anticipated emergency response activities that necessitate the waiver.  Though broadly written, it is unclear whether or not a waiver could be requested to swiftly qualify a new supplier or contract manufacturer when current production of critical devices at existing facilities has ceased or is in jeopardy. Nonetheless, communication with FDA is an imperative.  As with EUA requests, FDA strongly encourages interaction with the appropriate agency Center about potential QSR waivers before submitting a formal request.  Assuming FDA is in general agreement with the basis for the waiver, the company would then proceed to requesting the waiver for the product or process. 

FDA intends to evaluate requests for QSR waivers on a case-by-case basis.  A waiver may be issued when, based on the information available, the agency concludes it is reasonable to issue a waiver to facilitate an emergency response or preparedness efforts.  Requests for waivers should include the following information:

  • The identity and quantity of the medical product involved (e.g., product name(s); dosage form(s) and strength(s); number of doses, units, lots, or other unit(s); and unit/lot identifiers, as appropriate);
  • The manufacturer's name, address, and contact information;
  • The FDA application file number for the product, if known (e.g., 510(k); PMA; de-novo);
  • The actual or potential emergency for which the product is intended to be used;
  • The anticipated conditions (e.g., storage, handling, transport, packaging) that will or may deviate from CGMP requirements and for which a waiver is being requested, including why such deviation may be necessary and the anticipated duration; and
  • Available information about the potential impact of the deviation on the safety or efficacy of the product.

Based on the scope of initial discussions with the agency, additional information also may be required, such as whether any existing validations can be leveraged to support the reproducibility of a process to consistently ensure product meets specifications.  For example, validations performed on similar products, or worst case models may be requested, if applicable.  Options also could be presented whereby additional controls could be implemented prior to release by the contract manufacturer, or even the implementation of additional incoming inspection upon receipt at the contracting entity’s (e.g., marketing authorization holder) facility.

In addition to the QSR aspects noted above, obtaining FDA support for a manufacturing site change also will need to be discussed.  For example, it is unclear whether FDA would authorize production of a class III device at a new or different facility absent the submission of a site change supplement, or even a 30-Day Notice.  Although we are not aware of any EUAs or waivers granted for this specific scenario, if FDA determines that such authority has been granted to the agency, FDA could extend the EUA policy to allow changes to manufacturing facilities when necessary to supply chain issues and the continuity of medical devices needed to address a public health crisis.  If determined that such authority does not exist under Sections 564 and 564A of the FDC Act, FDA could fall back on its policy of granting enforcement discretion in moving forward with such action. Any such discussions with FDA also should explore options for expedited review of a submission by the agency; approval of a submission based exclusively on a desk review when an inspection would typically be needed (especially since FDA is reducing the number of foreign inspections due to the coronavirus); or flexibility with respect to submission type (e.g., submission of a 30-Day Notice in Lieu of a 180-Day Site Change Supplement).

It should be noted that it is unlikely that FDA’s authority under Sections 564 and 564A of the FDC Act could be extended to cover other devices that, although not necessary to directly address the immediate health crisis, would create a new crisis if they are not available (non-essential devices).  For example, although a pacemaker would not be considered an MCM for coronavirus, a shortage of pacemakers or their accessories, such as leads, could place a new population of subjects at risk of death as a tangential result of a pandemic triggered supply chain shortage.  In such cases, FDA could resort to other options such as granting enforcement discretion for the qualification of interim suppliers, as needed.  Of course, any such grant of enforcement discretion would likely require prior discussions with FDA, which could be initiated through FDA’s device shortages mailbox.  As noted above, any such discussions with FDA should explore options for expedited review of a submission by FDA; approval of a submission based on a desk review only when an inspection would typically be needed; or flexibility with respect to submission type.


Companies with significant presence in China or other areas with virus outbreak, either for direct manufacturing or sourcing of components, should be planning for potential shortages by carefully managing their supply chain and export/import issues and leveraging FDA alternative pathways applicable during emergency situations, as appropriate.  Companies that are experiencing shortages, or anticipate shortages in their supply chains should reach out to FDA via the device shortages mailbox,   Discussions with the agency will dictate the appropriate options and pathways available to address the issue. 



[2]              Pain in the (Supply) Chain:  Tariffs and U.S.-China Medtech Trade available at

Authored by:  Michael S. Heyl, Jodi K. Scott, Lina Kontos, Arthur Kim


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