The government should abandon a 35-year-old system for approving most medical devices in the U.S. because it offers little to no assurance of safety for patients, a panel of medical experts concludes in a report Friday.

The surprise recommendation from the Institute of Medicine panel calls for a massive reworking of how the government regulates medical devices, a $350 billion industry that encompasses everything from pacemakers to X-ray scanners to contact lenses.

The 12-member group's advice, commissioned by the Food and Drug Administration, is not binding. But it could signal a new era of tighter standards for medical device manufacturers, who have long benefited from less safety scrutiny than their peers in the drug industry.

FDA requires that most new prescription drugs go through clinical trials to prove that patients fare better after receiving medication. Most devices only have to show that they are similar to devices already on the market. Truly new devices have to undergo more scrutiny.

In a highly unusual move, the FDA said Thursday evening that it disagreed with the group's recommendations, but would hold a public meeting to discuss them.

The report arrives as the FDA fends off pointed criticism from manufacturers who say the agency has become too slow and bureaucratic in clearing new devices, driving up costs for companies and forcing some out of business. They point out that some devices reach the market two years earlier in Europe, where safety standards are lower. In the past year, companies have taken their arguments to Capitol Hill, where lawmakers have grilled FDA officials over device reviews.

But the Institute of Medicine panelists, mostly doctors and researchers, appear to overwhelmingly side with public safety advocates who have argued for years that devices used to treat and detect illnesses must undergo real medical testing.

The FDA sought the group's advice as it updates the system used to clear more than 90 percent of devices in the U.S. The so-called 510(k) system was created by Congress in 1976 to grant speedy approval to devices that are similar to products already on the market. The pathway was originally intended as a temporary method to grandfather in devices that had been used for decades. Instead it has become the standard tool to launch new medical implants.

The IOM generally recommends ways to improve or modify government programs, but in an unexpected move the panel said 510(k) approvals are "flawed" and should be eliminated completely.

"A system was put in place 35 years ago that does not really assess safety and effectiveness," said panel chair David Challoner, former vice president of health affairs at University of Florida. "We need something different for the next 35 years. We're dealing with a whole new world: new technology, new materials and new data."

Challoner and the other panelists recommend the FDA develop a new system based on safety metrics and tracking device failure rates in the real world. He said better tracking of device complications could take the place of premarket testing, which would be financially unfeasible if applied to all new devices.

The group stresses that medical devices cleared through the pathway are not inherently unsafe — most probably are safe — but the system used to clear them provides little assurance to doctors and patients.

The 510(k) system is popular among manufacturers because it is a faster, cheaper path to market than the review process for first-of-a-kind devices, which must undergo rigorous medical testing. Hip replacements, CT scanners and drug pumps are among the devices cleared by 510(k).

As generations of devices have been cleared year after year, FDA critics say dangerous devices that pose real risks to patients have slipped through because they vaguely resemble products approved decades ago.

"Originally there was this idea that the 510k would wither away and over time more and more new devices would go through the more onerous path. But instead there are more devices cleared this way than ever," Dr. Diana Zuckerman, director of the nonprofit National Research Center for Women & Families, said in an interview Thursday.

Earlier this month Zuckerman and other safety advocates critics seized on new reports of painful complications with pelvic surgical mesh as the latest example of the shortcomings of the abbreviated review system. Reports of pain, bleeding and infection with the implants are up 500 percent since 2008 among women who've had surgery to support the pelvic wall. The FDA cleared the device for that use in 2002 via 510(k). Similar safety issues have plagued metal-on-metal hip implants in recent years.

The IOM's 245-page report will strengthen FDA's hand against a multimillion-dollar lobbying effort by medical device manufacturers. But it also poses a host of challenges for the agency, including how to design and pay for a more comprehensive medical device system.

About 4,000 devices are cleared every year under the 510(k) system, while just 50 devices are approved under the more stringent system that requires human testing. It costs the FDA roughly $800,000 per device when utilizing the more rigorous system.

The IOM is a nonpolitical group of experts that advises the federal government on medical issues.
For months, medical device lobbyists and executives have downplayed the legitimacy of the IOM panel, pointing out that none of them have experience working in the device sector.

Like most panels convened by the agency, the group that drafted Friday's paper consists mostly of academics and researchers from institutions like Harvard University and the National Institutes of Health.

Dr. Jeffrey Lerner, who has studied medical technology for over 25 years, said device makers are still coming to grips with a new regulatory environment that demands greater safety — often at the expense of profits.

"The device industry tends to take the position that their industry is competitive enough already and that anyone wanting to make it tougher is trying to do them real harm," said Lerner, who is president of the Emergency Care Research Institute. "The bottom line is that everybody has got to make adjustments in an era in which technology is changing and public expectations are changing."