The three devices are all novel technologies that treat end-stage renal disease, or progressive kidney failure, and are developed by start-up companies or academic institutions.

The move comes as device makers push the FDA to promote innovation and speed up the review of devices, while advocacy groups contend the agency is doing too little to protect consumers.

End-stage renal disease affects more than half a million Americans, but existing treatments such as dialysis, which removes waste from the body, may be costly or time-consuming, the FDA said.

Medicare, the federal health insurance program for the elderly and disabled, covers 75 percent of U.S. costs for the kidney disease and spent $29 billion on it in 2009.

The FDA chose the three kidney technologies on Monday from 32 applicants as part of a pilot program that will later expand to other device companies and medical conditions.

The three technologies all replicate the function of the kidneys, which filter and remove waste from the body and produce necessary hormones that help with absorbing calcium and producing red blood cells.

One of the three technologies, from the University of California, San Francisco, combines a dialysis device that is implanted in the gut with live kidney cells. A second device, From Beverly Hills, California-based Blood Purification Technologies Inc, is a wearable artificial kidney. The third, a Hemoaccess Valve System made by Greenville, South Carolina-based CreatiVasc Medical, modulates blood flow between dialysis and regular kidney functions.

Under the program, companies with innovative technologies get more opportunities to meet regulators and scientific experts to explain what their devices do and prove they are safe and effective before they even begin testing on patients.

The FDA said this would speed up approval, but also help regulators better understand new technologies they may not be familiar with.

Venture-capital investors and device makers such as Medtronic Inc and Covidien Plc have criticized the FDA for slow reviews and regulatory hurdles they say will force innovation overseas.

"This program represents a new way of doing business (at the FDA)," said Dr. Jeffrey Shuren, head of the FDA's devices center, on a call with reporters.

Jack Lasersohn, from venture capital firm The Vertical Group, who consulted with the FDA on the program, said it would help speed up approval of the kind of revolutionary technologies that venture capitalists like to invest in.

"The problem is that very often there are no precedents," he said on the FDA's call with reporters. "When you go to the FDA with a new type of technology, you're raising regulatory and fundamental scientific questions that the FDA has never seen before."

Through the program, called "Innovation Pathway," senior FDA reviewers would weigh in on device development, which could shorten the time it takes to develop a clinical trial program by six months to a year, Lasersohn said.

He said it typically takes four to seven years to bring new technologies to patients from the time they are designed.

On the other hand, consumer groups contend the FDA should take a more rigorous approach to testing devices to avoid safety failures, such as the recent issues with metal-on-metal hip implants and surgical mesh.

Shuren said safety and innovation can go together, and the new process would still ensure patients are protected.

"(Safety and innovation) don't have to exist on opposite ends of the swinging pendulum," he said.

The FDA decided to expand the pilot program after testing it in early 2011 with a prosthetic arm developed by the U.S. Defense Advanced Research Projects Agency (DARPA), part of the Department of Defense. DARPA is now testing the arm in clinical trials.

(Editing by Andre Grenon)

• A Permanent Economic Emergency