By Jay W. Cormier –

The National Institutes of Health (NIH) recently announced that it would be suspending drug manufacturing at two of its facilities after preliminary findings by two outside consulting groups found that certain sterile products were not manufactured in compliance with GMP quality standards.  As a result, clinical studies using the drug products at these facilities that are subject to this suspension will, in turn, be halted until NIH can bring its manufacturing facilities into compliance. 

Recall that last summer, two NIH manufacturing facilities were inspected by FDA and issued a scathing Form 483 (see our earlier post here).  It isn’t exactly clear whether the two facilities mentioned in this latest press release (a National Cancer Institute laboratory engaged in cell therapy production and a National Institute of Mental Health facility producing positron emission tomography (PET) materials) are different than the two facilities that were closed immediately following the 2015 inspection (those two facilities were the Pharmaceutical Development Section and Clinical Center Pharmacy).  We attempted to clarify this with NIH contact listed on the press release, but our calls have not been returned. 

If it is the same facilities, it seems odd to us that NIH would announce the closure of the same facilities twice.  So, we are inclined to believe that these recent closures bring the total drug product manufacturing facilities have been at least partially closed due to a lack of cGMP compliance to four facilities.  If this is the case, it is very interesting as we cannot recall an instance where a manufacturer voluntarily shut down two of its facilities in response to a company-wide review of manufacturing facilities following negative inspectional findings at two other of its facilities.

Adding a twist to the whole story, in December, NIH formed the Clinical Center Working Group of the Advisory Committee to the Director (which NIH refers to as the “Clinical Center Red Team”), whose charge is defined as:

To make recommendations about ways to enhance the organization, financing, and management of the clinical center to improve the quality of patient care, and reduce the risk of clinical research and research-related activities. To inform its deliberations, the working group may examine the structural and cultural issues at the Clinical Center that may have contributed to the deficiencies identified in the Pharmacy and Pharmaceutical Development Service, and review other research activities at the Clinical Center that pose a potential risk to research participants.

The Clinical Center Working Group was expected to deliver its report to the full Advisory Committee to the Director on Thursday, April 21st in a meeting scheduled from 4-6pm.  Setting aside for a moment (or rather for a later post) that it has taken NIH almost a year to receive this report – an eternity in the world of major cGMP violations – we are glad to see that the Working Group is producing its report.  Although NIH announced that the report would be delivered to the NIH Advisory Committee at a specific date and time, a week later NIH has yet to disclose either the report or a summary of its contents.  We look forward to hearing about the report and to seeing what additional changes NIH makes to its drug manufacturing practices. 

We will be watching to see if the report or any summary of it is made public.  Because of the significance of the issues at NIH, and that NIH is funded through taxpayer funds, we urge NIH to make the report public expeditiously. 

By Kurt R. Karst –

On April 27, 2016, Eagle Pharmaceuticals, Inc. (“Eagle”) filed a Complaint in the U.S. District Court for the District of Columbia alleging that FDA violated the Administrative Procedure Act (“APA”) when the Agency refused to grant periods of 7-year orphan drug exclusivity upon the December 7, 2015 approval of Eagle’s 505(b)(2) NDA 208194 for BENDEKA (bendamustine HCl) Injection, 100 mg/4 mL (25 mg/mL) for both the treatment of patients with Chronic Lymphocytic Leukemia (“CLL”) and for the treatment of patients with indolent B-cell Non-Hodgkin Lymphoma (“NHL”) that has progressed during or within six months of treatment with rituximab or a rituximab-containing regimen.  We suspected that a lawsuit against FDA might be in the works when Eagle announced in late March 2016 that FDA refused to grant orphan drug exclusivity for BENDEKA and that the company was “evaluating all options to challenge the FDA’s decision.”

The story of BENDEKA follows a path similar to that of Depomed Inc.’s (“Depomed’s”) GRALISE (gabapentin) Tablets (NDA 022544), and it raises for a second time in court the issue of whether FDA can lawfully require a company to demonstrate “clinical superiority” to obtain orphan drug exclusivity. 

FDA designated BENDEKA as an orphan drug on July 2, 2014 for both the treatment of CLL and NHL. Because FDA had previously approved Bendamustine HCL for these two uses – specifically, Teva Pharmaceutical Industries Ltd.’s (“Teva’s”), TREANDA (bendamustine HCl) for Injection, for Intravenous Infusion (NDA 022249) – FDA required that Eagle provide a plausible hypothesis of clinical superiority to obtain orphan drug designation. As a ready-to-dilute concentrate solution for injection administered by infusion over 10 minutes after dilution in 50 mL of sodium chloride or a saline/dextrose mixture, FDA accepted Eagle’s hypothesis that the lower volume could provide a benefit to CLL and NHL patients. 

Fast-forward to December 7, 2015. Although Teva’s orphan drug exclusivity (as extended by pediatric exclusivity) for TREANDA for the treatment of CLL expired on September 20, 2015, orphan drug exclusivity for TREANDA for the treatment of NHL (as extended by pediatric exclusivity) remains in effect until May 01, 2016.  (As an aside, we note that after determining in response to a Citizen Petition [Docket No. FDA-2015-P-3980] that generic drug applicants could omit information on the protected NHL use, on March 24, 2016, FDA approved two ANDAs for generic TREANDA for the treatment of CLL [i.e., ANDA 204771 and ANDA 205476].)  As a result of a licensing agreement between Teva and Eagle, however, Teva agreed to waive unexpired orphan drug exclusivity with respect to BENDEKA.  That waiver paved the way to the December 2015 approval of BENDEKA without Eagle having to “break” Teva’s unexpired orphan drug exclusivity for TREANDA for the treatment of NHL by demonstrating “clinical superiority” over TREANDA.  But the issue of “clinical superiority” remained an issue in FDA’s mind for Eagle to be granted orphan drug exclusivity.

FDA’s orphan drug regulations define a “clinically superior” drug as “a drug . . . shown to provide a significant therapeutic advantage over and above that provided by an approved orphan drug (that is otherwise the same drug)” in one of three ways: (1) greater effectiveness as assessed by effect on a clinically meaningful endpoint in adequate and well controlled trials; (2) greater safety in a substantial portion of the target population; or (3) demonstration that the drug makes a major contribution to patient care. (For a list of clinical superiority precedents, see our previous post here.)  As FDA explained in a 2012 petition response concerning orphan drug exclusivity for WILATE (von Willebrand Factor/Coagulation Factor VIII Complex (Human)) (see our previous post here), as well in the preambles to FDA’s 2011 proposed rule and 2013 final rule amending the Agency’s orphan drug regulations (see our previous posts here and here), where clinical superiority is concerned, FDA says that the standard for obtaining designation is different from the standard for obtaining exclusivity:

Though the sponsor of a subsequent orphan drug must set forth a plausible hypothesis of clinical superiority over the previously approved drug at the designation stage, such a sponsor faces a higher standard at the time of approval. At approval, the sponsor of a drug which was designated on the basis of a plausible hypothesis of clinical superiority must demonstrate that its drug is clinically superior to the previously approved drug.  Should the sponsor fail to do so, then the subsequent drug will be considered to be the same drug as the previously approved drug, and will not be able to gain marketing approval if the previously approved drug’s orphan-drug exclusive approval period is still running.  Once this exclusivity has expired, the subsequent drug may be approved . . . , but it will not be eligible for orphan-drug exclusivity because the same drug has already been approved for the same orphan indication.

FDA’s heightened standard for demonstrating clinical superiority to obtain orphan drug exclusivity was at the heart of Depomed’s September 2012 lawsuit against FDA (see our previous post here).  Depomed prevailed in the lawsuit.  In a September 2014 Memorandum Opinion, Judge Ketanji Brown Jackson of the U.S. District Court for the District of Columbia decided the case on Chevron Step 1 grounds, finding that “the plain language of the Orphan Drug Act requires the FDA to recognize exclusivity for Gralise” (see our previous post here).  The court stated that the statute:

employs the familiar and readily diagrammable formula, ‘if x and y, then z.’ Congress has crafted its command to the Secretary of the FDA in a manner that sets forth two circumstances – a drug that has been designated for a rare disease or condition, and the FDA’s approval of a marketing application for that drug – that, if present, result in a particular consequence: a seven-year period of abstinence regarding marketing approval for other such drugs.

FDA decided not to appeal Judge Jackson’s decision. Instead, FDA published in the December 23, 2014 Federal Register a “clarification of policy” notice in which the Agency addresses the effects of the Depomed court decision (see our previous post here).  In that notice, FDA “double-downed” on the Agency’s pre-Depomed regulations.  In short, FDA says that Judge Jackson’s decision is limited to GRALISE, and that the Agency will continue to apply its clinical superiority regulatory paradigm insofar as orphan drug exclusivity is concerned.  Specifically, FDA states:

In consideration of any uncertainty created by the court’s decision in Depomed, the Agency is issuing this statement. It is the Agency’s position that, given the limited terms of the court’s decision to GRALISE, FDA intends to continue to apply its existing regulations in part 316 to orphan-drug exclusivity matters.  FDA interprets section 527 of the FD&C Act and its regulations (both the older regulations that still apply to original requests for designation made on or before August 12, 2013, as well as the current regulations) to require the sponsor of a designated drug that is the “same” as a previously approved drug to demonstrate that its drug is “clinically superior” to that drug upon approval in order for the subsequently approved drug to be eligible for orphan-drug exclusivity.

At the time, we commented that FDA’s out-of-left-field-strategy might be a way for the Agency to draw out another lawsuit from an affected sponsor so that FDA could have another crack to relitigate the issue in court. That appears to almost have happened in the case of another Eagle drug – RYANODEX (dantrolene sodium) for Injectable Suspension – where Eagle issued what we termed a “Depomed Threat.”  But in that case, FDA ultimately granted Eagle orphan drug exclusivity after finding a basis on which to find that clinical superiority was demonstrated (see our previous post here).  No “Depomed Threat” deterred FDA in the case of BENDEKA, so we’re off to court where FDA will once again attempt to defend the Agency’s interpretation of the statute to require a demonstration of clinical superiority for a company with orphan drug designation to obtain orphan drug exclusivity.

Citing and quoting from what appears to be a rather lengthy March 24, 2016 FDA letter ruling, Eagle says in the company’s Complaint that “FDA denied Bendeka exclusivity . . . taking essentially the same position it took in Depomed”:

First, the letter ruling explained FDA’s position that Depomed was wrongly decided. Id. at 39 (“[T]he Depomed court erred in not deferring to FDA’s statutory interpretation ….”); id. at 32 (“We are not bound to follow the Depomed decision, and we do not believe that the Depomed court’s conclusion is compelled by the statute ….” (internal citation omitted)); id. at 9 (“Because FDA concluded that the decision was inconsistent with FDA’s clinical superiority framework and the important policy interests at stake, the Agency has continued to implement its long-standing clinical superiority framework for designation and exclusivity decisions.”).

Second, FDA defended its regulatory scheme: FDA acknowledged that it had indeed granted orphan drug designation for Bendeka, but argued that Congress’s exclusivity incentive for orphan drugs is not particularly important compared to other incentives in the statute. See id. at 10, 34. Thus, FDA argued that, despite granting orphan drug designation, the agency was free to deny exclusivity at the end of the process. Id. at 32-40.

Third, despite FDA’s conclusion when it designated Bendeka as an orphan drug that Bendeka presented a plausible hypothesis of clinical superiority over a similar drug named Treanda, FDA reversed course in 2016. FDA now concluded that, although Bendeka is safe and effective, Eagle had not proffered sufficient evidence that Bendeka is in fact clinically superior to Treanda under the regulatory requirement this Court found unlawful in Depomed. Id. at 32.

“Had FDA respected Judge Jackson’s [Depomed] ruling in 2014,” says Eagle, “this case would not be necessary.  Unfortunately, FDA’s defiance of this Court’s prior order leaves Plaintiff no choice but to file this suit.”

Eagle is seeking both declaratory and injunctive relief. Eagle wants, among other things, a declaration that FDA’s refusal to grant orphan drug exclusivity to Eagle for Bendeka violates the APA, that Eagle is entitled to orphan drug exclusivity, and that FDA’s orphan drug regulations at 21 C.F.R. §§ 316.3(b)(12), 316.31(a), 316.34(a), (c) are invalid under the FDC Act, insofar as they purport to permit FDA to not recognize orphan drug exclusivity for BENDEKA; and injunctive relief “effectuating Eagle’s orphan drug exclusivity by enjoining [FDA] from approving any other drug covered by Eagle’s exclusivity for the treatment of CLL or indolent B-cell NHL until December 7, 2022.”  The case has been assigned to Judge Gladys Kessler.

By Kurt R. Karst –

Disputes involving non-patent marketing exclusivity available to 505(b)(1) and 505(b)(2) NDA applicants – either 5-year New Chemical Entity (“NCE”) exclusivity, 3-year new clinical investigation exclusivity, or 7-year orphan drug exclusivity – have increased dramatically over the past few years, and there’s no end in sight.  Just take a look at the various postings in the “Hatch-Waxman” category on this blog over the past year or two and you’ll see what we mean.  We’ve seen numerous lawsuits challenging FDA decisions on the availability of or scope of exclusivity, as well as several citizen petitions requesting that FDA make a particular determination on the appropriate exclusivity period to award an NDA applicant.  We’ve also seen several cases in which FDA has inexplicably delayed or failed to make an exclusivity decision after approving an NDA – e.g., AVYCAZ (ceftazidime-avibactam) Injection (NDA 206494; approved on February 25, 2015), AURYXIA (ferric citrate) Tablets (NDA 205874; approved on September 5, 2014), and SURFAXIN (lucinactant) Intratracheal Suspension (NDA 021746; approved on March 6, 2012) – or where FDA “punts” on making an exclusivity determination hoping that the issue will go away with time – e.g., XTAMPZA ER (oxycodone) Extended-release Capsules (NDA 208090), where FDA comments in a November 6, 2015 Tentative Approval letter that “We need not determine at this time whether approval of your 505(b)(2) NDA for XTAMPZA ER would otherwise be blocked by any other drug’s marketing exclusivity expiring before termination of the 30-month stay.”).

The latest exclusivity challenge comes in the form of a Citizen Petition (Docket No. FDA-2016-P-1163) submitted to FDA on behalf of Vifor Fresenius Medical Care Renal Pharma France (“Vifor Fresenius”) requesting that FDA award a period of 5-year NCE exclusivity for Vifor Fresenius’s VELPHORO (sucroferric oxyhydroxide) Chewable Tablets, which FDA approved on November 27, 2013 under NDA 205109 for the control of serum phosphorus levels in patients with chronic kidney disease on dialysis.  Although FDA has failed to make an exclusivity decision for another iron-based drug product (AURYXIA, noted above), in the case of VELPHORO it’s not FDA’s failure to act that is being challenged, but rather FDA’s decision to award a period of 3-year exclusivity instead of 5-year NCE exclusivity. 

According to Vifor Fresenius, VELPHORO is entitled to 5-year exclusivity under either FDA’s “active moiety standard” or the FDC Act’s “active ingredient standard,” which the U.S. District Court for the District of Columbia recently addressed in Amarin Pharms. Ir. Ltd. v. FDA, 106 F. Supp. 3d 196, 198 (D.D.C. 2015) (see our previous post here), and for which a decision out of FDA seems likely any day now.  Vifor Fresenius lays out detailed arguments, including:

• Velphoro is a novel iron-based phosphate binder with a different active moiety from previous iron-based products.  The Agency initially rejected five-year exclusivity for Velphoro on the basis of previously approved intravenous iron-carbohydrate iron supplements.  But these products do not share an active moiety with Velphoro.  Velphoro, a chewable phosphate binder, has as its active moiety a form of insoluble polynuclear iron(III)-oxyhydroxide that is specifically designed to minimize the release of iron: by contrast, the iron supplements are designed to release iron and have a ferric iron (Fe3+) active moiety.
• FDA has agreed that there are significant physicocheinical differences between Velphoro’s iron oxyhydroxide active moiety and the iron oxyhydroxides in Previously approved products.  The polynuclear iron(III)-oxyhydroxide moiety in Velphoro is different in significant respects from iron oxyhydroxides in previously approved products, as the Agency itself has concurred.  For example, the iron oxyhydroxides in previously approved products contain particles that are billions of times smaller, differ in their iron release properties, and differ in their structure and chloride content.
• Velphoro does not contain a previously approved active ingredient.  The FDCA requires that the Agency assess approved active ingredients as a whole, rather than focus narrowly on active moieties.  This approach is also consistent with FDA’s approach to active ingredient sameness in the ANDA approval context.  Here, the approved active ingredients in other iron-carbohydrate drugs differ in activity, differ in particle size, differ in iron release and solubility, contain different carbohydrates and other components, and contain significantly higher stoichiometric ratios of carbohydrates, resulting in dramatic differences in therapeutic effect.
• Velphoro’s physicochemical differences are essential for the desired therapeutic indication, not minor differences that the Agency can ignore. The Agency agrees that Velphoro has physicochemical differences from intravenous iron supplements that it also concurs are “essential for the desired therapeutic indication.”  Velphoro is a solid that binds phosphate for purposes of excretion, and is designed so that it causes only minimal iron absorption into the body.  By contrast, the iron-carbohydrate anemia drugs are injectables introduced into the bloodstream and designed for the purpose of delivering iron into the body.  In evaluating active ingredients, the Agency should not ignore differences that are essential to activity.

Until FDA makes a decison on NCE exclusivity, Vifor Fresenius wants FDA to stay the acceptance of any new ANDAs or 505(b)(2) NDAs that reference VELPHORO, and any action on a previously-submitted ANDA or 505(b)(2) NDA that references VELPHORO.  A single patent is listed in the Orange Book for VELPHORO that expires on December 19, 2016, so it’s possible that an application is pending at FDA with a Paragraph III patent certification. 

Metal-containing products have historically been difficult for FDA to evaluate for active moiety and exclusivity purposes.  Consider, for example, the September 2003 memorandum FDA included in NDA 021626 for RADIOGARDASE (insoluble Prussian Blue) Capsules evaluating whether different ferric(III) hexacyanoferrate(II) compounds are different active moieties.  There’s also FDA’s recent Manual of Policies and Procedures (“MAPP”) on NDA Classification Codes (MAPP 5018.2).  As we noted in a previous post, the MAPP specifically addresses the active moiety in metal-containing substances. 

We’re not entirely certain where FDA will land on the VELPHORO petition, but we note that it’s not very often that FDA changes an exclusivity decision . . . . at least not absent litigation.  So we may be headed down that path once again. 

The short answer to that question is “No,” says Hyman, Phelps & McNamara, P.C.’s Jeffrey K. Shapiro in an article published in the March/April 2016 issue of the Food and Drug Law Institute’s Update Magazine.  Mr. Shapiro examines the Department of Justice’s recent criminal prosecution of Vascular Solutions, Inc. (“VSI”), which ended with a unanimous jury acquittal for VSI and its chief executive officer of, among other things, misbranding products due to off-label promotion.

“[Z]ombielike, FDA/DOJ continue to pursue truthful and non-misleading off-label promotion as if it were per se a crime,” writes Mr. Shapiro.  “Absent an unlikely U-turn at the Supreme Court, the federal courts likely will continue to find that FDA’s prohibition against truthful and non-misleading off-label promotion is inconsistent with the First Amendment.  However, FDA’s Warning Letters and DOJ enforcement actions could continue for years before enough case law accumulates to force real change, with some companies and individuals choosing to settle rather than risk overwhelming punishment.”

By Ricardo Carvajal –

The would-be marketer of a probiotic suppository submitted a citizen petition (Docket No. FDA-2016-P-1133) to FDA asking the agency to “amend the definition of dietary supplement under the present statutory authority [of DSHEA] and to treat probiotic suppositories the same as oral probiotic dietary supplements.”  In support of that request, the petition argues in part that:

• A probiotic suppository should not be regulated as a drug if no drug claims are made for it;
• Probiotics delivered through a suppository convey essentially the same benefits as those conveyed by probiotics consumed as dietary supplements, and would be consumed for the same purpose – namely “to deliver supplemental microorganisms to the existing populations of beneficial organisms in an individual to help maintain a healthy microbe state in the gut”;
• Suppositories offer a more efficient route of administration, and avoid the possible breakdown of microbes in the stomach and upper GI tract;
• Certain individuals have difficulties orally ingesting supplements; and
• A probiotic suppository provides an alternative to fecal transplant (a subject that we previously addressed here).

The petition asks FDA to amend the definition of “dietary supplement” by replacing the phrase “is intended to be taken by mouth as a pill, capsule, tablet or liquid” with the phrase “is intended for enteral administration.”  Alternatively, the petition asks FDA to “allow a supplemental probiotic which is inserted as a rectal suppository to be classified as a dietary supplement as another delivery route in addition to the oral route.”  

It’s not clear which definition of “dietary supplement” the petition refers to, as the phrase “is intended to be taken by mouth as a pill, capsule, tablet or liquid” does not appear in the FDC Act’s definition of “dietary supplement” or in associated regulations (in relevant part, the statute defines “dietary supplement” as an article “intended for ingestion” in a variety of forms).  In any event, the petition does not explain what authority FDA could rely on to eliminate the statutory criterion of ingestion, or under what authority FDA could allow a suppository to be classified as a dietary supplement.  Indeed, in accord with the existing statutory definition, FDA has consistently taken the position that articles not intended for ingestion do not qualify as dietary supplements.  

By James C. Shehan –

In a bluntly-worded warning letter to contract manufacturer Sri Krishna Pharmaceuticals Ltd. issued April 1, 2016, we see another example of increasing FDA concern over data integrity issues at non-US drug manufacturing facilities, particularly those in India. This rather remarkable letter contains observations of GMP deficiencies in four general areas: (1) failure to include complete data in laboratory records; (2) failure to exercise appropriate controls over computer systems; (3) failure to establish adequate written procedures for production and process controls; and (4) failure in certain instances to follow established written procedures that existed. While the heading of each multi-part observation is somewhat bland, the body of each is quite detailed about data integrity issues and contains both specific descriptions of deceptive practices and FDA assertions that Sri Krishna has admitted to these deceptive practices.” We have previously discussed (see our post here), FDA warning letters on data integrity (18 out of 23 of CDER’s 2015 warning letters). Specifically, letters addressed to facilities in India and China (15 out of those 18) are running at record levels. This warning letter to Sri Krishna fits neatly into this clear pattern.

Moreover, the letter demands that Sri Krishna undertake three follow-up actions: (1) a “comprehensive investigation into the extent of the inaccuracies in data records and reporting,” including “interviews of current and former employees … by a qualified third party;” (2) a “current risk assessment of the potential effects of the observed failures on the quality of your drugs,” including the risk to patients; and (3) a “management strategy for your firm that includes the details of your global corrective action and preventive action plan,” and that includes “[i]nterim measures describing the actions you have taken or will take to protect patients and to ensure the quality of your drugs, such as notifying your customers, recalling product, conducting additional testing, … drug application actions, and enhanced complaint monitoring.”

The essence of the agency’s incomplete data observation is that Sri Krishna regularly deleted non-conforming test results and repeated tests in order to generate conforming results. The warning letter gives details on at least five different situations in which this occurred, including one in which 28 original data files were deleted and another in which a clock was changed prior to samples being reanalyzed. In some instances, “trial” tests were performed and the data from them stored on separate computer drives from those drives on which the data that were reported to FDA was stored.

Sri Krishna’s admissions of these violations are documented in numerous places in the warning letter: “Your management acknowledged that employees in your QC laboratories conduct trial HPLC injections prior to the injections submitted as the reported test results; “Your response acknowledges that an analyst deleted eight injections, including the blank, six standards, and a sample;” and “Your analyst deleted data from the first set of injections and submitted only the second set in the validation documentation. The analyst stated that he planned to back-date the preparation data within the worksheets.”

FDA even makes an allegation of a kind that this blogger has never seen before – that Sri Krishna falsified data specifically for inclusion in its response to FDA’s 483: “your response includes a chromatogram for trial injection … that differs from the chromatogram our investigator collected. It appears to have been reintegrated; the y-axis scale was changed, and only two of the original … peaks can be seen.”

Regarding Sri Krishna’s computer systems, the agency states that Sri Krishna quality control analysts used administrator privileges to make changes in manufacturing records, alter date and time settings, overwrite files and delete original data. While acknowledging that Sri Krishna committed after the inspection to set up user restrictions, discontinue certain practices, and institute audit trails for computerized systems, FDA expressed apparent deep unhappiness with the company’s response. Sri Krishna’s actions are “insufficient to correct the broad data manipulation and deletion problems observed at your facility and to prevent their recurrence.” FDA thus asked that Sri Krishna’s response clarify specific user roles for each laboratory system and “provide an assessment of the effectiveness of these newly implemented system controls.”

FDA’s citation of a failure to establish adequate written procedures concerns another apparent deception about a process performance qualification protocol for alternate manufacturing equipment for a specific product. The company is alleged to have said that it initiated a prospective qualification of this equipment, but FDA states that the protocol, while written, was not approved or implemented and the samples required were never collected. FDA rejects the company’s offer to perform a retrospective validation to fix this deficiency.

The allegation of a failure to follow correctly established written procedures is linked to an accusation of destruction of original batch records and substitution thereto of backdated replacement pages. Tantalizingly, the letter states that FDA found original pages from five batch records “discarded outside your facility,” but then sorely disappoints by failing to give any details about the dumpster diving that we imagined resulted in this discovery.

The agency’s detailed description of the corrective actions that it expects of Sri Krishna is unusual but seems to be part of a trend in warning letters. First, FDA requests a “comprehensive investigation” of the data integrity issues that covers all of the company’s laboratory and manufacturing operations, not just those found at fault by FDA, or a justification for exclusion of any part of these operations. The company is asked to assess and evaluate the effect of, via a third party, “data integrity deficiencies” and “[i]dentify omissions, alterations, deletions, record destruction, non-contemporaneous record completion, and other deficiencies.”  As mentioned previously, FDA specifically recommends that the company have a third party interview current and former employees “to identify the nature, scope, and root cause of data inaccuracies.” 

Second, FDA requests “a current risk assessment of the potential effects of the observed failures on the quality of your drugs,” including an analysis of the risks to patients and the risk posed by continuing to operate.

Third, FDA wants a very detailed “management strategy for [the] firm that includes the details of [a] global corrective action and preventive action plan.” This should include a detailed corrective action plan on ensuring reliability and completeness of data and a root cause evaluation of the data integrity lapses, including details on what has happened to the employees implicated in these lapses. FDA also asks Sri Krishna to outline interim measures it will take to protect patients, such as notifying customers, conducting recalls, conducting additional testing and enhancing complaint monitoring. FDA notes that there is no evidence that Sri Krishna has informed its customers of manufacturing changes and ominously states it “is important that you … promptly notify[] … customers of a significant production problem that could interrupt supply or potentially pose a hazard to the consumer.” Long-term measures are also expected to be part of the corrective action plan, including “enhancements” to procedures, systems and “human resources.”

Coincidentally, this warning letter on data integrity has come out at almost the same time as a new FDA guidance on data integrity (see our post here). We continue to watch these developments closely, and to wonder whether more severe sanctions will be forthcoming from the agency.

Readers seeking further enlightenment on these issues or simply looking to gather good karma may want to register here for a PLI webinar on FDA compliance and enforcement strategies to be given by  Jennifer D. Newberger, Jennifer M. Thomas and Anne K. Walsh of Hyman, Phelps & McNamara at 1:00 PM EST on April 27th or attend a conference on creation of effective documentation for FDA regulated products to be given by Brian Donato, Jeffrey Shapiro and Roger Thies of Hyman, Phelps & McNamara in Arlington, Virginia on May 3rd.

By Karla L. Palmer –

In FDA’s third draft guidance document in the past week related to drug compounding , FDA addresses hospital and health system drug compounding and distribution. FDA “regards a health system as a collection of hospitals that are owned and operated by the same entity and that share access to databases with drug order information for their patients.” (FN 5). FDA notes that hospital compounding and distribution varies: Some compound only for use and administration within the hospital and others compound for distribution throughout a broader health system to hospitals, clinics, infusion pharmacies, long term care facilities. Sometimes, hospitals compound after receipt of a prescription, but they also compound before receipt of a prescription, and hold the medication until a patient presents with a need for it (i.e., emergency room or surgery). Some hospitals act as traditional pharmacies. Hospitals and health systems also purchase from outsourcing facilities and others register as outsourcing facilities so that they can centralize compounding operations and distribute on a broad scale within their system.

FDA recognizes that hospitals may need to maintain supply of certain compounded drugs within the hospital but outside the pharmacy “in anticipation of a patient prescription.”   FDA asserts (for better or worse) that because the hospital or healthcare facility are under common ownership or control and are responsible for both the compounding of the drug and treatment of the patient, the cause of any compounding adverse event may be more readily identified. FDA announces the following draft policies for compounding within a hospital or health system:

(1) Hospital and Health System Compounding Under Section 503A.

FDA recognizes that Section 503A does not distinguish between compounding at traditional pharmacies or within hospitals or health systems. However, FDA will exercise enforcement discretion for Section 503A hospital and health system pharmacies “without first receiving a patient-specific prescription order” provided that:

(1) The drug products are distributed only to healthcare facilities that are owned and controlled by the same entity that owns and controls the hospital pharmacy and that are located within a 1 mile radius of the compounding pharmacy;

(2) The drug products are only administered within the healthcare facilities to patients within the healthcare facilities, pursuant to a patient specific prescription or order; and

(3) The drug products are compounded in accordance with all other provisions of section 503A, and any other applicable requirements of the FD&C Act and FDA regulations (e.g., the drug products are not made under insanitary conditions (section 501(a)(2)(A)) or misbranded (e.g., section 502(g)). (Emphasis supplied).

Thus, with respect to Section 503A pharmacies within hospitals or health systems, a patient-specific prescription would only be required at the time of administration of the compounded product.

(2) Hospital and Health System Compounding under Section 503B.

FDA states that a “compounder” (we assume FDA means one located within a hospital or health system) can register as an outsourcing facility if it intends to provide compounded preparations outside the one-mile radius of the pharmacy in which the drug is compounded without first obtaining a patient-specific prescription. If the pharmacy elects to register as an outsourcing facility, then it must comply with all provisions of Section 503B, and 501(a)(2)(B) of the FDCA, which are FDA’s current good manufacturing practices (required of any outsourcing facility).

Comments on the draft guidance are due July 18, 2016.

By Karla L. Palmer –

On April 15, 2016, FDA released a draft guidance document providing clarification concerning FDA’s position on prescription requirements for compounding human drug products for identified individual patients. Since the 2013 passage of the Drug Quality and Security Act, there has been a degree of confusion whether compounders acting under Section 503A were permitted to compound for office use (i.e., office stock) under certain circumstances. FDA has publicly stated on several occasions since the passage of the DQSA that pharmacies that desired to maintain statutory exemptions in Section 503A (i.e., exemptions from new drug, adequate directions for use, and cGMP requirements) were limited to compounding for individually identified patients pursuant to a prescription, but some in Congress and the compounding pharmacy industry disagreed, and sought clarification of the issue.

Now – as it exists in draft form – FDA’s opinion (and guidance) is clear. Pharmacies acting pursuant to Section 503A must compound pursuant to a prescription for an individually identified patient. Like other guidance documents, this draft contains the statement that it does not establish legally enforceable responsibilities, but instead describes the Agency’s current thinking on a topic that should be viewed as recommendations unless specific statutory or regulatory requirements are cited.  

At the outset of the draft guidance, FDA states that Section 503A describes two situations in which a drug product can be compounded: (1) based on the receipt of a valid prescription order for an identified individual patient; or (2) in limited quantities before the receipt of a valid prescription order for an identified individual patient. FDA confirms that “Section 503A does not provide for distributing a compounded drug product before receiving a valid prescription order of an identified individual patient.”

FDA asserts that the prescription requirement under Section 503A “is a critical mechanism to distinguish compounding by a licensed pharmacist or licensed physician from conventional manufacturing, and to ensure that products compounded under Section 503A. . . are provided to a patient only based on individual patient need.“ A prescriber may write a prescription for an identified individual patient who “needs the compounded product.” In an office setting, a physician may compound a drug after making a notation in the chart of a patient “who presents with a need for the compounded medication.” FDA draft guidance also addresses “anticipatory compounding” in the context of an established relationship with a particular prescriber or patient. FDA’s draft policy gives specific direction with respect to the following:

Receipt of a Valid Prescription Order or a Notation Approved by the Prescriber under Section 503A

FDA states that if it is “not obvious from a prescription order that the prescription is for a compounded drug product,” a pharmacist “may consult with a prescriber to determine whether patient needs a compounded drug and make an appropriate notation on the prescription order. “ (Emphasis supplied.)   FDA also states that the notation “must” document the prescriber’s determination that the compound is necessary for the identified patient.   FDA recommends inclusion of the following statement on each prescription:

Per [type of communication] with [name of prescriber] on [date], [name of prescriber] has advised that compounded [name of drug] is necessary for the treatment of [name of patient].

FDA says that the prescription must identify the patient for whom the compound is prescribed; if the intended patient is not identified or unclear, then the “valid prescription requirement” will not be satisfied. And, the pharmacist must contact the prescriber if the patient identity is unclear, and cannot dispense the prescription unless it clarifies the patient’s identity.

When a Drug May be Compounded

Unless the drug is compounded in limited quantities consistent with FDA’s guidance on anticipatory compounding, FDA makes clear that the “drug product must be compounded after receipt of a valid prescription, which FDA states is compounding ‘on’ receipt of a valid prescription order consistent with Section 503A(a)(1).

Compounding Before Receipt of a Valid Prescription Order  

A drug may be compounded before the receipt of a valid prescription – in limited quantities – if all conditions of Section 503A are met, and the following:

• The compounding is based on a history of receiving valid prescription orders (including chart orders) for the compounding of the human drug product.
• The orders have been generated solely within an “established relationship” between the physician or pharmacist and the patient or prescriber.

FDA’s draft guidance quantifies and illustrates “limited quantities:” At this time FDA does not consider a compounder to have exceeded the limit if the compounder:

• Holds for “distribution” (i.e., product immediately available and not awaiting further testing) no more than a 30-day supply to fill valid prescriptions not yet received.
• The amount of supply is based on the number of valid prescriptions the compounder has received for identified individual patients in a 30-day period over the past year that the compounder has selected. In other words, it seems a compounder may pick his or her highest month of dispensing a particular preparation and compound that amount going forward in anticipation of receiving prescriptions during a thirty day period.  

When a Compounded product may be distributed under Section 503A

FDA reiterates throughout the draft guidance that compounds must be pursuant to Section 503A. FDA notes that, although it recognizes that state boards of pharmacy may permit “writing of prescriptions that do not include individual names,” FDA interprets Section 503A to require patient-specific prescriptions.

Office Stock / Office Use

FDA states that hospitals, clinics, and health care practitioners may obtain non patient-specific compounds from Section 503B outsourcing facilities (but any compounds dispensed from the outsourcing facility must be pursuant to a patient specific prescription).

Recordkeepking

Lastly, FDA seeks to expand compounders’ current recordkeeping requirements. Compounders should keep detailed records to demonstrate compliance with Section 503A, including those that demonstrate: (1) appropriate anticipatory compounding (including calculations performed to determine limited quantities that may be compounded before receipt of the prescription); (2) prescription orders bearing notations that the compound is necessary, and (3) the identity of the individual patient.

Comments are due on July 18, 2016.   

By Karla L. Palmer –

On April 18, 2016, FDA released draft guidance addressing what it considers a “facility” under FDCA Section 503B (the section of the Drug Quality and Security Act that created outsourcing facilities back in 2013). The draft guidance was prompted FDA was asked whether an outsourcing facility may create a separate area within its facility for compounding according to patient specific prescriptions under Section 530A, and not follow cGMP requirements in that area, yet use the same components and staff that compound in the Section 503B area. FDA believes that the application of different cGMP requirements or different conditions in Sections 503A and 503B to "comingle compounding activities” would cause confusion about what requirements apply, and may ultimately lead to production of substandard drugs.

Compounding Drug Products under Sections 503A and 503B at One Facility

FDA defines, in part, Section 503B as a “facility in one geographic location or address” to mean a “business or other entity under one management, direct or indirect, engaged in human drug compounding at a geographic location or street address.” Interestingly (and expansively), the Agency considers all activities, equipment, appurtenances, and materials part of such a facility if related to human drug compounding under the supervision of the facility’s management at the same address, or same building, or “buildings located in close proximity to one another.” A compounder cannot avoid conditions of Section 503B by “segregating or subdividing” compounding within an outsourcing facility. As an example, FDA states that an outsourcing facility may not divide its space with either permanent or temporary barriers, (i.e., different hoods or different rooms), or conduct different types of compounding activities (i.e., switching between 503B and 503A compounding) at different times of the day. FDA states that Section 503B’s intent is that all drugs compounded without the restrictions in 503A must be compounded in accordance with cGMP, appropriately labeled, and subject to adverse event reporting. FDA further states this will prevent co-mingling of 503A and 503B compounding activities to “evade the conditions” of Section 503B and cGMP requirements. FDA also believes its position provides clarity during inspections so that inspectors know what standard to apply (which statement is somewhat surprising since review of 483s of Section 503A compounding pharmacies since 2013 shows that FDA is holding most pharmacies to a quality standard that is close to if not overlapping with cGMP in many important respects).

Compounding Drug Products under Section 503B and Drug Manufacturing at the Same Facility

A conventional drug manufacturer may register as a Section 503B outsourcing facility, and thus make both approved drug products and compounded drug products – so long as all of the drug products at the facility are subject to the cGMP requirements set forth in 21 C.F.R. parts 210 and 211. When FDA finalizes its cGMP guidance for outsourcing facilities (released in draft form in 2014 (see our previous post here), that guidance would apply to drugs compounded at the facility pursuant to 503B. However, certain cGMP requirements (such as environmental monitoring and pressure differential monitoring rudiments) apply facility wide, and must be implemented throughout.   FDA is permitting manufacturers and outsourcing facilities to share space because compounded products are “easily differentiated” from approved drug products, and there is little chance of comingling of products to avoid regulatory requirements.

And a Note about Animal Drug Compounding…

In the draft guidance’s first footnote, FDA claims that the draft guidance does not apply to compounding of animal drugs, which seems inconsistent with FDA’s earlier May 2015 Draft Guidance concerning animal drug compounding, in which FDA is attempting to impose the outsourcing facility paradigm (and compliance with its statutory provisions) on veterinary drug compounders. See our prior post and FDA’s Draft Guidance here.   

Comments on the Draft Guidance are due July 18, 2016.

By Michelle L. Butler & and Alan M. Kirschenbaum –

The Department of Veterans Affairs (VA) recently issued an Important Notice on its website regarding a change in policy with regard to covered drugs (drugs approved via new drug applications, including authorized generics, and biologics license applications) that are not compliant with the Trade Agreements Act of 1979 (TAA). Previously, the VA required that all products offered on the Federal Supply Schedule (FSS) contract be U.S.-made or substantially transformed designated country end products. However, the VA is “now requiring that all covered drugs, regardless of county of substantial transformation, be available on a 65 I B FSS contract. In other words, we now accept covered drugs that were formally [sic] excluded due to their ‘TAA non-compliant’ nature.” As described in more detail below, the VA has set forth an aggressive timeline for companies to make these covered drugs available on the FSS contract.

In making this change in policy, the VA stated that, in accordance with the Federal Acquisition Regulation, the decision has been made that contracting officers may make individual non-availability determinations regarding covered drugs so that the products can be placed on the FSS contract pursuant to:

1) information provided by the offeror that neither the offered 42-2A covered drugs nor similar or like items are manufactured in the United States or a designated country in sufficient quantity to fulfill the requirements, and

2) the statutory requirement that manufacturers shall make available for procurement on the FSS each covered drug of the manufacturer. 

The VA has provided an aggressive timeline for these TAA non-compliant covered drugs to be added to a company’s FSS contract. In addition, for a company that does not have a 65 I B contract because it does not have any TAA-compliant covered drugs, it will be required to enter into an Interim Agreement, Master Agreement, and Pharmaceutical Pricing Agreement (this process is described here), followed by an FSS contract. The schedule for implementation is as follows:

• 04/19/2016 – Notice sent out to current contractors with procedures to add the TAA non-compliant covered drugs to the FSS contract and a link to Mass Modification 0004, which includes a modification related to this issue as well as some other items.
• 04/26/2016 – Deadline for submitting NFAMP data to PBM for these covered drugs.
• 05/06/2016 – Deadline for current contractors to submit the Mass Modification and Request for Modification to add the covered drugs to the FSS contract; deadline for companies without an existing 65 I B FSS contract to submit an Interim Agreement.
• 06/06/2016 – Date by which all TAA non-compliant drugs must be on the FSS contract or an Interim Agreement.

This is a major change in policy for the VA – one that will be good news to companies that have wanted to offer their TAA non-compliant products on the FSS contract but have been unable to do so. However, the speed with which the VA is requiring this to be accomplished is surprising and may be difficult for some companies to achieve. While this change in policy is limited to covered drugs under SIN 42-2A, one wonders if the VA is working to accomplish something similar for generic drugs under SIN 42-2B or if TAA non-compliant generic drugs will continue to be excluded from award on the FSS contract.

By Kurt R. Karst –      

Last month, the Federal Trade Commission (“FTC”) announced the filing of a Complaint For Injunctive and Other Equitable Relief in the U.S. District Court for the Eastern District of Pennsylvania alleging that Endo Pharmaceuticals Inc. (“Endo”) and other drug manufacturers, including generic drug manufacturers Watson Laboratories, Inc. (“Watson”) and Impax Laboratories, Inc. (“Impax”), violated U.S. antitrust laws by using so-called “pay-for-delay” settlement agreements “to block consumers’ access to lower-cost generic versions” of two drugs: OPANA ER (oxymorphone) Extended-release Tablets (approved under NDA 021610), and LIDODERM (lidocaine patch 5%) (approved under NDA 020612).

The Complaint has garnered a lot of attention because it is the first challenge by the FTC of a so-called “No-AG” (No Authorized Generic) agreement since the U.S. Supreme Court’s June 17, 2013 decision in FTC v. Actavis, Inc., 133 S. Ct. 2233 (2013), which addressed the standards that courts should apply in drug patent settlement cases.  But the Complaint is also interesting to us for another reason: the FTC’s comments concerning 180-day exclusivity for Generic LIDODERM.  Various FTC comments in the Complaint (e.g., as the first Paragraph IV filer, Watson “therefore became eligible for first-filer exclusivity, which could prevent the FDA from approving any other generic versions of Lidoderm until 180 days after Watson’s generic launch”) – seem to indicate that only a launch of drug product approved under an ANDA can trigger 180-day exclusivity.  

According to the FTC, the following aspects of the Lidoderm Agreement are suspect and violate antitrust laws:

In May 2012, Endo and its partner Teikoku agreed to pay Watson (now Allergan) to abandon its patent challenge and forgo entry with its lower-cost generic version of Lidoderm for more than a year until September 2013. This payment also included two components.  First, Endo agreed to refrain from marketing an authorized generic version of Lidoderm during the first 7.5 months of Watson’s  generic sales.  Second, Endo agreed to provide Watson with branded Lidoderm patches valued at $96 to $240 million “at no cost, ” which Watson could then sell through its distribution subsidiary for pure profit. . . .

[T]he No-AG Payment ensured that Watson would not face generic lidoderm patch competition for at least 180-days – and up to 7.5 months – after its launch . . . .

As part of the Lidoderm Agreement, Endo and Teikoku agreed to provide $12 million worth of branded product monthly from January through August 2013 to Watson through its wholly-owned subsidiary.  [(Emphasis added.)]

Keep the emphasized text in mind as we move forward . . .

In November 2009, Watson submitted the first ANDA to FDA (ANDA 200675) challenging a patent listed in the Orange Book for LIDODERM – U.S. Patent No. 5,827,529 (“the ‘529 patent”), which expired on March 30, 2014 – thereby qualifying Watson as a first applicant eligible for a period of 180-day exclusivity. Post-2003 (MMA), eligibility for 180-day exclusivity can be forfeited under various statutory provisions, and it is also triggered through commercial marketing.  Specifically, the statute (FDC Act § 505(j)(5)(B)(iv)(I)) states that subject to a forfeiture determination, “if the application contains a certification described in paragraph (2)(A)(vii)(IV) and is for a drug for which a first applicant has submitted an application containing such a certification, the application shall be made effective on the date that is 180 days after the date of the first commercial marketing of the drug (including the commercial marketing of the listed drug) by any first applicant. ” FDC Act § 505(j)(5)(B)(iv)(I) (emphasis added).

As we noted in a post last year, the parenthetical above has been the topic of some FDA discussion. In 2012, FDA applied the Agency’s pre-MMA interpretation of the statute with respect to Teva’s claim to 180-day exclusivity for a generic version of Cephalon’s PROVIGIL (modafinil) Tablets, 100 mg and 200 mg.  Teva acquired Cephalon on October 14, 2011, and on March 20, 2012, Cephalon announced the launch of an authorized generic version of PROVIGIL by Teva.  FDA determined that Teva’s commercial marketing of the PROVIGIL authorized generic triggered Teva’s 180-day exclusivity such that it would expire 180-days later on September 26, 2012.  But FDA could have determined that 180-day exclusivity had been triggered months before March 20, 2012, on October 14, 2011 when Teva acquired Cephalon.  It was at that time that “Teva immediately began marketing PROVIGIL under Cephalon’s NDA.”  FDA laid out this option in a footnote to an April 4, 2012 Letter Decision:

We have considered finding that Teva’s marketing of PROVIGIL upon its acquisition of Cephalon triggered its 180-day exclusivity, and believe that there is a strong argument for finding so. We have refrained from adopting that interpretation in this case, however, because that exclusivity, if it were triggered by Teva’s acquisition of Cephalon, would expire on April 11, 2012 and, given the multiple uncertainties in this case, Teva had no notice that FDA considered it to be running.  Because of the potential for collusion between NDA holders and captive first generics, and the subversion of the statutory scheme that could result, the agency may in the future provide guidance on the effect of such a relationship between NDA holder and first applicant upon any claim for 180-day exclusivity.

FDA has not further discussed this option publicly since April 2012.

FDA approved ANDA 200675 on August 23, 2012, and noted Watson’s first applicant status and eligibility for 180-day exclusivity, but the Agency decided to punt on making a firm decision as to whether or not Watson forfeited eligibility for 180-day exclusivity:

With respect to 180-day generic drug exclusivity, we note that Watson was the first ANDA applicant for Lidocaine Patch, 5%, to submit a substantially complete ANDA with a paragraph IV certification. Therefore, with this approval, Watson may be eligible for 180 days of generic drug exclusivity for Lidocaine Patch, 5%.  This exclusivity, which is provided for under section 505(j)(5)(B)(iv) of the Act, would begin to run from the date of the commercial marketing identified in section 505(j)(5)(B)(iv).  The agency notes that Watson failed to obtain tentative approval of this ANDA within 30 months after the date on which the ANDA was filed. See section 505(j)(5)(D)(i)(IV) (forfeiture of exclusivity for failure to obtain tentative approval).  The agency is not, however, making a formal determination at this time of Watson’s eligibility for 180-day generic drug exclusivity.  It will do so only if another paragraph IV applicant becomes eligible for full approval (a) within 180 days after Watson begins commercial marketing of Lidocaine Patch, 5%, or (b) at any time prior to the expiration of the ‘529 patent if Watson has not begun commercial marketing. Please submit correspondence to this ANDA informing the agency of the date commercial marketing begins.

FDA never had to make a decision on whether or not Watson forfeited eligibility for 180-day exclusivity pursuant to FDC Act § 505(j)(5)(B)(iv), because the next ANDA approved for generic LIDODERM – ANDA 202346 – was not approved until August 7, 2015. That’s nearly two years after the September 15, 2013 “Start Marketing Date” listed in the National Drug Code Directory for drug product marketed under ANDA 200675. So any 180-day exclusivity, if it was not forfeited for failure to obtain timely tentative ANDA approval, would have expired 180 days after September 15, 2013 (in March 2014). 

But could 180-day exclusivity for generic LIDODERM have expired earlier, well before September 2013?  Perhaps so under the rational FDA laid out in the above-quoted footnote concerning generic PROVIGIL 180-day exclusivity.

Under the Lidoderm Agreement, Watson’s “distribution subsidiary” obtained (and presumably commercially marketed) LIDODERM obtained from Endo beginning on January 1, 2013.  As a subsidiary of Watson, the sponsor of ANDA 200675, the marketing of LIDODERM by the “distribution subsidiary” arguably triggered Watson’s 180-day exclusivity such that it arguably expired on or about July 1, 2013. We’ll leave it to the antitrust experts to determine what (if any) relevance such an alternative exclusivity analysis might have in the litigation.

Hyman, Phelps & McNamara, P.C. (“HP&M”) is proud to announce the publication of its FDA Deskbook, incorporating more than a century of experience of HP&M’s attorneys from positions in the government and regulated industry. The FDA Deskbook provides a comprehensive resource that details the ins-and-outs of compliance and enforcement issues affecting FDA-regulated products.  The book features chapters on each regulated product area, as well as hot-button issues like advertising and promotion, fraud and abuse, and internal investigations.  

On April 27, 2016, at 1:00 pm Eastern, HP&M attorneys Jennifer D. Newberger, Jennifer M. Thomas, and Anne K. Walsh, will reference key sections from the book as they walk through a case study of a scenario facing a hypothetical medical device company (although the issues apply to any FDA-regulated entity) as it attempts to comply with FDA’s regulations and to respond to potential enforcement action when it fails to meet those requirements. The panel will:  

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Register for this webinar here. Participants will receive a copy of Chapters 11 (Devices: Medical Device Reports) and 20 (Internal Investigations) from the book.  Participants in this One-Hour Briefing are entitled to a 35% discount off the cover price of the book, which can be purchased here.

By Mark I. Schwartz & Douglas B. Farquhar - 

After several years of observing an increase in data integrity issues, particularly with overseas drug manufacturers regulated by CDER, on Thursday, April 14^th, FDA issued a question-and-answer-based draft guidance entitled “Data Integrity and Compliance with cGMP”. We will provide more details below but, in summary, the draft guidance, which relies on numerous prior guidances, contains the following recommendations:

• For recording data, manufacturing, or testing steps, numbered, controlled forms to be issued and reconciled by Quality Assurance;
• Disclosure to FDA of findings of data integrity violations, and “removing at all levels individuals responsible for [data integrity] problems from cGMP positions”
• Both audit trail review and review of electronic testing by Quality Assurance prior to batch release;
• “Four eyes” review (i.e., at least two employees) of any original hard-copy laboratory records; and
• Immediate, irreversible recording of electronic testing data (including upon completion of each HPLC testing sequence) as opposed to recording only at the end of the day).

While guidances are not binding, FDA does tend to rely on guidance during inspections and in making enforcement decisions.

In sum, what we have found is that this draft guidance makes some overarching assertions that are difficult to justify as supported by the regulatory texts in question. The guidance essentially sets up data integrity measures that drug manufacturers can ignore only at their peril, measures that go beyond what the regulations require.

The 21 CFR Part 211 regulations that FDA emphasizes in the draft guidance as forming an integral part of the data integrity requirements include:

• § 211.68 (requiring that “backup data are exact and complete,” and “secure from alteration, inadvertent erasures, or loss”);
• § 212.110(b) (requiring that data be “stored to prevent deterioration or loss”);
• §§ 211.100 and 211.160 (requiring that certain activities be “documented at the time of performance” and that laboratory controls be “scientifically sound”);
• § 211.180 (requiring that records be retained as “original records,” “true copies,” or other “accurate reproductions of the original records”); and
• §§ 211.188, 211.194, and 212.60(g) (requiring “complete information,” “complete data derived from all tests,” “complete record of all data,” and “complete records of all tests performed”).

The guidance, which applies to human and animal drugs and biologics, begins by defining some key terms, such as: “data integrity” meaning “…the completeness, consistency, and accuracy of data. Complete, consistent and accurate data should be attributable, legible, contemporaneously recorded, original or a true copy, and accurate…”

Other defined terms include: “metadata” (“…data about data…”), “audit trail” (“…a chronology of the ‘who, what, when, and why’ of a record…”), “static” (“…a fixed-data document such as a paper record or an electronic image…”), “dynamic” (“…the record format allows interaction between the user and the record content…”), as well as the following terms from 21 CFR 211.68(b) “backup” (“…a true copy of the original data that is maintained securely throughout the records retention period…”) and “computer or related systems” (“…computer hardware, software, peripheral devices, networks, cloud infrastructure, operators, and associated documents…”).

Next the draft guidance turns to eighteen questions and answers. Some of the more interesting ones will be discussed below. It is worth noting that FDA’s answers to the questions it poses to itself do tend to rely on prior guidances.

A question frequently posed by stakeholders is when is it permissible to exclude cGMP data from a facility’s decision making? The guidance provides that: “…[t]o exclude data from the release criteria decision-making process, there must be a valid, documented, scientific justification for its exclusion…The requirements for record retention and review do not differ depending on the data format; paper-based and electronic data record-keeping systems are subject to the same requirements.”

Next, 21 CFR 211.68(b) provides that “…[a]ppropriate controls shall be exercised over computer or related systems to assure that changes in master production and control records or other records are instituted only by authorized personnel…” However, this raises the question as to what constitutes “appropriate controls,” and how access to cGMP computer systems should be restricted?

FDA recommends that stakeholders restrict the ability to alter specifications, process parameters, or manufacturing or testing methods by technical means where possible, and suggests that the system administrator role, including any rights to alter files and settings, be assigned to personnel independent from those responsible for the record content.

However, FDA makes an exception where operations or facilities are small, with few employees, and presumably it is not feasible to separate such functions among different employees. In such an instance, FDA recommends that alternate control strategies be implemented, such as by having a second person review the tasks performed by the employee responsible for both system administration and record content, or, where that is not possible, the employee would need to recheck his own work.

One of the problems that FDA has encountered with data integrity issues over the past few years has been oversight, or control, of paper records, which can be discarded relatively easily, in some instances without the agency becoming aware. Hence the question: “How should blank forms be controlled?” FDA recommends that blank forms, such as worksheets, notebooks and master production and control records be controlled by the quality unit or by another document control method. As an example, FDA states that numbered sets of blank forms may be used, and should be reconciled upon completion. FDA recommends that incomplete or erroneous forms be kept as part of the permanent record along with a written justification for their replacement.

The inadequacies of a facility’s audit trails and, in some cases, their complete absence has been a basis for citation in many warning letters over the past few years. How often should an audit trail be reviewed and who should do the reviewing? FDA recommends that audit trails that capture changes to “critical data” be reviewed with each record and before final approval of the record. In a development that may complicate the process of batch release, FDA more specifically states that both audit trail review and review of electronic testing be performed by Quality Assurance prior to batch release.

Furthermore, the draft guidance does not explain the distinction between “critical” and “non-critical” data. In addition, the agency recommends routine scheduled audit trail review based on the complexity of the system and its intended use.

In terms of who should review audit trails, FDA recommends that personnel responsible for record review should review the audit trails that capture changes to critical data associated with the record as they review the balance of the record.

What about electronic documents versus paper? Can electronic copies be used as accurate reproductions of paper records? Yes, provided that the copies preserve the content and the meaning of the original data, which includes associated metadata and the static or dynamic nature of the original records.

Is it acceptable to retain the paper printouts, or static records, instead of the original electronic records from stand-alone computerized laboratory instruments? If the paper printout or static record is a complete copy of the original record, according to FDA it may satisfy the agency’s retention requirements. However, because certain types of electronic records are dynamic in nature, a printout or static record does not preserve the dynamic nature of the original electronic record, and according to FDA would not satisfy the cGMP requirements.

Because the cGMP regulatory requirements are centered around the notion of “records” and not “data” per se, a perennial question is when does “data” become a “record” such that industry must comply with record requirements under 21 CFR Part 211? The draft guidance states that when data is generated to satisfy a cGMP requirement, all such data becomes a cGMP record.

The draft guidance goes on to say that, in such instances, industry must document the data at the time of performance to create a record in compliance with the cGMP provisions. Yet, in support of this proposition, FDA cites to two regulatory provisions (21 CFR 211.100(b) and 21 CFR 211.160(a)) that, on their face, cannot reasonably be interpreted to apply to all records required to be kept under 21 CFR Part 211. This is fodder for another day, and perhaps a future blog posting.

On the question of whether an internal tip regarding a quality issue, such as potential data falsification, can be handled informally outside the documented cGMP quality system, the answer in the draft guidance is a firm “no,” again despite the paucity of regulatory language that speaks to this issue.

On the related question as to whether facility personnel need to be trained to detect data integrity issues as part of a routine cGMP training program, the agency is somewhat more circumspect, stating that training to detect data integrity issues “…is consistent with the personnel requirements…” under 21 CFR 211.25 and 21 CFR 212.10, though the agency does not go so far as to call it a “requirement” under the regulations.

Finally, FDA recommends that data integrity problems be addressed by hiring a third party auditor, determining the scope of the problem, implementing a corrective action plan (globally), and removing at all levels individual responsible for problems from cGMP positions. Regarding this last point, one has to wonder how the agency defines the term “individual responsible”. For instance, if a quality assurance manager at a plant is within the chain of command of someone on the shop floor who manipulated data, but there is no evidence that he knew or participated in any of the data manipulation, is he an “individual responsible”? In addition, is it really appropriate to require a laboratory technician to be removed from a cGMP position when he or she was pressured – at risk of loss of employment in an autocratic facility – because he complied with orders to run an “unofficial” test?

If the drug manufacturing industry and the consultants and lawyers that serve them agree that this draft guidance makes some overarching assertions that are difficult to justify as supported by the regulatory texts in question, it will be incumbent on them to submit comments to the docket in the hope of obtaining more clarity, and holding the agency to greater fidelity with 21 CFR Part 211.

To close on a related issue, FDA states that guidance documents do not establish legally enforceable responsibilities on industry. Instead, guidance is supposed to describe the agency’s current thinking on a topic, and should be viewed only as a series of recommendations (“best practices” if you will), unless specific regulatory or statutory requirements are cited. It remains to be seen whether the above-referenced data integrity best practices are truly FDA “recommendations”, or whether manufacturers that choose not to abide by them will end up being cited for them as “transgressions” in warning letters subsequent to their next inspection.

As always, we will keep you posted.

By Riëtte van Laack –

As we have reported on several occasions, “natural claims,” particularly when used in the advertising of food and dietary supplements, are frequently challenged by competitors and consumers.  Neither the Federal Food, Drug, and Cosmetic Act (FDC Act), nor FDA regulations, nor the Federal Trade Commission (FTC) define the term “natural.”  Last year, FDA issued a notice for comments regarding the definition of natural for foods (see our previous post here).  (FDA extended the comment period until May 10, 2016.)  However, thus far, FDA has stuck to its informal policy that it considers “natural” to mean “that nothing artificial or synthetic (including all colors regardless of source) has been included in, or has been added to, a food that would not normally be expected to be in the food.”  The Agency has infrequently taken action against a “natural claim” for a food. 

FTC’s activity regarding natural claims has been even more limited.  Decades ago, in the ‘70s the Commission proposed a definition.  But, in 1983, it discontinued its plans for a definition and announced that it would scrutinize such claims on a case-by-case basis. 

Thus, the FTC’s April 12 announcement (here, here, and here) of four consent decrees and a complaint against companies that market skin care products, shampoos, and sunscreens online with 100% or all natural claims came somewhat as a surprise.  

According to the consent decrees and the administrative complaint, the FTC charged that the companies falsely claimed that their cosmetic products are “all natural” or “100% natural,” even though their products contained synthetic ingredients.  Allegedly the companies made the all and 100% natural claims in online ads. 

Under the consent orders, the companies may not make such representation unless they have evidence to support the claim.  They must have competent and reliable evidence to substantiate any ingredient-related, environmental, or health claims they make. In the complaint against the non-settling company, California Naturel, FTC seeks similar relief.  No money penalties were included in the orders.

FTC actions concerned “all natural” and “100 percent natural.”  None of the cases addresses “plain” natural claims and the issues that FDA mentions in its notice for comments are not addressed. 

The FTC actions provide another reminder to companies that market any over-the-counter products to carefully consider use of natural claims, particularly this type of absolute (“all” and “100%”) claims. 

By Jay W. Cormier & Diane B. McColl –

This past Tuesday, FDA issued a Notice of Opportunity for Hearing (NOOH) proposing to withdraw approval of all new animal drug applications for carbodox that have an indication for use in medicated swine feed. Specifically, FDA is proposing to withdraw approval for this product because it has concluded that certain drug metabolites of the drug are carcinogenic and that the approved withdrawal periods are insufficient to ensure that metabolite residues do not exceed safe levels in the pork produced from pigs administered the drug.

In 2003, the Joint Expert Committee on Food Additives within the World Health Organization (JECFA) issued a report that included data suggesting that residue levels of the carcinogenic metabolites were approximately four times higher than what would be considered safe. A 2014 FDA internal memorandum subsequently concluded that continued approval of the drug would expose humans to between 11 and 30 times the level of metabolites that would be considered safe. FDA also found that this report and internal memorandum are consistent with scientific publications dating back as far as 1990 that suggest that FDA’s earlier conclusions of human food safety were incorrect.

FDA is basing its proposed withdrawal on two distinct legal theories. First, because FDA believes that the metabolites are unsafe for human consumption, FDA asserts that the “new” information regarding the drug and its metabolites renders the product unsafe under the conditions of use described in the approved product labeling. Thus, the product fails to meet what FDA calls the “General Safety Clause” found in section 512 of the FDC Act. There, FDA has the authority to withdraw an approved application if there is data to “show that such drug is unsafe for use under the conditions of use upon the basis of which the application was approved.” FDC Act § 512(e)(1).

Second, and perhaps more interesting, is that FDA bases its proposed withdrawal on a conclusion that carbadox no longer can use the “DES Proviso” exception to the Delaney Clause. We know that for many readers, you are now wondering whether our blog just went haywire and started publishing in a foreign language. So, let’s back up a bit…

In 1968, Congress added a specific subparagraph to the animal drug provisions of the FDC Act. That subparagraph was one of three clauses added to the FDC Act over a ten-year period (from 1958 to 1968) that gave FDA the authority to evaluate and reject food additives, color additives, and animal drugs that are found to induce cancer when ingested by man or animals. Collectively, these provisions are referred to as the Delaney Clauses. The Delaney Clause relevant to animal drug applications, found at section 512(d)(1)(I), however, includes an exception that was included in the statute to cover certain animal drugs such as diethylstilbestrol, often referred to as DES. FDA refers to this exception as the DES Proviso. Via the DES Proviso, a new animal drug that is found to be carcinogenic can, nonetheless, be approved if FDA finds that, under the conditions of use: (1) the drug will not adversely affect animals given the drug; and (2) no residues of the drug are found in the food products derived from treated animals.

It has been known that carbadox was a carcinogen since before it was first approved in 1972. But, because FDA at that time believed that all carcinogenic residues from carbadox would not be detectable in swine tissue after a specified period of time (i.e., the withdrawal period), FDA approved carbadox under the DES Proviso to the Delaney Clause. In 1986, the Center for Science in the Public Interest filed a Citizen Petition asking FDA to withdraw the approval of carbadox due to concerns over carcinogenicity of specified metabolites of the drug. In 1995, FDA denied the petition after finding that, if the product was used according to the approved label, drug residues would not pose a risk to humans consuming the pork from treated animals. In 1998, FDA again found that carbadox residues did not pose a risk to humans consuming pork products. However, based on the 2003 JECFA report and the published literature, FDA has reversed course, finding that the data no longer support a finding that carbadox meets the DES Proviso standard, and, therefore, the general prohibition against approval in the Delaney Clause applies.

To the best of our recollection, this is the first time that FDA has first found that the DES Proviso applies to a drug application, then approved the drug, and later reversed course and sought the withdrawal of the approval based on application of the Delaney Clause. In 1991, FDA withdrew the approval for furazolidone under the same two theories (the Delaney Clause and the General Safety Clause), but in that case furazolidone was approved without any carcinogenicity issues (unlike carbadox, which was initially approved under the DES Proviso).

It is important to note that Phibro Animal Health, the company that manufactures carbadox, stands by the safety of the product. As has been reported by CBS News, the company has stated:

We are disappointed that the FDA would take this action when definitive studies are so close to being completed. Under the FDA's process, we intend to request a hearing and refute the allegations. Phibro will continue to market the product and to vigorously defend [carbadox] based on more than 40 years of science and safe use.

While the safety of carbadox continues to be debated, one thing is for sure: the process for Phibro to seek a hearing and the appeals that such a process may entail will likely mean that this issue is not settled for quite some time.