By Wes Siegner –

In an exercise in hairsplitting, FDA’s Mike Taylor has written to Herbalife to complain about a YouTube video, in which a former FDA official now working for Herbalife, Bill Frankos, allegedly (the video has been removed at FDA’s request) states the following:  “When I was director of dietary supplements at the FDA, I oversaw nutritional supplements, making sure they were safe and effective for use.”

As we understand his responsibilities while at FDA, Bill Frankos (with others at FDA) was responsible for making sure that dietary supplements were safe and effective for their intended uses.  FDA has many tools to fulfill this responsibility.  Unsafe dietary supplements are adulterated pursuant to the Federal Food, Drug, and Cosmetic Act (FDC Act), while products that claim to have beneficial effects that they do not have are misbranded.  The FDC Act prohibits the marketing of adulterated or misbranded dietary supplements.  FDA has the authority to, and does, issue warning letters, seize violative products, and even prosecute companies and individuals who market adulterated or misbranded dietary supplements.  Therefore, Bill Frankos’ statement seems appropriate.

At no point does FDA’s letter say that the video claims that FDA approves dietary supplements as safe and effective.  And yet FDA’s letter states that “[t]he safety and effectiveness standard referred to in the Herbalife video is the FDA standard for drug review and does not reflect what FDA does with regard to dietary supplements.”  Possibly there was more to the video than just Bill Frankos’ quoted statement that led FDA to conclude there was some implication of FDA approval, but as it has been removed from the internet, we are unable to tell.

FDA’s objections to the video are particularly questionable in light of FDA’s misleading statements in its own letter.   FDA writes that the agency “can stop marketing only by proving to a court there is inadequate information to provide reasonable assurance that the new dietary ingredient does not present a significant or unreasonable risk of illness or injury.”  This is incorrect.  FDA has multiple effective tools, short of actually going to court, that effectively stop improper dietary supplement marketing, including requests for recalls, the issuance of warning letters, and the administrative revocation of facility registrations, to name a few.  Further, given that the FDC Act is a strict liability criminal statute, most companies and corporate executives recognize that they ignore FDA concerns over safety at the peril of their own reputation and freedom.  The mere suggestion in a phone call that there might be a safety issue is often sufficient to stop marketing.

In short, under the FDC Act, FDA has sufficient authority and has the responsibility to regulate dietary supplements to assure safety and efficacy.  As is true with other FDA-regulated industries, companies marketing dietary supplements share in that responsibility.

By Kurt R. Karst –

Late last month, the Pharmaceutical Research and Manufacturers of America (“PhRMA”), the Biotechnology Industry Organization (“BIO”), and the Generic Pharmaceutical Association (“GPhA”) jointly filed a Petition for a Writ of Certiorari (Case No. 14-751) with the U.S. Supreme Court asking the Court to take up a case that could significantly affect the pharmaceutical industry (and beyond).  The appeal comes after a September 30, 2014 decision in which a unanimous panel of judges from the U.S. Court of Appeals for the Ninth Circuit affirmed an August 2013 decision from the U.S. District Court for the Northern District of California finding that a first-in-the-nation Safe Drug Disposal Ordinance passed by the Alameda County, California Board of Supervisors in July 2012 is not unconstitutional.  States, counties, and municipalities across the nation will be closely following this latest development as they consider whether or not to develop similar extended producer responsibility (a.k.a. product stewardship) legislation and programs targeting pharmaceuticals and that require manufacturers to finance the costs of safe disposal of their products.

As we previously reported (here, here, and here), PhRMA, BIO, and GPhA challenged the Alameda Ordinance as a per se violation of the Commerce Clause of the U.S. Constitution, and, in particular, the dormant Commerce Clause.  Under that Clause, state and local governments may not enact regulations that unduly interfere with interstate commerce.  While the Ninth Circuit noted that “[o]pinions vary widely as to whether adoption of the Ordinance was a good idea,” the Court “needed only to review the Ordinance and determine whether it violates the dormant Commerce Clause of the United States Constitution.”  “We did; it does not,” wrote the panel after examining the Ordinance under the U.S. Supreme Court’s two-tiered approach to analyze whether a state or local economic regulation violates the dormant Commerce Clause.

In their Petition to the U.S. Supreme Court, PhRMA, BIO, and GphA present the following question:

Whether the dormant Commerce Clause permits a local law that directly conscripts out-of-state manufacturers to enter the locality and to assume all costs and responsibility for collecting and disposing of unused medicines from local residents, for the avowed purpose of shifting the costs of this traditional government function from local taxpayers and consumers to foreign producers and consumers?

Urging the Court to review the Ninth Circuit’s decision, the trade groups state:

The Ninth Circuit’s unqualified endorsement of local laws requiring interstate producers to enter the locality, to perform an uncompensated local public service at the expense of the interstate market, sharply conflicts with this Court’s precedent.  It violates both the specific precedent forbidding laws requiring interstate actors to establish operations in the local jurisdiction, and the general precedent forbidding laws that attach conditions to the sale of products in order to secure a local economic advantage at the expense of outsiders.  While the dormant Commerce Clause provides states with broad leeway to regulate interstate products to protect local residents, it imposes a virtually per se prohibition against leveraging the local presence of products to coerce interstate producers to enrich local residents at the expense of non-local businesses and consumers. [(Emphasis in original.)]

The trade groups go on to note the potentially expansive – i.e., “Balkanizing” – effect of the Alameda Ordinance:

Nor will this effort to dragoon out-of-state actors into local jurisdictions to provide services to local residents be confined to pharmaceutical products.  The sole mission of the California Product Stewardship Council (CPSC), a group at the heart of the lobbying effort to pass the Alameda Ordinance, is to ensure that “Producers have the primary responsibility to establish, fund, and manage end of life systems for their products with state government setting performance goals.”  The CPSC hailed the decision below as a “landmark victory” for extended producer responsibility and is pressing for programs comparable to the Alameda pharmaceutical takeback program for medical sharps, paint, and batteries.

There is no reason to think that other jurisdictions in the Nation will not follow suit, as localities have every incentive to favor their own residents by shifting regulatory costs onto the interstate market.

Regulations similar to the Alameda County Safe Drug Disposal Ordinance have been enacted in King County, Washington.  There too, PhRMA, BIO, and GphA, along with  the Consumer Healthcare Products Association (“CHPA”), challenged as unconstitutional the County’s Secure Medicine Return Regulations establishing an industry-funded stewardship program for the collection and disposal of unwanted household medicines from county residents (see our previous post here).  That lawsuit is on hold for the moment.  According to an updated agreement between the parties, the matter “is stayed until such time as the as the Alameda County plaintiffs exhaust United States Supreme Court review or until the time for seeking such review has lapsed.”

Meanwhile, other state and local governments are pursuing (or are being pursued) to draft legislation and regulations modeled after the Alameda Ordinance.  For example, an Ordinance was recently proposed by the San Francisco Board of Supervisors that’s inspired by the Alameda Ordinance.  Indeed, the “Findings” section of the proposal mentions the Alameda County and King County regulations, as well as the Ninth Circuit’s decision (and a recent rule from the DEA on controlled substance disposal – see our previous post here), as justification for the passage of a San Francisco drug stewardship program.  Other California government authorities – including Sonoma County and Turlock City – are also reportedly considering Alameda-like ordinances, and appear to be taking steps (see here) to mobilize.  Indeed, in late October 2014, one California State Senator sent a letter to every county in the State informing them of the Ninth Circuit’s decision and urging them to adopt programs modeled after Alameda’s Ordinance.

By Kurt R. Karst –    

It’s been many months since we last posted on the issue of so-called “premature notice” (and over a year since we first posted on the issue).  Premature notice is notice – ineffective notice – of a Paragraph IV certification sent to the NDA holder and patent owner prior to FDA’s acceptance of an original ANDA, and is apparently intended to jump-start patent infringement litigation, potentially resulting in quicker ANDA approval actions.  FDA has addressed the issue (disapprovingly) in letter correspondence (here and here), and several courts have found that premature notice is improper, null, void, and without legal effect – see SB Pharmco Puerto Rico, Inc. v. Mutual Pharm. Co., 552 F. Supp. 2d. 500 (E.D. Pa. 2008) (here); Merck & Cie v. Watson Pharms., Inc., C.A. No. 12-161-RGA (D. Del. Sept. 25, 2012) (here); and Otsuka Pharm. Co. v. Par Pharm., Inc., C.A. No. 13-1979 (RGA) (D. Del. Mar. 10, 2014) (here).  Nevertheless, as detailed in a previous post, the practice has continued and spread among companies.  But some recent events in court, as well as some action by FDA with respect to the company some have considered the major proponent of premature notice – Par Pharmaceutical, Inc. (“Par”) – may signal the demise of the disfavored practive. 

On December 23, 2014, the U.S. District Court for the Eastern District of Texas granted in part a Motion for Summary Judgment stemming from a Complaint (later amended) Allergan, Inc. (“Allergan”) filed alleging premature notice concerning generic RESTASIS (cyclosporine ophthalmic emulsion) 0.05%.  Allergan was seeking, among other things, a “Declaratory Judgment of False Paragraph IV Notification” based on notice letter sent regarding an ANDA that was initially submitted to – and that was later the subject of a Refuse-to-Receive action by – FDA. 

After finding that there was specific personal jurisdiction, the District Court delved into the premature notice issue.  Citing to SB Pharmco, the District Court pointed out the similarities between the two cases, noting that in both SB Phamco and this case:

• the defendants submitted an ANDA, followed by an “amendment” to said ANDA;
• concurrently with (SB Phamco) or shortly after (this case) said amendment, the defendants sent the plaintiff a paragraph IV notice letter; 
• the FDA refused to receive said ANDA (this case) or had not received the ANDA at the time that the paragraph IV notice was sent (SB Phamco); 
• and the plaintiffs filed a complaint seeking declaratory judgment that the paragraph IV notices were deficient, or in the alternative seeking relief under 35 U.S.C. § 271(e)(2).

And the Court agreed with the SB Phamco holdings: that the defendants’ Paragraph IV notice was premature and improper under 21 U.S.C. § 355(j)(2)(B)(ii)(I) and 21 C.F.R. § 314.95(b), and that “the term ‘submit’ in § 271(e)(2) clearly means that an ANDA has been received, not merely delivered” (552 F. Supp. 2d at 511).  “To hold otherwise,” wrote Disctirc Court Judge Rodney Gilstrap, “would invite generic manufacturers to submit incomplete or otherwise deficient applications, in order to secure their position as the first-filed generic.  They could then attempt to remedy any deficiencies through an amendment to their premature application, while claiming priority to the original application for purposes of securing exclusive access to the market and other benefits.”

Judge Gilstrap didn’t buy Defendants’ argument that the statutory notice provisions at FDC Act § 505(j)(2)(B)(ii), and, in particular, FDC Act § 505 (j)(2)(B)(ii)(II) concerning ANDA amendments/supplements and the requirement to simultaneously send notice with a Paragraph IV certification, establish that FDA acceptance (i.e., receipt) of an ANDA is irrelevant with respect to compliance with 35 U.S.C. § 271(e)(2).  That patent law provision provides that it is an act of infringement to: “submit . . . an [ANDA or 505(b)(2) application] for a drug claimed in a patent or the use of which is claimed in a patent.”  This patent provision, wrote Judge Gilstrap

protects the property rights of name brand drug manufactures, and stands as a counterbalance to the expedited approval process and “safe harbor” provisions that dramatically decrease the cost of bringing a generic drug to market. . . .  In this context, Defendants’ argument is clearly flawed.  It would essentially eviscerate “the cardinal rule that a statute is to be read as a whole, . . . since the meaning of statutory language, plain or not, depends on context,”  King v. St. Vincent's Hosp., 502 U.S. 215, 221 (1991).

Moreover, noted Judge Gilstrap, citing to a letter FDA sent to Allergan, “FDA has expressly rejected this interpretation of the relevant statutes in the past.”

Reading the statute as a whole, the Court finds the FDA’s interpretation to be persuasive; 21 U.S.C. § 355(j)(2)(B)(ii)(II) clearly permits that the notice be sent concurrently with the amendment only if the amendment is submitted for an ANDA that has already been received for filing by the FDA.

Accordingly, the Court is persuaded that “submission” of an ANDA under 35 U.S.C. § 271(e)(2) requires said ANDA to be received by the FDA.  Mere transmission of an application cannot satisfy the statutory requirements for infringement.  Were transmission alone the test, such a result would unavoidably promote a flood of “hit and run” filings in which glaring deficiencies would be no impediment to gaining the benefits properly reserved for those applicants who now survive the FDA’s careful review and obtain its certification as “received” . . . .  Accordingly, because the FDA has not received Defendants’ ANDA, the Court is persuaded that Defendants’ ANDA cannot trigger infringement under 35 U.S.C. § 271(e)(2), as a matter of law.

Despite this initial holding, however, Judge Gilstrap did decine to declare, as Allergan requested, whether or not the premature notice triggered the statutory 45-day period for Allergan to timely file a patent infringement lawsuit, and whether or not a 30-month litigation stay would begin only with a lawsuit based on a valid Paragraph IV notice.  Citing to a 2001 decision from the U.S. Court of Appeals for the Federal Circuit in Minnesota Mfg. and Mining v. Barr Labs., 289 F.3d 775 (Fed. Cir. 2001), in which that Court clarified, in the context of a dispute about compliance with the Paragraph IV certification requirements of the statute, that there is no private right of action under the Hatch-Waxman Amendments, Judge Gilstrap wrote that

at least with respect to Allergan’s request for an order declaring that Defendants’ paragraph IV notices would not trigger the [45]-day countdown and/or the 30-month stay provided for in § 355(j)(5)(B)(iii)[,] [s]uch an order would go too far, effectively constituting a mandate that compells the FDA to take specific action with respect to Defendants’ ANDA.

But that District Court decision is not the end of our story for today; it’s only part of our offering. . . . 

Next, we turn to ongoing litigation in the U.S. District Court for the District of Delaware concerning a premature notice from Par with respect to that company’s ANDA for a generic version of Reckitt Benckiser Pharmaceuticals, Inc.’s (“RB’s”) SUBOXONE (buprenorphine and naloxone) Sublingual Film.  We’ve been following this case for a while.  Given a convergence of events – i.e., the RESTASIS premature notice decision and some recent filings in the SUBXONE premature notice case – it’s the perfect time to blog about the SUBOXONE case, even though there’s not yet a court decision on the pending issue of the potential consequences of premature notice.

We’ll spare you all of the details (you’re welcome), but suffice it to say that the litigation is premised on a fact pattern similar to that encountered in other premature notice cases.   Par filed a premature notice that RB challenged.  Last April, RB filed a Motion to Dismiss the case, which Par opposed (RB’s Reply Brief is available here).  In a May 17, 2014 Order, the Delaware District Court granted RB’s Motion to Dismiss.  And in a handwritten footnote, District Court Judge Richard G. Andrews said the following, referring to two other cases involving ANDAs for generic SUBOXONE Sublingual Film, including Par’s ANDA: “the Court will issue a separate order in regard to scheduling.”

That scheduling Order was handed down on May 28, 2014 and includes an interesting footnote concerning how the case should be scheduled in light of RB’s argument that Par “should not benefit from wrongdoing in triggering the litigation before the statutory requirements were met.”  Judge Andrews commented that “I
expect at some point when I have a better handle on the case, for example, at the Markman hearing, I will entertain a request from Plaintiffs for a later trial and pretrial date for some or all of the issues in No. 14-422 [(i.e., Par’s case)],” and dropped a footnote providing one potential remedy:

For example, if there is going to be a trial on infringement in No. 14-422, I might sever that issue and try it separately.  On the other hand, to the extent the Defendants in both cases have the same invalidity arguments, there is a lot to be said for trying them together.  Possibly, we might try all issues at the same time, and I would issue the No. 13-1674 opinion separately and before the No. 14-422 opinion.  I am sure the parties can come up with some other suggestions for how to avoid rewarding the 14-422 Defendants for their dubious conduct while at the same time minimizing the extra work that might otherwise be required of the Court and the Plaintiffs.

Fast-forward several months to the December 3, 2014 Markman hearing in the action.  At the hearing, RB reminded Judge Andrews of his invitation for RB to request a later trial and pretrial date vis-à-vis Par’s case.  In a subsequent letter to the court, Par laid out its reasons for Par’s case to remain consolidated with other Paragraph IV defendants:

Par’s actions in sending its first Notice Letter to Plaintiffs were done based on a good faith belief that it was required to do so under statute.  Additionally, Par has not gained any unfair advantage, nor have Plaintiffs . . . been prejudiced by Par’s consolidation.  ANDA cases filed on similar schedules . . . are routinely consolidated and tried together, and accordingly doing so here would not cause prejudice to any party. 

With respect to Par’s “good faith belief,” the company further stated in its letter that:

Par believed that the express language of the Hatch-Waxman statute required it to send a Notice Letter with its ANDA amendment.  21 U.S.C. § 355(j)(2)(B)(ii).  Par also understood that failure to send notice upon amendment had been held to disqualify an ANDA applicant from first-filer status.  Purepac Pharm. Co. v. Thompson, 354 F.3d 877, 888 (D.C. Cir. 2004).  Par has since reached agreement with the Agency on how to proceed for future products, and therefore Par does not expect that this circumstance will be repeated again. [(Emphasis added)] 

A week later, RB shot back in its own letter to the court: 

The simple fact is that if Par had followed the rules under the Hatch-Waxman statute, Par would not be allowed to reach a potential determination of its case until many months later than under the presently consolidated schedule.  The only reason Par, which has a proposed, non-FDA approved, not yet marketed product, is currently able to litigate any issues of infringement or validity of Plaintiffs’ patents is because of the procedures provided by the Hatch-Waxman regime, which represents a careful, negotiated balance between the interests of brand-name pharmaceutical innovators and the interests of would-be generic competitors.  That balance includes the timing of potential judicial determinations of the issues of validity and infringement.  There is no justification for allowing Par to leapfrog the Hatch-Waxman sequence to schedule a non-entitled, premature trial date, particularly, in the present situation, in regard to infringement, or to otherwise gain any potential and undue strategic advantage by having improperly “cut the line” on the way to the courthouse.

Judge Andrews has not yet decided how to resolve the issue; however, we’ll be watching closely to see if there is any court-imposed sanction for a premature Paragraph IV notice. 

We were particularly intrigued by one sentence in Par’s December 2014 letter to the court (emphasized above): “Par has since reached agreement with the Agency on how to proceed for future products, and therefore Par does not expect that this circumstance will be repeated again.”  Though we don’t know for sure, we suspect that the “agreement” reached with FDA is reflected in a March 11, 2014 letter from FDA to Par.  The letter was issued after the Agency requested a meeting with Par representatives “to discuss Par’s practice of sending premature notifications of paragraph IV certifications in violation of [FDC Act §] 505(j)(2)(B), and 21 C.F.R. 314.95(b).”  That meeting was held on January 24, 2014.

According to FDA:

At the January 24 meeting, Par informed the Agency that it intended to continue its violative practice.  Par’s explanation for its practice was that Par’s premature notification was based on a “literal” reading of section 505(j)(2)(B)(ii)(II) of the FD&C Act and 21 CFR 314.95(d), and was done “in an abundance of caution” in light of Purepac Pharmaceutical Corporation v. Thompson, 354 F.3d 877 (D.C.Cir. 2004).  Par acknowledged that its notice did not comply with 21 CFR 314.95(c) but did not explain why this provision did not apply to Par.  In response to questioning by the agency, Par also acknowledged that it was aware of the court’s decision in SB Pharmco Puerto Rico, Inc. v. Mutual Pharmaceutical Co., 552 F. Supp. 2d 500 (E.D.Pa.), appeal dismissed, 2008 App. LEXIS 27672 (Fed. Cir. 2008).

According to the FDA letter, “Par offered to include in its paragraph IV notifications language that Par believes could help reduce confusion, and distributed an already prepared draft of such language.”  At the time, FDA deferred specific comment on the language provided.  Subsequently, Par shared with FDA revised language.  FDA states in the Agency’s March 11, 2014 letter that:

In implementing 21 U.S.C. 355(j)(2)(B), the regulations at 21 CFR 314.95(c) state what must be included in a notice of certification.  This regulation at 21 CFR 314.95(c)(1) sets forth the requirement that the notice include “a statement that FDA has received an [ANDA] submitted by the applicant.”  FDA’s regulation at 21 CFR 314.101(b)(1) defines the term “received.”  It states that “An [ANDA] will be reviewed after it is submitted to determine whether the [ANDA] may be received. Receipt of an [ANDA] means that FDA has made a threshold determination that the [ANDA] is sufficiently complete to permit a substantive review.”  As FDA has conveyed to Par both in writing and at the January 24 meeting, and regardless of the additional language Par chooses to include, a notice provided before an ANDA is received for filing cannot comply with this regulatory requirement and therefore is invalid on its face.  This regulation does not, however, proscribe inclusion of any additional information or statements.  Indeed, the regulation plainly states that the notice “shall include, but not be limited to” the required information.  The agency, therefore, has no objections to the inclusion of the language above.  We do note, however, that FDA does not agree that the first sentence of your proposed additional language is true, complete, or accurate in light of our reading of the statute and regulations as a whole and the court’s finding in SB Pharmco.

Unfortunately, the language offered by Par is redacted from FDA’s letter; however, we’re pretty sure an NDA holder or patent owner who has recently received a (premature) notice letter from Par can easily identify it.

By Kurt R. Karst –      

In what is, to our knowledge, a first-of-its-kind written decision, Judge Esther Salas of the U.S. District Court for the District of New Jersey issued an Oral Opinion and Order on December 22, 2014 granting without prejudice in part and denying in part a Motion to Dismiss filed by Celgene Corporation (“Celgene”) in litigation brought by Mylan Pharmaceuticals Inc. (“Mylan”) alleging that Celgene violated federal and state antitrust laws by preventing generic competition for two of Celgene’s drug products: THALOMID (thalidomide) Capsules (NDA 020785) and REVLIMID (lenalidomide) Capsules (NDA 021880).  (Copies of the Opposition and Reply Briefs in the case are available here and here.)  

As we previously reported, Mylan, in its April 2014 Complaint, is seeking preliminary and permanent mandatory injunctive relief to compel Celgene to sell Mylan sufficient quantities of THALOMID and REVLIMID at market prices for purposes of bioequivalence testing and ANDA submission, and compensatory damages for Mylan’s lost sales of generic versions of both drugs (and profits on those sales) determined to be caused by the delay in Mylan’s ability to submit ANDAs to FDA.  Both THALOMID and REVLIMID are the subject of Elements To Assure Safe Use (“ETASU”) Risk Evaluation and Mitigation Strategies (“REMS”) – here and here – providing for restricted distribution of the products because of safety concerns.  According to Mylan, “Celgene . . . has used REMS as a pretext to prevent Mylan from acquiring the necessary samples to conduct bioequivalence studies, even after the FDA determined that Mylan’s safety protocols were acceptable to conduct those studies.” 

In her Oral Opinion, Judge Salas denied Celgene’s Motion to Dismiss with respect to Mylan’s claims alleging violations of Section 2 of the Sherman Act (Monopolization, Attempted Monopolization and Conspiracy to Monopolize, and Denial of an Essential Facility or Resource Necessary to Compete), Section 56:9-4 of the New Jersey Antitrust Act, and New Jersey Common Law (Unfair Competition and Tortious Interference with an Economic Advantage).  Judge Salas, however, also dismissed Mylan’s allegations under Section 1 of the Sherman Act (Contract, Combination or Conspiracy in Restraint of Trade in that “Celgene devised an anticompetitive scheme to prevent Mylan and others from filing ANDAs for generic versions of Thalomid and Revlimid, and that Celgene entered into unlawful agreements with wholesale distributors and pharmacies to unduly restrain trade”) and Section 56:9-3 of the New Jersey Antitrust Act.

Under Sherman Act § 2, a plaintiff must plead two elements: (1) monopolization; and (2) under Verizon Communs., Inc. v. Law Offices of Curtis V. Trinko, LLP, 540 U.S. 398 (2004), “the willful acquisition or maintenance of that power as distinguished from growth or development as a consequence of a superior product, business acumen, or historic accident.”  Celgene and Mylan disputed the second element.  Celegene argued that “its conduct is not exclusionary as a matter of law because Section 2 does not impose an affirmative duty to deal with competitors except under limited circumstances, which it argues are inapplicable here,” while Mylan took the position that “Celgene’s conduct falls within the scope of cases where a duty to deal applies.”

In discussing the relevant refusal to deal law under Sherman Act § 2, Judge Salas found that a “prior course of dealing” between Celgene and Mylan was not strictly required under U.S. Supreme Court, Third Circuit, or district court precedent.  Rather, the District Court found that a prior course of dealing was simply an indicator or proxy for the larger inquiry of whether Celgene’s refusal to deal was legitimate or motivated by anticompetitive gain.  According to Judge Salas:

[T]he Supreme Court reasoned [in Trinko] that “prior course of dealing” was relevant to the § 2 inquiry insofar as it served as a proxy for the larger inquiry of whether the defendant’s conduct was anticompetitive. . . .  The Third Circuit cases to consider the scope of the “no duty to deal” do not appear to adopt a strict requirement that a party must plead “prior course of dealing” for its claims to proceed. . . .  [T]he cases in our Circuit that have considered the scope of the affirmative duty to deal suggest that a “prior course of dealing” is relevant but not dispositive in determining whether such a duty applies. . . .  Likewise, the district court cases in our Circuit do not appear to require pleading a prior course of dealing.

Judge Salas also rejected, as a matter of law, arguments raised by Celgene that the relevant product market, for Sherman Act § 2 monopolization purposes, could not be limited to a single drug and its generic equivalents, and that Celgene’s patents on THALOMID and REVLIMID precluded a finding of antitrust injury. 

The Mylan litigation is being watched closely by many in the pharmaceutical industry and in the government, because it could result in the first merits decision on the topic.  Previous antitrust cases involving restricted distribution products – Actelion Pharm. Ltd. v. Apotex, Inc., Case No. 12-5743 (D.N.J.) (see our previous posts here, here, and here) and Lannett Co., Inc. v. Celgene Corp., Case No. 8-3920 (E.D. Pa.) (see our previous post here) – although allowed proceed after motions to dismiss were denied based on facts similar to those before Judge Salas, were ultimately dismissed after the parties entered into settlement agreements.  The Federal Trade Commission filed an amicus brief in the Mylan case taking the position that a brand-name company’s refusal to sell samples to a an ANDA applicant can constitute exclusionary conduct under established U.S. Supreme Court precedent, that a brand-name company’s distribution agreements are not immune from antitrust scrutiny, and that a brand-name company’s patents alone do not establish a lack of antitrust injury.  And, as we previously reported, Congress has been considering legislation – H.R. 5657, the Fair Access for Safe and Timely Generics Act of 2014 – to amend the FDC Act to address the availability of products subject to a restricted distribution program.  Moreover, in December, FDA issued a draft guidance document to formalize the Agency’s long-standing process for prospective ANDA applicants to obtain a letter from the Agency stating FDA’s determination that the Agency will not consider it a violation of a REMS for the RLD sponsor to provide a sufficient quantity of a drug for bioequivalence testing purposes. 

By Kurt R. Karst –

FDA’s Sixth Annual Report to Congress, required by FDC Act § 505(q)(3), on the Agency’s experience during Fiscal Year 2013 (“FY 2013”) with citizen petitions subject to FDC Act § 505(q), though largely repetitive of reports filed for previous fiscal years (see our previous posts here, here, here, here, and here), includes more forceful statements about the effects of the statutory provision than we have seen in the past from the Agency. The report also includes updated figures and statistics on the numbers and outcomes of petitions FDA has received and acted on.

FDC Act § 505(q) was added to the law by the 2007 FDA Amendments Act (“FDAAA”) and is intended to prevent the citizen petition process from being used to delay approval of pending ANDAs and 505(b)(2) applications. The law was amended by Section 301 of Pub. L. No. 110-316 (2008), and again by Section 1135 of the 2012 FDA Safety and Innovation Act (“FDASIA”).  Among other things, FDASIA changed the original 180-day response deadline to 150 days, and made the law applicable to citizen petitions concerning biosimilar applications submitted to FDA pursuant to PHS Act § 351(k). In June 2011, FDA issued final guidance on FDC Act § 505(q). That guidance was revised in November 2014 to account for changes made to the law by FDASIA.  In January 2012, FDA issued proposed regulations to amend the Agency’s citizen petition regulations to implement changes made to the law by Section 505(q).

Under FDC Act § 505(q), FDA shall not delay approval of a pending ANDA, 505(b)(2) application, or 351(k) biosimilar application as a result of a citizen petition submitted to the Agency pursuant to 21 C.F.R. § 10.30 (citizen petition) or § 10.35 (petition for stay of action), unless FDA “determines, upon reviewing the petition, that a delay is necessary to protect the public health.” FDA is required to “take final agency action on a petition not later than 150 days after the date on which the petition is submitted.” FDA may not extend the 150-day period “for any reason,” including consent of the petitioner.

Although the statute provides that FDA may summarily deny a petition submitted with the primary purpose of delaying ANDA, 505(b)(2) application, or 351(k) biosimilar approval, the Agency has never done so. Instead, FDA seems to have resorted to a form of public shaming when the Agency suspects delay tactics (see our previous post here).  But outright denial of a 505(q) petition is clearly something that’s been on FDA’s mind. In the latest Report to Congress, FDA comments:

505(q) contains a provision that permits FDA to summarily deny a petition at any point If FDA finds that it was submitted with the primary purpose of delaying the approval of an ANDA or 505(b)(2) application and the petition does not “on its face” raise valid scientific or regulatory issues (FD&C Act, section 505(q)(l )(E)). As FDA previously noted in its report to Congress entitled “Encouraging Early Submission of Citizen Petitions and Petitions for Stay of Agency Action,” dated February 2009, we believe that the statutory language requires that both preconditions be present, and we believe this statutory standard would be extremely difficult to meet. To date, FDA has never applied this provision to summarily deny a petition, despite the fact that, in FDA’s estimation, many 505(q) petitions do not in fact raise persuasive scientific or regulatory issues when those issues have been reviewed by FDA (as previously noted, approximately two-thirds of these petitions are denied in full). Accordingly, it is FDA’s view that this provision has neither curbed the filing of frivolous petitions submitted with the primary purpose ofdelay, nor has it permitted FDA to dispose of such petitions without expending substantial amounts of resources.

FDC Act § 505(q)(3) requires that each annual report to Congress specify: “(A) the number of applications that were approved during the preceding 12-month period; (B) the number of such applications whose effective dates were delayed by petitions referred to in paragraph (1) during such period; (C) the number of days by which such applications were so delayed; and (D) the number of such petitions that were submitted during such period.” FDA says in its Sixth Annual Report that:

Between September 27, 2007, and September 30, 2013, FDA determined that a delay in approving an ANDA was necessary to protect the public health in the case of seven ANDAs with related 505(q) petitions. FDA has not delayed approval of any 505(b)(2) applications or biosimilar biological product applications based on 505(q) petitions.

During the FY 2013 reporting period, the Agency approved 37 applications submitted under section 505(b)(2), 440 ANDAs, and no biosimilar biological product applications. No approvals for any 505(b)(2) or biosimilar biological product applications were delayed because of the filing of a 505(q) petition in this reporting period. Two ANDA approvals were delayed in this reporting period because of pending 505(q) petitions.

The two ANDA approvals delayed in FY 2013 were delayed by 25 days because “FDA was concerned that if it approved the ANDAs before resolving the issues raised in the petition and later concluded that one or more ofthe arguments against approval were meritorious, then the presence on the market of drug products that did not meet the requirements for approval could negatively affect public health.” Although FDA does not identify by drug name or ANDA number the particular approvals delayed, they are clearly ANDAs affected by FDA’s consideration of a March 2013 citizen petition (Docket No. FDA-2013-P-0247) concerning Zoledronic Acid Injection. FDA denied that petition in August 2013 and specifically noted that the petition caused a 25-day delay in ANDA approvals.

As to the number of 505(q) citizen petitions submitted in FY 2013, the Report to Congress says that 15 of the 93 citizen petitions (or 16%) handled by the Center for Drug Evaluation and Research (excluding ANDA suitability petitions and petitions that raise only OTC monograph issues) were 505(q) petitions. “During FY 2008 through FY 2013, FDA received a total of 131 petitions subject to section 505(q). Over this 6-year period, FDA responded to all but six of the 505(q) petitions within the statutory time frame that was applicable during that period” (i.e., 180 days or 150 days). The report includes helpful tables showing the percentage of 505(q) petitions received during Fiscal Years 2008-2013, and the outcomes for the 124 petitions that have been resolved under FDC Act § 505(q) as of September 30, 2013. Our friends over at RAPS have also put together some tables based on the data reported by FDA (see here).

In previous Reports to Congress, FDA has repeatedly expressed frustration with how responding to 505(q) petitions interferes with other Agency work.  FDA’s Sixth Annual Report is no exception. If anything, FDA is expressing more frustration as the years go by:

The Agency is concerned that section 505(q) is not discouraging the submission of petitions that are intended primarily to delay the approval ofcompeting drug products and that do not raise valid scientific issues. The statute requires FDA to prioritize these petitions above other matters, such as safety petitions, that do raise important public health concerns. FDA also believes that innovator companies are, in some cases, implementing strategies to file serial 505(q) petitions and petitions for reconsideration in an effort to delay approval ofANDAs or 505(b)(2) applications for competing drugs. In addition, with the shortened timeframe under FDASIA, FDA remains concerned about the resources required to respond to 505(q) petitions within the statutory deadline at the expense of completing the other work of the Agency.

Whether FDA’s growing frustration will boil over into something more – perhaps a change in the law – remains to be seen.

By Jennifer M. Thomas –

Last month, the U.S. District Court for the District of Utah dealt a significant blow to the Federal Trade Commission (“FTC”) when it denied FTC’s motion summary judgment in a case against Basic Research, LLC (“Basic Research”).  The Court’s decision marks the potential conclusion of a long-standing conflict between FTC and Basic Research regarding the meaning and application of the “reasonable basis” standard in a 2006 consent agreement.  FTC’s deadline to appeal the decision is in late January, 2015.

Related interactions between Basic Research and FTC began in 2004 or earlier, but this specific case began in 2009, when Basic Research sued the FTC.  More specifically, Basic Research sued the FTC for threatening to sue Basic Research.  According to Basic Research’s 2009 compliant, FTC threatened to bring contempt proceedings against the company under a prior consent agreement entered into by FTC and Basic Research in 2006, unless Basic Research complied with FTC’s demands to produce certain substantiation or pull advertising for Basic Research’s AkävarTM and RelacoreTM dietary supplement products.  See Complaint, Basic Research LLC v. FTC, No. 09-cv-779 (D. Utah, Aug. 31, 2009).  But Basic Research argued that FTC’s demands were outside the scope of the parties’ prior agreement – which required only a “reasonable basis” for advertising claims – and its threats of imminent contempt litigation allegedly violated Basic Research’s First and Fifth Amendment rights to advertise as permitted by that binding agreement.  Id. at 2.  Basic Research asked the District Court to declare the meaning of the “reasonable basis” standard.

Predictably, FTC filed the threatened enforcement action shortly after Basic Research sued.  See United States v. Basic Research, LLC, No. 09-cv-972 (D. Utah, Oct. 29, 2009).  The two actions were consolidated into the case Basic Research had filed.  See Memorandum Decision, Basic Research LLC v. FTC, No. 09-cv-779 (D. Utah, May 23, 2011).  FTC’s motion to dismiss the Basic Research’s case for lack of jurisdiction was concurrently denied.  Id.

On June 1, 2012, the District Court ruled in favor of Basic Research’s motion for partial summary judgment, declaring among other things that (1) FTC was bound by the consent agreement, which must be enforced only according to its terms, (2) the “reasonable basis standard” in the consent agreement was clear and unambiguous.  See Order Granting Plaintiffs’ Motion for Partial Summary Judgment, Basic Research, LLC v. FTC, No. 09-cv-779 (D. Utah, Jun. 1, 2012).  Specifically, the Court declared that the “reasonable basis” standard is met when there is a causal connection between the evidence proffered as support and the representation at issue at the time it is made, and the representation is supported by competent and reliable scientific evidence, including tests, analysis, research, and studies that:

(i) is based on the expertise of professionals in the relevant area;
(ii) conducted and evaluated in an objective manner;
(iii) by a person qualified to do so; and
(iv) uses procedures accepted in the profession to yield accurate and reliable results.

Id.  More significantly, however, the Court also declared FTC must prove that one of the above requirements for a “reasonable basis” has not been met in order to prove contempt, and that FTC’s burden would not be met merely by producing evidence that contradicts the evidence proffered by Plaintiffs, unless FTC’s evidence proves that one of the requirements for “reasonable basis” was not met.  Id.

In light of the Court’s 2012 order, FTC faced a significant challenge in proving contempt under the “reasonable basis” standard.  And it ultimately failed. 

On November 25, 2014, the District Court granted Basic Research’s motion for summary judgment and denied that of the FTC.  See Memorandum Decision and Order, Basic Research, LLC v. FTC, No. 09-cv-779 (D. Utah Nov. 25, 2014).   First, the Court determined that the study Basic Research proffered in support of its claims for AkävarTM, a double-blind, placebo controlled, peer-reviewed and published study, was sufficient to provide a “reasonable basis” for the company’s AkävarTM advertising.  This conclusion was based in part on the opinions of two experts that Basic Research asked to review the study, both of whom concluded that the study supported Basic Research’s claims for AkävarTM.  FTC also produced an expert, but it appears the Court found his opinion less than convincing on the salient point of whether Basic Research had a “reasonable basis” for its claims.  Specifically, the Court found that FTC’s expert had impermissibly compared the company’s proffered evidence with the “Gold Standard” for scientific substantiation, rather than the reasonable basis standard as stated by the Court’s 2012 order, and had “based his opinion on inaccurate and incomplete facts.”  Id. at 23.  Second, the Court found that FTC’s expert had similarly applied the wrong standard to Basic Research’s evidence in support of its RelacoreTM claims (multiple expert opinions based on a review of the published data on RelacoreTM’s ingredients).  The Court rejected the FTC expert’s opinion that a single study on the RelacoreTM formulation was necessary to support claims for that product.  Id. at 25.  The Court’s decision is also noteworthy in that the Court deemed several categories of studies worthy of consideration that FTC’s expert had summarily dismissed.  For example, the Court determined that animal and in vitro studies, while they did not warrant “automatic extrapolation . . . to human beings” should not be disregarded.  Id. at 26.  The Court questioned why “correlations and inference cannot be drawn” across study reports.  Id. 

Based on its evaluation of the expert opinions submitted by FTC and the data and expert opinions submitted by Basic Research, the Court concluded that (1) Basic Research provided a reasonable basis for its AkävarTM and RelacoreTM marketing claims, and (2) FTC failed to make a prima facie showing that Basic research lacked competent and reliable scientific evidence.  Thus, the Court granted summary judgment to Basic Research.

FTC’s loss to Basic Research drives home the importance to FTC and its enforcement authority of being able to impose a more specific substantiation standard on allegedly violative companies than the historically more general “competent and reliable scientific evidence” definition.  FTC clearly recognizes the importance of this issue, as evidenced in part by its persistent defense of the “two random and controlled trials” standard it has sought to impose on POM Wonderful LLC, see here.  Cases like Basic Research (and Bayer, which we blogged about here and here), amplify the significance of the D.C. Circuit’s eventual holding in the POM Wonderful case, which we at the FDA Law Blog await eagerly.

By Kurt R. Karst –      

Last week, the Federal Trade Commission (“FTC”) announced the issuance of the Bureau of Competition’s annual summary of agreements filed with the Commission during the last fiscal year (Fiscal Year 2013) – Agreements Filed with the Federal Trade Commission under the Medicare Prescription Drug, Improvement, and Modernization Act of 2003.  The report was issued less than two months after U.S. Senators Amy Klobuchar (D-MN) and Charles Grassley (R-IA) sent a letter to FTC Chairwoman Edith Ramirez requesting prompt release of not only the FY 2013 numbers, but the numbers from FY 2014 as well. 

The FTC’s FY 2013 Staff Report is the first report issued since the U.S. Supreme Court’s June 17, 2013 decision in FTC v. Actavis, Inc., 133 S. Ct. 2233 (2013), which addressed the standards that courts should apply in drug patent settlement cases (also known as “pay-for-delay” or “reverse payment” cases).  (See our previous post here regarding the Actavis decision, here for more on FTC action concerning patent settlement agreements, and here for our post on the FTC’s FY 2012 summary.)  According to the FTC, however, “[b]ecause this decision came nearly three quarters of the way through FY 2013, there are not yet enough post-Actavis settlements to draw meaningful conclusions from the [FY 2013] data.”

The Actavis decision has resulted in significant litigation.  In fact, there’s been sooo much litigation that it’s been difficult to keep up with all of the action.  That’s why we’re thankful for a recent summary of drug patent settlement agreement litigation provided by our friends Seth Silber, Jonathan Lutinski, and Ryan Maddock over at Wilson Sonsini Goodrich & Rosati.  Their article, titled “‘Good Luck’ Post-Actavis: Current State of Play on ‘Pay-for-Delay’ Settlements,” is a helpful read.  And more litigation – both from the FTC and private parties – is likely on the horizon.  Indeed, FTC Commissioner Terrell McSweeny said in a speech earlier this month that “I expect that the Commission will continue to be an integral player in bringing cases, where appropriate, post-Actavis.”

According to the FTC Staff Report, FY 2013 saw 145 final patent settlement agreements filed with the Commission, which is a small increase from FY 2012.  But only 29 of the 145 agreements “potentially involve pay for delay because they contain both compensation from a brand manufacturer to a generic manufacturer and a restriction on the generic manufacturer’s ability to market its product in competition with the branded product.”  That’s a drop from the 40 of the 140 agreements reported in FY 2012.  In addition, 41 of the 145 agreements reportedly involved ANDA sponsors eligible for 180-day exclusivity, of which 13 are tagged by the FTC as “potential pay-for-delay settlements.”  As the FTC points out in the report, 13 is the lowest number on record since FY 2008 and represents a “substantial decrease from the previous three years.” 

When we at the FDA Law Blog play around with the numbers, however, it shows that 13 of 145 is 9%.  That’s the lowest number on record since the first year of reported numbers.  Below is a table based on the numbers provided in the FTC Staff Report showing how the FY 2013 figures stack up against the numbers from previous years – as well as overall totals.  And because a picture is worth a thousand words, we also include a graph displaying the data. 

Turning to Congress, legislators have been relatively quiet over the past year with respect to legislation that would curb – or effectively ban – drug patent settlement agreements.  In fact, the last relevant bill we recall was introduced in December 2013: H.R.3709, the Protecting Consumer Access to Generic Drugs Act of 2013 (see our previous post here). 

Despite the relative calm from Congress over the past year, however, things could once again heat up with the 114th Congress.  Indeed, Senator Klobuchar, who, as noted above, was seeking prompt release of data from the FTC, recently penned commentary that appeared in the StarTribune saying that one of three “wise solutions that could unlock a future of more affordable drugs” is enactment of S.214, the Preserve Access to Affordable Generics Act.  (See our previous post on that bill here.) 

By Anne Marie Murphy –

On December 24th, in response to industry requests, FDA issued a guidance document indicating that it will not enforce product tracing requirements of the Drug Supply Chain Security Act ("DSCSA") prior to May 2015. The guidance, states in relevant part:

FDA recognizes that some manufacturers, wholesale distributors, and repackagers may need additional time beyond January 1, 2015, to work with trading partners to ensure that all of the product tracing information required under section 582 of the FD&C Act is provided to and captured by the recipient trading partner. To minimize possible disruptions in the distribution of prescription drugs in the United States, FDA does not intend to take action against trading partners who do not, prior to May 1, 2015, provide or capture the product tracing information required by section 582(b)(1), (c)(1), and (e)(1) of the FD&C Act. This compliance policy is limited to the requirements that trading partners provide and capture product tracing information; it does not extend to other requirements in section 582 of the FD&C Act, such as verification related to suspect and illegitimate product (including quarantine, investigation, notification and recordkeeping) and requirements related to engaging in transactions only with authorized trading partners.

This enforcement discretion aims to avoid possible disruptions in the prescription drug supply chain as the new requirements come into effect.  For more recent news on the DSCSA, see our prior posts here, here, and here. 

By Ricardo Carvajal –

In an opinion piece recently published in the Journal of the American Medical Association, a trio of Colorado physicians examine the implications of legalization of marijuana in their home state.  The authors summarize “expected” effects, including increased use of health care services in relation to marijuana exposure, as well as “increased opportunities for clinician scientists to study the positive health effects” of legalization – opportunities that purportedly have been limited by continued “federal designation of marijuana as a Schedule I drug.”  The authors also summarize “unexpected” effects, including “an increased prevalence of burns, cyclic vomiting syndrome, and health care visits due to ingestion of edible products”  (for background on Colorado’s regulation of edible products, see our prior blog posting here).

Edible products reportedly account for the “majority of health care visits due to marijuana intoxication for all ages.”  The authors attribute this phenomenon to several factors, namely the “delayed effects of ingestion compared with inhalation,” the relatively high levels of THC in some edible products, inconsistent levels of THC due to the lack of standardized manufacturing practices, the lack of childproof packaging for individual “dosing units” (as opposed to the outer container), and packaging that is appealing to children or that can lead to confusion with conventional products.  These factors lead the authors to conclude that “risks of use must be consistently communicated through health care practitioners and public health officials, especially for edible products that pose unique risks for exposed adults and children.”

By Jeffrey K. Shapiro –

FDA has always allowed companies to transfer 510(k) clearances without obtaining new clearance.  Indeed, this blogger provided a short primer on the topic 15 years ago.  However, this administrative practice has long been shrouded in mystery, because FDA has never published guidance.

Until now!  At last, FDA has issued a draft guidance in the form of a Q&a on 510(k) transfers.  The Federal Register notice can be found here.

The key points:

FDA allows allows a 510(k) holder to transfer clearance without a new 510(k) clearance (absent a significant modification of the device).  There may be only one 510(k) holder at a time. 

Notice of a 510(k) transfer is (and always has been) accomplished via compliance with device listing requirements.  The transferor notifies FDA by de-listing the device, and the transferee notifies FDA by newly listing the device.  Although the regulations only require an update annually, the federal register notice for the draft guidance estimates that 78% of listing updates are voluntary changes outside the annual registration cycle.

FDA has never had the capability to track 510(k) transfers through each iteration, and it still does not.  What is new is that, for the first time, FDA has developed the ability to show the current 510(k) holder (as opposed to the original 510(k) holder) in the 510(k) clearance database.  This capability has arisen because registration and listing regulations were altered in 2012 to require the 510(k) number associated with each device to be listed in FDA’s Unified Registration and Listing System (FURLS) Device Registration and Listing Module (DRLM).  Taking advantage of this requirement, FDA has modified the 510(k) clearance database to sync with the FURLS DRLM so that the most recent 510(k) holder can appear in both databases.

Because FDA does not track 510(k) transfers, it is possible for ownership to be disputed.  Interestingly, the federal register notice estimates there are approximately 2,000 such disputes per year, with an average of 2.3 parties involved (meaning that a good percentage of these disputes involve more than two parties).  (This blogger’s primer has some tips on how 510(k) purchasers can mitigate this risk.) 

If two persons claim to be the 510(k) holder, based upon conflicting listings, the draft guidance indicates that FDA will contact both parties and attempt to determine the rightful 510(k) holder.  This willingness to intervene may be a new development, since in our experience FDA generally has shied away from involvement in these disputes. 

The guidance does not provide procedural detail about how the dispute resolution process will be conducted.  (It would be helpful if the final guidance did so.)  The draft guidance does give examples of the type of documents that might be submitted to prove ownership:  court orders, attestation from a previous uncontested 510(k) holder, a legal instrument (e.g., contract or will), and/or other documentation establishing the chain of transfers up to the current holder.  A contest over ownership could be high stakes if both purported 510(k) holders are actively placing a device in commercial distribution under the same K number: the loser’s device will be deemed misbranded.

The draft guidance explains that a number of different parties may need to list a particular 510(k) number, in their role as manufacturer, specification developer, repacker/relabeler, single use device reprocessor or remanufacturer of a device.  Furthermore, after the 510(k) holder has listed, under secondary parties are expected to list their customer’s 510(k) number (contract manufacturers, sterilizers, foreign exporters, and foreign private label distributors).  The draft guidance does not explain how FDA will distinguish the 510(k) holder from others required to list the same number, but presumably these distinctions will be drawn based upon the activities of the listing party (e.g., if a sterilizer lists the 510(k) number, FDA will infer that it does not claim to be the 510(k) holder).  It would be helpful if the final guidance addressed this topic more clearly.

Finally, the transfer of a 510(k) relating to an in vitro diagnostic (IVD) test raises an additional issue.  FDA is responsible for categorization of commercially marketed IVD tests under the Clinical Laboratory Improvement Amendments of 1988 (CLIA).  The draft guidance indicates that where the name of a cleared device changes, or the name of the manufacturer or distributor changes, an updated label and copy of the package insert should be submitted to ensure accurate CLIA categorization and record of the 510(k) holder and device information.  This recommendation is a bit of a trap, because FDA may take the opportunity to consider changes to the test since clearance, and the new 510(k) holder may be required to provide a new CLIA and/or 510(k) submission.  Nonetheless, it is difficult to see how to avoid it, since failure to do so will mean that the CLIA categorization database does not list the new 510(k) holder.

By Kurt R. Karst & Michelle L. Butler –       

Ever since FDA withdrew a notice of appeal in Depomed Inc. v. U.S. Department of Health and Human Services et al., Case No. 1:12-cv-01592, to the U.S. Court of Appeals for the District of Columbia Circuit (see our previous post here), rumors were swirling that FDA was working on a statement to clarify how the Agency would proceed with administering its orphan drug regulations in a post-Depomed world.  Indeed, the Agency was working on something.  In a notice, styled as a “clarification of policy,” that will be published in the Federal Register on December 23, 2014, FDA addresses the effects of the Depomed court decision.  But FDA’s “clarification” is likely not what most folks were expecting. 

As we previously reported, on September 5, 2014, the U.S. District Court for the District of Columbia granted Depomed Inc.’s (“Depomed’s”) Motion for Summary Judgment in a lawsuit initiated with a September 2012 Complaint (see our previous post here) and ordered FDA to recognize orphan drug exclusivity for GRALISE (gabapentin) Tablets “without requiring any proof of clinical superiority or imposing any additional conditions on Depomed.”  The District Court found that “the plain language of the exclusivity provisions of the Orphan Drug Act requires the FDA to recognize exclusivity for any drug that the FDA has designated and granting marketing approval.” 

At the time, we thought the decision could have far-reaching implications for FDA’s orphan drug program (and perhaps beyond).  Indeed, we laid out a bunch of potential issues in a prior post.  But FDA, in the Agency’s “clarification of policy,” pushes all of these concerns to the side (at least for now).  In short, FDA says that the U.S. District Court for the District of Columbia’s decision in Depomed is limited to GRALISE.  As such, the Agency will continue to apply its clinical superiority regulatory paradigm insofar as orphan drug exclusivity is concerned.  Specifically, FDA states:

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

In essence, FDA is doubling down on its pre-Depomed regulations.  Perhaps this out-of-left-field-strategy is FDA’s way of drawing out another lawsuit from an affected sponsor so that the Agency can have another crack to relitigate the issue in court.  We’ll see. 

By Ricardo Carvajal - 

The Weston A. Price Foundation sued FDA to compel a response to the Foundation’s 2008 citizen petition (Docket No. FDA-2008-P-0452) asking FDA to revoke its regulation authorizing heart health claims for soy protein, which the Foundation claims is “not soy in its natural form.”  The complaint alleges that “[t]he totality of scientific research shows that the benefits of consuming soy protein are putative and unproven,” and that soy protein actually poses certain risks to health.  Thus, FDA’s regulation purportedly “placed consumers at risk because it helped establish the image of soy protein as heart healthy and contributed to an increase in consumption of soy protein in the United States.” 

The complaint describes the Foundation as “dedicated to restoring nutrient-dense foods to the human diet through education, research, and activism,” and as supportive of “a number of movements that contribute to this objective including accurate nutrition instruction, organic and biodynamic farming, pasture-feeding of livestock, community-supported farms, honest and informative labeling, prepared parenting and nurturing therapies.”  The Foundation has also been a staunch advocate www.realmilk.com for increased availability and consumption of raw (nonpasteurized) milk, which the Foundation claims is “safe and healthy” when “produced under sanitary and healthy conditions.”

Coincidentally, in a study published in CDC’s Emerging Infectious Diseases journal, CDC scientists reported an increase in reported outbreaks of foodborne illness associated with consumption of raw milk from 2007-2012.  The annual number of outbreaks increased both within that 6 year period, and in comparison to the annual number of outbreaks reported during 1993-2006.  During the 2007-2012 period, there were a total of 81 outbreaks in 26 states, resulting in 979 illnesses and 73 hospitalizations.  Of the 78 outbreaks for which the age of patients was available, 59% involved at least 1 patient under 5 years of age. 

The authors note that the increase in outbreaks “was concurrent with a decline in the number of states in which the sale of nonpasteurized milk was illegal, from 28 in 2004 to 20 in 2011, and with an increase in the number of states allowing cow-share programs (from 5 in 2004 to 10 in 2008)” (citations omitted).  The authors therefore conclude that “[t]he decision to legalize the sale of nonpasteurized milk or allow limited access through cow-share programs may facilitate consumer access to nonpasteurized milk,” and that “[l]egalization of the sale of nonpasteurized milk in additional states would probably lead to more outbreaks and illnesses.”  Further, the authors recommend that regulators enforce existing restrictions on the distribution of raw milk.  Although published in CDC’s journal, the study bears a disclaimer stating that the opinions expressed by the authors do not necessarily reflect those of CDC.

By Kurt R. Karst –    

Queue up the dueling banjo scene from the film Deliverance. . . . 

Early last month we saw an interesting press release from Veloxis Pharmaceuticals, Inc. (“Veloxis”) announcing FDA’s October 30, 2014 tentative approval of 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.  Why only a tentative approval?  According to FDA:

[T]he listed drug product Astagraf XL (NDA 204096), with which you share conditions of approval for which new clinical studies were essential, is subject to a period of exclusivity protection under sections 505(c)(3)(E)(iii) and 505(j)(5)(F)(iii) of the Act.  Therefore, final approval of your application under section 505(c)(3) of the Act [21 U.S.C. 355(c)(3)] may not be made effective until that product’s exclusivity period has expired.

FDA approved 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, on July 19, 2013 for prophylaxis of organ rejection in adult patients receiving kidney transplants.  In addition to several patents, the Orange Book lists a period of 3-year exclusivity that expires on July 19, 2016 and that is coded “NDF” – defined in an Orange Book addendum to mean “NEW DOSAGE FORM.”

In the company’s press release, Veloxis expressed its discontent with FDA’s decision, saying that “Veloxis disagrees that exclusivity for Astagraf XL, which was not identified as a listed drug or relied upon to support approval of Envarsus XR, should require delay in the formal approval of Envarsus XR.”  The company also noted that it “plans to immediately appeal this decision within FDA, and will pursue all options available to it.” 

At the time, we thought about posting on the Veloxis tentative approval as part of a broader discussion of the scope of 3-year new clinical investigation marketing exclusivity provided for under the Hatch-Waxman Amendments, including the then-recent announcement that Zogenix, Inc. and  Purdue Pharma L.P. entered into an agreement under which the two companies exchanged waivers of 3-year exclusivity applicable to their respective single-entity, extended-release hydrocodone products.  But we didn’t.  Something told us – perhaps Veloxis’s comment that the company “will pursue all options available to it” – to hold off because the dispute might ripen into a lawsuit against FDA.  And that’s exactly what happened.

Earlier this week, Veloxis filed a Complaint and a Motion for Preliminary Injunction in the U.S. District Court for the District of Columbia challenging FDA’s denial of approval of the ENVARSUS XR 505(b)(2) NDA as a result of the exclusivity FDA granted to ASTAGRAF XL.  (In a separate motion, Veloxis  requests that the district court treat Veloxis’s Motion for Preliminary Injunction as a motion for summary judgment by consolidating the hearing on Veloxis’s Motion for Preliminary Injunction with a hearing on the merits.)  Veloxis alleges that FDA’s actions violate the Administrative Procedure Act (“APA”).  Specifically, says Veloxis, FDA’s decision is erroneous as a matter of law and a violation of the APA for three independent reasons:

First, according to the unambiguous statutory language of the [FDCA], Astagraf XL was never entitled to three-year exclusivity.  For drug products like Astagraf XL, exclusivity is only available if an application for approval was submitted to FDA after October 2008.  Because the initial NDA for Astagraf XL was submitted in 2005, FDA’s grant of exclusivity to Astagraf XL exceeded its statutory authority.

Second, even if Astagraf XL is eligible for three-year exclusivity (and it is not), that exclusivity, as a matter of law, cannot block approval of Envarsus XR because the Envarsus XR NDA did not rely upon any of the studies or data supporting approval of Astagraf XL.

Third, even if the reliance requirement was read out of the FDCA, Envarsus XR still would not be subject to the exclusivity granted Astagraf XL because Envarsus XR does not share conditions of approval with Astagraf XL.  In this regard, FDA arbitrarily and capriciously concluded that the two drugs share the same conditions of approval, ignoring the significant clinical differences between the two drugs and the material differences in the package inserts, and abandoning more than 20 years of its own precedent.

Before turning to each of these arguments, we have a some background and comments on 3-year new clinical investigation exclusivity. 

Under the FDC Act and FDA’s implementing regulations, an applicant (either a 505(b)(1) or a 505(b)(2) applicant) may qualify for a 3-year period of exclusivity if the application is for a previously approved active moiety and if the application contains: (1) “reports of new clinical investigations (other than bioavailability studies);” (2) that were “essential to approval” of the application; and (3) that were “conducted or sponsored by” the applicant.  All three criteria must be satisfied in order to qualify for 3-year exclusivity.  Each criterion is defined in FDA’s implementing regulations.

Three-year exclusivity extends to the “conditions of approval [of an] original application” (emphasis added) and prevents FDA from approving a 505(b)(2) application (or an ANDA) for a drug for those new conditions for 3 years.  With respect to 505(b)(2) applicants, the law (at FDC Act § 505(c)(3)(E)(iii)) states:

If an application submitted under [FDC Act § 505(b)] for a drug, which includes an active ingredient (including any ester or salt of the active ingredient) that has been approved in another application approved under [FDC Act § 505(b)] is approved after September 24, 1984, and if such application contains reports of new clinical investigations (other than bioavailability studies) essential to the approval of the application and conducted or sponsored by the applicant, [FDA] may not make the approval of an application submitted under [FDC Act § 505(b)] for the conditions of approval of such drug in the approved [FDC Act § 505(b)] application effective before the expiration of three years from the date of the approval of the [FDC Act § 505(b) application] if the investigations described in clause (A) of subsection (b)(1) of this section and relied upon by the applicant for approval of the application were not conducted by or for the applicant and if the applicant has not obtained a right of reference or use from the person by or for whom the investigations were conducted. [(Emphasis added)]

FDA explained the limited scope of 3-year exclusivity in the preamble to the Agency’s proposed regulations implementing the Hatch-Waxman Amendments (54 Fed. Reg. 28,872 (July 10, 1989)):

Exclusivity provides the holder of an approved [application] limited protection from new competition in the marketplace for the innovation represented by its approved drug product. . . .  If the innovation is a new dosage form or route of administration, then exclusivity protects only that aspect of the drug product, but not the active ingredients.  If the innovation is a new use, then exclusivity protects only that labeling claim and not the active ingredients, dosage form, or route of administration. . . . 

In explaining what applications would be blocked by 3-year exclusivity, FDA also stated:

If these requirements are met [(i.e., new clinical investigations conducted or sponsored by the applicant that are essential to approval)], approval of an ANDA or of a 505(b)(2) application for a duplicate drug product or an ANDA submitted pursuant to an approved petition under section 505(j)(2)(C) for a similar drug product that relies on the information supporting the new conditions of approval of the first approved application, may not be made effective before the expiration of 3 years from the date of approval of the original new drug application. [(Emphasis added)]

More recently, FDA explained in a Letter Decision the scope of 3-year exclusivity (at least insofar as ANDAs are concerned and in relation to an NDA Supplement).  According to FDA:

The statute sets up a relationship between the “new clinical investigations” that are “essential to the approval of the supplement,” and the scope of exclusivity.   That is, if an applicant submits a supplement and gets 3-year exclusivity for a change in the use of the drug product supported by new clinical investigations, the FDA may not approve an ANDA referencing that drug product for the “change approved in the supplement” during that 3-year exclusivity period.  Because the change in the drug product or use of the drug product that was approved in the supplement was based at least in part on the new clinical investigations, it naturally follows that the scope of any exclusivity also will relate to the scope of those new clinical investigations.

FDA’s regulation similarly emphasizes a relationship between the change in the use of the drug product supported by the supplement and the scope of the exclusivity that the supplement earns.  The regulation provides that the agency will not approve an ANDA referencing a drug product for three years if the ANDA “relies on [] information supporting a change approved in the supplemental new drug application.” 21 C.F.R. § 314.108(b)(ii)(5).  The regulation, in context with the definition for “new clinical investigation,” emphasizes this relationship between the information from the new clinical investigation, the change approved in the supplement, and the scope of what the ANDA seeks to rely on for approval.  [(Emphasis added)]

Although the 3-year exclusivity provisions in the FDC Act state that such exclusivity prevents a subsequent 505(b)(2) applicant from being approved for the same protected conditions of approval if the subsequent applicant relies on the previous applicant’s information, and although FDA has stated that 3-year exclusivity prevents the Agency from approving another 505(b)(2) application (or an ANDA) “that relies on the information supporting the new conditions of approval of the first approved application,” one statement in the preamble to FDA’s 1989 proposed rule implementing the Hatch-Waxman Amendments suggests that approval of a 505(b)(2) application with exclusivity would prevent approval of a subsequent 505(b)(2) application for 3 years even though the subsequent 505(b)(2) applicant did not rely on data in the first 505(b)(2) application.  That statement reads as follows:

The exclusivity provisions of sections 505(c)(3)(D) (iii) and (iv) of the act delay the effective date of approval of any 505(b)(2) application that is for the conditions of use of a previously approved application that contained new clinical investigations essential for approval.  Consequently, if two 505(b)(2) applications are under review at the same time and one is approved before the other, the effective date of approval of the second application to be approved will be delayed, regardless of the date of submission, if the first contained new clinical investigations essential for approval and thereby qualified for exclusivity.

This statement, which has been referred to as “FDA’s dueling 505(b)(2) application policy,” has not, to our knowledge, been further publicly discussed by FDA.  (This policy was raised in 2005 in the context of a citizen petition about the appropriate type of exclusivity to award to 505(b)(2) applicants for hyaluronidase drug products (Docket No. FDA-2005-P-0005); however, because FDA ultimately determined that 5-year new chemical entity exclusivity, instead of 3-year exclusivity, should be granted to each hyaluronidase applicant, the Agency did not address the scope of 3-year exclusivity and whether the first company to obtain 505(b)(2) application approval would block the approval of subsequent 505(b)(2) applicants for the same conditions of use, even where subsequent 505(b)(2) applicants did not rely on data in the first applicant’s 505(b)(2) application.)

The current dispute over FDA’s ability to approve Veloxis’s NDA 206406 for ENVARSUS XR given the 3-year exclusivity FDA granted with respect to NDA 204096 for ASTAGRAF XL does not specifically concern FDA’s dueling 505(b)(2) application policy – because ASTAGRAF XL was approved as a 505(b)(1) NDA and ENVARSUS XR is the subject of a 505(b)(2) NDA – however, it may be functionally equivalent.  That might explain, at least in part, why FDA refused to grant final approval of ENVARSUS XR depite no reliance on the ASTAGRAF XL approval.  In any case, on to the current dispute . . . .

Veloxis’s first argument that FDA’s decision is erroneous as a matter of law implicates the 2008 QI Act, which, among other things, added Section 505(v) to the statute.  FDC Act § 505(v) provides that so-called “old antibiotics” (i.e., antibiotic drugs, like tacrolimus, for which the first application was received before the November 21, 1997 enactment of the Food and Drug Administration Modernization Act of 1997) are not eligible for 3-year exclusivity for any condition of use for which the old antibiotic was approved before October 8, 2008 (i.e., the date of the enactment of the QI Act), but also that an old antibiotic is eligible for 3-year exclusivity for a new condition of use if that application is submitted to FDA after October 8, 2008.  As we previously reported, FDA was successful in defending the only challenge to the Agency’s application of FDC Act § 505(v). 

According to Veloxis:

The Astagraf XL NDA initially was submitted in 2005 and, in fact, was pending at FDA prior to, during, and after the enactment of the QI Act on October 8, 2008.  Accordingly, as a matter of law, Astagraf XL was not entitled to three-year exclusivity when the QI Act was passed. . . .  It appears that FDA granted exclusivity to Astagraf XL on the basis that – even though it was the subject of a pending NDA at the time of the enactment of the QI Act – Astellas withdrew its NDA in 2009 and refiled it in 2012.  The prohibitions of the QI Act, however, cannot be avoided through such manipulation of the regulatory process. FDA’s grant of exclusivity to Astagraf XL was contrary to Congress’s intent and inconsistent with the incentive structure created by Congress in the QI Act, and therefore in excess of FDA’s statutory authority.

Veloxis argues next that even if ASTAGRAF XL is eligible for 3-year exclusivity, that exclusivity cannot block approval of ENVARSUS XR because the Veloxis NDA did not rely upon any of the studies or data supporting approval of ASTAGRAF XL.  As noted above, FDA has, in most circumstances, keyed the applicability of 3-year exclusivity to reliance.  Thus, argues Veloxis:

The FDCA provides that if an NDA is approved and awarded three-year exclusivity based upon “reports of new clinical investigations (other than bioavailability studies) essential to the approval of the application and conducted or sponsored by the applicant,” FDA may not approve a pending 505(b)(2) application “for the conditions of approval” of the first drug for a period of three years if the safety and effectiveness studies “relied upon by the [505(b)(2) applicant] for approval of the [505(b)(2)] were not conducted by or for [the 505(b)(2) applicant] and if [the applicant] has not obtained a right of reference or use from the person by or for whom the investigations were conducted.” 21 U.S.C. § 355(c)(3)(E)(iii) (emphasis added).  This statutory language unambiguously requires an overlap in the relied upon studies to trigger the period of exclusivity.  In the absence of such overlap, exclusivity is inapplicable as a matter of law. . . .

The language, structure, and purpose of the Hatch-Waxman Amendments all establish that Congress intended three-year marketing exclusivity under Section  505(c)(3)(E)(iii) to block approval of only those 505(b)(2) applications that rely upon the data supporting the approval of the drug with exclusivity.  As the Envarsus XR NDA does not rely upon the clinical studies conducted by Astellas in connection with the Astagraf XL NDA, FDA’s application of Astagraf XL’s exclusivity to Envarsus XR is contrary to the FDCA’s plain language, in excess of the FDA’s statutory authority, and in violation of the APA

Finally, Veloxis argues that even if the reliance requirement was read out of the statute, ENVARSUS XR still would not be subject to ASTAGRAF XL’s exclusivity because the drug products don’t share conditions of approval.  “Consistent with longstanding FDA precedent,” writes Veloxis, “because the two drugs have markedly different (i) dosage forms, (ii) dosing strengths, (iii) dosing regimens, and (iv) pharmacokinetic profiles, they cannot be considered to share conditions of approval.”  Citing several FDA approval precedents, Veloxis says that they

confirm that, throughout the twenty years since the Hatch-Waxman Amendments were enacted, FDA repeatedly has approved 505(b)(2) applications for products that share a common active ingredient, indication, dosage form, and dosage frequency with a drug subject to exclusivity.  FDA has done so because the later-in-time applications did not rely on data necessary to the approval of the drug with exclusivity.  Indeed, Veloxis is not aware of a single instance in which FDA has applied exclusivity to block approval of a product with a different dosage form that did not reference or rely upon the drug with exclusivity.

In a Motion to Stay Proceedings Pending Final Agency Action FDA says that the case is unripe.  “On December 12, 2014, FDA informed Veloxis that it intends to issue a final decision on the underlying merits in this matter no later than January 12, 2015.  Because the agency is diligently considering the complex scientific and regulatory issues presented by Veloxis’ submissions, Veloxis’ lawsuit is unripe.”  As such, FDA requests that the district court stay the proceedings until January 12, 2015 to give FDA time to issue a final decision in the matter.  After that decision is issued, FDA “would be happy to discuss an expedited schedule for merits briefing and production of the Administrative Record, if necessary.” 

On December 18th, the district court granted FDA’s motion, denied Veloxis’s Motion for Preliminary Injunction without prejudice, and ordered the parties to appear before the court for a status hearing on January 14, 2015 (10:45 AM).

By James E. Valentine* & Anne Marie Murphy –

As we previously reported, last month the National Institutes of Health (“NIH”) published a Notice of Proposed Rulemaking on clinical trials registration and results submission (“NPRM”), and is requesting public comment by February 19, 2015.  The NPRM generally applies to “responsible parties” for “applicable clinical trials.”  In our previous post we took a first look at some of the key areas of expansion that are being considered as part of the rulemaking process, which includes NIH’s proposal to require disclosure of results information for trials of products that are not approved and limit the delay for disclosure of those results.  In addition to these high profile issues, there are a wide range of other clarifications and changes proposed in the 116-page NPRM.

Applicable Clinical Trials

The registration and results reporting requirements apply to all “applicable clinical trials.”  Section 801 of the Food and Drug Administration Amendments Act of 2007 (“FDAAA 801”) defined an “applicable clinical trial” as either an applicable device clinical trial or an applicable drug clinical trial.  An applicable drug clinical trial is defined as a controlled clinical investigation, other than a phase 1 clinical investigation of a drug subject to [the New Drug Application (“NDA”) or Biologics License Application (“BLA”) sections of the Federal Food, Drug, and Cosmetic Act (“FD&C Act”).  An applicable device clinical trial is defined as either (1) a prospective clinical study of health outcomes comparing an intervention with a device subject to the 510(k), Premarket Approval (“PMA”), or Humanitarian Device Exemption (“HDE”) sections of the FD&C Act against a control in human subjects except for feasibility studies or (2) a pediatric postmarket surveillance as required under section 522 of the FD&C Act.

A key consideration in determining if a study meets the definition of an applicable clinical trial is if it is “controlled.”  The NPRM proposes to include both concurrent controls and non-concurrent controls, such as historical controls or comparisons to baseline data.  For single-arm trials, the NPRM would require that the control be specified in the protocol or statistical analysis plan, and for this to be identified as part of registration.  NIH invites comments specifically on this approach for identifying controlled single-arm trials.

Another key consideration is whether the drug is subject to U.S. Food and Drug Administration (“FDA”) regulation (as opposed to studies conducted entirely outside of the U.S.).  In general, studies are considered subject to FDA regulation if they meet one of the following criteria:

• include one or more clinical study sites in the United States;
• study a drug that is manufactured in the United States or its territories and is exported for use in a clinical trial outside the United States; or, 
• conducted under an Investigational New Drug (“IND”).

Rather than continuing to have registrants indicate whether their trial is an applicable clinical trial, NIH proposes using a limited set of registration data elements on ClinicalTrials.gov to simplify the determination of whether a particular study meets the definition of an applicable clinical trial. 

Responsible Party

While not new information, the NPRM reiterates FDAAA 801’s definition for a “responsible party” with respect to a clinical trial of a drug or device as either (1) the sponsor of the clinical trial, or (2) the principal investigator of such clinical trial if designated by a sponsor, so long as the principal investigator is responsible for conducting the trial, has access to and control over the data from the trial, has the right to publish the results of the trial, and has the ability to meet all of the registration and reporting requirements.  If the trial is conducted under an IND or IDE, the IND/IDE holder is the sponsor; otherwise the sponsor is the person or entity who initiates the trial, by preparing and/or planning the trial, and who has authority and control over the trial.  For a pediatric postmarket surveillance of a device that is not a clinical trial, the responsible party is the entity whom FDA directs to conduct the surveillance of the device. 

Registration

In the NPRM also reiterates FDAAA 801’s general registration requirement: a responsible party must register an applicable clinical trial at ClinicalTrials.gov not later than 21 calendar days after enrolling the first participant.  The NPRM specifies requirements for registration, which include establishing structured data elements within four categories:

• descriptive information (e.g., title, brief summary, primary purpose, study design, study phase, study type, primary disease or condition being studied, intervention name, study start date, completion date, enrollment);
• recruitment information (e.g., eligibility criteria, gender, age limits, overall recruitment status, actual enrollment, individual site status);
• location and contact information (e.g., name of sponsor, responsible party, facility information); and,
• administrative information (e.g., unique protocol identification number, FDA IND number, human subjects protection review board status, record verification date, responsible party contact information).

Many of the registration data elements outlined in the NPRM are not required in the PHS Act but have been proposed by NIH under their statutory authority to modify requirements, mostly to aid in the determination of whether or not a clinical trial is an applicable clinical trial (some of these data elements have already been implemented, either prior to the enactment of FDAAA or as part of NIH’s implementation since 2007):

• Single Arm Controlled? – a sub-element of Study Design that would enable the NIH to determine whether a registered clinical trial is an applicable clinical trial when such a determination cannot be made based on other submitted registration data elements.
• Whether Study is a Pediatric Postmarket Surveillance of a Device – indicates if the study is a pediatric postmarket surveillance of a device to confirm that the study is an applicable device clinical trial.
• Other Intervention Name(s) – a requirement if the sponsor has used more than one name publicly to identify the intervention under study in the clinical trial.
• Intervention Description – to be submitted as clinical trial information to help distinguish between similar interventions.
• Studies an FDA-regulated Device/Drug – to indicate whether or not a clinical trial studies an FDA-regulated device or drug to assist in determining whether or not a clinical trial is an applicable device or drug clinical trial.
• U.S. FDA Approval, Licensure, or Clearance Status – to indicate whether any intervention regulated by FDA and studied in the clinical trial has been approved to help in assuring the data bank operates in compliance with statutory requirements (e.g., determining when clinical trial registration information submitted for an applicable device clinical trial may be posted publicly).
• Product Manufactured in the U.S. – to assist determining whether a registered clinical trial is an applicable clinical trial.
• Why Study Stopped? – when a trial is suspended, terminated, or withdrawn prior to its completion as anticipated by the protocol, in addition to updating the Overall Recruitment Status, a brief explanation of why the clinical trial was stopped (e.g., because of safety concerns, difficulties in recruitment, or for financial reasons) is required. 
• Actual Enrollment – submission of the actual enrollment figure after enrollment is closed (i.e., when overall recruitment status is updated to “active, not recruiting” or “terminated”) to aid in tracking the subsequent progress of clinical trials.
• Human Subjects Protection Review Board Status – to indicate whether a clinical trial registered is undergoing or has undergone human subjects protection review board review or is exempt from approval “to enhance patient enrollment.”  This data element is consistent with prior Agency practice of requiring this information.

Also, Section 402(j)(2)(A)(ii)(II)(gg) of the PHS Act specifies that for an applicable clinical trial of a drug that is not approved, the responsible party must specify whether or not there is expanded access for those who do not qualify for enrollment in the clinical trial and, if so, how to obtain information on such access.  In furtherance of making this information readily available, the NPRM proposes to create an Expanded Access record with its own NCT number. This record would consist of additional data elements describing the expanded access, including eligibility criteria for participation.

NIH invites comments on its proposed modifications and additions to the data elements of clinical trial registration information, including the benefits and burdens associated with structuring of certain registration data elements.

Posting of Registration Information – Drugs vs. Devices

Registration information for applicable drug clinical trials must be publicly posted by NIH no later than 30 calendar days after it is submitted.  The NPRM proposes to not make publicly available certain administration information, including the IND number and responsible party contact information.

By comparison, public posting of registration information for applicable device clinical trials is not so straightforward.  For trials of devices that were previously approved or cleared for any indication, registration information must be posted by NIH no later than 30 days after results information is required to be posted.  The NPRM proposes that, in practice, this registration information will be posted as soon as practicable after submission, but not later than 30 days after clinical trial results information is required to be posted. 

Meanwhile, the NPRM lays out the original statutory scheme to delay posting of registration information for applicable device clinical trials that have not previously been approved or cleared.  Registration information for these trials must be posted publicly no earlier than the date of approval or clearance of the device and no later than 30 days after such date.  NIH anticipates there will be a number of situations in which those who conduct this category of device clinical trials may prefer to make the registration information publicly available prior to this statutory mandated time frame (e.g., to meet ICMJE policy, assist in recruitment efforts).  The NPRM seeks input on potential mechanisms for addressing these situations.

Results Reporting

FDAAA 801 requires the submission of results information for each applicable drug clinical trial for a drug that is approved or licensed and each applicable device clinical trial for a device that is cleared or approved.  Following initial approval, clinical trial results information must be submitted no later than one year after the completion date or 30 calendar days after FDA approves the product, whichever is sooner. 

By contrast, for applicable clinical trials of drugs or devices that are not approved, licensed, or cleared, whether or not approval was sought, the statute provides that NIH determine through regulation whether results information must be submitted and, if they are, the date which such information shall be required to be submitted. Pursuant to this authority, NIH proposes to require submission of results information for applicable clinical trials that are not approved by FDA and to limit the delay for disclosure of those results. 

Generally, these results submissions for applicable clinical trials involving unapproved products are required no later than one year after the completion date of the clinical trial.  The exception to this proposed rule is that if initial approval is being sought, or may at a future date be sought, then the responsible party may delay submission by providing a certification prior to that deadline.  The allowable delay period for results information is now proposed in the NPRM to be limited to two years after the submission of a certification, and only one certification may be submitted for each clinical trial.  Therefore, the total delay in disclosure of results would be up to three years after the completion date of the trial.

If, instead, the sponsor of the applicable clinical trial is seeking approval of a new use for a previously approved drug or device, and has filed, or plans to file, with FDA within one year, the responsible party may submit a certification for delayed submission of results information.  This will delay the deadline for results submission to 30 calendar days after the earliest of the following events:

• FDA approves the product for the use studied in the applicable clinical trial;
• FDA issues a letter that ends the regulatory review cycle for the application, but does not approve the product for the use studied in the applicable clinical trial; or,
• the application seeking approval of the new use is withdrawn without resubmission for not less than 210 calendar days.

Notwithstanding these deadlines, the responsible party must submit complete results no later than two years after the date that the certification was submitted, except in situations where the required clinical trial results information has not been collected.

The NPRM also proposes to allow submission of partial results where results for a secondary outcome measure have not been collected by the completion date, as well as extensions of results reporting for “good-cause.”

As proposed in the NPRM, drug clinical trial results information will be submitted through structured data entry, in an effort to ensure all required data elements are provided and to optimize the presentation of the submitted data.  The pre-specified fields for results reporting are proposed to consist of:

• information documenting the progress of human subjects through the clinical trial by arm;
• information on demographic and baseline measures and data collected by arm or comparison group and for the entire study population;
• data for each primary and secondary outcome measure by arm or comparison group, including the results of scientifically appropriate statistical analysis performed on that data;
• summarized adverse event information grouped, including (a) serious adverse events grouped by organ system and (b) all adverse events, other than serious adverse events, that exceed a frequency of five-percent within any arm of the clinical trial, grouped by organ system; and
• certain administrative information (e.g., results point of contact).

At this time, NIH has not proposed requiring submission of either non-technical or technical summaries of trial results, or submission of the full protocol, but is considering whether to do so as part of the rulemaking.  To this end, NIH invites comments on methods to help determine if either type of summary or the full protocol should be required. 

NIH is required to publicly post this required results information no later than 30 calendar days after it is submitted.

Updates

In general, the NPRM provides that updates of clinical trial information must be provided every 12 months, unless there are no changes in that time frame.  A responsible party would have to submit updates until the final results information has been submitted for all primary and secondary outcome measures and all adverse events collected in accordance with the protocol. 

However, the NPRM identifies several data elements that would be required to be updated more quickly:

• No later than 30 days after the change occurs: study start date, intervention name(s),  availability of expanded access, overall recruitment status, individual site status, human subjects protection review board status, completion date, responsible party, responsible party contact information, and if the protocol is amended in a manner that changes are communicated to human subjects.
• No later than 15 days after the change occurs: U.S. FDA approval, licensure, or clearance status.

Providing Comment

Comments can be submitted no later than February 19, 2015 to docket number NIH-2011-0003 at Regulations.gov.  NIH also announced, in conjunction with the NPRM, a draft policy that would extend similar registration and reporting requirements to all clinical trials funded by NIH, regardless of whether they are subject to FDAAA.

*Not admitted to practice law. Working under the supervision of the Firm’s attorneys.

By Kurt R. Karst –

December 16th was a good day for Hyman, Phelps & McNamara, P.C. We learned that the U.S. Court of Appeals for the Fourth Circuit handed our client, Mylan Pharmaceuticals, Inc. (“Mylan”), a significant victory. In a 3-0 panel decision (Circuit Judges Wilkinson, Shedd, and Wynn), the Court reversed and remanded by unpublished opinion a June 2014 decision from the U.S. District Court for the Northern District of West Virginia concerning 180-day exclusivity for generic versions of GD Searle LLC’s (now Pfizer Inc.’s) CELEBREX (celecoxib) Capsules, 100 mg, 200 mg, and 400 mg. The Court’s decision also puts the kibosh on FDA’s “bundle of rights” theory, under which an original patent and a reissued patent are treated as a single bundle of rights for 180-day exclusivity purposes. FDA first publicly articulated that interpretation of the law in an April 2014 Letter Decision, just before ruling on 180-day exclusivity for generic CELEBREX; however, as we previously posted (and as discussed in FDA’s Letter Decision), the Agency has applied that interpretation in other instances going back several years.

By way of background, CELEBREX (approved under NDA 020998) is currently listed in the Orange Book with two unexpired patents: U.S. Patent Nos. 5,760,068 (“the ‘068 patent) and RE44,048 (“the ‘048 patent”). Both patents expire on the same date – i.e., June 2, 2015 (and are subject to a period of pediatric exclusivity that expires on December 2, 2015) – because the ‘048 patent is a reissue of the ‘068 patent.

The first ANDA for a generic version of Celecoxib Capsules, 100 mg, 200 mg, and 400 mg, containing a certification to an Orange Book-listed patent was submitted to FDA prior to the December 2003 enactment of the Medicare Modernization Act (“MMA”). As such, 180-day exclusivity for the drug is governed by the pre-MMA version of the law. Pre-MMA 180-day exclusivity is patent-based, such that an ANDA applicant is (or different applicants are) eligible for 180-day exclusivity with respect to different Orange Book-listed patents covering the Reference Listed Drug if such applicant submitted the first ANDA to FDA containing a Paragraph IV certification to a particular patent. Pre-MMA 180-day exclusivity is triggered by the earlier of either the first commercial marketing (for all patents certified to as Paragraph IV by a first-filer), or by a court decision favorable to an ANDA applicant (with respect to a particular patent). Although the list of pre-MMA drugs is fixed (see our previous post here), disputes under the pre-MMA version of the law continue to come up – and may for years to come.

TEVA Pharmaceuticals USA, Inc. (“Teva”) was the first company to submit an ANDA (ANDA 076898) for generic CELEBREX containing Paragraph IV certifications to certain Orange Book-listed patents, including the ‘068 patent. An initial district court decision held that the CELEBREX patents were valid; however, the Federal Circuit revered in part, ruling that many of the claims of the ‘068 patent were invalid. The Federal Circuit issued its mandate on May 13, 2008.

Fast-forward to March 5, 2013, when the U.S. Patent and Trademark Office reissued the invalidated ‘068 patent as the ‘048 patent. The ‘048 patent was promptly listed in the Orange Book and several companies, including Teva and Mylan, certified Paragraph IV to the patent. In March 2014, a district court deemed the ‘048 patent invalid, and the decision was appealed to the Federal Circuit where the case remains pending.

After some ANDA applicants inquired with FDA as to how the Agency would apply, in the case of Celecoxib Capsules, 100 mg, 200 mg, and 400 mg, the pre-MMA provisions of the FDC Act concerning 180-day exclusivity, the Agency issued a Letter Decision on April 24, 2014 addressing situations involving a reissued patent. FDA concluded that:

for purposes of 180-day exclusivity, upon the listing of a reissued patent, a prior court decision on the original patent is not regarded as having triggered 180-day exclusivity for the single bundle of patent rights represented by the original and reissued patent. In such a case, eligibility for 180-day exclusivity is only available to the applicant that first filed a paragraph IV certification to the original patent, and that applicant must make a timely submission of a paragraph IV certification to the reissued patent to remain eligible for 180-day exclusivity.

In other words, FDA ruled that only Teva was eligible for 180-day exclusivity because only Teva certified Paragraph IV first to both the ‘068 and ‘048 patents, and that the Federal Circuit’s decision with respect to the ‘068 patent did not trigger 180-day exclusivity because the ‘068 patent and the reissued ‘048 patent are considered by the Agency as a single bundle of patent rights. FDA approved Teva ANDA 076898 on May 30, 2014 after the expiration of a period of pediatric exclusivity on another patent that the Federal Circuit upheld in 2008.

The day after FDA issued its Letter Decision, Mylan filed an action against FDA in the U.S. District Court for the Northern District of West Virginia seeking injunctive and declaratory relief. Other ANDA applicants, including Teva, Watson Laboratories, Inc. (“Watson”), and Lupin Pharmaceuticals, Inc. (“Lupin”) entered the lawsuit. The District Court denied Mylan’s Motion for Preliminary Injunction in a May 29, 2014 decision and subsequently entered a final judgment on June 16, 2014.

Mylan (and other ANDA sponsors with tentative approval) appealed the decision to the Fourth Circuit. In a joint brief, Mylan and Watson asked the court to address two issues:

1. Whether the FDA Decision was unlawful, arbitrary, and capricious because it determined, contrary to the clear statutory language of the Hatch-Waxman Amendments, that a final court decision invalidating an original patent is not a court decision trigger for 180-day generic drug marketing exclusivity if the invalid patent is later replaced by a reissue patent.
2. Whether the FDA Decision to deny eligible generic drug manufacturing companies a period of shared exclusivity tied to the reissue patent was arbitrary, capricious, or otherwise not in accordance with law.

Lupin filed a separate brief arguing that first-filers to the ‘048 patent are not entitled to shared 180-day exclusivity.

After briefing the case (briefs available here, here, here, here, here, and here) and holding Oral Argument in September 2014, the Fourth Circuit issued its decsion on December 16, 2014.  

Analyzing this issues under the familiar two-step Chevron analysis, the Court was able end its analysis at Chevron Step One. “Here, Congress has spoken directly regarding the court decision trigger,” wrote the Court. “The statute makes plain that the 180-day exclusivity runs from ‘the date of a decision of a court in an action . . . holding the patent which is the subject of the certification to be invalid or not infringed.’ 21 U.S.C. § 355(j)(5)(B)(iv).”  Applying that language to the case at hand, the Court wrote that “[a]s to generic celecoxib, such a decision was reached by the Federal Circuit in 2008. . . . Teva’s 180-day exclusivity period as to the ‘068 patent began to run from the date the Federal Circuit issued its mandate in May 2008. And the exclusivity period expired on November 9, 2008, i.e., 180 days later.”

Moving on to FDA’s treatment of a patent and a reissue of that patent as a “bundle of rights,” the Court said that FDA’s interpretation is contrary to the statutory text, and that a reissue patent is a separate and distinct patent that can yield a separate period of 180-day exclusivity:

Hatch-Waxman does not define “patent” nor does it specifically speak to reissued patents. This does not, however, render the statute ambiguous. The “court-decision trigger” speaks of “the patent which is the subject of the certification.” 21 U.S.C. §355(j)(5)(B)(iv) (emphasis added). FDA’s interpretation of this language treats the original patent and the reissued patent as a single “bundle of rights” which can only be the subject of one Paragraph IV certification and therefore provides only a single 180-day exclusivity period. However, this interpretation is contrary to the plain statutory
language. . . .

The plain language of the statute indicates that each patent that is the subject of a certification may trigger exclusivity. The Hatch-Waxman Act required [ANDA] applicants to certify as to both the original and reissued patents; each could be “the patent which is the subject of the certification.” 21 U.S.C. §355(j)(5)(B)(iv).

Setting aside FDA’s interpretation, the Court reversed the West Virginia District Court decision and remanded the case with instructions for the District Court to proceed with adjudicating the rights of ANDA applicants consistent with the Court’s opinion.

Last week, several ANDA applicants whose approvals were blocked as a result of FDA’s now-invalidated Letter Decision announced (here, here, and here) the launch of authorized generic versions of Celecoxib Capsules, 100 mg, 200 mg and 400 mg. Teva also announced the launch of its Celecoxib drug products. As a result, any 180-day exclusivity associated with the drug has been triggered.