Understanding FDA Pathways for Human Cell and Tissue Products: 361 HCT/P vs. 351 Biologic License Application
By Nikolai Sopko, MD, PhD Chief Scientific Officer & Chief Operating Officer, PolarityBio
In regenerative medicine, products derived from human cells and tissues are regulated under different FDA regulatory pathways depending on their characteristics, intended use, and method of manufacture. Two labels frequently used to describe these pathways are “361” and “351.” These pathways represent distinct regulatory approaches with meaningful implications for product oversight and, now, Medicare payment policy.
This article is intended to provide high-level, educational context on these FDA pathways and explain how recent Centers for Medicare & Medicaid Services (CMS) payment changes relate to them. There are also 510K, De Novo, and Premarket Approval (PMA) marketed medical devices, but the focus for this discussion is going to be on the 361 and 351 human cells and tissue products.
FDA’s regulatory framework in brief
The U.S. Food and Drug Administration regulates human cell- and tissue-based products (HCT/Ps) under the Public Health Service Act using two primary approaches:
Section 361 HCT/Ps, regulated under 21 CFR Part 1271, and
Section 351 products, regulated as biologics and subject to biologics licensure.
Which pathway applies is determined by a product’s attributes and intended use, not by manufacturer preference.
What is a 361 HCT/P?
Per the FDA, “HCT/Ps are defined in 21 CFR 1271.3(d) as articles containing or consisting of human cells or tissues that are intended for implantation, transplantation, infusion, or transfer into a human recipient.” An HCT/P may be regulated solely under section 361 of the Public Health Service Act if it meets all of the criteria outlined in 21 CFR 1271.10(a). These criteria include, among other requirements:
The product is minimally manipulated
It is intended for homologous use
It is not combined with other articles beyond limited exceptions
It does not have a systemic effect or is not dependent on the metabolic activity of living cells, unless specific conditions are met
Products meeting these criteria are considered low risk and fall within a regulatory framework that was not intended for complex biological therapies making therapeutic claims, but rather to provide oversight for traditional human tissues that are recovered, stored, and later transplanted, such as corneas, skin, and bone. The FDA has stated that this regulatory framework is designed primarily to prevent the transmission of communicable diseases associated with human cell and tissue products. Eligibility for regulation under section 361 is evaluated based on objective intent, including how the product is described in labeling and promotional materials. Products marketed under the 361 HCT/P pathway are considered FDA-registered but not FDA-approved and are manufactured in compliance with current Good Tissue Practice (cGTP), which focuses on communicable disease prevention and is substantially less comprehensive than current Good Manufacturing Practice (cGMP).
What distinguishes a 351 product?
If a product does not meet all of the criteria in 21 CFR 1271.10(a), it is generally regulated under section 351 of the Public Health Service Act. Products regulated under section 351 are treated as biologics and are subject to FDA’s biologics licensure framework. A much more rigorous structure for approval.
This typically involves:
Clinical development under an investigational new drug (IND) application
Demonstration of safety, purity, and potency for the intended use
Demonstration of safety and efficacy through adequate and well-controlled studies
Current Good Manufacturing Practices (cGMP) Manufacturing
Submission and approval of a Biologics License Application (BLA) prior to commercial marketing
Whereas the 361 HCT/P pathway focuses on meeting defined regulatory criteria and administrative requirements and filling out the requisite forms, the 351 BLA pathway requires substantial clinical evidence—often requiring multiple controlled trials—before a product can be approved and marketed.
Under the 361 framework, manufacturers self-designate their products by submitting the appropriate registration and listing information and are not required to obtain FDA concurrence prior to marketing. The 361 pathway does not require pre-market clinical studies and permits commercialization without demonstration of safety or effectiveness. By contrast, products regulated under the 351 pathway are subject to the same statutory and regulatory standards applied to new drugs and biologics, including FDA review of clinical data demonstrating safety, purity, and potency. Products approved under the 351 BLA pathway are therefore FDA-approved for their indicated use.
In wound care, the 361 HCT/P pathway is used for minimally manipulated human tissues, such as cadaveric skin, acellular dermis, and amniotic membranes, that function primarily as coverings or structural replacements. Manufacturers of products regulated under Section 361 that make claims exceeding minimal manipulation or homologous use may violate Section 351(a)(1) of the Public Health Service Act (42 U.S.C. § 262(a)(1)) by distributing unlicensed biological products intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease, and/or products intended to affect the structure or function of the body. Indeed, there has been an increase in FDA Warning Letters issued in 2025, finding companies in violation based on their product marketing claims made on their website and promotional materials.
Why this distinction matters for CMS payment policy
In recent rulemaking that was implemented Jan 1, 2026, CMS has made significant changes to how skin substitute products are categorized and reimbursed under Medicare. Beginning in calendar year 2026, CMS finalized policies[i] that align skin substitute payment categories with FDA regulatory status. The non-BLA products (510K, 361, and PMA) are categorized as incident-to supplies and subject to a payment rate of $127.28 per cm.[ii] Additionally, CMS recently clarified that they will not pay for skin substitute wastages – meaning you will only get paid for the skin substitute administered to the wound.
CMS has stated that this change does not apply to products marketed under a 351 biologics license application (BLA). These products will continue to receive separate payment as biologics (typically ASP + 6%).[iii] In other words, the new payment methodology applies to non-BLA skin substitutes (510K, 361 and PMA), while BLA-licensed biologics remain subject to distinct payment.
CMS explained their rationale for the approach in a recent press release, “CMS believes that grouping and paying for skin substitute products based on relevant product characteristics, consistent with their FDA regulatory status, recognizes the clinical and resource differences in product types and would incentivize competition to create more innovative products.” [iv] In brief, CMS reimburses 510(k), 361 HCT/P, and PMA products as dressings based on their regulatory classification, reflecting that they are not approved or intended to function as independent biological therapeutics.
Putting the pieces together
From a policy perspective, FDA regulatory status and CMS payment treatment are related but distinct:
361 HCT/Ps are regulated under FDA’s tissue framework and, under CMS’s 2026 policies, are generally grouped within the incident-to supply payment approach for skin substitutes.
351 biologic products, which require FDA licensure through a BLA, are treated separately by CMS and are not subject to the new incident-to supply payment methodology.
Understanding the distinction is increasingly important as CMS continues to refine reimbursement policy based on product classification and regulatory oversight.
Closing perspective
As regenerative medicine continues to advance, clarity around regulatory pathways and the impact on payment and coverage is essential for clinicians, policymakers, and patients. The distinction between 361 and 351 products reflects fundamental differences in the level of evidence a company is required to prepare and submit to the FDA, and with the recent changes, directly informs how CMS structures payment policy.
Recent CMS changes underscore this alignment by explicitly distinguishing non-BLA skin substitutes from BLA-licensed biologics, reinforcing their previous statement focused on driving innovative products. Maintaining a clear understanding of these frameworks helps ensure informed decision-making across development, clinical adoption, and reimbursement.
Disclaimer – this is purely informational, based on the information available that has been published by the FDA and CMS. I encourage anyone reading to follow the links and do your own research. PolarityBio does not yet have any approved products. SkinTE is currently available for investigational use only.
[i] https://www.cms.gov/newsroom/press-releases/cms-modernizes-payment-accuracy-significantly-cuts-spending-waste
[ii] https://www.cms.gov/newsroom/fact-sheets/calendar-year-cy-2026-medicare-physician-fee-schedule-final-rule-cms-1832-f
[iii] https://www.cms.gov/files/document/part-b-drug-payment-limits-overview.pdf-0
[iv] https://www.cms.gov/newsroom/fact-sheets/calendar-year-cy-2026-medicare-physician-fee-schedule-final-rule-cms-1832-f