Risk, Regulation, and Managing the Rhythm of Change in Regulated Industries

Compliance Teams Shape the Response to Change

Regulated industries manage change methodically to minimize risk and maintain trust with regulators, customers, and stakeholders. Each company has compliance and regulatory teams who monitor regulations, review the approved requirements, assess the impact, and interpret what the law means for the company. Then they develop and provide training on what is needed to comply.

“These teams guide the company’s internal changes,” Karen says. “They work with medical and technical writers and translation partners to ensure that content is written for the intended audience and is suitable for its purpose.”

Rules and Reality: When Regulations Don’t Align

A regulation’s impact can vary based on the product, especially the difference between the product’s current state and the new requirement. In some cases, Kristen says, the product is already compliant, so it’s simply a matter of producing the evidence for the relevant authority. In other cases, such as the implementation of the EU’s Restriction of Hazardous Substances requirement, significant changes may have been needed. If that wasn’t possible, it meant the product could no longer be sold in that market.

Some regulations are harder to implement than others, motivating some companies to seek reforms or get involved in the legislative process.

“It is well-known from all the MDR implementation delays that this regulation has not been easy to navigate,” Ulrike says. “Companies are calling for amendments and sometimes getting active politically via associations or direct action to modify the legislation that affects them.”

Conflicting requirements in the regulations pose one of the biggest challenges for regulated industries. Green initiatives requiring less hard-copy documentation and electronic delivery of labeling contradict the MDR requirement that each device have paper instructions for use.

“This leaves manufacturers and hospitals facing a violation of either not creating waste by using digital documentation or ensuring one paper document be included with every product, even if one shipment contains 1,000 products,” Kristen says. “I hope that regulations will become more aligned in the future to avoid these situations.”

Additionally, regulations could potentially drive medical device companies out of smaller markets — or even all markets — because of the cost of keeping the product and labeling current in all languages.

“We all know that there is much more to localization than translation,” Kristen says. “Some departments choose lower-cost translation options to keep their content current. But if you ask whether the rate includes edit, proof, and customer review, or if the paperwork required for compliance was included, oftentimes the response is no.”

Small Companies, Big Challenges: Navigating Compliance

It makes sense that larger, multinational companies may be slower to adapt to change, but are smaller companies or startups more nimble? Depending on the type of change, they may be faster to respond because they are working on only one product or one technology. Smaller companies and startups also typically focus on a single market, usually in their home country, making initial clearance easier.

Small companies often cannot afford to meet global compliance requirements, which impacts whether new technologies make it to smaller markets. From a localization perspective, small companies may find the cost of local language requirements higher than the profits to be made in that market, so they will choose not to expand. This is particularly true if the country also has a highly unique set of regulations and an expensive, time-consuming submission and approval process.

Testing and Development Lead the Way

Despite a desire to improve time to market, all departments in a medical device company march to the pace of the company’s development and testing team.

“When it comes to a new product or significant change to an existing product, everyone depends on development and testing,” Kristen says. “Marketing cannot promote a product that is not approved for sale, and all claims about a product have to be backed up by evidence, which is often the result of testing and trials.”

Labeling is also considered part of a product, so it’s required to follow the same development process as research and development. Because labeling is part of the regulatory submission, technical documentation teams have to wait for feedback from the regulators. This feedback often results in last-minute changes, which trickles down to linguists and language service providers (LSPs) as rush translation updates for a project that might have been completed months before.

The Art of Change Management

Response to change is also prescribed by a company’s ISO standards and quality management system (QMS). Consisting of four elements — quality planning, quality control, quality assurance, and quality improvement — a QMS contains business practices aimed at consistently meeting customer requirements and ensuring patient safety.

A product’s compliance with regulation is achieved via the company’s QMS processes and work instructions, and these must be updated when any changes occur. In addition, employees must be trained on these changes, the product adapted (if needed), and the changes documented.

“Change management is an important part of a company’s QMS,” Karen says. “Change shouldn’t be made in one place without considering the knock-on effects in other parts of a process.”

AI and Compliance: Opportunities and Obstacles

The impact of generative AI (GenAI) and large language models (LLMs) is still taking shape for regulated industries because these organizations are not typically early adopters of technology, as befitting their risk-averse reputation.

“During 2024, many companies were discussing pilot projects and task forces, but I didn’t see a great deal of implementation at scale,” Karen says. “Consider two facts: We see the risk of hallucinations [false or misleading AI output] in LLMs daily, and we know that medical misinformation is common on the internet. Therefore, any LLM being created, even any small language model, needs to have tight control on source content, which means significant investment.”

While AI could help accelerate some tasks, concerns about security and dependence remain.

“There is a shortage of experienced regulatory medical writers, and I think some of the medical writing work could be accelerated with these tools,” Ulrike says. “But there are still a lot of questions regarding potential pitfalls.”

From medical device and pharmaceutical companies to regulators, physicians, and patients, AI is getting a lot of attention in regulated industry news stories and press releases.

“The impact of AI is going to be huge, but it needs to be implemented carefully,” Kristen says. “Not only must the data feeding into these systems be checked, but the statements coming out must be carefully reviewed to ensure it is producing accurate, evidence-based information.”