June 14, 2024

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What Chevron’s Demise Could Mean for Medtech

The Supreme Court will soon address the fate of agency deference—an issue presented in Relentless v. Department of Commerce and Loper Bright Enterprises v. Raimondo—in a ruling expected to have far-reaching effects on how federal agencies regulate medtech and many other industries and how the industries interact with lawmakers, agencies, and the courts.

At the core of the Supreme Court’s review is the doctrine in Chevron v. Natural Resources Defense Council, under which courts defer to an agency’s construction of an ambiguous statute, so long as it was reasonable. The Supreme Court has been asked to overturn or limit this deference and direct courts to instead ask: Was the agency’s interpretation the best reading of the statute?

If the Court does away with Chevron deference, that decision would have far-reaching consequences across regulated industries and would have a profound impact on medtech. 

Overall—and what I’m watching most closely—is what the Court’s final opinion means for regulatory certainty by expert agencies that know the fragile medtech innovation ecosystem and science best. Medtech innovation thrives best in a predictable legal environment. 

  • On one hand (without Chevron deference), where long-standing and balanced regulatory agency decisions may be easily litigated and thereby change or reverse standards, the ability to bring the latest innovations to patients can be compromised. 
  • On the other (with Chevron deference), where agency decisions key to innovation and patient access change from one administration to the next, innovation and patient access can be compromised.  

Patients need a finely tuned outcome in this case. More stability and continuity could be more conducive to unleashing the bold innovations patients need.

Potential Pros for Medtech of Overturning Chevron include:

  • Opportunities for legal challenges to overzealous rulemakings: Overturning Chevron could create opportunities for medtech to challenge in court regulations that restrain medtech innovation and have adverse consequences for patient access. This could be particularly important where agencies promulgate broad-based policies without understanding the innovation, research, manufacturing, supply chain or FDA approval implications on medical technology and patient access.
  • Opportunities to support lawmakers and agencies: As Congress will have greater responsibility for drafting technical and precise legislation, this will provide more opportunity and value in receiving expert input from industry stakeholders like medtech. This can be especially valuable for medtech, as America leads the world in medtech innovation and manufacturing.

Potential Cons for Medtech of Overturning Chevron include:

  • Risks to patient access and favorable agency action: Patients rely on one centralized decision maker to ensure the safety and effectiveness of medical technology. Where FDA product clearances are subject to re-review by self-interested parties like the trial bar, that can have adverse effects on patient access in general (and create differential patient access premised on court jurisdiction), chill investment in innovation, and drive other uncertainties in the industry. 
  • Less flexibility for agencies in changing times: Some agencies essential to facilitating patient access to the latest medical technologies are hampered by old statutes that restrain innovation and benefit from the flexibility to reinterpret existing laws that Congress has not updated to account for evolving technology. Medical technology evolves at a rapid rate, and in some cases, Congress’ enacted legislation is anchored in the 1970s—where the law is outdated or silent, we can’t limit patients to the state of medical care at that time.

We look forward to providing updates on the Supreme Court’s decision—and its impact on medtech—which we expect the Supreme Court to issue this summer.

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