For developers of human cells, tissues and cellular and tissue-based products, classification can determine the shape of an entire regulatory strategy and ultimately how to get that product to market. Is a product regulated solely under Section 361 of the Public Health Service Act (PHSA), or does it require pre-market review as a drug, biological product or medical device? A recent decision out of the U.S. District Court for the Northern District of Georgia, MiMedx Group, Inc. v. FDA, offers a timely insight into how courts may scrutinize FDA’s answers to those questions.
Why AxioFill’s Classification Matters
AxioFill is a dry powder made from extracellular matrix (ECM) derived from human placental tissue and intended for use to provide a physical scaffold on wounds to support the growth of new cells. According to the court, MiMedx “collects donated human placental tissue from mothers delivering healthy babies via C-section and isolates the placental disc ECM through a series of processing steps” to produce AxioFill.
The Code of Federal Regulations Title 21 Section 1271.10(a) defines the specific criteria that determine whether a human cell, tissue or cellular and tissue-based product (HCT/P) is regulated solely under Section 361 of the PHSA rather than as a biological product under PHSA or as a drug or device under Section 351 of the Food, Drug and Cosmetic Act. A Section 361 classification “has less stringent regulatory requirements,” including exemption from pre-market review. Thus, MiMedx sought FDA’s classification of AxioFill as a 361 HCT/P under Section 1271.10(a). Those criteria are as follows:
- HCT/P is minimally manipulated.
- HCT/P is intended for homologous use only, as reflected by the labeling, advertising or other indications of the manufacturer’s objective intent.
- The manufacture of the HCT/P does not involve the combination of the cells or tissues with another article, except for water, crystalloids or a sterilizing, preserving or storage agent, provided that the addition of water, crystalloids or the sterilizing, preserving or storage agent does not raise new clinical safety concerns with respect to the HCT/P; and
- Either:
- The HCT/P does not have a systemic effect and is not dependent upon the metabolic activity of living cells for its primary function; or
- The HCT/P has a systemic effect or is dependent upon the metabolic activity of living cells for its primary function, and:
- Is for autologous use;
- Is for allogeneic use in a first-degree or second-degree blood relative; or
- Is for reproductive use.
Products meeting all four criteria are subject to a comparatively limited framework focused on controlling communicable disease, rather than under the full pre-market rules for drugs, biological products and devices, which comes with heightened regulatory burdens.
FDA concluded that AxioFill is not a 361 HCT/P because it is not minimally manipulated and ultimately classified it as a biological product. In a footnote to its designation letter, FDA added that AxioFill “does not appear to meet” the homologous-use criterion but stated it was not necessary to address that criterion. MiMedx challenged the decision under the Administrative Procedure Act, arguing that FDA misread its minimal-manipulation regulation and acted arbitrarily and capriciously by classifying AxioFill as a biologic product while classifying similar ECM products as devices.
Minimal Manipulation: What Is the Proper Starting Point?
The dispute focused primarily on the meaning of “minimal manipulation.” Applying Kisor v. Wilkie, the court resolved that question based on the regulation’s plain text, without deferring to FDA’s interpretation. Under 21 C.F.R. § 1271.3(f)(1), minimal manipulation is defined, “[f]or structural tissue,” as “processing that does not alter the original relevant characteristics of the tissue relating to the tissue’s utility for reconstruction, repair, or replacement.”
MiMedx put forth an ECM-to-ECM comparison. FDA instead began with the placental disc from which the ECM is isolated. The court agreed with FDA on that threshold point: For purposes of assessing structural tissue, the inquiry begins with the original placental disc tissue and not with the processed material that becomes the final product, i.e., the finished powder.
However, the court disagreed with FDA about which characteristics of that original tissue are “relevant.” FDA focused its analysis on the placental disc’s function in the donor—specifically, acting as a selective barrier between fetal and maternal circulatory systems. After considering the regulation’s reference to “utility for reconstruction, repair, or replacement,” the court concluded that the relevant characteristics must be considered in relation to utility in the recipient (not the donor). As a result, the court vacated and remanded FDA’s minimal-manipulation determination and instructed FDA to reconsider it.
How Much Explanation Is Enough?
The court also addressed a recurring administrative law issue: When an agency classifies seemingly similar products differently, what explanation must it give? Here, recall that FDA classified AxioFill as a biological product. MiMedx directed the court to other ECM products that FDA classified as devices and not biological products. FDA stated that AxioFill achieved its primary intended purpose through chemical action, but the court found that FDA provided “no explanation as to how, or why,” AxioFill differs from those similarly situated products, and no substantial record evidence supporting the disparate treatment (emphasis added).
Therefore, the court vacated the biological product classification as arbitrary and capricious and remanded it. If FDA concludes that AxioFill is a biological product in its next review, it “must explain any differentiating features, with reasonable specificity, of [AxioFill] in light of the FDA’s classification of similar products as devices.”
What’s Missing from the Court’s Decision
The court’s decision leaves several issues open. Most importantly, the court did not hold that AxioFill is minimally manipulated. Furthermore, it did not determine whether it is a 361 HCT/P or a device. The court left those questions for FDA to decide. Additionally, the court declined to review FDA’s four-sentence footnote stating that AxioFill “does not appear to meet” the homologous-use criterion, finding that the statement was not final agency action.
It is important to note what the court did not decide on because a remand can reshape an agency’s analysis without dictating the outcome. FDA’s next decision will possibly turn on how it characterizes the original functions of placental tissue, how it evaluates the product’s activity in a recipient, and how it distinguishes AxioFill from similar products already classified as devices.
A Decision to Keep in View
MiMedx highlights the continuing importance of precise regulatory language and well-developed scientific record. It also suggests that product classification is not only about the category FDA selects, but about whether the agency connects the category to the governing text, the evidence provided to support it, and its treatment of comparable products.
It will be interesting to see how FDA will refine its interpretation of “relevant characteristics” on remand and whether it will provide a more detailed biologic-versus-device analysis. It is also possible FDA may reach a completely different classification altogether. Overall, FDA’s final decisions will reach far beyond AxioFill for sponsors developing placental, ECM and other tissue-based products.
For More Information
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