Transferring Foreign 510(k) “Ownership” to Domestic Subsidiary

Transferring Foreign 510(k) “Ownership” to Domestic Subsidiary

February 20, 2023

Transferring Foreign 510(k) “Ownership” to Domestic Subsidiary

 

In a nutshell, if a foreign sponsor/owner of a U.S. FDA 510(k) clearance wants to transfer/relinquish ownership and control over to its U.S. subsidiary (or any other party), then such a business/regulatory model can have regulatory merit and, if properly configured/managed, can generally work to meet FDA’s establishment registration and device listing requirements of 21 CFR Part 807.  Indeed, FDA’s establishment registration and device listing obligations are primarily driven by the operations in which a firm is engaged, and only secondarily (if at all, depending on the circumstances) by who obtained the 510(k) clearance.

 

It is true that FDA’s standard approach is to reflexively view the 510(k) owner as the owner/controller of the device specifications (i.e., as the Part 807 “manufacturer” or “specification developer”), and thus to view that firm as being ultimately responsible for assuring proper 21 CFR Part 820 GMP compliance and ongoing Part 807 compliance for the subject device.  Yet transfer of “ownership” / control of a 510(k) (and ultimate accountability for GMP) is a well-established business/regulatory scenario that FDA accepts as long as the proper notifications/adjustments are made to assure FDA knows who is the current/latest Part 807 “manufacturer”, “specification developer”, and “contract manufacturer”.

 

For example, a U.S. firm could, via the aforesaid FDA notifications/adjustments, take on the Part 807 role of being, as applicable, either the responsible “manufacturer” or “specification developer”, and can have the subject device fabricated outside the U.S. by a Part 807 “contract manufacturer” [such as the firm that originally sponsored/obtained the 510(k) clearance]. Moreover, if the finished devices in that scenario are imported into the U.S. by the U.S. firm and distributed from that same U.S. site into U.S. interstate commerce (whether directly to end users or to distributors), then the FDA told me that there would be no requirement for registration of an “initial importer” like there was previously when the foreign site was initially getting its products into the U.S. through a third-party importer/distributor.

 

Ultimately in such a scenario, don’t overlook the fact that the U.S. subsidiary site becomes the actual responsible “manufacturer” or “specification developer” who is held ultimately accountable for finished device design, fabrication, ongoing quality, etc., etc.  That means, for example, that FDA’s first (and typically only) direct focus for GMP inspections will be that U.S. subsidiary.  It also means that the U.S. site is ultimately responsible for critical regulatory events like recalls, 510(k) letters to file, and responding to inquiries from FDA’s adverse event monitoring group.

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