Despite the promises of nanotechnology, only a few companies have received approval from the U.S. Food and Drug Administration to commercialize nanoscale materials and devices. Many nanosystems are under clinical trial, but only a small portion of them have been successfully commercialized. Innovation, value creation, and other benefits from the commercialization of nanotechnologies can be accelerated by a functional regulatory framework.
In this article I examine the current regulatory regime and propose a number of policies that could facilitate commercialization of nanotechnology products.
Nanotechnology / What is nanotechnology? It is the systematic application of scientific research at the nano level. A nanometer (nm) is the unit of length in the metric system equal to one billionth of a meter. As a sense of scale, consider that the width of a human hair is around 80,000nm.
At the nanometer level, chemical reactivity as well as magnetic and electrical properties change. A more formal definition offered by the federal government’s National Nanotechnology Initiative website describes it as “the understanding and control of matter at the nanoscale, at dimensions between approximately 1 and 100 nanometers, where unique phenomena enable novel applications.” For example, nanostructures can pass through biological barriers without triggering the immune system. While this generates incredible opportunities for health care, it also raises concerns about safety.
FDA regulation / The FDA is a key regulator of nanotechnology. And yet the agency has acknowledged that it cannot adequately regulate (medical) products of “new sciences” such as nanotechnology. “This compromises not only the public health mission since the Agency cannot effectively regulate products built on emerging science, but it also hamstrings the Agency’s ability to support innovation in the industries and markets that it regulates,” noted a 2007 report by an FDA Science Board subcommittee
The FDA has two main problems dealing with the regulatory complexity of nanotechnology. The first is a lack of scientific expertise. The agency recognizes that it has a weak scientific base and organizational structure, which is supported by an inadequate information technology infrastructure.
The second problem is a mismatch between the existing organizational culture of the FDA and the realities of nanotechnology. The FDA and similar organizations usually have complex structures and contain diverse subdivisions. Moreover, “each center and each regulated product category has its own statutory requirements and regulatory criteria,” as noted in a 2009 paper by Gary Marchant, Douglas Sylvester, and Kenneth Abbott. Each of those regulated product categories resulted from a particular crisis that provoked legislation. Much of the current FDA culture stems from the thalidomide birth defects scandal of the early 1960s and the 1962 amendments to the federal Food and Drug Act that mandated the current regime of requiring clinical trials to prove the safety and effectiveness of new prescription drugs. Nanotechnology does not fit easily and clearly within that framework and culture. As a result, significant delays and transaction costs in the commercialization of nanotechnology products may occur.
In June 2014, the FDA issued one draft and three final guidance documents related to the use of nanotechnology. As the terminology suggests, rather than being binding, they are representative of the FDA’s current thinking. The good news is that the FDA says it will focus on the finished product rather than on the nanotechnological aspects of the manufacturing process. The bad news is that while the guidance refers to the definition of nanotechnology as having at least one dimension in the nanoscale range (1nm to 100nm), it can include materials or end products that could exhibit specific properties, the dimensions of which fall outside the nanoscale range (up to 1,000nm). Taking into account the uncertainty of measurement at this level, the definition of these particular properties can be quite complicated and vague.
The U.S. Environmental Protection Agency also claims regulatory jurisdiction over nanotechnology. Many nanotechnologies are regarded as “chemical substances” controlled by the Toxic Substances Control Act (TSCA). The EPA has imposed four new sets of rules for nanotechnology under the TSCA. Thus a nanostructure might receive approval from the EPA but not the FDA, or the other way round, thus delaying innovation commercialization. An example is the aggressive approach by the EPA to regulating nanoscale silver. In contrast, nanosilver is extensively used in drugs, foods, and medical devices under the approval of the FDA.
Policy suggestions / What can be done to clarify and expedite nanotechnology regulation? My first suggestion is to ensure a clear and widely accepted definition of nanotechnology. Based on previous arguments regarding dimensions, a clear definition would help firms understand what is and is not regulated.
Because nanotechnology transcends regulatory agencies, cooperation and coordination among different organizations are vital. This should include not only state and federal agencies, but also international organizations. The EPA, for example, is working collaboratively with the Organization for Economic Cooperation and Development and the International Organization for Standardization.
The participation of the private sector in setting standards, best practices, and self-regulation is essential. Public–private partnerships would encourage transparency through the participation of the entrepreneurial stakeholders in the regulatory process. Additionally, these partnerships would build capacity by providing technical skills, risk analysis, research, and knowledge sharing.
But the most important feature is to establish nonarbitrary methodology to assess not only the risks and costs of nanotechnology, but also the benefits. “Benefit-Cost analysis can play an important role in legislative and regulatory policy debates,” Kenneth Arrow and coauthors noted in a 1996 Science article. The “Stanford Model” of risk assessment, as described by Henry Miller (“The Use and Abuse of Science in Policymaking,” Summer 2012), could be a useful paradigm for risk-based regulation for nanotechnologies. It is a flexible protocol that could easily be applied to the commercialization of different kinds of technologies, industries, and regulatory preferences.
Readings
- “Angstrom Medica: Securing FDA Approval and Commercializing a Nanomedical Device,” by Andrew S. Baluch. Nanotechnology Law and Business, Vol. 29, No. 2 (2005).
- “Cancer-fighting Nanorobot May Be Able to Target Tumors, Spare Healthy Tissue,” by Michelle Castilo. CBS/Reuters, January 6, 2014.
- “EPA Targets Nanotechnology: Hi-Ho, Nanosilver, Away?” by David L. Wallace and Justin A. Schenck. Nanotechnology Law & Business, Vol. 11 (2014).
- “FDA Science and Mission at Risk: Report of the Subcommittee on Science and Technology,” produced by the U.S. Food and Drug Administration Science Board. 2007.
- “Is There a Role for Benefit–Cost Analysis in Environmental, Health, and Safety Regulation?” by Kenneth Arrow et al. Science, Vol. 272 (1996).
- “Nanomedicines and Nanodiagnostics Come of Age,” by Ijeoma Uchegbu and Adeline Siew. Journal of Pharmaceutical Sciences, Vol. 102, No. 2 (2013).
- “Nanoscience and Nanotechnologies: Opportunities and Uncertainties,” produced by the Royal Society. July 30, 2004.
- “Nanosilver and Global Public Health: International Regulatory Issues,” by Thomas Faunce and Aparna Watal. Nanomedicine, Vol. 5, No. 4 (2010).
- “Nanotechnology Regulation: The United States Approach,” by Gary Marchant, Douglas Sylvester, and Kenneth Abbott. In New Global Frontiers in Regulation: The Age of Nanotechnology, edited by Graeme Hodge, Diana Bowman, and Karinne Ludlow; Edward Elgar, 2007.
- “The Use and Abuse of Science in Policymaking,” by Henry I. Miller. Regulation, Vol. 35, No. 2 (Summer 2012).
- “What It Is and How It Works,” web-published by the National Nanotechnology Initiative, 2015. www.nano.gov/nanotech-101/what.
