The health institution exemption ('HIE') allows certain health organisations to manufacture or modify medical devices for use within that institution without meeting the full requirements of the Medical Devices Regulations 2002 ('UK MDR 2002'). Many NHS hospitals and private healthcare providers rely upon the exemption to enable them to provide access to innovative, tailored medical devices especially for complex cases where there are unique patient needs. However, the scope of the exemption and its practical application have always given rise to much uncertainty.
The Medicines and Healthcare products Regulatory Agency ('MHRA') is working to refine its policy and guidance on the HIE in Great Britain to align with the government’s strategies, including the 10 Year Health Plan for England and the Life Sciences Sector Plan. Over the summer, the MHRA invited stakeholders to share information on how the exemption was being used in practice. The findings - Health Institution Exemption – Stakeholder survey: Call for Evidence Analysis Summaries - GOV.UK – make for reassuring reading, recognising the many aspects that would benefit from clarification. It is to be hoped that the updated guidance now expected from the MHRA will address these concerns.
The current operation of the HIE
The HIE, also known as in-house manufacture, refers to medical devices that are made in a healthcare establishment for use by its patients within that establishment. A healthcare establishment is defined as a body that provides care for patients and promotes public health, such as an NHS hospital.
The UK MDR 2002 actually specifies that the exemption is only applicable to in vitro diagnostic medical devices (IVDs). However, although not specifically stated, MHRA guidance applies to both IVDs and general medical devices, and the in-house manufacturing exemption can apply to all medical devices assuming the guidance is followed.
If the exemption is not applicable then the health organisation, as manufacturer, must ensure the medical device complies with the conformity assessment and CE or UKCA marking procedures.
The outcome of the call for evidence
To shape future HIE policy, the MHRA sought to build knowledge and understanding as it had limited visibility of current practice since there is no requirement in the UK MDR 2002 for these devices to be registered with the MHRA. It received 137 responses to the public questionnaire it issued. The analysis of the responses revealed a number of common themes that will be familiar to those who use the exemption.
The HIE is vital but its use and understanding varies
Software as a medical device, including AI as a medical device, and general medical devices were the most common device types manufactured under the HIE.
Most respondents indicated they use the HIE to meet unmet clinical needs and because no commercial alternative existed or was suitable. For respondents who did not use the HIE, this was largely because of the availability of a commercial alternative, lack of awareness of the HIE prior to the survey and lack of clarity about its scope of use. Some also employed other regulatory routes such as CE/ UKCA marking or the custom-made devices pathway.
Only a few respondents indicated that some devices they manufactured under the HIE were used outside their health institution’s premises or immediate vicinity, typically being used in patients’ homes, without full compliance to the UK MDR 2002.
Overall, usage varied significantly across organisations, with many citing confusion over key definitions and the scope of the HIE. The need for clearer, risk-proportionate regulations that safeguard patients without limiting innovation was emphasised.
Clearer definitions and device specific guidance are needed
While awareness of the HIE guidance was generally high, only a third of users found the current guidance clear which led to difficulty in applying the HIE consistently.
Clearer definitions of terms like “health institution” and “legal entity” were called for along with practical case studies to illustrate their application, especially as regards working with universities and collaborative partnerships.
There were calls for more detailed content outlining best practices and the HIE's scope of use, including the transfer of devices, use in community care and cross-trust referrals. Respondents also called for more detailed, tailored guidance for specific device types, especially for software, assistive technology, genomics and rehabilitation.
Concerns were also raised on how the current HIE policy fits with the recent rapid advancements in health technology, particularly for software devices.
Strong internal commitment to device safety but limited oversight
Many respondents already met several key requirements in terms of voluntary compliance with the UK MDR 2002, such as meeting relevant essential requirements, standards or common specifications, or producing a technical file.
Most respondents reported adopting a quality management system when manufacturing devices under the HIE, with the vast majority holding a formal ISO certification. Many also maintained comprehensive device documentation, including technical documentation, incident reports, approvals for use records and change management records.
Most respondents confirmed they used incident reporting systems and platforms within their organisation. However, voluntary post-market surveillance and external incident reporting to national systems, such as to the MHRA, were low. Where external reporting did occur, a number of alternative reporting routes were noted.
These findings highlight the need for clearer, more consistent practices and reporting pathways to ensure robust oversight and safety for devices manufactured under the HIE.
Device transfer and care practices
Many respondents called for the scope of the HIE to be expanded to better align with current care practices. This is a particular issue with device transfer although limited off-site use was reported.
Respondents confirmed most devices under the exemption were manufactured and used within the same premises with transfers to other entities or use in patients’ homes being rare. However, many respondents raised concerns on how the inability to transfer devices outside of the “immediate vicinity” could lead to duplication of effort and resources and fragmented delivery of care.
Where such transfers do occur, the MHRA noted that this does raise compliance concerns and that there is a need for clearer rules.
Clinical investigations
Use of the HIE for clinical investigations of medical devices appeared to be limited although there was an indication that this had been increasing over recent years. There was limited information on the circumstances when the HIE may be used during a clinical investigation and the MHRA noted a need for clearer specific guidance on carrying out Clinical Investigations under the HIE.
Next steps
The feedback gathered, including the areas that give rise to uncertainty and concern, will be familiar to all those who seek to rely upon the HIE in providing patients with tailored medical devices as part of their care.
With these insights, it is to be hoped that the MHRA can now provide future guidance that is clear, practical and enables innovative technology to be incorporated safely into patient care.
If you have any questions on the current guidance or the consultation findings, please contact the authors below.
