Depuy Boss Worries About FDA and Sales Taxes. But EU Regs Changes Will Hit Just as Hard

Minnesota’s Star Tribune has been widely covered with its reporting of St. Jude Medical CEO Dan Starks’ presentation to a group of entrepreneurs and investors. While the headline comment was that there’s still room for innovation in the device industry at the intersection of cost-cutting and improved patient health, what really sang out was his attack on US regulations and the medical device sales tax. We wonder whether US Medtech is so inward looking it’s not noticed EU device regulation changes that will hit them just as hard as their domestic challenges.


Starks’ speech took place at the 27th annual Collaborative venture and finance conference, and event that highlighted the work of 18 up-and-coming companies, many of them in medical technology.

According to the Star Tribune piece, Starks offered an upbeat assessment of the future for medical devices, but focused on two old chestnuts, FDA’s regulatory stringency and the 2.3% medical device sales tax.

On the first problem, Starks cited examples of seemingly minor changes to devices at a software level, that required 5000 patient trial before gaining market approval, despite being on the market in the rest of the world already.

He also suggested that FDA’s stance was toughening, despite the agency’s assertion that it is streamlining its processes.

Reading his words from over here, across the pond, what struck me is that in the example he cites, at least his company is already generating revenue from outside the United States. Perhaps he should be worrying as much about what will happen under the new European regulatory regime, which will in many ways mirror FDA’s bureaucratic and supercautious approach.

Starks and his ilk come over a bit parochial when talking about the US sales tax and the FDA. They reckon both are threats to US medtech industry competitiveness, and they may be right. But in focusing so heavily on the important domestic situation they seem to be missing the changes that are about to be imposed on their products in Europe. The CE mark, which companies small and large take it for granted they will breeze through, will soon not look like quite the easy ride to early revenue it is now. Perhaps US companies should turn some of their lobbying powers onto the Eurocrats, because the train to greater restrictions in Europe is well and truly leaving the station.

Dan Stark’s comments

“In the United States, the regulatory environment has tended to swing on a pendulum,” he said. “Under the current administration, the tone of the FDA is different from the tone of the FDA under the prior administration. We are at a point in the regulatory cycle where the regulatory requirements are more difficult than they typically have been.”

You ain’t seen nothing yet Dan.

Source: Minnesota Star Tribune