For medical device manufacturers, the breadth of technologies on offer today represents real cause for excitement. AI is revolutionising diagnostics, while telemedicine is expanding access to healthcare and virtual reality is reshaping medical training. As we learn more about how to wield these technologies, the possibilities become more and more extensive.
All this said, it’s not always straightforward to bring cutting-edge innovations to market. Many manufacturers find themselves stumbling against regulatory barriers, which can delay product launches and bump up costs. As Anna Lundy, associate director in Osborne Clarke’s commercial and regulatory disputes team, explains, healthcare businesses may feel hampered by older regulatory frameworks.
“Regulations such as the UK’s Medical Device Regulations are outdated and do not align with the rapid pace of technological advancement,” she says. “Even newer regulations, such as the EU Medical Device Regulations, did not anticipate the technology we see today when it was drafted.”
This situation is less than ideal, especially for the UK. Long considered a global leader in life sciences, the UK has found its crown slipping somewhat over the past decade. Its share of global pharmaceutical R&D has declined, with levels of manufacturing, export and clinical research all experiencing slowdown. According to the Office for Life Sciences, the UK is failing to capitalise on its historic advantages in this field, with disappointing signs across a range of economic, health and research metrics.
When Labour came into power last July, it was quick to set out a vision for change. As detailed in its manifesto, Labour plans to bring in “reformed incentive structures to drive innovation and faster regulatory approval for new technology and medicines”. It has also said it will increase access to finance for life sciences companies, while improving the business environment. That includes a £118m investment (split between government and partner support) into five new research and partnership hubs. These will develop new medical technologies, such as AI models that can detect cancer.
Then, in October, the government announced the launch of a new Regulatory Innovation Office (RIO) that will work on addressing these challenges. Notionally, the office will remove some red tape for businesses, while turbocharging economic growth. It will be housed within the Department for Science, Innovation and Tech, and will initially be overseen by science minister Sir Patrick Vallance.
Cutting red tape for device makers
“The RIO will help position Britain as the best place in the world to innovate by ensuring safety, speeding up regulatory decisions and providing clear direction in line with our modern industrial strategy,” said the Secretary of State for Science, Innovation and Technology, Peter Kyle, at the time the RIO was unveiled.
The RIO will support four complex, fast-emerging areas of technology. These include the space industry (think weather forecasting and disaster response systems); engineering biology (vaccines and clean fuels); and autonomous technology such as drones. More relevant for the medical devices sector, it also includes the use of AI and digital tech within healthcare. In theory, it will help businesses launch AI innovations safely, with a view to improving NHS efficiency and boosting patients’ health outcomes.
Business associations have been overwhelmingly supportive of the move. “By smoothing the path to deployment of new technologies, the RIO can open the door to significant applications both in the commercial sphere and for public services,” says Edward Emerson, head of digital regulation at techUK. “We hope that by narrowing its focus to high-growth sectors, the RIO will be able to develop a centre of excellence in government that is able to rapidly respond to the challenges presented by regulating emerging technologies.”
He notes that the RIO appears to build on Sir Patrick Vallance’s review into emerging technologies. The review, which looked at how pro-innovation regulation might support their development, was conducted at speed and reported alongside the Spring 2023 budget. Each of its nine recommendations were taken forward by the Sunak government. “The review saw welcome collaboration with industry,” says Emerson. “We hope that this spirit will continue to guide the work of the RIO, which will be most successful if it draws upon a wide range of private sector expertise.”
Few could begrudge the RIO’s ambition. If done right, it could mean unlocking billions of pounds of additional investment to help fund new research. It would also smooth the path from the lab to the marketplace, helping researchers scale and commercialise their technologies (that’s an area in which the UK, competitive though it is on pure research, has historically underperformed).
“We are hopeful about the potential of the RIO to improve the way we regulate emerging technologies and support their scaling,” says Emerson. “In particular, we believe that success will come from close collaboration with industry and a clear focus on commercial opportunities.”
Above all, it will seek to get the balance right between facilitating innovation and ensuring public safety. As Peter Rudd-Clarke, a regulatory and litigation partner in Osborne Clarke’s life sciences and healthcare team, remarks, this balancing act will strike a chord with regulators the world over.
“This is particularly the case in the more heavily regulated sectors like life sciences and healthcare, where products placed on the market pose an inherent risk to the public, which can be mitigated by regulations focused on safety,” he says.
Another talking shop?
The question is whether its goals are truly achievable. Lundy points out that, from a cynic’s perspective, the announcement looks a lot like a “government trying to make a quick headline to appease the sector” rather than providing anything more substantive.
“While a big announcement was made about the launch, there has been little mentioned since, and detail around how it will run and who will staff it has been scant,” she adds. “The government’s commitment to regulatory reform and the initial focus areas suggest that there is pressure on it to succeed. However, we await the details on how success will be measured.”
On top of that, it isn’t wholly clear how the RIO will be funded. A recent industry report has argued that the UK Medicines and Healthcare products Regulatory Agency (MHRA) needs more resources, with its “capacity and predictability” cited as major deterrents for investors. Meanwhile, the UK government has been explicit about the ‘black hole’ in public finances.
“The fear is that without cash, RIO will become another talking shop,” comments Rudd-Clarke. “If it ends up as a committee with limited resources, but one that must be consulted, it could even slow down the government’s efforts to reform regulations to boost the economy.”
Though in theory, the RIO will perform a vital role. It will enable approval processes to be streamlined, provide pre-application support, and create regulatory sandboxes for testing new developments under regulatory supervision. Sandboxes are controlled environments where innovators can test out new approaches without some of the usual rules applying.
It will also work to update regulations and speed up timeframes where appropriate. That will mean working in partnership with the MHRA – and possibly pushing back on some of their recommendations. For instance, it might suggest that regulators adopt more stringent safety monitoring once the products are already on the market, as opposed to creating more red tape during the approvals process.
“RIO could ask whether new regulations are necessary, or whether they could be watered down to promote innovation by making the compliance burden cheaper,” suggests Rudd-Clarke. “It’s notable that the MHRA appears to be singing from the same hymn sheet, stating that it wants to support innovation whilst promoting patient safety.”
Making life science a priority
There are certainly encouraging signs in this regard. In 2024, the MHRA created a regulatory sandbox for AI-based medical devices, known as AI Airlock. Five novel medical devices are being tested as part of the scheme, including a device that predicts health outcomes for lung disease, and another that makes cancer care more efficient. The agency is also pushing forward changes to medical device regulations, with a new UK medical device framework expected in draft form later this year. Historically, the UK has tended to update its regulations in line with the EU framework, but it’s possible that things could be different this time around. Rudd-Clarke notes that the RIO may end up “pushing for a lighter touch”.
“The economic prospects in the EU look less promising than other jurisdictions, practically by the day,” he adds. “There has also been an increase in criticism of the EU regulatory model, such as the Draghi report that criticised the EU for overregulating the market. The early pronouncements by RIO on whether or not the EU model will be followed will be fascinating to see.”
Whatever happens, it’s clear that technological advancements in the life sciences sector are a government priority. As Lundy explains, the establishment of the RIO constitutes a strong sign of intent, even if the practical details remain hazy. Should its goals come to pass, device makers may soon find themselves operating within a more supportive regulatory environment.
“It exemplifies how the government intends to boost the UK life sciences sector, making it an attractive environment for businesses to bring their innovative products to market,” says Lundy. “It’s a positive step towards enhancing the UK’s regulatory capability, supporting innovation, and driving investment and growth in the UK.”
