JACE Systems

Foreign Compliance Case Study (May 2017)

BACKGROUND

JACE Systems designs and manufactures continuous passive motion equipment (CPM) used by patients 

recovering from orthopedic surgery for rehabilitation. It was founded in 1989 and has 12 employees. 

International represents 12% percent of sales.

EUROPEAN MARKET

In the US, JACE’s equipment is categorized as a low risk, Class I medical device. Although the company is an 

FDA licensed medical device manufacturer with 510K clearance, its Class I products do not require an FDA 

audit. However, as JACE explains, in Europe its product is a higher risk Class 2A, because it has an electric 

motor − even though “our product is basically exercise equipment.”

JACE got its first CE Mark in 2009. CE Mark is used in the EU to indicate compliance with all applicable 

directives and is necessary to sell medical devices in the EU. 

When a CE Mark became necessary, several requirements needed to be addressed, such as electrical safety, 

safety in case of fire (smoke), EMI interference, etc. While working toward compliance, JACE’s export sales 

were impacted. JACE worked with one outside company to achieve compliance with ISO 13485 (which specifies 

requirements for quality management systems related to medical devices) and ISO 9000, which are both prerequisites for CE marking (for the EU Medical Device Directive). In addition to ISO certification, CE Mark also 

requires a technical file that JACE claims, “took a while to put together.” It included “lots of paperwork” – labels, 

manuals, test results, risk management plan, product photos, etc., which resulted in 4 folders for one piece of 

equipment. BSI (www.bsigroup.com) was its Notified Body (organization designated to assess compliance with 

regulations) for its CE Mark. Eventually it got through all the testing and qualification processes. It was a lot of 

effort JACE says, “just to sell 70 machines to Germany since 2014.”

For many medical devices, CE certification requires annual audits by a Notified Body to ensure ongoing 

compliance. Similarly, ISO certification is also “audited” with surveillance visits on an ongoing basis to ensure 

compliance. JACE is currently dealing with what it describes as a “surprise” audit from its CE auditor. JACE 

received similar audits from them in 2015 and 2016 as well, each time costing JACE $5,000. JACE is also

currently working toward ISO certification to the current standard. The company working with JACE on ISO is

also supposed to be auditing JACE to the CE standard and should be submitting this information to their CE 

auditor. But instead, JACE is being audited by both companies (and is thus paying both).

According to JACE there have been some changes to electrical testing requirements for EU directives, part of 

small changes that are incorporated on an ongoing basis. In addition, ISO standards 13485 and 9001 are 

significantly changing their approaches to risk management. JACE says, “It practically takes an interpreter to 

understand it.”

The company gets its information on EU compliance primarily through self-research; auditors are not acting as 

consultants to JACE (as paying them to act as consultants would be an additional cost to auditing fees). JACE 

claims there are very good websites for information, such as https://elsmar.com/Forums/, where companies can 

discuss requirements with experts, some blogs, and the European Commission site for information on 
documentation requirements for the Medical Device Directive (MDD). However, the company says it is not easy 

to self-inform. 

OTHER MARKETS

Mexico, South America and Canada each have their own regulations and documentation and, according to 

JACE, it can be expensive to comply with each country’s specific requirements. This is particularly true if you 

use some of the higher priced vendors such as UL or BSI. For example, it may cost $25,000 for an EMI test with 

these “brand name” companies versus $10,000 with lower cost compliance companies. Further, these costs are 

in addition to whatever product changes must be made as a result.

Japan requires conformance with ISO standards (such as 13485) and a government auditor visited the 

company’s facility. In addition, Japan required a certificate of testing for compliance with IEC 60601-1-1 

(medical electrical systems) and 60601-1-2 (electromagnetic compatibility) safety standards, which cost $30,000 

from Intertek (www.intertek.com, a Nationally Recognized Testing Laboratory). IEC 60601-1 is a medical 

electrical equipment harmonized standard recognized by most countries.