By Kurt R. Karst –   

There are few things this blogger relishes more in his practice than getting his hands on FDA exclusivity decisions.  (It’s like being given and then unwrapping a holiday gift.)  We don’t mean the “decisions” that most people see in ANDA approval letters or that are published in the Orange Book.  Those “decisions” are interesting, but they aren’t usually terribly helpful because of their opacity.  We mean the decisions underlying those “decisions”; the decisions that explain why FDA granted (or denied) exclusivity to an application sponsor.  Those decisions aren’t published by FDA.  You have to know what you’re looking for, and then ask for them. 

We try to publicize FDA exclusivity decisions when we can.  After all, those FDA decisons should be freely available and in the public domain so that folks understand FDA’s current thinking.  Nobody likes stumbling around in a dark room.  The lights need to be turned on – or, at the very least, you need a night light.  Sometimes we cannot provide the actual FDA decision, so, when possible, we put up a post explaining what we know, as we did here and here.  Sometimes we can provide the actual FDA decisional memorandum.  We did that last year when we obtained a copy of FDA’s decision on 180-day exclusivity forfeiture for Risedronate Sodium Tablets (ACTONEL) (see our previous post here).  More recently, we publicized FDA’s various decisions on the scope of 3-year new clinical investigation exclusivity made available after the unsealing of litigation documents in a lawsuit involving extended-release Tacrolimus (see our previous post here).  In some instances, we’re in the dark as much as everyone else, because FDA has decided not to decide on exclusivity – sometimes for many months (as in the case of AURYXIA (ferric citrate) Tablets approved under NDA 205874), and sometimes for years (as in the case of SURFAXIN (lucinactant) Intratracheal Suspension approved under NDA 021746).

Over the past few weeks we’ve come across three exclusivity decisions: two concerning 180-day exclusivity forfeiture, and another concerning 3-year exclusivity.  The two 180-day exclusivity forfeiture decisions are interesting reads, but not overly noteworthy.  One FDA Memorandum provides FDA’s rationale for determining that 180-day exclusivity for Linezolid Injection 2 mg/mL (packaged in 600 mg/300 mL single-use flexible plastic containers), a generic version of ZYVOX, was not forfeited because of a change in or review of the requirements that prevented tentative approval within 30 months of ANDA submission (FDC Act § 505(j)(5)(D)(i)(IV)).  Another FDA Memorandum goes into the “better late than never” category and explains FDA’s rationale for determining that 180-day exclusivity for Valsartan Tablets, 40 mg, 80 mg, 160 mg, and 320 mg (DIOVAN) was not forfeited under FDC Act § 505(j)(5)(D)(i)(IV).  That decision led to litigation that was resolved in late 2012 (see our previous post here). 

Our best “find” is a March 3, 2015 Memorandum from the CDER Exclusivity Board explaining FDA’s decision to grant a period of 3-year exclusivity with respect to the April 16, 2013 approval of NDA 022272/S014 for OXYCONTIN (oxycodone HCl) Controlled-Release Tablets.  That NDA Supplement included a “drug liking” study and proposed the addition of “labeling language describing the results of pre- and post-marketing data from in vitro and in vivo abuse potential studies to the DRUG ABUSE AND DEPENDENDCE section of the Package Insert.”  The NDA Supplement approval was the first approval for a drug with abuse-deterrent labeling claims.  (Then in draft form – see our previous post here – today final guidance – “Abuse-Deterrent Opioids — Evaluation and Labeling” provides FDA’s current thinking about the studies that should be conducted to demonstrate that a particular drug product formulation has abuse-deterrent properties.)

The approval of NDA 022272/S014 had been on our radar for a while.  It was on our list of drug products for which an exclusivity decision was pending (and delayed).  We’re not entirely certain why it took FDA so long to make a decision, or what finally prompted the Agency to act, but when we saw the addition of a period of 3-year exclusivity for NDA 022272 in the February 2015 Orange Book Cumulative Supplement (published in mid-March) coded as “M-153” and defined as “ADDITION OF INFORMATION REGARDING THE INTRANASAL ABUSE POTENTIAL OF OXYCONTIN” we were immediately interested to know what FDA had to say.  (Orange Book exclusivity codes are defined in an appendix to the publication.  FDA has explained that “[e]xclusivity codes with an ‘I’ prefix (‘I-###’) are suggestive of new indication exclusivity, exclusivities for ‘new dosing schedules’ are assigned a ‘D-###’ code, whereas exclusivities that do not neatly fall into either of these two categories are assigned a ‘miscellaneous’ use code ‘M-###.’”)

After providing the necessary background and going through the criteria for granting 3-year exclusivity (i.e., an application for a previously approved active moiety containing “reports of new clinical investigations (other than bioavailability studies),” that were “essential to approval” of the application, and that were “conducted or sponsored by” the applicant), the CDER Exclusivity Board addresses the issues at hand: “The issues before the Board in this instance are the scope of exclusivity and the assignment of an appropriate exclusivity code in the Orange Book that best characterizes this exclusivity.”  Here’s what the Board has to say about those two issues:

Exclusivity extends only to the change approved in the supplement for which new clinical investigations were essential, and the Agency interprets the scope of 3-year exclusivity to be related to the scope of the underlying new clinical investigations that were essential to the approval of the supplement.  As discussed above, OTR 1018 did not support approval of the original NDA 022272 on April 5, 2010, and was thus not essential to the approval of the specific abuse-deterrent formulation of [reformulated OxyContin (OCR)].  This study only supported the addition of information obtained from the drug liking study to the OCR labeling that indicates that OCR has physicochemical properties that are expected to reduce abuse via the intranasal route.  Therefore, the scope of exclusivity in this instance is limited to the addition of this information to Section 9.2 in the labeling.

The Board notes generally that the scope of exclusivity should be determined by the nature of the clinical studies done to gain approval of the NDA, not by the exclusivity code that is used as shorthand to describe that approval in the Orange Book.  Nevertheless, the Board recommends that when the Orange Book listing is updated to display this exclusivity period, OCR be assigned a unique exclusivity code that reflects the scope of this exclusivity.  Given that the scope of 3-year exclusivity in this instance is limited to the addition of information to the OCR labeling regarding the reduction of abuse via the intranasal route, the Board recommends that the following exclusivity code be assigned:

M-###: “Addition of Information Regarding the Intranasal Abuse Potential of OxyContin.”

What one might gather from the Board’s memorandum is that the scope of the period of 3-year exclusivity for OXYCONTIN expiring on April 16, 2016 applies to the particular drug product formulation studied in clinical trials, and not broadly to prevent approval of all oxycodone extended-release drug products with abuse-deterrence labeling.  That would seem to be consistent with other FDA decisions.  For example, on January 4, 1999, FDA approved ANDA 075102 for Propofol Injectable Emulsion, 1% (10 mg/mL), notwithstanding a period of 3-year exclusivity on the reference listed drug, DIPRIVAN, that was not scheduled to expire until June 11, 1999.  The period of 3-year exclusivity applicable to DIPRIVAN was based on FDA’s approval of a NDA Supplement for a version of the drug product formulated with EDTA as a preservative.  FDA determined that the ANDA sponsor, whose drug product was formulated with sodium metabisulfite as the preservative in place of EDTA, was not subject to the exclusivity applicable to the EDTA-formulated version of DIPRIVAN because the scope of 3-year exclusivity was limited to the drug product formulation.

FDA’s decision was challenged in court.  In upholding FDA’s grant of 3-year exclusivity as relating only to the clinical investigations for EDTA, and not to preservatives in general, the U.S. District Court for the District of Maryland ruled in Zeneca Inc. v. Shalala, No. CIV.A. WMN–99–307, 1999 WL 728104 (D. Md. Aug. 11, 1999), aff’d, 213 F.3d 161 (4th Cir. 2000), that the 3-year exclusivity FDA granted:

extends only to the change approved in the supplement.  Zeneca’s NDA supplement sought authority to add EDTA to Diprivan.  The clinical investigations it submitted to the FDA with that supplement were necessitated by specific concerns related to EDTA, not to preservatives in general.  Thus, the exclusivity applies to propofol products including EDTA, not to propofol products with other preservatives.

More recently, FDA approved multiple 505(b)(2) applications for pharmaceutically equivalent testosterone gel drug products containing different penetration enhancers, and granted each sponsor a period of 3-year exclusivity.  FDA’s decision that the first 505(b)(2) application approved with a period of 3-year exclusivity – i.e., NDA 202763, approved on February 14, 2012 with a period of “new product” exclusivity expiring on February 14, 2015 – did not block the approval of a subsequent 505(b)(2) application – i.e., NDA 203098, approved on January 31, 2013 with a period of “new product” exclusivity expiring on January 31, 2016 – would seem to be the result of FDA’s determination that the scope of each applicant’s 3-year exclusivity is limited to the clinical trial data supporting approval of the particular penetration enhancer formulation tested. 

With all of the “abuse-deterrent” drug products in development these days (including products that are or will be the subject of 505(b)(2) applications), and given FDA’s recent explanation of the scope of 3-year exclusivity (above and in recent memoranda unsealed in litigation against FDA), interest (and concern) over the scope of a particular period of 3-year exclusivity seems to be growing.  Indeed, the concern was so great that late last year two companies exchanged waivers of 3-year exclusivity for their competing single-entity, extended-release hydrocodone drug products (see here).  Those mutual waivers occurred shortly after at least one of the companies met with FDA's Office of Chief Counsel on October 21, 2014 (see here) 

By David C. Gibbons –

On Friday, August 7, Judge Paul Engelmayer, U.S. District Court for the Southern District of New York, handed down one of the most significant rulings concerning First Amendment protection for a pharmaceutical manufacturer’s off-label promotion of an otherwise approved drug.  Judge Engelmayer granted a motion for preliminary injunction in favor of Amarin Pharma, Inc. (“Amarin” or “the Company”) and did what some believed the court would not do: reach the merits of Amarin’s First Amendment claims.  

Background

The case before Judge Engelmayer concerned Vascepa (icosapent ethyl), an ethyl ester of the omega-3 fatty acid eicosapentaenoic acid (“EPA”) obtained from fish oil.  Vascepa is an approved drug indicated as an adjunct to diet to reduce triglyceride levels in adult patients with severe (≥ 500 mg/dL) hypertriglyceridemia.  Vascepa (icosapent ethyl), Label, NDA 202057 (June 23, 2015). 

Vascepa’s approval was based on a single phase 3 clinical trial (the MARINE trial), conducted in patients with “very high” triglycerides (≥ 500 mg/dL), pursuant to a Special Protocol Assessment (“SPA”) agreement with FDA. Generally, a SPA indicates FDA agreement that a study will support the approval of a drug or biologic product’s marketing application (or supplement to an approved application) if it is conducted according to the protocol and it achieves its agreed-upon objectives.  See FDCA § 505(b)(5)(B); see also FDA, Guidance for Industry: Special Protocol Assessment, 2 (May 2002).  Once FDA and a sponsor enter into a SPA agreement, there are only two narrow statutory bases for changes to the SPA – written agreement between FDA and the sponsor or where FDA finds a “substantial scientific issue essential to determining the safety or effectiveness of the drug” that is identified after the trial has begun.  FDCA § 505(b)(5)(C). 

Similar to the Company’s approach with the initial indication, Amarin designed a single phase 3 clinical trial to examine the effect of Vascepa on triglyceride levels among statin-treated patients with “persistently high” triglycerides (≥ 200 and ≤ 500 mg/dL), the ANCHOR trial, and entered into a separate SPA with FDA (the “ANCHOR SPA”). In connection with the ANCHOR SPA, Amarin also agreed to conduct a cardiovascular outcomes trial (the REDUCE-IT trial) to examine whether Vascepa would be effective in reducing cardiovascular events.  As a condition of the ANCHOR SPA, FDA required that the REDUCE-IT trial would need to be at least 50% enrolled before FDA would accept Amarin’s supplemental new drug application (“sNDA”) for use of Vascepa in patients with persistently high triglycerides.  When Amarin submitted its application for approval of the initial indication, FDA reviewed the ANCHOR data as a second, confirmatory trial and included the combined safety results from both trials in the first indication labeling.

Amarin believed it had satisfied all of FDA’s requirements to obtain approval of Vascepa for persistently high triglycerides, per the ANCHOR SPA agreement.  The ANCHOR study achieved its primary endpoint demonstrating statistically significant reductions in triglyceride levels with Vascepa, compared to placebo. Vascepa achieved statistically significant results for its secondary endpoints in the ANCHOR study as well.  In addition, Amarin met its enrollment obligations with respect to the REDUCE-IT trial.  Thus, Amarin submitted its sNDA for the persistently high triglyceride indication in February 2013and anticipated a timely approval for this additional indication.

However, FDA convened an Advisory Committee during which the agency called into question the clinical validity of the ANCHOR study endpoint of triglyceride lowering, despite having agreed to that endpoint in the SPA. Data from several high-profile cardiovascular outcomes trials reported out after the ANCHOR SPA was entered into by FDA and Amarin and cast doubt on the clinical benefit of triglyceride lowering and whether a reduction in triglyceride levels would translate into a reduction in cardiovascular events, in general.  Upon reviewing these data, FDA asked the Advisory Committee to weigh in on whether Vascepa’s triglyceride lowering effect was sufficient to approve the drug for use in patients with persistently high triglycerides. The Advisory Committee voted 9 to 2 against approval of Vascepa for that indication. Subsequently, FDA rescinded the ANCHOR SPA, something FDA has done only 10 times among approximately 1,000 SPAs, and issued a Complete Response Letter to Amarin indicating the need for data showing a reduction in cardiovascular events (i.e., data from the REDUCE-IT trial) prior to approval for persistently high triglycerides.  Amarin stated that FDA concluded the Complete Response Letter “with a warning that any effort by Amarin to market Vascepa for the proposed supplemental use could constitute ‘misbrand[ing] under the Federal Food, Drug, and Cosmetic Act [(“FDCA”)].’”  Complaint at 27, Amarin Pharma, Inc. v. FDA, No. 15-3588 (S.D.N.Y. May 7, 2015).

The court had acknowledged the lawful use of FDA-approved drugs for off-label uses by doctors and the inability of FDA to regulate doctors so using those drugs.  The court cited to numerous studies of off-label use that shows such use is ubiquitous in clinical medicine, noting in some areas that off-label use is “the norm rather than the exception.”  Amarin at 5.  The court went on to say that the “therapeutic—indeed, sometimes life-saving—value of off-label uses of FDA-approved drugs has been widely recognized.”  Id. at 6. 

The court discussed how FDA has “long taken the position” that pharmaceutical manufacturers who market or promote off-label uses of approved drugs violate the FDCA.  Id. at 9.  The court described FDA’s long-standing position that off-label promotion of drug products risks criminal misbranding under the FDCA.  FDCA § 301(b).  A drug is misbranded if its labeling is “false or misleading in any particular.”  Id. § 502(a).  A drug is misbranded, according to the FDCA, if its labeling does not bear “adequate directions for use.”  Id. § 502(f).  FDA regulations define adequate directions for use as those under which a lay person can “use a drug safely and for the purposes for which it was intended.”  21 C.F.R. § 201.5.  The court, in its opinion, skipped a step, but it is important to note that labeling for prescription drugs, which are not safe for use except under supervision by a licensed health care provider, cannot bear adequate directions for use by a lay person, but can be subject to an exemption from this statutory requirement.  FDCA §§ 503(b), 502(f).  FDA regulations require that, to satisfy the conditions for this exemption, prescription drugs must have labeling that contains “adequate information for [] use . . . under which practitioners licensed by law to administer the drug can use the drug safely and for the purposes for which it is intended, including all conditions for which it is advertised or represented.”  21 C.F.R. § 201.100(d)(1) (emphasis added).  “Intended use” means the objective intent of the persons legally responsible for the labeling of drugs, which is determined by such persons’ expressions or may be shown by the circumstances surrounding the distribution of the article.  This objective intent may, for example, be shown by labeling claims, advertising matter, or oral or written statements by such persons or their representatives.  21 C.F.R. § 201.128.  Where the intended use of a prescription drug differs from the use approved by FDA (as indicated in the drug’s approved labeling), FDA has asserted that the product is a “new drug” for which FDA approval is required.  Placing a new drug in interstate commerce without FDA approval is a violation of the FDCA.  FDCA § 505(a). 

FDA has argued that misbranding actions against manufacturers who engage in off-label promotion furthers public safety.  Amarin at 12.  The court noted, “FDA has stated, its goal in pursuing misbranding charges against manufacturers based on the off-label promotion of drugs is to encourage use of the FDA’s drug review and approval process.”  Id.  Prosecutions therefore, act as a deterrent for manufacturers to evade FDA’s drug approval process for new uses of approve drugs.  Id. at 13. 

Amarin’s Proactive Challenge to FDA

In a bold move, Amarin filed a civil complaint against FDA claiming that FDA’s threat of prosecution for misbranding Vascepa had a chilling effect on Amarin’s commercial speech that was otherwise protected by the First Amendment.  For that reason, Amarin sought declaratory and injunctive relief that would prevent FDA from prosecuting the Company for truthful, non-misleading speech concerning Vascepa, going so far as to detail, in its complaint, certain off-label promotional content regarding Vascepa that the Company proposed to disseminate.  Early in the litigation proceedings, Amarin filed a motion for preliminary injunction and the court heard oral arguments on the motion on July 7, 2015, and, on August 7, the court handed down a 71-page opinion in which it granted Amarin’s requests, as described below.

Amarin sought to disseminate three types of information relating to the use of Vascepa in patients with persistently high triglycerides.  Importantly, Amarin stated in its complaint that it did not intend to promote this use of Vascepa in direct-to-consumer advertising, but only sought to “engage in truthful, nonmisleading speech about Vascepa directly with healthcare professionals.”  Compl. at 41.  First, Amarin wanted to disseminate the results of the ANCHOR study.  Amarin proposed to distribute summaries of Vascepa’s effect on triglycerides as well as secondary endpoints on other lipid parameters that were examined in the ANCHOR study.  Second, Amarin wanted to make the statement that “[s]upportive but not conclusive research shows that consumption of EPA and DHA [(docasohexanoic acid)] omega-3 fatty acids may reduce the risk of coronary heart disease,” a claim that EPA- and DHA-containing dietary supplements are allowed to make, under FDA’s rules.  Compl. at 41, 31-37.  Third, Amarin sought to distribute reprints of “peer-reviewed scientific publications relevant to the potential effect of EPA on the reduction of the risk of coronary heart disease.”  Compl. At 42.  Along with this information, Amarin proposed to make relevant “contemporaneous disclosures” to ensure that the messages the Company communicated to healthcare professionals concerning the use of Vascepa in patients with persistently high triglycerides was not misleading.  These disclosures included the statements: 

• FDA has not approved Vascepa to reduce the risk of coronary heart disease;
• FDA has not approved Vascepa for the treatment of statin-treated patients with mixed dyslipidemia and high (> 200 mg/dL and < 500 mg/dL) triglyceride levels;
• The effect of Vascepa on the risk of cardiovascular mortality and morbidity has
• not been determined;
• A cardiovascular outcomes study of Vascepa designed to evaluate the efficacy of Vascepa in reducing cardiovascular mortality and morbidity in a high risk patient population on statin therapy is currently underway; and
• Vascepa may not be eligible for reimbursement under government healthcare programs, such as Medicare or Medicaid, to reduce the risk of coronary heart disease or for treatment of statin-treated patients with mixed dyslipidemia and high (> 200 mg/dL and < 500 mg/dL) triglyceride levels. We encourage you to check that for yourself. [(Compl. at 42-43.)]

In response, and perhaps in light of FDA’s recent losing record on First Amendment cases, FDA attempted to moot Amarin’s case in a letter provided to Amarin and filed with the court.  In its letter, FDA stated that it “does not intend to object to Amarin’s proposed communications” if made in a truthful, non-misleading, and balanced manner.  Exhibit A to Letter from Ellen London to Judge Paul A. Engelmayer at 6, Amarin, No. 15-3588 (S.D.N.Y. June 8, 2015).  Essentially, FDA agreed that many of Amarin’s proposed communications were consistent with FDA policy on dissemination of reprints and other medical communications.  FDA also agreed that Amarin’s proposed contemporaneous disclosures regarding Vascepa’s regulatory status, approval limitations, and the status of the REDUCE-IT trial would help to balance Amarin’s presentation of Vascepa efficacy data in patients with persistently high triglycerides.  However, FDA insisted that certain additional disclosures be made with Amarin’s proposed off-label promotion and rejected Amarin’s ability to make claims similar to the qualified health claims of EPA-containing dietary supplements.  FDA justified its exercise of enforcement discretion regarding these claims in the dietary supplement context due to the different statutory and regulatory schemes governing dietary supplement as well as the lower level of scientific evidence required for such products.

The Court Granted Preliminary Relief to Amarin

Finding a ripe controversy as to the threat of prosecution under the FDCA, the court indicated that the central dispute, as to whether a preliminary injunction should be granted, was whether Amarin was likely to succeed on the merits.  In accord with binding precedent set by the Second Circuit in the criminal misbranding case, United States v. Caronia, 703 F.3d 149 (2d Cir. 2012) (here), Judge Engelmayer granted Amarin’s motion for preliminary injunction against FDA.  The court noted that Amarin sought protection for its speech “both at a general and a statement-specific level.”  Amarin at 28.

When addressing Amarin’s statement-specific request for relief, surprisingly, the court evaluated and ruled on each of Amarin’s proposed off-label statements concerning Vascepa along with FDA’s responses to the same.  The court held, noting that FDA did not dispute, that Amarin’s dissemination of a summary of the ANCHOR study results as well as the reprints regarding the potential cardioprotective effect of EPA, “would be neither false nor misleading.”  Amarin Pharma, Inc. v. FDA, No. 15-3588, 55 (S.D.N.Y. Aug. 7, 2015) (opinion and order granting preliminary injunction).  The court then considered the “agreed-upon statements and disclosures” proposed by Amarin.  These included statements concerning the results of the ANCHOR study on both primary and secondary endpoints.  The court held the statements, along with the proposed contemporaneous disclosures that would be made with such statements were “based on current information, truthful and non-misleading.”  Id. at 57. 

Next, the court discussed additional “contested disclosures” that would be made contemporaneously with certain off-label statements concerning Vascepa.  Amarin proposed to state: “FDA has not approved Vascepa for the treatment of statin-treated patients with mixed dyslipidemia and high (≥200 mg/dL and <500 mg/dL) triglyceride levels.”  However, FDA wanted the following added to this disclosure: “FDA declined to approve this indication because the available evidence does not establish that reducing triglycerides with a drug reduces the risk of cardiovascular events among patients already treated with statins,” to which Amarin disagreed.  Court filings evidenced the back-and-forth between Amarin and FDA concerning the appropriate disclosure indicating FDA’s lack of approval for the persistently high triglyceride indication.  In the end, the court agreed with FDA that a disclosure explaining FDA’s decision not to approve Vascepa for this off-label use was necessary, stating that a revised disclosure “drawing upon both parties’ final positions, achieves a truthful and non-misleading result.”  Id. at 58.  Judge Engelmayer then proceeded to provide such a revised disclosure that read:

Vascepa is not FDA-approved for the treatment of statin-treated patients with mixed dyslipidemia and high (≥ 200 mg/dL and < 500 mg/dL) triglyceride levels due to current uncertainty regarding the benefit, if any, of drug-induced changes in lipid/lipoprotein parameters beyond statin lowered low-density lipoprotein cholesterol on cardiovascular risk among statin-treated patients with residually high triglycerides. No prospective study has been conducted to test and support what, if any, benefit exists.  [(Id.  at 60.)] 

The court held that its own revision was “at present, truthful and non-misleading,” but noted that Amarin and FDA were “at liberty to pursue further refinements. . . .”  Id. at 60.

Finally, the court considered Amarin’s proposed cardiovascular disease claim.  During the litigation, Amarin proposed to revise the claim to read: “Supportive but not conclusive research shows that consumption of EPA and DHA omega-3 fatty acids may reduce the risk of coronary heart disease. Vascepa should not be taken in place of a healthy diet and lifestyle or statin therapy.”  Id. at 63.  The court held that its “assessment, with Amarin, is that the coronary heart disease claim—given its qualified phrasing and its acceptance elsewhere by the FDA, and with the sentence added by Amarin—is presently truthful and non-misleading. Therefore, Amarin may today make that claim, too, without exposing itself to liability for misbranding.”  Id. at 64. 

The court noted that circumstances could change the court’s “approval” of the aforementioned statements as truthful and non-misleading.  The court stated:

The Court has held that Amarin’s proposed communications, as modified herein, are presently truthful and non-misleading. But the dynamic nature of science and medicine is that knowledge is ever-advancing. A statement that is fair and balanced today may become incomplete or otherwise misleading in the future as new studies are done and new data is acquired. The Court’s approval today of these communications is based on the present record. Amarin bears the responsibility, going forward, of assuring that its communications to doctors regarding off-label use of Vascepa remain truthful and non-misleading.  [(Id. at 66.)]

The Court’s High-level Analysis and Holding Related to First Amendment Protection for Off-Label Promotion

In addition to its rulings on the specific statements proposed by Amarin, the court also addressed Amarin’s general request for First Amendment protection for truthful and non-misleading off-label promotion.  The court heavily relied on the precedent-setting analysis in Caronia, although this court amplified Caronia’s central holding in Amarin’s as-applied challenge to FDA’s threat of prosecution for off-label promotion. 

At a high level, the court said that FDA “reserve[ed] the right” to prosecute Amarin for its truthful and non-misleading off-label promotion.  Id. at 44.  FDA’s argument was a refinement of its long-standing position that it would use Amarin’s speech as evidence of misbranding, and not prosecute the speech itself.  FDA, in its briefs as well as in its oral arguments stated that it could lawfully use speech to establish both the intent and the act of misbranding.  In addition to using Amarin’s speech as evidence of intent to misbrand Vascepa, FDA stated that it “may bring a misbranding action where Amarin’s only acts constituting promotion of Vascepa for an off-label use are its truthful and non-misleading statements about that use, provided that these acts support an inference that Amarin intended to promote that off-label use.”  Id.  FDA went on to argue that “it does not read Caronia to preclude a misbranding action where the acts to promote off-label use consist solely of truthful and non-misleading speech, provided that the evidence also shows that the drug had been introduced into interstate commerce and that the FDA had not approved it as safe and effective for the off-label use.”  Id. at 44-45.  To bolster its point, FDA likened misbranding to other crimes where speech constitutes the act, such as jury tampering, blackmail, and insider trading.  Id. at 45.

The court flatly rejected FDA’s interpretation of Caronia and stated that “[t]he [c]ourt’s considered and firm view is that, under Caronia, the FDA may not bring such an action based on truthful promotional speech alone, consistent with the First Amendment.”  Id. (emphasis in original). The court stated that, based on its reading of Caronia, misbranding is not like the analogous crimes of jury tampering, blackmail, or insider trading.  The court closed the door on FDA’s line of reason by stating, “[w]here the speech at issue consists of truthful and non-misleading speech promoting the off-label use of an FDA-approved drug, such speech, under Caronia, cannot be the act upon which an action for misbranding is based.”  Id. at 49 (emphasis in original).

FDA made three counter-arguments, none of which persuaded the court. First, FDA argues that Amarin’s proactive challenge constituted a “frontal assault” on FDA’s new drug approval process to which Congress gave effect in the 1962 amendments to the FDCA.  Id.  To this, the court simply stated that the 1962 amendments predate First Amendment jurisprudence protecting commercial speech (see Cent. Hudson Gas & Elec. Corp. v. Pub. Serv. Comm’n, 447 U.S. 557 (1980)) and finding that pharmaceutical speech qualifies for such protection (see Sorrell v. IMS Health, Inc., 131 S. Ct. 2653, 2672 (2011)).  Id.  The court went so far as to “ding” FDA for not seeking a rehearing or appeal of Caronia. 

Second, FDA argues that Caronia’s holding should only apply to certain types of truthful and non-misleading off-label promotion, consistent with FDA policy as expressed in its guidance documents.  For example, off-label promotion in the context of a solicited request for such information is permissible while the unsolicited provision of such information is not.  The court responded by stating that Caronia applies “across the board to all truthful and non-misleading promotional speech.”  Id. at 51 (emphasis in original). 

Finally, FDA reprised its argument that Caronia does not prohibit the use of speech as evidence of intent to promote a drug for off-label uses.  The court found this argument “beside the point” since Amarin’s lawsuit concerned only the situation in which FDA prosecuted Amarin for misbranding based on its truthful and non-misleading speech.  The court stated that the “construction [of the misbranding provision in the FDCA in accord with Caronia] applies no matter how obvious it was that the speaker’s motivation was to promote such off-label use.”  Id.  The court concluded by stating: “[i]n the end, however, if the speech at issue is found truthful and non-misleading, under Caronia, it may not serve as the basis for a misbranding action.”  Id. at 53.

Conclusion

There are several points we would emphasize, as we read the court’s lengthy opinion in Amarin:

• Although the court reached the merits in this case, the opinion reflects a ruling only on Amarin’s motion for preliminary injunction.  However, it does provide a great deal of insight into the court’s thinking on the matter. 
• The government has a number of options at this point, one of which is to file an appeal, for which it has 60 days to do so.  We cannot predict whether the government will appeal, cut its losses and settle with Amarin, or continue to defend itself as the litigation progresses.  The government’s next move may have a significant impact on this ruling.
• While this ruling in Amarin, coupled with the Second Circuit’s decision in Caronia, appears to foreclose FDA from prosecuting a pharmaceutical manufacturer for truthful and non-misleading off-label promotion, it is important to note that this precedent has only been established in the Second Circuit to date and there is considerable uncertainty as to how sister Circuits would rule if faced with the same set of facts. 
• Finally, the limitation of First Amendment protection to truthful and non-misleading speech is not to be missed.  Indeed, the court gave very practical advice to manufacturers when it said:

Although the FDA cannot require a manufacturer to choreograph its truthful promotional speech to conform to the agency’s specifications, there is practical wisdom to much of the FDA’s guidance, including that a manufacturer vet and script in advance its statements about a drug’s off-label use. A manufacturer that leaves its sales force at liberty to converse unscripted with doctors about off-label use of an approved drug invites a misbranding action if false or misleading (e.g., one-sided or incomplete) representations result. Caronia leaves the FDA free to act against such lapses.  [(Amarin at 53.)]

By Riëtte van Laack –

On August 5, 2015, FDA announced the availability of a guidance document regarding nanomaterials in food for animals.  The guidance contains no surprises as it is virtually identical to the draft guidance (based on the docket, it appears that FDA did not receive any comments to the draft guidance) and is in agreement with FDA’s guidance regarding use of nanomaterials in human food (see our previous post here).

At the outset, FDA clarifies that the guidance is applicable only to feed ingredients for which the size has been deliberately manipulated with the goal to produce specific effects.  Materials that naturally occur or naturally contain substances in nanoscale range or contain particles in nanoscale range as a result of conventional manufacturing processes are not within the scope of the guidance. 

FDA does not question the regulatory status of products that naturally contain nanosize substances and have already been determined to be generally recognized as safe (GRAS) or approved as a food additive.  However, FDA concludes that animal food ingredients that have been engineered to be nanosize are not GRAS and, therefore, will be food additives subject to premarket review and approval by FDA.  The guidance details FDA’s recommendations for a food additive petition for nanomaterial food ingredients.  Throughout the guidance, FDA encourages companies contemplating the use of nanomaterials in animal food to consult FDA.

By Jeffrey K. Shapiro & Jeffrey N. Gibbs –

The Office of Combination Products (OCP) was established in 2002 to improve the agency’s handling of combination products and also drug versus device classification decisions.  Unfortunately, it has become clear that more needs to be done.  FDA’s approach to these issues continues to slow technological innovation.

Senators Isakson, Casey and Roberts have introduced a reform bill called, “The Combination Product Regulatory Fairness Act of 2015” (S. 1767).  This bill is a good start, but more is needed.  This post will focus on reform of drug versus device classification decisions. 

For certain types of products, it can be a close question whether it is a drug or device under the statute.  This area of decision making by the OCP badly needs reform.

As the OCP reads the Food, Drug, and Cosmetic Act (FDCA), any product intended to diagnose, prevent or treat disease, or alter the structure or function of the body is presumptively a drug unless an applicant proves that it satisfies the “device exclusionary clause.”  This clause states that an article is a device if it “does not achieve its primary intended purposes through chemical action within or on the body of man … and … is not dependent upon being metabolized for the achievement of its primary intended purposes.”  Id., sec. 201(h).

Whether or not the OCP’s reading of the FDCA in this regard is plausible, there are important classes of products historically regulated as devices that have some degree of chemical action.  For example, many wound healing products fall in this category.  Various washes or skin care products with neutralizing or surfactant properties are another example.  Now, when a new product is presented, the OCP requires detailed information – within its 15-page limit – about the chemical action of each and every component and classifies the product as a drug if it cannot be proven that the exclusionary clause is satisfied. 

This approach leads to inconsistency with historical agency classification decisions, so that a product intended to compete with other devices is forced to undergo much more burdensome drug regulation.  OCP’s lack of transparency also means surprises for applicants, since they had expected – and reasonably so – that like products would be regulated in a like manner.  Furthermore, for many of these products, the drug regulatory framework is a bad fit and unnecessarily burdensome for the protection of public health.  In many instances, the more burdensome drug provisions mean that the company abandons the attempt to sell the product in the U.S.

The Isakson bill would create a procedure requiring the OCP to provide a scientific rationale for its conclusion that chemical action is responsible for achieving a product’s primary intended purpose, and would permit a sponsor the option to propose a study to resolve the issue.

This solution is not likely to yield good fruit.  It will not be difficult for the OCP to provide a rationale, even if supported by little science.  It often does so now.  Once the decision is made, with or without a required scientific rationale, it is difficult or impossible as a practical matter for the sponsor to challenge.  An appeal goes to the Office of Special Medical Programs (OSMP), where matters often languish without a decision for well past a year.  While OCP must decide in 60 days, OSMP has no deadline.  A lawsuit is likely to be prohibitively expensive for most sponsors, and represents even more years of delay.

Sponsors have always had the opportunity to provide study data to show that chemical activity is not responsible for the product’s primary purpose.  In our experience, and as shown by the Prevor litigation (see our previous posts here, here, and here), the OCP tends to apply narrow and stringent constructions on the data, with a bias toward concluding that the study does not exclude chemical action as playing a role in product performance.  Since the study must prove a negative, i.e., that chemical action does not play a role – or at least more than a minor role – it is easy for the OCP to dismiss almost any such study as insufficient.

The more formal opportunity to develop a study in the Isakson bill may make it possible to provide supporting data more efficiently, but is unlikely to resolve the problems identified above.  It also places quite a burden on a sponsor, requiring a study solely to address classification, even before undertaking additional studies to show that the product is safe and effective.

At a minimum, the burden of scientific proof should be reversed and placed upon the OCP.  That is, instead of the sponsor proving that there is no chemical action involved in achieving the product’s primary purpose, the OCP should not be permitted to classify a product as a drug unless it proves that a product claimed to be a device actually uses chemical (or metabolic) action as the primary mechanism for achieving the product’s primary purpose. 

More fundamentally, the problem with the Isakson bill on this point is that it applies a procedural solution to a substantive problem: the OCP’s construction of the governing statute.  A root cause solution to the problem does not require a new procedure; it requires a revision to the statute to shift the burden of proof and to require that the chemical or metabolic action be the primary mechanism for achieving the product’s primary purpose.

To be clear, we are not questioning the OCP’s good faith in its classification decisions.  The problem is that, as a practical matter, the OCP’s decisions are not yielding good outcomes from a public health perspective, and create confusion by being inconsistent with prior classifications.  The solution is to revise the statute to help direct the OCP’s energies in the right direction.

One final, somewhat technical, note:  The exclusionary clause in the device definition requires that chemical action not be required to achieve the products “primary purposes.”  The Isakson bill refers to the “primary purpose.”  This distinction, believe it or not, has been a subject of litigation.  The OCP, at least for a time, declared every possible purpose to be “primary” and thereby precluding device classification if any of them were achieved by chemical action.  It would be helpful to clarify it by striking the “s” and changing “primary purposes” to “primary purpose.” 

Or, even more helpfully, Congress could change “primary purposes” in the exclusionary clause to “intended use” which is the key phrase in the device definition.  No one, to our knowledge, has explained the why “intended use” is used in the body of the definition but “primary purposes” is used in the exclusionary clause.  This discrepancy seems to serve no purpose other than to stir up confusion.

By Alan M. Kirschenbaum –

Yesterday, CMS’s final Medicaid Drug Rebate Program rule arrived on the doorstep of OMB’s Office of Information and Regulatory Affairs (OIRA) for review under Executive Order 12866.  Under the Executive Order, OIRA ordinarily has 90 days to complete its review, with the possibility of one 30-day extension with the written approval of the Director of OMB.  Of course, OIRA may complete its review sooner.  The current Unified Agenda of Regulatory and Deregulatory Actions still identifies August 2015 as the expected time of publication, as it has since May.  Note that the expected “final action” date published in the regulatory agenda has been missed multiple times since CMS published the proposed rule in February 2012.  However, we can now be relatively confident that the final rule will be published within the next several months.  We will be watching for it and will keep our readers posted.

By Larry K. Houck –

Representatives Bill Johnson (R-Ohio) and Doris Matsui (D-California), members of the House Energy and Commerce Committee, introduced legislation in Congress on July 28th that seeks to curb teenage dextromethorphan (“DXM”) abuse by restricting its sale to individuals under 18 years old.  The DXM Abuse Prevention Act of 2015 (H.R. 3250) is similar to the Preventing Abuse of Cough Treatments Act of 2014 (H.R. 3969) that Rep. Johnson introduced in January 2014, which was last referred to the Subcommittee on Health in February 2014.  A post on the 2014 bill appeared here on February 5, 2014.

Representative Johnson observed that “[t]eens are taking large doses of cough and/or cold medicine to get high, largely because of its easy availability.”  Dextromethorphan is an antitussive (i.e., cough suppressant) found alone or in combination with other drugs in over 120 over-the-counter cough and cold products.  Dextromethorphan is not a federally-controlled substance, but the Drug Enforcement Administration (“DEA”) has noted that even though abuse is not exclusive to individuals in a specific age group, “its abuse by teenagers and young adults is of particular concern.”  Dextromethorphan, DEA Office of Diversion Control, March 2014.  A handful of states prohibit the sale of dextromethorphan to minors.

The DXM Abuse Prevention Bill would amend the Federal Food, Drug, and Cosmetic Act by:

• Prohibiting the sale of any drug containing dextromethorphan to individuals under 18 years old except with a valid prescription or for military personnel;
• Requiring retailers to verify that they are not selling dextromethorphan to individuals under 18 years old and to implement a verification system through an electronic point-of-sale prompt to verify age, employee training manuals and materials, sales approval by authorized employees, signs or other authorized measures;
• Providing an affirmative defense to retailers who check identification and reasonably conclude that the identification is valid and indicates that the customer is at least 18 years old;
• Creating the following penalties for age violations:  a warning for a first violation; civil penalties of up to $1,000 for a second violation, civil penalties of up to $2,000 for a third violation and civil penalties up to $5,000 for a fourth or subsequent violation;
• Prohibiting possession or receipt of unfinished dextromethorphan by any person not registered, licensed or approved under federal or state law to practice pharmacy, engage in “pharmaceutical production,” or manufacture or distribute drug ingredients;
• Prohibiting the distribution of unfinished dextromethorphan to unregistered or unauthorized persons; and
• Establishing a civil penalty of up to $100,000 for the unfinished dextromethorphan possession, receipt and distribution violations.

In determining civil penalty amounts for violations, the bill would require consideration of whether the retailer “has taken appropriate steps to prevent subsequent violations,” including establishing a documented training program for all employees who sell dextromethorphan.  The bill has received strong support by a number of anti-drug abuse, healthcare and industry organizations including the Consumer Healthcare Products Association, Drug Abuse Resistance Education (“D.A.R.E.”) and Partnership for Drug-Free Kids.  The bill was referred to the Committee on Energy and Commerce the day it was introduced.

By Riëtte van Laack –

On July 30, FDA announced the publication of a draft guidance titled “FDA’s Policy on Declaring Small Amounts of Nutrients and Dietary Ingredients on Nutrition Labels”.  The draft guidance addresses an apparent conflict between FDA’s compliance guidelines and FDA’s rounding rules for nutrition labeling.  The relevant regulations have been in effect for approximately two decades and the conflict is not new, so it is unclear what induced FDA to issue this guidance now.

So what is it all about?  The nutrition labeling regulations, 21 C.F.R. §§ 101.9(c)(1)-(8); 101.36(b)(2)(ii), specify how to declare nutrients and dietary ingredients.  Notably, the regulations specify the rounding of nutrients, e.g., the quantitative amount of total fat present at 5 g or less must be rounded to the nearest 0.5 increment.  The regulations also specify how FDA tests for compliance.  Paragraphs (g)(4)(ii) and (g)(5) of section 101.9 detail what is often referred to as the 20-20 rule.  Specifically, under the compliance provisions a product declaring the amount of a nutrient or dietary ingredient is misbranded if:

• The amount of a naturally present vitamin, mineral, protein, total carbohydrate, dietary fiber, other carbohydrate, polyunsaturated fat, monounsaturated fat or potassium is less than 80% of the declared value for that nutrient
• The amount of calories, sugars, total fat, saturated fat, trans fat, cholesterol, or sodium is more than 120% of the declared value for that nutrient.

For small amounts, however, it may not be possible to comply with the rounding requirements under 101.9(c)(1)-(8) and meet the compliance standard of 101.9(g), because the rounding may result in more than the permissible 20% deviation.  For example, if a food contains 0.70 g of saturated fat per serving, this amount would be declared as 0.5 g, but this declaration would not comply with § 101.9(g)(5) because 0.70 g is more than 20 percent in excess of 0.5 g. 

FDA advises that the label should declare nutrients and dietary ingredients in accordance with the rounding rules set forth in § 101.9(c)(1) through (8).  In cases that a conflict may arise between the rounding rules regarding the declaration of nutrients and the compliance requirements, FDA intends to use its enforcement discretion. 

FDA will evaluate whether it should change the nutrition labeling regulation (either the rounding rules or the compliance criteria) to address this potential conflict.

Although comments may be submitted at any time, to be considered in finalizing the guidance, they should be submitted by September 28, 2015. 

It’s that time of year again when we ask our loyal FDA Law Blog readers for just a few minutes of their time.  You got it: it’s the best legal blog nomination season!  And this year, there are two contests for which we’re seeking your nomination.  We would love to add a couple of badges to the “Awards and Honors” collection posted on our blog webpage (it gives us the affirmation we crave), but we need your support to do that.

The 2015 ABA Blawg 100

The American Bar Association (“ABA”) has initiated the annual process for selecting the top legal blogs (or “blawgs”) in the blogosphere.  The 9th iteration of the list will be revelaed later this year when the ABA announces the “Blawg 100” in the print and electronic versions of the ABA Journal.  With your help, we’ve made the top 100 list four times before. 

To nominate the FDA Law Blog for the 2015 Blawg 100, readers should use the Amici Form – available here – supplied by the ABA and submit a friend-of-the-blawg brief.  You have only 500 characters to say why you’re a fan of the blog, so you’ll have to keep your remarks pithy.  Remember, when you complete the nomination form, our URL is www.fdalawblog.net.  Friend-of-the-blawg briefs are due no later than 11:59 p.m. CT on August 16, 2015.  ABA editors make the final decisions about what blogs to include in the Blawg 100.  We hope they’ll be impressed with what our readers have to say about us. 

The Expert Institute 2015 Best Legal Blog Contest

The Expert Institute is working on a comprehensive ranking of legal blogs as a part of its 2015 Best Legal Blog Contest.  The three blogs that receive the most votes overall will win small cash prizes.  Every blog will be sorted into one of seven categories: Medical Malpractice/Personal Injury; Criminal; Technology; Commercial and Intellectual Property Law; Labor and Employment; Education; and Niche and Specialty.

To nominate the FDA Law Blog for the 2015 Best Legal Blog Contest, readers should use the form – available here – provided by The Expert Institute.  When completing the form, you’ll be asked for a “Blog address” (www.fdalawblog.net ), to remark on “Why does this blog deserve to be nominated?”, and to identify a “Blog Category.”  In terms of “Blog Category,” we think we fit into the “Niche and Specialty” group.

Thank you for your continued support! 

By Kurt R. Karst –  

It’s that time of year again when FDA-regulated companies need to think about cracking open their checkbooks to pay FDA some pretty heft sums of cash for operations in the next fiscal year, and to plan ahead for submissions to FDA in the next fiscal year.  Yep, you got it: it’s user fee season.  On August 3, 2015, FDA published notices in the Federal Register establishing the Fiscal Year 2016 (“FY 2016”) user fee rates for several programs, including:

• Prescription Drug User Act (“PDUFA”) Fee Rates
• Biosimilar User Fee Act (“BsUFA”) Rates
• Generic Drug User Fee Amendments (“GDUFA”) Rates
• Medical Device User Fee Rates
• Animal Drug User Fee Act Rates and Payment Procedures
• Animal Generic Drug User Fee Act Rates and Payment Procedures
• Food Safety Modernization Act Domestic and Foreign Facility Reinspection, Recall, and Importer Reinspection Fee Rates
• Outsourcing Facility Fee Rates

For several years now we’ve been tracking the changes in user fees rates FDA sets each fiscal year under PDUFA, and, more recently, under BsUFA and GDUFA.  Almost in it’s 24th year, the historical increase in PDUFA user fee rates has been nothing short of astounding (and it’s a likely harbinger of what direction user fee rates in other programs will go in over the next decade or more).  Looking at only the growth in the PDUFA application fee (see the table further below), the compounded annual growth rate is 14.11% for 24 years.  Don’t we all wish we had an investment that did that well?!  But enough daydreaming . . . on to the numbers. 

The FY 2016 PDUFA application user fee rate is set at $2,374,200 for an application requiring “clinical data” (defined here in an FDA guidance document), and one-half of a full application fee ($1,187,100) for an application not requiring “clinical data” and a supplement requiring “clinical data.”  These figures reflect FDA’s estimate of 119.545 fee-paying full application equivalents – an average of the number of full applications that paid fees over the lateset 3 years.  This figure is higher than last year’s estimate of 115.042 fee-paying full application equivalents.  Annual establishment and product fees have been set at $585,200 and $114,450, respectively, and are based on estimates of 485 establishments and 2,480 products.   

The FY 2015 PDUFA user fee rates become effective on October 1, 2015 and generally represent a very modest change vis-à-vis the FY 2015 user fee rates.  All BsUFA user fees – i.e., the initial and annual biosimilar Biological Product Development (“BPD”) fees, the reactivation fee, and the biosimilar biological product application, establishment, and product fees – are keyed to PDUFA user fees.  The FY 2016 rates have thus been set at $237,420 (initial and annual PBD), $474,840 (reactivation), $2,374,200 (application), $585,200 (establishment), and $114,450 (product).  

The first table below shows the changes in PDUFA user fee rates for the latest iteration of the law – PDUFA V – and the next three tables chart the historical growth.  Additional hisorical tables for user fee rates changes since the enactment of PDUFA are avilable here.   

GDUFA establishes several types of user fees that together generated $299 million in funding for FDA in FY 2013 (including $50 million from the one-time ANDA backlog fee).  That $299 million base amount is adjusted annually.  The FY 2014 adjusted base figure was $305,659,000; in FY 2015, it was set at $312,224,000; and in FY 2016, it is set at $318,363,000.  Three of the FY 2016 GDUFA user fee rates – application, Prior Approval Supplement (“PAS”), and Type II Drug Master File (“DMF”) – are up significantly vis-à-vis the FY 2015 user fee rates; however, the Active Pharmaceitical Ingredient (“API”) and Finished Dosage Form (“FDF”) facility fee rates dipped a bit vis-à-vis the FY 2015 user fee rates.  This is exactly the opposite of what happened in FY 2015 when FDA hiked the API and DMF fee rates and reduced the application, PAS, and DMF fee rates. 

The original ANDA and PAS fees, which make up 24% of the $318,363,000 (or $74,934,000 rounded to the nearest thousand dollars), are based on a total number of 1,005 fee-paying full application equivalents expected to be received in FY 2016.  Dividing $76,407,000 by the total number of fee-paying full applications expedted to be received results in an original ANDA fee of $76,030 and a PAS fee of $38,020 for FY 2016. 

The 1,005 fee-paying full application equivalents figure FDA identifies for FY 2016 is the lowest yet under GDUFA.  FDA estimated 1,160 in FY 2013; 1,148.8 in FY 2014; and 1,276 fee-paying full application equivalents in FY 2015.  This low number, combined with the portion of the adjusted base figure for applications and PASs (i.e., $74,934,000), largely explaines the nearly 30% fee rate increase over FY 2015.  FDA figures show a downward trend in ANDA and PAS submissions. (See here for the latest FDA activity report, and here for the most recent GDUFA Performance Report.)  If that trend continues (or if the number of submissions remains relatively static), then fee rates will continue to increase in subsequent fiscal years (because the adjusted base figure will almost certainly continue to increase). 

The DMF fee, which makes up 6% of the $318,363,000 ($19,102,000 rounded to the nearest thousand dollars), is based on an estimate of 453 fee-paying DMFs in FY 2016.  This is a big decrease over the 701 fee-paying DMFs estimated in FY 2015.  The resulting fee is $42,170 for FY 2016 – a big increase over FY 2015.

The API and FDF facility fees are based on data submitted by generic drug facilities through the self-identification process.  The FDF facility fee revenue makes up 56% of $318,363,000 ($178,283,000 rounded to the nearest thousand dollars), and the API facility fee makes up 14% of $318,363,000 ($44,571,000 rounded to the nearest thousand dollars).  According to FDA, the total number of FDF facilities identified through self-identification was 705 (283 domestic and 422 foreign), and the total number of API facilities identified through self-identification was 826 (105 domestic and 721 foreign).  These numbers translate into FY 2016 FDF facility fee rates of $243,905 for a domestic facility and $258,905 for a foreign facility, and API facility rates of $40,867 for a domestic facility and $55,867 for a foreign facility.  These are minimal decreases compared to the FY 2015 FDF and API facility user fee rates, and are likely explained by the nominal increase in self-identified facilities.  The table and chart below show the changes in GDUFA user fee rates for the first iteration of the law. 

By Larry K. Houck –

A bipartisan group of senators representing Oregon, Colorado and Washington, states that have legalized nonmedical use of marijuana, introduced legislation that would protect financial institutions from adverse action by federal banking regulators for providing services to legal marijuana businesses.  The “Marijuana Businesses Access to Banking Act of 2015” (S. 1726), introduced July 9th, would protect depository institutions that provide financial services to marijuana-related legitimate businesses.  Senator Jeff Merkley (D-OR), a co-sponsor, observed, “The people of Oregon have spoken, and the federal government should make sure that legal marijuana businesses can operate properly within our banking system.  It’s time to let banks serve these legal businesses without fearing devastating reprisals from the federal government.”  Marijuana businesses’ lack of access to bank accounts and their inability to accept credit cards or write checks have required many to operate on a cash-only basis.

While a number of states have passed laws that conflict with federal law legalizing marijuana for medical or recreational use (see our previous post here), federal law prohibits the possession, cultivation or distribution of marijuana and prohibits anyone from operating a business for these purposes.  The Department of Justice (“DOJ”) and the Drug Enforcement Administration (“DEA”) remain committed to enforcing the federal Controlled Substances Act.  DOJ and DEA issued guidance in August 2013, and then again in February and March 2014 (see here), that outline federal enforcement priorities, noting that DOJ is unlikely to take action against a marijuana business operating in compliance with state law that does not implicate one of DOJ’s enumerated enforcement priorities.  The Department of the Treasury’s Financial Crimes Enforcement Network issued concurrent guidance in February 2014.

The bill would by prohibit federal banking regulators from:

• Terminating or limiting the deposit insurance or share insurance of a depository institution solely for providing financial services to marijuana-related legitimate businesses;
• Prohibiting, penalizing or discouraging a depository institution from offering financial services to marijuana-related legitimate businesses;
• Recommending, incentivizing or encouraging depository institutions not to offer financial services to an individual or to downgrade or cancel financial services offered to an individual solely because they are a manufacturer, producer, owner or operator of a marijuana-related legitimate business or the depository institution was unaware that the individual is the owner or operator of a marijuana-related legitimate business; or
• Taking adverse or corrective supervisory action on a loan to an owner or operator of a marijuana-related legitimate business or real estate or equipment that is leased to a marijuana-related legitimate business.

The bill would protect the depository institution, its officers, directors and employees in a state or one of its political subdivisions that allows marijuana business activities from liability under federal law or regulation solely for providing financial services or investing income derived from those services.

Lastly, the Department of the Treasury must require any suspicious activity report filed by a financial institution regarding a marijuana-based business to comply with specified guidance of the Financial Crimes Enforcement Network.

The marijuana business access bill was referred to the Committee on Banking, Housing and Urban Affairs.  The Senate Appropriations Committee passed a financial services appropriations bill which includes an amendment similar to the bill on July 23rd.  A companion bill (H.R. 2076) of the same name was introduced in the House of Representatives on April 28, 2015.

By Kurt R. Karst –

It’s been almost seven weeks since the U.S. District Court for the District of Columbia issued its Opinion in Veloxis Pharmaceuticals. Inc. v. FDA, ___ F.Supp.3d ___, 2015 WL 3750672 (June 12, 2015), a challenge concerning the scope of 3-year new clinical investigation exclusivity under the Hatch-Waxman Amendments.  As we previously reported (here and here) Veloxis Pharmaceuticals, Inc. (“Veloxis”) sued FDA after the Agency tentatively approved the company’s 505(b)(2) NDA 206406 for ENVARSUS XR (tacrolimus extended-release tablets), 0.75 mg, 1 mg, and 4 mg, for prophylaxis of organ rejection in kidney transplant patients.  FDA cited a period of 3-year exclusivity expiring on July 19, 2016 for another drug – Astellas Pharma US, Inc.’s (“Astellas’s”) 505(b)(1) NDA 204096 for ASTAGRAF XL (tacrolimus extended-release capsules), 0.5 mg, 1 mg, 5 mg, approved on July 19, 2013 for prophylaxis of organ rejection in adult patients receiving kidney transplants – as the basis for the ENVARSUS XR tentative approval.  Veloxis lost the case, and, as we predicted, the company has not appealed the decision to the U.S. Court of Appeals for the District of Columbia Circuit.  Instead, Veloxis settled for approval of NDA 206406 for an indication outside the scope of ASTAGRAF XL’s 3-year exclusivity – i.e., “for prophylaxis of organ rejection in kidney transplant patients converted from tacrolimus immediate-release formulations in combination with other immunosuppressants. ”

One thing that frustrated us to no end during the litigation was the lack of access to briefs and FDA decisions.  Almost everything in the case was filed under seal, including, according to a Joint Appendix Index, an Administrative Record that exceeded 6,100 pages.  But we believe many of the documents filed in the case are important and should be made available so that folks in the pharmaceutical industry know exactly where FDA stands on interpreting the Hatch-Waxman Amendments.  After all, the Veloxis decision may live on for a long time, and it has already formed the basis for at least one Citizen Petition (Docket No. FDA-2015-P-2482).  Fortunately, the seal in the case was lifted last week, and a treasure trove of documents was made available. 

While the various briefs filed in the case provided some good weekend reading – see FDA’s Motion to Dismiss/Motion for Summary Judgment, Veloxis’ Motion for Summary Judgment, and Reply/Opposition briefs (here and here) – what we really wanted to see was FDA’s rationale as explained in letter decisions and correspondence.  We were not disappointed. 

In a 53-page General Advice Letter, a largely identical 59-page internal FDA Exclusivity Evaluation, and a 6-page Memorandum penned by the CDER Exclusivity Board – all from from January 2015 – FDA lays out the Agency’s rational for granting 3-year exclusivity for ASTAGRAF XL and the blocking effect of that exclusivity on ENVARSUS XR.  We’ll leave it to our readers to fully explore and digest on their own this exclusivity bounty, but suffice it to say that this blogger (and Hatch-Waxman junkie) found the documents to make for scintillating reading.  For example, with respect to whether a 505(b)(2) applicant must rely on a listed drug for 3-year exclusivity on that listed drug to apply to the 505(b)(2) applicant, FDA states:

The scope of 3-year exclusivity for Astagraf XL does not depend on whether Envarsus XR relies on Astagraf XL for approval.  Veloxis’ assertion is misplaced because the phrase “relied upon,” in section 505(c)(3)(E)(iii) of the FD&C Act, does not indicate that only drugs that rely on a particular drug with exclusivity are blocked; it simply distinguishes a 505(b)(2) NDA from a stand-alone NDA (and thereby identifies 505(b)(2) NDAs as those that have the potential to be blocked under that provision).  This is plain from a review of the statutory text. . . . 

Similarly, in FDA regulations, the use of the words “relies on” in 21 CFR 314.108(b)(4)(iv) only modifies ANDAs submitted under suitability petitions pursuant to section 505(j)(2)(C) of the FD&C Act.  Neither the statute nor the regulation requires a 505(b)(2) NDA to rely on a drug with exclusivity for that 505(b)(2) NDA to be blocked.  To the contrary, the operative statutory term for the scope of exclusivity is “conditions of approval”; this phrase and others in section 505(c)(3)(E)(iii) and in the sections of the regulation at 314.108(b)(4)(iv) that apply to 505(b)(2) NDAs do not refer to any such reliance. . . .

Even assuming arguendo that the statute is ambiguous, the Agency’s interpretation is reasonable; the Agency interprets 3-year exclusivity to protect the change supported by the new clinical investigations regardless of reliance, thereby preserving the incentive to make exclusivity-protected changes.

Also illuminating are the examples FDA proffers to support what the Agency says is a long-standing interpretation of the statute’s 3-year exclusivity provisions, and FDA’s discussion of the precedents cited by Veloxis (including one involving Testosterone Gel where FDA says the Agency might have incorrectly classified the application as a 505(b)(2) NDA instead of a stand-alone 505(b)(1) NDA – see here).  “These examples demonstrate that . . . when FDA is aware of exclusivity for a product on which a 505(b)(2) NDA did not rely, FDA has continued to interpret the 3-year exclusivity provisions in a manner consistent with the interpretation set forth in the Agency’s preamble statements and consistent with its position set forth here,” writes FDA.  As to why this issue is coming to a head now, more than 30 years after the enactment of the Hatch-Waxman Amendments, FDA goes on to say that:

Questions about the scope of 3-year exclusivity and its potential to block approval of 505(b)(2) NDAs are not presented often, which can be explained by a combination of several factors, including the rarity of the factual scenario and rational decision-making by knowledgeable industry actors.  Three years is relatively short in relation to the time required to develop an NDA.  It generally takes a longer time for an NDA to be developed, filed, and reviewed.  Therefore, for this question to be presented, two applicants would generally have to proceed on parallel development paths for the same innovation. In addition, the later-in-time application would have to be a 505(b)(2) NDA, which would have to become ready for an approval decision during the pendency of the 3-year exclusivity period of a protected drug on which it did not rely.  Moreover, for the question of reliance to arise, there must also exist another version of the exclusivity-protected drug (or a significant quantity of non-product specific published literature) such that the 505(b)(2) NDA is able to refer to the other drug as its listed drug or rely on the non-product specific published literature to fill gaps in its application, rather than relying on the exclusivity-protected drug product.

Even in the relatively rare cases where a 505(b)(2) NDA has the potential to be blocked by exclusivity for a previously approved application on which it did not rely because it seeks approval for an exclusivity-protected condition of approval, it is likely that sponsors and applicants will strategically avoid situations where FDA must determine whether their applications fall within the scope of another sponsor’s exclusivity.  For example, applicants may shape their NDA submissions to avoid submitting an application that may be delayed by existing exclusivity.  Similarly, because (in contrast to an ANDA) a 505(b)(2) NDA is not required to be the same as any previously approved application in any respect, in many cases a 505(b)(2) applicant can seek approval for conditions of approval that are no longer (or never were) protected by exclusivity. . . .

And as to the examples FDA cites, here they are (with links to relevant documents):

A search of the Agency’s records has not produced another instance where FDA refused to fully approve a 505(b)(2) application due to the 3-year exclusivity of another NDA on which the subsequent application did not rely.  However, in instances where the Agency has considered this situation, it has applied considerations consistent with this interpretation of the scope of 3-year exclusivity. . . .

On May 27, 1999, FDA considered the approvability of Duoneb (NDA 020950), which was a solution for inhalation and also a fixed-combination of albuterol sulfate and ipratropium bromide for the same indication as Combivent. Duoneb had been submitted as a 505(b)(2) application that did not rely on Combivent.  FDA noted that the Duoneb applicant conducted its own clinical trials to establish the safety and effectiveness of the fixed-combination, but FDA concluded that it likely would not be able to fully approve Duoneb’s 505(b)(2) NDA at that time due to Combivent’s existing exclusivity, which was due to expire on October 24, 1999.

Similarly, in May 2010, when considering whether Cipher’s tramadol hydrochloride ER capsules (NDA 022370) were blocked by exclusivity for Labopharm’s Ryzolt (tramadol hydrochloride ER tablets) (NDA 021745), FDA noted that Cipher’s product had the potential to be blocked if it was “seeking the same conditions of approval as are protected for Ryzolt.”  FDA made this observation even though Cipher’s product differed in dosage form from the Labopharm product and Cipher’s product did not rely on Ryzolt for approval.  Although the Agency ultimately concluded that Labopharm’s clinical studies were essential only to approval of the specific titration schedule approved for Ryzolt and that Cipher’s product (which had a different nonprotected titration schedule previously approved for another tramadol product) was not blocked, the Agency’s analysis contemplated that Cipher’s product would have been blocked had it sought approval for the exclusivity-protected titration schedule.  FDA further noted that although Cipher’s tramadol product was an ER capsule and Ryzolt was an ER tablet, “[a] difference in dosage form alone for a proposed product would not necessarily be a basis for concluding that a previous applicant’s exclusivity does not delay approval.”

In the case of colchicine products too, FDA acknowledged that exclusivity for a drug that a 505(b)(2) NDA did not reference nonetheless had the potential to block approval of that 505(b)(2) NDA.  [In a Citizen Petition response,] the Agency found that “the labeling for a single-ingredient colchicine product seeking approval for prophylaxis of gout flares must inform healthcare providers that the lower dose colchicine regimen evaluated in the AGREE trial is adequate to treat an acute gout flare that may occur during chronic colchicine use, and thus the approval of such a product must await expiration of Colcry’s 3-year exclusivity for acute gout flares . . . .”  Thus the Agency recognized that although a 505(b)(2) NDA that was not a duplicate of Colcrys tablets need not reference Colcrys as a listed drug, it might nonetheless be subject to exclusivity for Colcrys and would have to await expiration of that exclusivity before it could obtain approval.  [(Emphasis in original)]

With the popularity of the 505(b)(2) approval route increasing, we’re almost sure to see this issue crop up again.  Of course, we may not know when it comes up, unless another company is willing to challenge FDA publicly. 

By Jay W. Cormier –

On Monday, after seeking input from a number of large industry stakeholders and floating the idea for some time, FDA announced the availability of a Draft Guidance entitled “Request for Quality Metrics.”  The Draft Guidance formally presents FDA’s current thinking and intentions regarding the collection and use of quality metrics – a broad new initiative that will see the collection and review of potentially large swaths of new information that was previously difficult for FDA to collect and assess systematically.  FDA intends to use these data to make risk-based decisions when assigning facility inspections and to identify potential drug shortage issues earlier so that issues can be corrected before a shortage happens. 

For those who don’t make quality metrics a topic of regular conversation, FDA’s legal authority started almost three years ago when FDASIA was signed into law.  Within its 140 pages were two short sections that, on their own, seem entirely separate.  Section 711 of FDASIA added a new sentence to the end of Section 501of the FDCA, and read, in its entirety:

For purposes of paragraph (a)(2)(B), the term ‘current good manufacturing practice’ includes the implementation of oversight and controls over the manufacture of drugs to ensure quality, including managing the risk of and establishing the safety of raw materials, materials used in the manufacturing of drugs, and finished drug products.

Recall that Section 501(a)(2)(B) is the statutory requirement that all human and animal drugs be manufactured under cGMPs; it is the source of the regulations at Parts 210, 211, 225, and 226, as well as the litany of guidance that governs drug substance and drug product manufacturing.  The other FDASIA provision, Section 706, added a new subparagraph to Section 704(a) of the FDCA that states, in relevant part:

Any records or other information that the Secretary may inspect under [Section 704] from a person that owns or operates an establishment that is engaged in the manufacture, preparation, propagation, compounding, or processing of a drug shall, upon the request of the Secretary, be provided to the Secretary by such person, in advance of or in lieu of an inspection, within a reasonable timeframe, within reasonable limits, and in a reasonable manner, and in either electronic or physical form, at the expense of such person.

Put these two provisions together in a room (or coop, rather) and the result is something new – FDA’s Draft Guidance.  Using these two authorities, the Draft Guidance asserts that keeping records of quality metric inputs is part of cGMPs, because a company, under the amended Section 501(a)(2)(B), has an obligation to implement and have oversight over process quality controls, and that FDA has a right to “request” that companies provide such information, under the new Section 704(a)(4), in advance of (or in lieu of) a facility inspection.  I use quotes around “request” because, according to the Draft Guidance, failing to comply with a quality metrics request under 704(a)(4) does two very unwelcome things:  (1) it renders your products adulterated under Section 501, and (2) is considered a refusal of an inspection under Section 704.  Both of these are prohibited acts, subject to FDA’s full panoply of enforcement tools (injunction, seizure, and criminal prosecution, to name a few).  So, a “request” for quality metrics is just a nice way of making a demand for quality metrics. 

In the Draft Guidance, FDA defines quality metrics to include:

• Lot acceptance rate
• Product quality complaint rate
• Invalidated out-of-specification (OOS) rate
• Annual Product Review (APR) or Product Quality Review (PQR) on-time rate

In order to calculate these metrics, FDA will be asking manufacturers to provide:

• Number of lots attempted
• Number of lots pending disposition for more than 30 days
• Number of lots released
• Number of OOS results
• Number of lots rejected due to OOS
• Number of release and stability tests conducted
• Number of OOS results that are invalidated due to laboratory error
• Number of product quality complaints
• Number of APRs and PQRs required
• Number of APRs and PQRs completed within 30 days of due date

Importantly, although all draft guidance documents are submitted for public comment, FDA specifically asks manufacturers to comment on several specific items, including:

• Whether FDA should allow manufacturers to submit additional optional metrics, including, among others:
• The extent of senior management involvement in APR and PQR review and approval
• How many CAPAs identify training as a root cause
• Whether a facility calculates a process capability or performance index for each product’s critical quality attributes
• What the most efficient timing for submission of quality metrics may be, for example:
• Within a specified period of time after the FDA request
• At the same time that the APR/QPR is submitted
• Whether FDA should allow for explanations to be included with the submitted data (FDA says that it can’t guarantee that it will review these comments)

As far as who all of this will apply to, FDA hasn’t specifically said which manufacturers will need to submit.  FDA does say, however, that, as a general matter, these requests would only be made of facilities registered under Section 510 of the FDCA as manufacturers of drug substances and drug products for NDA/ANDA-approved drugs, OTC monograph drugs, and marketed unapproved drug products. 

When FDA decides to make a request of a manufacturer, FDA states that it will do so first by publishing the request in the Federal Register.  We expect that FDA will make general requests from specific types of facilities (e.g., human prescription drug substance manufacturers) rather than publish the full listing of every facility that must comply with a given request. 

FDA’s Draft Guidance states that quality metric requests would not be made of a lengthy list of facilities, including: drug compounding facilities, outsourcing facilities, medical gas manufacturers, and manufacturers of blood, cell therapy, gene therapy, and vaccine products, as well as those that manufacture allergenic extracts and tissue based products.  A full listing of these types of facilities can be found on page 2 of the Draft Guidance. 

FDA asks for comments to be submitted by September 25th. 

By Kurt R. Karst –

A “phantom” is defined, in part, to mean “an appearance or illusion without material substance, as a dream image, mirage, or optical illusion.”  That’s probably the best way to sum up what’s at the heart of the issues raised by FDA in the Agency’s latest “Dear Applicant Letter” (Docket No. FDA-2015-N-2713)  requesting comment on a Hatch-Waxman issue.  In this case, the drug is Cyclosporine Ophthalmic Emulsion, 0.05% (the generic name for RESTASIS, which was approved as an “old antibiotic” under NDA 050790 – see here), and the questions on which FDA is seeking comment concern “first applicant” status, 180-day exclusivity eligibilty and forfeiture, and whether an ANDA applicant who certified Paragraph IV to a now-expired patent really qualifies as a first applicant. 

By way of background, FDC Act § 505(j)(5)(B)(iv)(II)(bb) defines a “first applicant” as “an applicant that, on the first day on which a substantially complete application containing a [Paragraph IV certification] is submitted for approval of a drug, submits a substantially complete application that contains and lawfully maintains a [paragraph IV certification] for the drug.”  A first applicant is eligible for 180-day exclusivity vis-à-vis subsequent Paragraph IV ANDA applicants, and, as FDA explained in a prior decision (see our previous post here), can remain a first applicant even if eligibility for 180-day exclusivity is forfeited.  A first applicant can forfeit eligibility for exclusivity under one (or more) of six statutory forfeiture provisions, including if “[a]ll of the patents as to which the applicant submitted a certification qualifying it for the 180-day exclusivity period have expired.”

In the case of Cyclosporine Ophthalmic Emulsion, 0.05%, FDA explains that “[t]he first patents for Restasis were listed in the Orange Book in late 2008: U.S. Patent Nos. 4,839,342 (the ‘342 patent) and 5,474,979 (the ‘979 patent).”  These patent listings were made possible as a result of the October 8, 2008 enactment of the QI Act (see our previous post here).  The ‘342 patent expired on August 2, 2009, and the ‘979 patent expired on May 17, 2014; however, “[o]ne or more ANDAs or patent amendments submitted after the ‘342 patent expired but before January 14, 2014 contained a paragraph IV certification to the ‘979 patent, potentially qualifying the ANDA sponsor(s) as a ‘first applicant’ eligible for 180-day exclusivity,” writes FDA. 

What’s important about January 14, 2014?  That the date on which U.S. Patent No. 8,629,111 (“the ‘111 patent”) was submitted to FDA and listed in the Orange Book for RESTASIS.  Also on that date, “one or more [ANDA] applicants submitted a paragraph IV certification to the ‘111 patent.”

So far, this seems to be a pretty simple forfeiture analysis, right?  After all, as noted above, one 180-day exclusivity forfeiture provision states that a forfeiture event occurs if all exclusivity-bearing patents expired.  But then FDA throws the following facts into the mix:

Until the ‘111 patent was listed on January 14, 2014, the ‘979 patent was the only patent listed in the Orange Book for Restasis since expiry of the ‘342 patent in 2009. 

The one or more paragraph IV certifications to the ‘979 patent submitted to FDA after the ‘342 patent expired but before January 14, 2014, were the first paragraph IV submissions made for Restasis.  But the ‘979 patent expired before FDA issued an Acknowledgement Letter to any applicant with a pending ANDA for this drug product, and before any sponsor had the opportunity to provide notice of the paragraph IV certification to that patent.

Given this complicated scenario, FDA says that there are two issues before the Agency:

(1) the one or more applicants that submitted ANDAs or patent amendments with paragraph IV certifications to the ‘979 patent after the ‘342 patent expired but before January 14, 2014, and that did not receive Acknowledgement Letters until after the ‘979 patent had expired, are “first applicants” under FD&C Act section  505(j)(5)(B)(iv)(II)(bb); and

(2) whether 180-day generic drug exclusivity for this product was forfeited on May 17, 2014, when the ‘979 patent expired, such that no ANDA applicant for Cyclosporine Ophthalmic Emulsion, 0.05%, is eligible for 180-day generic drug exclusivity.

FDA further notes that as part of the Agency’s consideration it “is considering whether the fact that FDA did not issue an Acknowledgement Letter for this drug product until after the patent expired impacts this analysis,” and that the Agency is also seeking comment on “whether there are any other factors that are material to this question.”  Interested parties have until August 28, 2015 to send comments to FDA. 

It’s been a while since we’ve seen a public docket established for a “Dear Applicant Letter” – the last being in early 2014 for PRECEDEX (dexmedetomidine HCl) Injection (see our previous post here).  FDA’s decision in that case led to litigation (see our previous post here), so we’ll be closely watching things in this case to see where the cards fall.  And we’ll also be keeping an eye on any action by FDA (or others) on issues concerning acceptance of ANDAs for generic RESTASIS.  There’s no indication that FDA has responded to a December 2014 Citizen Petition (Docket No. FDA-2015-P-0065) asking the Agency to refuse to receive and approve any ANDA for generic RESTASIS unless certain criteria are met. 

By Riëtte van Laack –

Last week, FDA announced a supplemental proposal to amend the nutrition labeling regulation for food and dietary supplements, and the availability of consumer studies related to FDA’s proposed changes to the format of the Nutrition Facts box.

Undoubtedly, the proprosal to establish a Daily Reference Value (DRV) for added sugars will receive the most attention.  FDA proposes a DRV of 10% of the total energy intake from added sugars, i.e., a DRV of 50 grams for adults and children above 4 years and a DRV of 25 g for children aged one to three.  This DRV would be used in calculating the percent Daily Value (%DV) that FDA proposes to require when the quantitative amount of “Added Sugars” must be declared. 

In the 2014 proposed rule, FDA included a requirement for the amount of added sugars (see our previous post here).  FDA proposed to require an added sugar declaration even though, at that time, the “U.S. consensus reports [had] determined that inadequate evidence exist[ed] to support the direct contribution of added sugars to obesity or heart disease.”  The Agency proposed a mandatory declaration of added sugars to provide “consumers with the information necessary to follow the 2010 [Dietary Guidelines] to reduce the intake of calories from added sugars.”  However, FDA drew the line at setting a DRV, because, at that time, there was no “sound scientific basis for the establishment of a quantitative intake recommendation [from] which a DRV could be derived.”  Perhaps somewhat surprisingly, a little over a year later, the Agency is finding a sound scientific basis.  FDA’s change of heart is based, at least in part, on evidence in the 2015 Dietary Guidelines Advisory Committee (DGAC) report, which is still in draft and has not yet been adopted by HHS and USDA. 

The proposal to require a declaration of “added sugars” probably has been the most contested aspect of the proposed amendment of the nutrition labeling regulations. The supplemental proposal undoubtedly will relight that fire.

In a related development, FDA proposes to replace the term “Sugars” with “Total Sugars,” based on comments to the proposed rule and the results of two consumer studies that have become available. However, according to FDA, there is still no scientific basis to set a DRV for total sugars.

FDA’s supplemental proposal also addresses the footnote in the Nutrition Facts box.  In the original proposal, FDA proposed to maintain the footnote for the Supplement Facts box but requested feedback regarding a revised footnote for the Nutrition Facts box.  FDA now proposes to simplify the footnote in the Nutrition Facts box to state “The % Daily Value tells you how much a nutrient in a serving of food contributes to a daily diet. 2,000 calories a day is used for general nutrition advice,” and queries whether the footnote in the Supplements Facts box should be revised in a similar manner.

Comments on the supplemental proposal are due October 12, 2015.  Comments must be limited to the footnote, the DRV for added sugars, the percent DV declaration for added sugars, and the new information from the DGAC report for the added sugars declaration.

In addition to issuing the supplemental proposal, FDA announced a reopening of the comment period for the proposed rule.  FDA performed two consumer studies –a study regarding the potential effects of several possible changes to the label on consumer viewing and use of the label, and a study to explore whether modifications to the format of the Nutrition Facts box would affect consumers’ interpretation of information in the Nutrition Facts box.  The results of these studies are being made available and the comment period has been reopened to allow for public comments on these studies.  Comments related to the two consumer studies are due September 25, 2015.

By Ricardo Carvajal - 

The distinction between the claims “natural” and “made with natural ingredients” is among the issues addressed in a recent NAD decision involving advertising for ASPIRE, a brand of sports drinks promoted as “all natural” and “natural sports drinks.”  The drinks include vitamins and citric acid, which NAD noted are typically synthetic.  Because the advertiser apparently did not provide evidence demonstrating that those ingredients are naturally derived, NAD concluded that the advertiser’s use of unqualified “natural” claims was unsupported, and recommended that the claims be discontinued.  However, NAD recognized the advertiser’s interest in distinguishing its drinks from competing products based on the use of natural flavors and sweeteners.  NAD thus made clear that nothing in its decision prevents the advertiser “from claiming that ASPIRE is naturally sweetened, naturally flavored, or that it is made with natural ingredients.”

For its part, the advertiser disagreed with NAD’s recommendation and maintained that its “natural” claim is “truthful and supported.”  Because the advertiser declined to implement NAD’s recommendation, the matter has been referred to FTC “for possible enforcement action.” 

The decision recaps NAD’s position on “natural” claims, which dovetails with FDA’s policy (“nothing artificial or synthetic (including color additives regardless of source) has been included in, or has been added to, a food that would not normally expected to be in the food”).  However, NAD has arguably gone beyond that policy in determining “that ingredients which undergo significant chemical alteration should not be called ‘natural.’”  NAD has also taken the position that “advertisers of ‘natural’ products should be very specific when describing ingredients that may be inconsistent with their consumer’s expectation.”  The decision thus serves as a timely reminder that, when it comes to “natural” claims, FDA’s policy is only one point of reference.