Keeping up with AI: Australia’s Next Chapter in Medical Device Regulation

Artificial intelligence isn’t just a buzzword in healthcare anymore — it’s already here, powering diagnostics, guiding treatment decisions, and transforming how medical devices interact with patients and clinicians. But with innovation comes responsibility, and the TGA is taking steps to ensure the regulations can keep up with the technology.

Last month (July 2025), the TGA released a major report: “Clarifying and Strengthening the Regulation of Medical Device Software including Artificial Intelligence (AI)”, examining the changing needs in order to meet the challenges (and opportunities) of the digital age.

A $39.9 Million Commitment to Safe AI

The Federal Government has committed nearly $40 million over five years to strengthen regulatory oversight of AI, including its role in medical devices. This investment sends a clear message: Australia is serious about supporting innovation, but not at the expense of patient safety.

What’s Changing?

The TGA report highlights three big areas where clarity is needed:

• Who’s responsible? In an AI-driven environment, it’s not always clear who the “manufacturer” or “sponsor” is. Developers, data scientists, and even cloud providers all play a role — and regulation needs to reflect that.

• What does “supply” mean? Traditionally, supply means delivering a physical product. But in a world of app stores, downloads, and real-time updates, the definition must expand to capture how software is really delivered.

• How do we regulate evolving AI? Unlike traditional devices, AI can change after it’s on the market. Regulations must strike the right balance between encouraging innovation and protecting patients.

Why This Matters

For developers, sponsors, and healthcare providers, these changes mean earlier engagement with the TGA, more emphasis on transparency, and stronger lifecycle monitoring of AI-enabled devices. For patients, it means confidence that safety remains front and centre – even as technology moves faster than ever.

At KD&A, we see this as an exciting step forward. It shows that Australia is not only aware of the global conversation around AI in healthcare, but is actively shaping its own approach. We’re committed to helping our clients navigate these requirements, ensuring they can innovate responsibly while staying compliant despite the evolving regulatory landscape.

Regulation is not about rejecting innovation, but tackling it, to ensure every breakthrough in healthcare translates to safe and reliable improvements in patient outcomes.

The full “Clarifying and Strengthening the Regulation of Medical Device Software including Artificial Intelligence (AI)” report can be found here.