Canada has classified medical devices into four classes based on risk level associated with the device. Although Class I medical devices are lowest risk devices, companies are still required to abide by certain regulatory obligations. To operate legally in Canada, manufacturers, importers, and distributors of Class I medical devices must hold an MDEL. For a safe and efficient medical device supply chain, Health Canada has proposed certain changes in the MDEL pathway. In this blog, we have discussed the proposed changes in phase II of MDEL and the impact of these changes. Additionally, we have provided tips for companies to adapt to these changes.
What is MDEL?
To legally manufacture or import Class I medical devices in Canada, you must obtain the Medical Device Establishment Licence (MDEL). Additionally, manufacturers may opt to partner with a licensed importer and list their device under the importer’s MDEL. This way manufacturers of Class I medical devices can avoid paying the MDEL application fees.
- Purpose: The MDEL is designed to inform Health Canada about the commercial entities involved in the supply chain of medical devices. The aim is to ensure entities involved are accountability for device quality, safety, and post-market surveillance.
- Who needs MDEL: Manufacturers, importers, and distributors of Class I devices must secure the MDEL.
- Implication for manufacturers: Class I devices are exempt from the need for a specific device licence, which higher-risk devices must mandatorily obtain. However, manufacturers are required to obtain their own MDEL or partner with an importer having a valid MDEL to market their devices in Canada.
What is phase II of MDEL?
Phase II of Health Canada’s MDEL is a strategic overhaul of the regulatory framework. The current MDEL regulatory structure had some challenges for businesses. The requirements for foreign distributors were burdensome and often redundant. Phase II of MDEL is aimed at improving oversight, reducing redundancy, and enhancing supply chain traceability. Modernizing the framework will improve the traceability of non-compliant devices. Additionally, it will strengthen oversight of the growing medical device supply chain in Canada. Phase II builds on Phase I. It is a part of Health Canada’s 2024–2026 Forward Regulatory Plan.
Need for changes in MDEL regulatory framework
Proposed changes in phase II of MDEL aim to balance strong regulatory oversight with reduced administrative burdens for businesses. The changes were driven by a clear need to address regulatory inefficiencies, enhance supply chain oversight, and align with global best practices. We have listed the need for the changes in phase II of MDEL.
- Redundant licensing requirements: Foreign distributors were required to hold an MDEL even when selling only to Canadian importers who already held one. This created unnecessary administrative burdens and duplicated oversight.
- Limited supply chain visibility: Health Canada lacked a clear view of all entities selling medical devices into or within Canada. This made it harder to trace non-compliant products.
- Inconsistent SOP implementation: Inspections revealed gaps in how MDEL holders documented and followed standard operating procedures (SOPs).This weakened the reliability of complaint handling, recalls, and corrective actions.
- Need for agile and a risk-based oversight: The existing framework relied heavily on license suspension, which was often too blunt a tool. This limited Health Canada’s ability to respond proportionately to compliance issues.
4 Proposed changes in phase II of MDEL
- Removal of MDEL requirement for foreign distributors: Foreign distributors will no longer need an MDEL, if they sell exclusively to Canadian importers who already hold an MDEL. This change reduces redundancy and shifts accountability to Canadian license holders. Moreover, it streamlines global supply chains and reduces administrative burden.
- Mandatory supplier lists: All MDEL applicants and holders must submit a list of suppliers, which is defined as “persons” selling into or within Canada. This is required during initial applications and annual renewals. The goal is to improve traceability and enable targeted enforcement against non-compliant entities.
- Strengthened SOP requirements: MDEL holders must establish, implement, and maintain documented procedures for importing and distributing medical devices. This addresses gaps identified during inspections and reinforces operational discipline.
- Risk-based oversight: With these changes, Health Canada has been bestowed with the authority to impose terms and conditions on MDELs instead of suspending them outright. This enables more agile as well as proportionate response and enforcement of action.
What are the impacts of these changes on regulatory compliance?
We have presented the impact of the proposed modifications in phase II of MDEL and changes needed to comply with the latest guidelines.
- Shift from license suspension to targeted terms and conditions: Health Canada now has the authority to impose specific conditions and terms on MDEL holders instead of outright license suspension. This will lead to an agile and risk-based regulatory oversight. Hence, you will need to proactively identify and mitigate compliance gaps to avoid restrictive conditions that will limit operations.
- Enhanced scrutiny of SOPs and record-keeping: Inspectors will focus more intensely on documented procedures for complaints, recalls, and corrective actions. Hence, SOPs must be clearly written and role-specific as well as aligned with updated recall definition. Additionally, it should have robust audit trails.
- Updated recall reporting requirements: Only recalls involving serious injury risks must be reported but with stricter timelines and detailed documentation. Thus, revise recall SOPs to reflect new definitions and reporting windows. Moreover, integrate incident tracking with risk assessment protocols.
- Supplier list mandate: MDEL holders must submit supplier lists during application and renewal phases. Thus, a dynamic supplier database has to be maintained. Moreover, ensure all suppliers meet regulatory expectations. Additionally, use digital tools to automate updates and flag non-compliance
- Foreign distributor exemption: Foreign distributors selling only to Canadian MDEL holders are exempt from securing an MDEL. Thus, Canadian importers must vet foreign partners more rigorously. Additionally, contracts should include compliance clauses and audit rights.
What are the benefits of the proposed changes?
1. Streamlined global supply chain: Removing the MDEL requirement for foreign distributors (who sell only to Canadian MDEL holders) eliminates redundant licensing. Moreover, it reduces administrative burden, accelerates onboarding of international partners, and aligns Canada closely with global regulatory norms.
2. Improved supply chain traceability: Mandatory supplier lists give Health Canada visibility into who is selling medical devices into or within Canada.
3. Enhanced SOP discipline: Strengthened requirements for documented procedures ensure consistent handling of complaints, recalls, and corrective actions. Moreover, it boosts audit readiness, reduces inspection failures, and fosters a culture of accountability.
4. Agile and risk-based oversight: Health Canada can now impose tailored terms and conditions on MDEL holders instead of suspending licenses outright. This minimizes operational disruption while enforcing compliance with precision, especially useful for complex, multi-site organizations.
5. Strategic alignment with global regulators: These changes mirror regulatory trends in the regulatory markets of US, EU, UK, Australia, and Switzerland.
How can companies adapt to the new changes in phase II of MDEL?
- Supplier traceability system: Build or upgrade a centralized database of all suppliers (foreign and domestic). Include supplier name, contact, device class, and regulatory status in the supplier database. Additionally, use digital tools for automation.
- SOP modernization: Revise and standardize SOPs for importing, distribution, complaints, recalls, and corrective actions. Include role-based responsibilities and escalation protocols. Additionally, conduct mock audits to test SOP effectiveness.
- Risk-based partner vetting: Strengthen due diligence for foreign distributors. Implement contractual compliance clauses. Moreover, schedule periodic partner audits or reviews.
- Recall procedure alignment: Update recall SOPs to reflect new definitions and reporting thresholds. Create templates for initial and final recall reports. Additionally, train staff on incident triage and reporting workflows.
- Digital QMS integration: Embed the new changes in phase II of MDEL into your digital quality management system. Use dashboards to monitor supplier status, SOP updates, and recall events. Additionally, enable alerts for regulatory deadlines and renewal cycles.
For any queries on the proposed changes in phase II of MDEL or for MDEL application assistance, email at [email protected] or call/Whatsapp on 9996859227.
