1. Definition & Regulatory Context
Definition of Custom-Made Devices (CMDs)
Under Article 2(3) of the EU MDR, a custom-made device is defined as any medical device specifically made in accordance with a written prescription provided by a qualified medical professional, indicating the design characteristics and intended use of the device, and intended solely for the use of a particular patient. These devices are not mass-produced and are not intended to be made in batches. A key distinction is made between truly custom-made devices and mass-produced devices that are merely adapted to individual patients; the latter do not qualify as CMDs under MDR and are subject to standard conformity assessment procedures.
Definition of Niche Market Devices
Niche market devices refer to medical devices that are developed for highly specific, low-volume clinical applications, such as treatment of rare diseases, pediatric conditions, or specialized surgical procedures. These devices often serve a small patient population or meet unique anatomical or functional needs that cannot be addressed through mass-produced products. Examples include certain orthopedic implants for congenital deformities, customized prosthetic components, or highly specialized diagnostic tools. Though not formally defined in the MDR, they are impacted significantly because MDR requirements are volume-independent, meaning even these low-scale, high-need products must meet the full regulatory burden.
Regulatory Framework Under MDR
The EU MDR (Regulation (EU) 2017/745), which replaced the Medical Devices Directive (MDD), significantly expands regulatory oversight, including for custom-made and niche devices. Although CMDs remain exempt from conformity assessment by a notified body, MDR imposes new obligations on manufacturers, such as comprehensive documentation requirements, a detailed statement of manufacture, implementation of a quality management system (QMS), and post-market surveillance (PMS) responsibilities. For niche devices, the MDR offers no specific exemptions or streamlined pathways, even though these products face unique challenges related to cost-efficiency and scalability. The regulation applies the same clinical evaluation, risk management, and technical documentation standards to all devices regardless of market size or frequency of use.
Challenges in Regulatory Interpretation
One of the core challenges introduced by MDR for CMD and niche device manufacturers is the ambiguity in interpretation and the lack of tailored guidance. While CMDs are technically exempt from notified body involvement, there is considerable variation among EU member states in how these exemptions are interpreted and enforced, particularly regarding hospital-based manufacturing or 3D-printed patient-specific devices. In the case of niche market products, MDR does not provide specific provisions to ease the regulatory burden, which creates uncertainty for companies developing innovative solutions for rare or low-incidence conditions. This has led many stakeholders to call for harmonized EU-wide interpretations and potentially new regulatory categories.
Custom-Made Devices (CMDs)
As per Article 2(3) of MDR:
A CMD is “any device specifically made in accordance with a written prescription… for the sole use of a particular patient”.
Not to be confused with mass-produced devices adapted to a specific patient, which do not qualify as CMDs.
Niche Market Devices
These include:
- Devices for rare diseases
- Devices for small surgical specialties (e.g., pediatric cardiology)
- Low-volume, innovative products
- Orphan devices (e.g., pediatric orthopedic implants)
2. MDR vs MDD: Regulatory Shift
Scope and Definitions
Under the Medical Device Directive (MDD 93/42/EEC), the scope of regulation was narrower and focused primarily on the general safety and performance of medical devices. The EU Medical Device Regulation (MDR 2017/745), which replaced the MDD in May 2021, significantly expands the scope. MDR now explicitly includes devices without a medical purpose (e.g., aesthetic products like colored contact lenses), software as a medical device (SaMD), and reprocessed single-use devices. The broader scope under MDR reflects an effort to align regulatory controls with technological advances and evolving healthcare applications.
Clinical Evaluation and Evidence Requirements
The MDD allowed for more flexible clinical evaluation approaches, often accepting literature reviews or equivalence data as sufficient for device approval. In contrast, MDR mandates a far more rigorous and structured clinical evaluation process. Manufacturers must now provide robust clinical data, typically derived from clinical investigations, especially for higher-risk devices. Equivalence can still be used but under stricter conditions, such as full access to technical documentation of the equivalent device. This shift demands substantial investment in clinical studies, which can be particularly burdensome for small and medium enterprises (SMEs) and low-volume product lines.
Classification Rules
MDR introduces 22 classification rules compared to the 18 rules in MDD, with several modifications that lead to the up-classification of many devices. For example, under MDR, certain software, nanomaterials, and reusable surgical instruments are now classified under higher risk classes. This means that devices previously considered Class I under MDD may now require Notified Body oversight under MDR. The revised rules aim to ensure that newer and more complex technologies are subject to appropriate regulatory scrutiny, but they also increase the regulatory burden for manufacturers.
Role of Notified Bodies
Under MDD, many low-risk devices (Class I) could be self-certified by manufacturers without involvement from a Notified Body (NB). MDR significantly reduces the range of devices eligible for self-certification. Now, even many Class I reusable surgical instruments and up-classified devices require NB review. Furthermore, MDR places more stringent requirements on Notified Bodies themselves, including re-designation under new criteria, which has led to a temporary reduction in the number of available NBs. This bottleneck has created substantial delays in device certifications and market access.
Technical Documentation
The requirements for technical documentation have been significantly enhanced under MDR. While MDD allowed more flexibility and variation in format, MDR standardizes documentation and increases the level of detail required. Annex II and Annex III of MDR prescribe detailed expectations for technical files, covering general safety and performance requirements (GSPRs), risk management, benefit-risk analysis, design verification, and clinical evaluation. This has led to a substantial increase in workload for regulatory affairs teams and often requires significant updates to legacy documentation.
Post-Market Surveillance (PMS) and Vigilance
MDD placed limited and loosely defined obligations on manufacturers regarding post-market surveillance. MDR introduces detailed, proactive, and systematic PMS requirements for all device classes. Manufacturers must now prepare and maintain PMS plans, periodic safety update reports (PSURs), and post-market clinical follow-up (PMCF) plans and evaluations. These requirements aim to enhance continuous monitoring of device performance and safety once on the market but require ongoing investment in regulatory infrastructure, especially burdensome for low-resource organizations.
EUDAMED and Transparency
One of the major reforms introduced by MDR is the creation of EUDAMED (European Database on Medical Devices), designed to centralize and increase transparency in device regulation across the EU. Under MDD, there was no centralized EU-wide database, and information was scattered across national authorities. MDR mandates the registration of economic operators, UDI (Unique Device Identification) systems, clinical investigations, PMS data, and certificates in EUDAMED. Although not fully functional as of mid-2025, the database is expected to become mandatory in phases, further increasing compliance obligations and visibility.
Unique Device Identification (UDI)
The MDR introduces a comprehensive UDI system to improve device traceability throughout the supply chain. MDD did not require a standardized identification system, which made recall management and tracking difficult. MDR’s UDI requirements apply to nearly all devices and mandate labeling, registration in EUDAMED, and integration into PMS processes. While the UDI system enhances safety and supply chain control, it also imposes logistical challenges and cost implications, especially for companies with broad or complex product lines.
Transition and Legacy Devices
Under the MDD, devices could remain on the market with indefinite validity of CE certification, as long as no significant changes were made. The MDR introduces strict deadlines for transition, with original CE certificates expiring at fixed intervals, now extended under Regulation (EU) 2023/607 to 2027–2028 depending on risk class. Legacy devices (MDD-certified) may stay on the market temporarily, but must still meet MDR requirements for PMS, vigilance, and registration. This has created uncertainty for manufacturers managing multiple product lifecycles and increased pressure to prioritize recertification strategies.
Summary of Impact
The shift from MDD to MDR represents a fundamental transformation of the EU’s regulatory framework for medical devices, from a largely self-regulated model to one of tight, centralized control with high data and compliance expectations. While this change aims to improve patient safety, product performance, and regulatory harmonization, it also introduces significant complexity and cost. Custom-made devices, SMEs, and niche market products are particularly challenged under MDR, and many stakeholders are calling for streamlined pathways or risk-based adaptations to preserve innovation and ensure continued access to essential medical technologies.
| Aspect | MDD (Old) | MDR (New) | Impact on CMDs & Niche Devices |
|---|---|---|---|
| Clinical Evidence | Minimal for CMDs | More structured documentation needed | Increases cost & complexity |
| Oversight | CMDs excluded from NB oversight | Still exempt, but tighter scrutiny | Indirect burden via PMS, registration |
| Documentation | Simple manufacturer statement | Detailed “Statement of Manufacture” (Annex XIII) | Many SMEs lack resources |
| Registration | National systems | EUDAMED mandatory (once fully functional) | Delays, confusion, data issues |
| PMS / Vigilance | Basic | Required for CMDs and niche devices | Complex reporting for small firms |
| Orphan/rare devices | No distinction | No exemptions under MDR | Threatens market sustainability |
3. Consequences for Custom-Made Devices & Niche Markets
Economic Viability Under Threat
One of the most significant consequences of the EU MDR for custom-made and niche market devices is the threat to their economic viability. These devices typically serve small patient populations or are tailored for individual use, meaning they are produced in very low volumes. However, the fixed costs of compliance under MDR—such as implementing a full quality management system (QMS), generating clinical evaluation reports, and maintaining post-market surveillance—are comparable to those for high-volume mass-produced devices. This disproportionate cost-to-volume ratio makes it economically unfeasible for many manufacturers to continue offering certain CMDs or niche devices, especially when reimbursement rates have not kept pace with the rising regulatory burden. As a result, many products are being withdrawn from the EU market, despite their continued clinical utility.
Shrinking Access to Specialized Innovations
The EU MDR has led to reduced access to innovative, highly specialized devices, particularly in fields like pediatric care, rare disease treatment, and complex reconstructive surgery. These innovations often begin as low-volume, custom-made solutions developed collaboratively between clinicians and small manufacturers. However, the stringent and uniform MDR requirements now applied across all device classes make it difficult for such innovations to reach the market or to continue being offered. Companies are forced to delay development timelines, abandon promising R&D projects, or choose not to pursue MDR certification for low-volume products. This slows the pace of innovation and may limit clinicians’ ability to offer the best possible care in complex or individualized cases.
Struggles for Small and Medium Enterprises (SMEs)
The new regulatory demands are particularly burdensome for SMEs, which make up the majority of CMD producers and manufacturers operating in niche segments. Most SMEs lack in-house regulatory expertise and cannot easily absorb the cost of hiring dedicated MDR consultants or expanding their compliance departments. Tasks such as producing technical documentation, performing clinical evaluations, and implementing the new post-market surveillance protocols require significant resources. For many SMEs, the costs outweigh the profits that could be made from their niche products. This has led to consolidation in the industry, withdrawal from certain markets, and even closure of smaller firms, which ultimately reduces competition and diversity in device offerings.
Clinical Risks and Patient Impact
The withdrawal or delayed availability of custom-made and niche devices can have direct clinical implications. In the absence of appropriate specialized products, healthcare providers may be forced to use more generic, less suitable alternatives, potentially compromising patient outcomes. In pediatric or rare disease care, for example, there may be no safe or effective substitutes available. Delays in obtaining devices that require MDR certification can also postpone surgeries or treatments, which can be critical in time-sensitive or progressive conditions. There is growing concern among clinicians that such regulatory-driven supply issues are beginning to impact the standard of care in certain specialties.
Increased Reliance on Workarounds and Off-Label Use
As the regulatory environment becomes more complex, some hospitals and clinicians are increasingly resorting to workarounds such as repurposing existing devices for off-label uses or relying on older devices that are no longer formally supported or manufactured. While these practices may fill short-term clinical gaps, they introduce legal, safety, and liability risks. In some cases, hospital-based manufacturing exemptions under Article 5(5) of MDR are being explored, but these come with their own administrative and compliance burdens. Overall, the result is a growing tension between regulatory compliance and the clinical imperative to provide timely, individualized patient care.
A. Economic Viability Threatened
- High cost of compliance (~€50k–€200k per device line)
- Small volume → No economies of scale
- Many CMD manufacturers considering exiting the EU market
- Some clinicians report discontinuation of essential devices
B. Access to Innovation Shrinking
- Delay or abandonment of highly specialized or customized innovations
- Off-label use risks increase as alternatives vanish
- Pediatric or rare-disease segments hit hardest
C. SMEs Struggling
- Most CMDs made by SMEs or hospital-based units
- Limited resources to implement full QMS, PMS, vigilance, UDI compliance
- Growing dependency on consultants and regulatory outsourcing
D. Clinical Risks
- Hospitals/customers might be forced to use standardized, less-suited devices
- Delay in surgeries due to device unavailability
- Poorer patient outcomes for rare conditions
4. Real-World Examples (2023–2025)
Orthopedic Implants and Revision Surgeries
Under the MDR, several European manufacturers producing custom orthopedic implants for complex revision surgeries (such as hip or knee reconstructions) have either scaled back production or entirely withdrawn certain product lines from the EU market. These implants, often designed for patients with unique bone structures or post-traumatic deformities, previously required only a simple design file and patient prescription. Now, manufacturers must provide extensive documentation on material traceability, quality management, and post-market surveillance—even for one-off cases. One major orthopedic company in Germany reported discontinuing its bespoke femoral and acetabular components due to unsustainable compliance costs, resulting in delayed surgeries and increased patient referrals to non-EU facilities.
Pediatric Cardiology and Congenital Conditions
Manufacturers specializing in low-volume pediatric cardiology devices, particularly catheters and stents designed for congenital heart defects, have been severely affected. These devices often serve very small patient populations and must be tailored to unique anatomical variations in infants and toddlers. Under MDR, these are now classified as Class IIb or III devices, requiring extensive clinical data and notified body review. A Dutch-based SME that produced such pediatric stents ceased operations in early 2024, citing insurmountable regulatory costs. Pediatric cardiologists across Belgium and the Netherlands reported the loss of critical tools for minimally invasive interventions, forcing reliance on adult-sized alternatives or riskier open-heart surgeries.
Dental and Maxillofacial Custom Devices
The dental sector, especially custom-made dental prostheses and maxillofacial implants, has experienced a sharp rise in compliance burdens. Dental labs, many of which are small family-run businesses, now must maintain detailed technical documentation, implement a compliant Quality Management System (QMS), and register each device with EUDAMED once fully active. In France and Italy, more than 30% of dental labs reported a doubling of compliance-related costs, and some rural regions experienced a shortage of labs willing to produce custom implants due to the administrative burden. This has translated into longer wait times for dental reconstruction, particularly in oncology cases requiring rapid post-surgical prosthetics.
Custom Cranial Implants for Neurosurgical Use
Hospitals and device developers producing custom cranial plates for neurosurgical reconstruction (e.g., post-trauma or tumor resection) have also faced delays and complications. Previously, hospitals could 3D-print cranial implants under a surgeon’s prescription and deliver them within 48 hours. Under MDR, even in-house manufacturing under Article 5(5) requires compliance with nearly full MDR standards, including documentation, risk assessment, and traceability. A major university hospital in Spain temporarily halted its custom implant unit in 2023, pending legal clarity on its obligations under MDR. The outcome was a significant delay in cranial reconstruction surgeries, with some patients being sent abroad for care or fitted with standard-sized plates.
Rare Disease Diagnostic Devices
Manufacturers of in vitro diagnostic (IVD) devices for rare genetic or metabolic disorders have also seen adverse effects, especially with the parallel implementation of IVDR (EU 2017/746). Several custom kits that were previously used in specialist labs for diagnosing ultra-rare diseases are now either discontinued or facing approval delays due to insufficient patient data to support clinical performance studies. An Austrian firm specializing in biochemical assays for lysosomal storage diseases halted EU distribution in 2024 after failing to secure IVDR certification, citing high costs and an absence of specific guidance for rare diagnostics. Consequently, clinicians now report cross-border testing delays and reduced diagnostic options for these life-threatening conditions.
- Orthopedic Implants: Custom femoral components in revision knee arthroplasty discontinued by some EU manufacturers.
- Pediatric Cardiology: Specialized catheters used for congenital heart diseases withdrawn.
- Dental & Maxillofacial Devices: Dental labs report >30% cost increase and >6 months of documentation effort.
5. Proposed Solutions and Industry Adaptation
Centralized CMD Exemption Registry
A prominent industry proposal is the creation of a centralized EU-level registry for custom-made device exemptions. Under current MDR rules, CMD manufacturers must generate detailed documentation for each device, even if it follows a consistent template for multiple patients. A centralized registry would simplify recurring device approvals by allowing manufacturers to reference previously submitted documentation, thereby reducing redundant effort and review timelines. This approach has received support from medical associations and manufacturers, particularly in fields like orthopedics and dental prosthetics where device design is frequently customized yet technically similar. However, regulatory implementation has been slow, and such a registry remains under discussion at the EU level.
Hospital Exemptions and In-House Manufacturing
Article 5(5) of the MDR provides a legal basis for hospital-made, in-house devices to be used without full MDR compliance, provided they meet stringent conditions. This provision has been seen as a potential lifeline for certain niche and emergency-use devices. Some large academic and university hospitals have started setting up internal manufacturing and quality control frameworks to take advantage of this exemption. However, interpretation and enforcement vary significantly by EU member state, making cross-border use of these devices legally and logistically complex. Additionally, most smaller hospitals lack the infrastructure to maintain MDR-compliant in-house manufacturing, limiting the scope of this solution.
Portfolio Optimization by Manufacturers
Faced with increased regulatory burden and rising costs, many manufacturers have begun strategically optimizing their product portfolios. This means discontinuing low-volume, high-cost devices — even if clinically important — and focusing on products with higher revenue potential or broader indications. While this improves financial viability under MDR, it negatively affects patients with rare conditions who rely on discontinued devices. For example, certain pediatric orthopedic implants and low-use cardiovascular products have been withdrawn from the EU market due to lack of commercial justification. This strategy is a pragmatic adaptation, but it underscores the limitations of the MDR in supporting low-volume, high-value innovation.
EU-Wide Reimbursement Support Advocacy
Stakeholders have also been lobbying for increased EU-level and national reimbursement support specifically for custom-made and niche medical devices. The argument is that higher pricing and reimbursement would help offset the increased regulatory and compliance costs imposed by the MDR. However, progress in this area has been limited. Reimbursement remains highly fragmented across EU countries and is not directly influenced by MDR provisions. Nonetheless, some countries — such as Germany and the Netherlands — are beginning to evaluate new pricing models that account for regulatory costs in rare-use medical technologies, which could become a model for wider adoption.
Automation and Digital Workflow Integration
An emerging trend, particularly in the dental and prosthetics sectors, is the integration of advanced digital design and documentation systems. These systems use computer-aided design (CAD), 3D modeling, and automated generation of technical documentation to comply with MDR requirements more efficiently. By integrating these tools with quality management systems (QMS), manufacturers can reduce human error, streamline custom device design workflows, and ensure consistent documentation. This adaptation is particularly helpful for high-frequency CMD producers like dental labs, enabling them to remain competitive despite increased administrative requirements. While initial investment in such digital infrastructure can be significant, long-term cost savings and compliance benefits are increasingly recognized by industry leaders.
| Strategy | Details | Adoption |
|---|---|---|
| Centralized CMD Exemption Registry | Proposed by industry to simplify recurring CMD approvals | Still under discussion |
| Hospital Exemptions / In-House Manufacturing | Article 5(5) allows for hospital-made devices exemption | Complex, country-specific interpretation |
| Portfolio Optimization | Focus only on devices with highest clinical/economic value | Widely used, but cuts off rare indications |
| EU-Wide Reimbursement Support | Lobbying for higher reimbursement for niche/CMDs | Limited progress |
| Digital Workflow Automation | CAD-based systems to auto-generate documentation (e.g., dental CMDs) | Emerging trend among dental labs and prosthetic companies |
6. Comparison with Other Jurisdictions
United States (FDA)
In the United States, the Food and Drug Administration (FDA) regulates custom-made devices under the Custom Device Exemption (CDE) policy. This allows manufacturers to produce devices tailored for individual patients without undergoing the full premarket approval (PMA) or 510(k) clearance process, provided certain criteria are met. The CDE permits manufacturing of no more than five units per year per device type, per manufacturer, for use by a specific physician. This flexibility greatly benefits patients with rare conditions or unique anatomical needs. Additionally, FDA maintains a relatively pragmatic approach to regulating low-volume or niche-use products, often offering streamlined pathways like Humanitarian Device Exemptions (HDEs) for devices intended to treat diseases affecting fewer than 8,000 individuals annually in the U.S. This contrasts sharply with the EU MDR, where no such tailored exemptions currently exist for orphan devices or CMDs, thereby making the U.S. regulatory environment more supportive of innovation in niche markets.
United Kingdom (MHRA)
Following Brexit, the Medicines and Healthcare products Regulatory Agency (MHRA) has taken over medical device regulation in the UK. For now, the UK continues to allow CE-marked devices under the former EU Medical Device Directive (MDD) or MDR, with extended grace periods up to July 2028 for many devices, including custom-made ones. MHRA has indicated it will introduce a new UK regulatory framework in phases starting from 2025, and early guidance suggests a more risk-proportionate and innovation-friendly regime. For CMDs and niche devices, the UK may provide more regulatory flexibility than the EU, especially in areas such as post-market surveillance and clinical evaluation. Additionally, MHRA is reportedly exploring routes to facilitate early market access for innovative and patient-specific devices, potentially mimicking or adapting the U.S. HDE or CDE-style frameworks. However, current uncertainty over the post-2025 framework means manufacturers remain cautious, awaiting clearer rules.
Switzerland
Switzerland, although geographically in Europe, is not part of the EU and thus subject to separate regulatory arrangements. Previously aligned with EU device regulation through a Mutual Recognition Agreement (MRA), the political stalemate between Switzerland and the EU resulted in the non-renewal of the MRA in 2021. Consequently, Swiss manufacturers now face considerable difficulties accessing the EU market, and vice versa. For custom-made and niche devices, this has created a regulatory vacuum, where such products must comply both with Swiss law (which mirrors EU MDR in many respects) and with EU MDR for export. This dual compliance is especially burdensome for SMEs and local labs producing CMDs, leading to increased operational costs and market exits. Moreover, Switzerland lacks equivalent frameworks like the U.S. HDE or CDE, limiting flexibility for low-volume or highly specialized devices. Hospitals and physicians in the country report delays in acquiring essential CMDs due to the new cross-border regulatory hurdles.
Japan (PMDA)
In Japan, medical device regulation is governed by the Pharmaceuticals and Medical Devices Agency (PMDA) under the Pharmaceutical and Medical Device Act (PMD Act). Japan offers more flexible approval processes for niche and orphan devices, particularly through systems like the Orphan Device Designation and Fast Track Review for devices targeting rare diseases or specific pediatric applications. The PMDA works closely with manufacturers to provide regulatory consultation and clinical strategy alignment, which helps reduce the burden for companies developing low-volume or custom devices. For custom-made products, Japanese regulations recognize the need for tailored solutions and allow certain devices to be manufactured and used under a physician’s responsibility, provided safety protocols are met. Compared to the EU MDR, Japan’s system is relatively more accommodating to patient-specific needs and emphasizes clinical utility over bureaucratic uniformity, making it a more innovation-friendly environment for CMDs and niche markets.
| Region | CMD/Niche Device Treatment | Impact |
|---|---|---|
| United States (FDA) | Custom Device Exemption (CDE) for <5 patients/year | More permissive, faster access |
| UK (MHRA) | Accepts MDD/CE legacy up to 2028, working on UK MDR | Slightly easier for SMEs right now |
| Switzerland | Aligned with MDR; issues with EU access due to MRA split | Very challenging for exports |
| Japan (PMDA) | Exemptions for orphan and pediatric devices available | Encourages development in niche areas |
7. Policy Recommendations
Introduction of a Dedicated MDR Annex for Orphan and Niche Devices
To address the disproportionate regulatory burden faced by low-volume and highly specialized medical devices, the European Commission should consider introducing a dedicated annex or regulatory track within MDR that mirrors the “orphan drug” model used in pharmaceuticals. Such an annex would define eligibility criteria for devices intended for rare diseases, pediatric use, or small patient populations, and provide streamlined requirements for clinical data, post-market surveillance, and documentation. This would protect the availability of critical yet economically nonviable technologies that serve vital clinical needs.
Simplified Compliance Framework for Custom-Made Devices
Custom-made devices are typically developed by small manufacturers or hospital-based units and are tailored for individual patients. Current MDR requirements impose a complex set of documentation and quality assurance processes, even though these devices are exempt from notified body conformity assessment. To relieve this burden, a simplified and standardized compliance pathway specifically designed for CMDs should be developed. This could include modular templates for the statement of manufacture, risk management, and post-market monitoring, enabling efficient compliance while preserving patient safety.
Expansion of Article 5(5) Exemptions for In-House Devices
Article 5(5) of the EU MDR allows hospitals and healthcare institutions to manufacture and use devices in-house, bypassing full MDR conformity under specific conditions. However, interpretation and implementation of this clause vary significantly across EU Member States, creating uncertainty. Expanding the scope of Article 5(5) to explicitly include inter-hospital collaboration and multi-institutional use of CMDs could help hospitals maintain access to critical devices without facing industrial-scale compliance requirements. Clearer EU-level guidance would reduce legal ambiguity and promote safe, innovative solutions within public health systems.
Establishment of Regulatory Sandboxes for Innovative Niche Devices
Regulatory sandboxes—controlled environments where regulators can interact with manufacturers developing innovative or unproven technologies—should be extended to niche and custom-made devices. These frameworks can provide real-time feedback, temporary exemptions, and early-stage clinical data acceptance pathways. Sandboxes would allow SMEs and hospital labs to test new designs and gather preliminary clinical data before entering full MDR compliance, thereby accelerating development without compromising safety or oversight.
Financial and Reimbursement Incentives for Low-Volume Devices
Due to the high cost and low return on investment associated with many niche and CMD products, economic support is essential to ensure their continued availability. EU health authorities and member states should consider targeted funding programs, innovation grants, or differentiated reimbursement schemes to incentivize the development and MDR certification of these devices. Just as orphan drugs receive market exclusivity and reimbursement benefits, devices serving rare patient populations should be similarly supported through fiscal policies to maintain a diverse and responsive healthcare ecosystem.
- Introduce an MDR Annex for Orphan/Niche Devices – similar to orphan drug pathways.
- Establish a Simplified MDR CMD Framework – with lower documentation burden.
- Strengthen Regulatory Sandboxes – for low-volume innovative products.
- Expand Article 5(5) Scope – to allow inter-hospital collaboration under exemptions.
- Incentivize CMD development – through EU funding or reimbursement support.
Conclusion
Regulatory Uniformity Disproportionately Impacts Low-Volume Devices
The EU MDR introduces a uniform regulatory framework intended to improve device safety, transparency, and traceability across all medical devices. However, this uniformity has disproportionately burdened custom-made and niche market devices, which often serve highly specific patient needs or rare conditions. The lack of regulatory flexibility in the MDR does not reflect the operational and clinical realities of these segments, where device production is often low-volume and tailored to individual patients. Applying the same stringent clinical, technical, and post-market requirements to these categories as those used for mass-produced devices creates excessive overhead, making compliance economically unviable for many small manufacturers.
Economic Pressures Threaten Product Continuity and Innovation
Under the MDR, the cost of maintaining or introducing niche and custom-made devices has escalated dramatically, with certification, documentation, and quality system requirements demanding both time and capital. For many small and medium-sized enterprises (SMEs), this has led to product line rationalization or complete market withdrawal. In some cases, manufacturers have chosen to exit the EU market altogether. This contraction affects not just the businesses involved but also the broader healthcare ecosystem by reducing access to specialized tools needed for complex or rare conditions. It also discourages innovation in precisely the areas where tailored solutions are most necessary.
Patient Access and Clinical Outcomes at Risk
The most concerning consequence of MDR’s rigid framework is its impact on patient care. As niche and custom-made devices become harder to produce or access, clinicians are left with fewer therapeutic options, especially for pediatric patients, individuals with rare diseases, or those requiring revision or reconstructive procedures. In some cases, hospitals are forced to resort to suboptimal alternatives or delay treatments, directly impacting health outcomes. The erosion of access to such devices could lead to increased off-label usage or reliance on outdated technologies, undermining the safety and efficacy principles that the MDR was designed to uphold.
Fragmented Implementation Further Complicates Compliance
Although the MDR is an EU-wide regulation, the actual implementation of specific provisions—such as hospital exemptions under Article 5(5), registration of custom-made devices, and clinical evaluation expectations—varies significantly across member states. This fragmentation creates additional uncertainty and inconsistency for manufacturers operating in multiple countries. The complexity is further compounded by the incomplete rollout of EUDAMED, the central European database meant to streamline device tracking and transparency. Until harmonization improves, even manufacturers with the intent and resources to comply are challenged by inconsistent national interpretations and evolving guidance.
The Need for Policy Reform and Targeted Support
To mitigate these consequences, targeted policy reforms are urgently needed. These could include the creation of a specific annex for orphan and niche market devices, simplified regulatory tracks for custom-made devices, and expanded allowances for hospital-based manufacturing. Additionally, increased EU-level funding, regulatory sandboxes, and innovation-friendly incentives would help SMEs continue to serve specialized clinical needs without being driven out of the market. If MDR is to remain viable for all segments of the healthcare industry, it must evolve to accommodate the diversity of devices, patients, and clinical contexts that make up modern medicine.
The EU MDR, while improving patient safety and market transparency, does not adequately accommodate the unique realities of custom-made and niche market devices. The uniformity of requirements, combined with the lack of economic incentives or regulatory flexibility, is discouraging innovation, limiting access, and causing product withdrawals in critical care areas.
If not addressed through policy reform, targeted guidance, or regulatory tailoring, these unintended consequences could have long-term negative effects on clinical care, innovation, and health equity across Europe.