In Part 1 of our effort to characterize the principal errors and mischaracterizations underpinning attacks on the GRAS exception, we focused on misrepresentations of the Food Additive Amendment’s legislative history and of the difficulties FDA allegedly faces in identifying and contesting the unlawful use of an ingredient in food. In that context, we touched on the issue of conflict of interest (COI) in the conduct of GRAS determinations – an issue we take up in greater detail here.
Concerns over COI were expressed in the 2010 GAO report recommending that FDA strengthen its oversight of the GRAS exception. GAO noted that, although there is guidance to minimize COI among FDA staff and individuals who serve on scientific and advisory panels, there is no guidance on COI “that companies can use to help ensure that the members of their expert panels are independent in their determinations of GRAS status.” As noted in the report, companies sometimes use expert panels to demonstrate consensus for a GRAS determination – a particularly useful course of action when there are no secondary sources that evaluate the primary literature, or when a published study warrants interpretative analysis.
GAO’s analysis of the potential for COI focused primarily on factors that could compromise an expert panel’s independence, such as “corporate or financial affiliations that could bias their decisions.” GAO was concerned that, in such scenarios, an expert panel decision relied on by a company could be tainted by an expert panel member’s COI in much the same way as an advisory panel recommendation relied on by FDA could be tainted by an advisory panel member’s COI. However, in drafting its recommendations, GAO used language that suggested the need to address the potential for COI more broadly: FDA should “develop a strategy to minimize the potential for conflicts of interest in companies’ GRAS determinations, including taking steps such as issuing guidance for companies on conflict of interest and requiring information in GRAS notices regarding expert panelists’ independence” (emphasis added). Thus, GAO set the stage for consideration of at least two conceptions of COI. The first conception is narrowly concerned with the potential for COI in expert panel decisions. The second conception is more broadly concerned with the potential for COI in GRAS self-determinations generally.
In its response to the GAO report, FDA focused primarily on the narrow conception of COI in relation to expert panel decisions. FDA noted that the agency’s review of a GRAS notice containing an expert panel report encompasses “the totality of the publically available and corroborative evidence about the safety of the substance for its intended use, including favorable and potentially unfavorable information.” FDA further noted that “the use of an expert panel is one way to demonstrate consensus,” and that the agency “does not consider the view of an expert panel alone to be determinative for establishing safety.” FDA made clear that, if it finds deficiencies in the composition of an expert panel or in the panel’s consideration of the data and information, the agency takes those deficiencies into account in reviewing and responding to the GRAS notice.
However, FDA’s response also paid a nod to the broader conception of COI in GRAS self-determinations generally:
FDA recognizes that, because the notifier has an inherent interest in the outcome of its GRAS notice, there is the potential for a conflict of interest (this is also true for food additive petitions). To address this concern, GRAS determinations are required to consider the totality of the publically available information, including potentially unfavorable information.
(Emphasis added.) In other words, it is a given that a company interested in marketing a substance for a new use has an interest in establishing a regulatory basis for the use of the substance, but that interest is at play regardless of whether the company pursues a GRAS self-determination or a food additive approval. That interest is kept in check by the regulatory requirement that the company consider all information that has a bearing on the safety of the proposed use. Any company that fails to ensure the rigor and comprehensiveness of its GRAS determination or food additive petition does so at the risk of violating that requirement. As we noted in our prior posting, the consequences could be severe, as the products in question could be deemed adulterated by virtue of being or containing an unapproved food additive.
How FDA conceives of the potential for COI has significant implications for any steps the agency might take to address it. FDA has indicated its intent to focus on the narrow conception of COI (CFSAN’s plan for program priorities states that the agency intends to “publish draft guidance on conflict of interest for experts participating on GRAS panels” in 2014). If that holds true, then industry can expect the agency to propose criteria for the consideration of the potential for COI in establishing expert panels. The impact of those criteria would need to be carefully thought out, as overly restrictive criteria could have the effect of limiting the use of those experts most qualified to opine on the safety of the use of a substance – a particularly perverse consequence given the statutory requirement that GRAS status be based on general recognition of safety by qualified experts. This concern is of little consequence if one regards the pool of available qualified experts as large (PEW’s publication on COI blithely noted that “[t]here are multiple schools offering food science, toxicology and risk assessment degrees, and the Institute of Food Technologists has certified 1200 food scientists”). In our experience, the pool of available qualified experts is quite small, such that any unnecessarily restrictive standards for evaluating COI could significantly hamper the conduct of GRAS self-determinations generally.
Although even a narrowly targeted initiative on COI could have significant consequences, PEW (and now NRDC) are after much bigger game. They have urged FDA to adopt a very broad conception of COI that sees the potential for COI in essentially all GRAS self-determinations, and that entirely discounts the value of post-market controls. In doing so, they draw on a framework of questionable relevance, namely that set forth in the Institute of Medicine’s report on COI in medical research, education and practice (perhaps not coincidentally, COI in medicine is also of significant interest to PEW). That framework was devised to address issues and concerns particular to the health care sector, in which life-or-death decisions are often made on the basis of data that often are not publicly available, and in which financial incentives that can skew decision-making are orders of magnitude greater than in the food sector.
Not surprisingly, PEW/NRDC’s prescriptions belie an underlying preference for mandatory premarket review of all GRAS self-determinations – a preference at odds with the fact that NRDC has questioned the competence of FDA’s evaluation of GRAS notices and of food additive petitions. In any event, as we’ve noted elsewhere, mandatory premarket review is both unattainable and unworkable in the absence not just of a statutory amendment, but of a funding mechanism as well. Those are tall orders in the current fiscal and political environment.
From our perspective, the controversy over COI in GRAS self-determinations is largely manufactured – designed to sow public confusion and anxiety in support of a broader attack on a regulatory program that has proven itself to be remarkably efficient and effective. The next move is FDA’s, and we look forward to seeing how the agency addresses the COI issue in its forthcoming guidance.
On September 30, 2014, the Centers for Medicare & Medicaid Services (“CMS”) released for public review the first round of Open Payments (more commonly known as “Sunshine”) data. According to CMS, the Sunshine data is intended to “help consumers understand the financial relationships between the health care industry, and physicians and teaching hospitals.”
Unfortunately, this initial release has been marred by numerous problems pertaining to data accuracy and the lack of information about the potential benefits that can arise from relationships between the drug and device industry and physicians.
Due to a short window for physicians to review and request correction of their data (45 days), combined with—surprise!—continuing website shutdowns, a complicated registration process, and missing data, many physicians were unable to confirm the accuracy of the data reportedly associated with their practice. The American Medical Association (“AMA”) stated that “[o]nly 26,000 physicians out of the nearly 550,000 physicians affected by the Sunshine Act were able to register to review their data and seek correction of any inaccuracies.”
CMS acknowledges problems with data accuracy, stating, “During the review and dispute period, CMS identified payment records that had inconsistent physician information, such as National Provider Identifier (“NPI”) for one doctor and a license number for another.” CMS’s fix was to de-identify 40% of the published data, calling into question how these data will help achieve the above-mentioned goal.
In addition to issues with data accuracy, both physician and industry trade groups requested that CMS provide context on the Sunshine website about the payments. In a letter to CMS, PhRMA, AdvaMed, and BIO stated that “providing context for reported payments and other transfers of value is critical to ensuring patients do not form mistaken impressions that all payments to physicians are suspect.” CMS apparently rejected this suggestion. The Deputy Administrator and Director of the Center for Program Integrity at CMS stated: “Open Payments does not identify which financial relationships are beneficial and which could cause conflicts of interest. It simply makes the data available to the public. So while these data could discourage payments and other transfers of value that might have an inappropriate influence on research, education, and clinical decision-making, they could also help identify relationships that lead to the development of beneficial new technologies.”
CMS seems to overestimate the ability of the public to determine, based solely on the information provided on the website, into which category certain payments fall. For example, members of the public are not likely to know that research payments are reported as a single payment to the primary investigator. This could appear to be a large, multi-million dollar payment to one physician, and, without context, someone viewing the data would not understand that the payment reported is intended to cover any number of years worth of research and a variety of costs associated with the research.
Facts matter. Context matters. And accuracy matters. Unfortunately, the data published by CMS, intended to shed light and provide transparency, do not adequately account for any of these factors. No doubt people will review the data and reach their own conclusions about the meaning. What will CMS do if it learns these conclusions are wrong? Based on its actions thus far, the answer is most likely to be nothing.
On September 24, 2014, FDA finalized its guidance document, “Custom Device Exemption,” which explains FDA’s interpretation of the new custom device requirements implemented as part of the Food and Drug Administration Safety and Innovation Act ("FDASIA"). We previously posted on the FDASIA requirements and FDA’s draft guidance on this topic here and here.
We will not repeat here the requirements to meet the custom device exemption, but will again note how limited this exemption will be. FDA expresses this view in the guidance by stating that, under the revised FDASIA provision, “as under the original custom device exemption, custom devices should represent a narrow category for which, due to the rarity of a patient’s medical condition or physician’s special need, compliance with premarket review requirements and performance standards under section 514 and 515 of the FD&C Act is impractical.” Guidance, at 2.
For the most part, the draft and final guidances are largely similar. A few exceptions are as follows:
The final guidance includes a question asking whether, if a patient needs to undergo revision surgery to replace a component of her implant that is no longer being manufactured, the component is a custom device. The guidance states that the component would only be a custom device “if it is designed to treat a unique pathology or physiological condition that no other device is domestically available to treat and meets all the other requirements of section 520(b). That the component is no longer being manufactured does not make the component a custom device. However, under these circumstances, a compassionate use request to allow the component to be manufactured and implanted could be submitted to FDA.” Guidance at 7. It is not clear why a manufacturer would need to seek a compassionate use request from FDA to replace a component that was previously manufactured and, presumably, was itself cleared or approved or was part of a cleared or approved medical device. So long as the clearance or approval covering the component is still valid (e.g., has not been withdrawn), the manufacturer should not need to seek permission from FDA to manufacture the component.
As noted in our prior blog post, the draft guidance did not provide any examples of potential “physician-centric” custom devices; all the examples were patient-centric. In the final guidance, FDA states that in the comments received about the draft, it did not receive any examples describing a potential physician-centric custom device. The final guidance states: “Assuming all other aspects of the custom device exemption in the FD&C Act are met, a potential example of a physician-centric medical device could be one for a surgical instrument requiring premarket review that needs to be modified to accommodate a deformity of a surgeon’s hand.” Guidance, at 9.
The draft guidance modifies the advice regarding submission of electronic copies of the annual report. The draft guidance stated that one or both copies could be submitted electronically to customdevices@fda.hhs.gov. The final guidance, however, states that at least one of the two required copies must be a hard copy, and encourages that the second copy be an eCopy provided on a CD, DVD, or flash drive. Both the hard copy and eCopy will need to be sent to a physical address; the final guidance does not include the email address provided in the draft as a submission method. The final guidance also states that the submission of the eCopy should be done in accordance with the guidance document, “eCopy Program for Medical Device Submissions.” Being required to submit one hard copy and follow the eCopy guidance is more burdensome to submitters than being able to submit two electronic copies via email.
The final guidance, like the draft, does a good job of explaining how FDA will interpret the custom device exemption. And the final guidance, like the draft, indicates FDA’s intent to restrict use of the custom device exemption as much as possible.
A lot has happened since FDA’s notification to Congress in late July. For instance, on Tuesday September 9, 2014, the House Committee on Energy and Commerce Subcommittee on Health held a hearing on the documents provided as part of the notification to Congress. At the hearing, which lasted for hours, several members of the subcommittee grilled FDA Center for Devices and Radiological Health (CDRH) Director Jeff Shuren at length. The critical questions from representatives focused on the following areas: FDA’s decision to issue the framework using guidance instead of notice-and-comment rulemaking, bypassing, among other requirements, a regulatory flexibility analysis and economic impact analysis; questions about FDA’s statutory authority to regulate LDTs as medical devices; FDA’s lack of informal outreach to lawmakers prior to officially notifying Congress of the framework; the source of FDA resources for the increased regulation; FDA’s basis for believing that there are flawed LDTs on the market; duplication between FDA regulation and CLIA; tax implications of the framework; obstacles to innovation; and inconsistencies between the current registration and listing regulations and FDA’s proposed framework.
Also at the congressional hearing, Alan Mertz, President of the American Clinical Laboratory Association (ACLA), criticized the proposed framework as announced in the notification to Congress. ACLA issued a press release on September 30, 2014, responding to FDA’s formal issuance of the draft guidances. In the press release, the association cited its concern that “unnecessary and duplicative regulation could delay patient access to life saving treatments and compromise America’s leadership in diagnostic discovery.” On the other hand, Andrew Fish, Executive Director of AdvaMed Dx, testified at the hearing in favor of FDA regulation of LDTs.
Just one day after the congressional hearing, on September 10, 2014, Alberto Guiterrez, Director of the Office of In Vitro Diagnostics and Radiological Health at CDRH, presented FDA’s proposed framework to a webinar hosted by the American Association for Clinical Chemistry. Dr. Gutierrez asserted that the current LDT regulatory model presented “significant adverse health consequences” and led to “unnecessary healthcare costs.”
Despite the flurry of activity since FDA notified Congress, substantively, the Framework Guidance is unchanged from what was provided to Congress on July 31, with two exceptions: (1) the definition of a companion diagnostic has been revised for consistency with the final guidance document, “In Vitro Companion Diagnostic Devices;” and (2) the “Traditional LDT” factor regarding use of only legally marketed components has been clarified to require only use of components (including instruments) that are legally marketed for clinical use. In the Federal Register notice, among other comments, FDA specifically requests public comment on the following topics in the Framework Guidance:
Whether the healthcare system criterion in the Traditional LDT and LDT for Unmet needs can be omitted.
Standard for determining if an LDT is for a Rare Disease (e.g., use of the HUD standard or an alternative standard.)
Quality System Regulation phase-in timeline.
Notification – whether a single notification from a healthcare system is sufficient if the test is being run in multiple labs and whether some LDTs should not require registration and listing.
The draft Notification Guidance is substantively the same as the version that was provided to Congress in late July. Interestingly, we noticed that FDA may have significantly underestimated the number of laboratories affected by the draft guidances. In the Federal Register notice for the draft Notification Guidance, FDA estimates that “approximately 650 manufacturers [of LDTs will] provide notification regarding approximately 17 LDTs each.” Based on our experience, we expect that closer to approximately 2,000 laboratories will be affected by these guidance documents, although how many will choose to notify FDA is anyone’s guess.
FDA intends to hold a public webinar on October 23, 2014 at 2:00 p.m. regarding the draft guidance documents, and FDA will answer questions. The meeting has been announced on FDA’s website and pre-registration is not required. Additionally, the Centers for Disease Control and Prevention (CDC) and the Centers for Medicare and Medicaid Services (CMS), which administers most of CLIA, announced that they will be holding a public workshop on November 4-5, 2014 to discuss the proposed framework in Atlanta, Georgia (and will also be available via webcast).
Recognizing that the public will require significant time to prepare and submit comments on these important draft guidance documents, FDA has allotted a 120-day review period for the draft LDT guidances. The comment period for the proposed LDT guidances will end on January 30, 2015. This time frame is longer than the typical 60-day comment period for a draft guidance document.
We fully expect that FDA will have its hands full reviewing (and possibly addressing) all of the comments to these two draft guidance documents. We also expect FDA to receive a diverse set of views and opinions on this highly controversial topic.
In a September 30, 2014 decision, 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. The Court succinctly (and with a little snark) captures its decision in a concluding paragraph:
The parties agree that the Alameda County Safe Drug Disposal Ordinance constitutes a “first-in-the-nation” ordinance. Opinions vary widely as to whether adoption of the Ordinance was a good idea. We leave that debate to other institutions and the public at large. We 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.
The case was kicked off in December 2012 when the Pharmaceutical Research and Manufacturers of America (“PhRMA”), the Biotechnology Industry Organization (“BIO”), and the Generic Pharmaceutical Association (“GPhA”) challenged the county ordinance as a per se violation of the Commerce Clause of the U.S. Constitution. As we previously reported (here and here), the Alameda Ordinance, like other manufacturer take-back ordinances and laws, places the primary responsibility for end-of-life management of certain products on the manufacturers of the products. Specifically, the Alameda Ordinance requires “producers” of “covered drugs” to operate take-back programs after submitting a plan to the county’s Department of Environmental Health. Such operation includes the creation, administration, promotion, and payment of the program (including the payment of Alamada County’s costs to administer and enforce the Ordinance). Unless otherwise excused, every producer’s take-back program – which may be run by an individual producer or funded by a group of covered producers under a “product stewardship organization” – must accept and dispose of all covered drugs received, no matter who manufactured the drugs. (As an aside, we note that the Drug Enforcement Administration recently published a final rule implementing the Secure and Responsible Drug Disposal Act of 2010 that expands the options available to patients to dispose of controlled substances – see our post here.)
PhRMA, BIO, and GPhA argued that the Alameda Ordinance is a per se violation of the Commerce Clause of the U.S. Constitution, and, in particular, the dormant Commerce Clause, under which state and local governments may not enact regulations that unduly interfere with interstate commerce. Using the U.S. Supreme Court’s two-tiered approach to analyze whether a state or local economic regulation violates the dormant Commerce Clause, seeHealy v. Beer Institute, 491 U.S. 324 (1989); Brown–Forman Distillers Corp. v. New York State Liquor Auth., 476 U.S. 573 (1986), the California District Court dispensed with the case in an 11-page ruling. The Ninth Circuit followed a similar analysis in its 17-page decision.
The first tier asks whether the Ordinance “either discriminates against or directly regulates interstate commerce.” It does neither, said the Ninth Circuit. As an initial matter, the Ordinance is not discriminiatory:
The Ordinance, both on its face and in effect, applies to all manufacturers that make their drugs available in Alameda County—without respect to the geographic location of the manufacturer. Even if one of the manufacturers represented by Plaintiffs were to close all of its production facilities, open a single production facility in Alameda County, and limit the sale of its products to intra-county commerce, the Ordinance would still apply to that manufacturer. In other words, the Ordinance does not discriminate, because it “treat[s] all private companies exactly the same.” . . .
And pointing to certain stipulations between the parties, the Court said that those stipulations reveal that the Ordinance does not control conduct beyond the boundaries of Alameda County.
Under the second tier of a dormant Commerce Clause analysis, which requires a certain balancing test, seePike v. Bruce Church, Inc., 397 U.S. 137 (1970), a court must ask whether the burden imposed on interstate commerce by, in this case, the Alameda Ordinance is significant vis-à-vis the putative local benefits. It is not said the Court: “Plaintiffs provide no evidence that the Ordinance will interrupt, or even decrease, the ‘flow of goods’ into or out of Alameda. . . . Without any evidence that the Ordinance will affect the interstate flow of goods, we cannot say that the Ordinance substantially burdens interstate commerce.”
The challenge to Alameda’s Safe Drug Disposal Ordinance is not the only challenge to such a county law. In December 2013, PhRMA, BIO, GPhA, and the Consumer Healthcare Products Association filed a Complaint in the U.S. District Court for the Western District of Washington challenging as unconstitutional a King County, Washington Board of Health regulation establishing an industry-funded stewardship program for the collection and disposal of unwanted household medicines from county residents (see opur previous post here). That case was stayed pending resolution of the challenge to the Alameda Ordinance. According to an agreement between the parties, the Ninth Circuit’s panel decision triggers a countdown to implementation of certain provisions of the King County regulation, which is known as the Secure Medicine Return Regulations.
The Ninth Circuit’s decision could open the floodgates for other counties across the nation to create and implement their own take-back ordinances and regulations. That could be costly for the drug industry. Alameda County estimates that the annual total cost to each manufacturer for its take-back program is between $5,300 and $12,000. If each of the 3,144 counties and county equivalents in the U.S. implements a similar program with a similar cost range, then that would mean each manufacturer would need to cough up between $16,663,200 to $37,728,000 each year. Alternatively, Congress could create a national take-back law. Back in 2011, Rep. Louise Slaughter (D-NY) introduced H.R. 2939, the Pharmaceutical Stewardship Act of 2011. The bill didn’t go very far in the legislative process; however, the Ninth Circuit’s decision could reignite interest in such legislation.
As most folks know by now, earlier this month the President’s Council of Advisors on Science and Technology (“PCAST”) released a report to the President titled “Combating Antibiotic Resistant Bacteria.” The report is part of a broader initiative announced by The White House to address the growing challenges posed by antibiotic resistance that includes a National Strategy on Combating Antibiotic Resistant Bacteria and a Presidential Executive Order. Of particular interest to us are the various “push” and “pull” mechanisms the PCAST report considers to incentivize the development of antibiotics – and especially the “push” mechanism described in the report as “[t]radable vouchers to extend patent life or market exclusivity of another drug.” This is longhand for “wildcard exclusivity.” And although it is not a new concept, there seems to be a growing chorus of support for wildcard exclusivity that may mean it will gain traction among legislators and find its way into the FDC Act.
By way of background, traditional research and development incentives can be divided into two main types: “push” and “pull” methods. “Push” incentives tend to focus on removing barriers to product development, and include tax credits and grants. “Pull” incentives tend to focus on the promise of financial reward after a product has been developed, and include monetary prizes, intellectual property extensions, tradable vouchers, and non-patent marketing exclusivities.
The FDC Act is chock-full of “pull” incentives. Indeed, several have been created in the past decade, including a 5-year marketing exclusivity add-on pursuant to the Generating Antibiotic Incentives Now Act (“GAIN Act”) (FDC Act § 505E) for a drug product designated by FDA as a Qualified Infectious Disease Product (see our previous post here), and tradable vouchers under the Rare Pediatric Disease Priority Review Voucher (FDC Act § 529) and Tropical Disease Priority Review Voucher (FDC Act § 524) programs (see our previous posts here and here). But existing incentives – and in particular GAIN Act exclusivity – are not enough when it comes to antibiotics, says PCAST:
[T]he GAIN Act guarantees five years of additional market exclusivity for antibiotics that target qualified pathogens. Unfortunately, the economic impact of this provision is rather limited – because the additional 5‐year period runs concurrently with the patent protection of the drug, the average extension to market exclusivity is only 2 to 3 years and the sales during this period have little net present value as they occur almost three decades after the innovator begins the research project which produces the new drug. Although the GAIN Act was an appropriate step by Congress for various reasons (including its requirement that FDA provide guidance on pathogen‐focused development), Government and industry experts have stated in discussions with PCAST that the GAIN Act’s economic provisions have had no significant impact on pharmaceutical companies and only modest impact on small biotechnology firms. It is too early to measure directly its impact on new antibiotic development.
As such, the PCAST report identifies several “push” and “pull” mechanisms, including a tradable period of wildcard exclusivity, that it says could help stimulate and reward antibiotic development; though with the caveat that the various options “as well as others, should be carefully analyzed with respect to the magnitude of incentive needed to have a meaningful impact on drug development, total cost, relative economic efficiency, and political feasibility.” According to the report:
[One] approach would be to reward a successful developer of an important antibiotic with a ‘tradable voucher’ (sometimes called a ‘wildcard voucher’) that provides a short extension to the patent life (or market exclusivity period) of any drug. The developer could sell the voucher to another company with a blockbuster drug whose patent is soon to expire.
Such a voucher could be very valuable, providing a powerful incentive to potential innovators. For a mature blockbuster drug with $4 billion in annual sales, a three-month extension would yield $1 billion in additional sales – corresponding to profits of $800 million, assuming margins on a mature drug of 80%. Such an incentive might elicit considerable interest from the venture capital community in launching biotechnology companies focused on new antibiotic development.
There are several advantages to this approach, says PCAST, including that “[i]t would leave innovation decisions up to the free market,” “would not require direct appropriation from the Federal discretionary budget,” and that “[t]he overall cost of incentivizing antibiotic development would be spread across many different drugs, with the cost of any given three-month extension being limited.” But as the PCAST report also notes, “[t]he key issue with this approach is that it would delay the transition of other drugs to generic status.” Such delay could raise significant opposition from an array of stakeholders, including patients, public health advocates, generic drug manufacturers. “Public health advocates, for example, may ask why patients taking a statin drug (or their insurers) should bear the financial burden of incentivizing antibiotic development.” Moreover, “the total social cost of this approach is likely to be larger than some other solutions because antibiotic developers will require a fraction of the value of the tradable vouchers,” says PCAST.
The concept of wildcard exclusivity is not new. It has cropped up from time to time over the years. We’ve seen it discussed in reports and in the published literature generally, and specifically in the context of providing an incentive for antibiotic and cancer drug development (see here, here, here, and here). It’s also a concept that Congress debated including in the law a decade ago in the context of bioterrorism countermeasure development (see here at pages 17-18). That effort drew sharp criticism from the Generic Pharmaceutical Association (see here).
Congress may once again be poised to consider wildcard exclusivity. Indeed, the topic was discussed on Capitol Hill just a day after the release of the PCAST report when the Subcommittee on Health of the House Committee on Energy and Commerce held a hearing as part of the broader 21st Century Cures Initiative, titled “Examining Ways to Combat Antibiotic Resistance and Foster New Drug Development.” A 21st Century Cures Initiative bill is expected to be dropped in January 2015 and may incorporate some of the “push” and “pull” incentives laid out in the PCAST report. That bill could ultimately be wrapped into a broader FDA bill that reauthorizes and amends several of the user fee acts.
As we previously posted, in June 2011, ReGen Biologics, Inc. (“ReGen”), which was subsequently acquired by Ivy Sports Medicine, LLC (“Ivy”), sued FDA based upon the theory that FDA lacked authority under the Federal Food, Drug, and Cosmetic Act (“FDCA”) to rescind a 510(k) substantial equivalence determination for the Menaflex product. In April 2013, the District Court for the District of Columbia granted summary judgment to FDA, concluding that FDA had the inherent authority to rescind the 510(k) substantial equivalence determination because it was done within a reasonable period of time (see our earlier post here).
On September 26, 2014, the U.S. Court of Appeals for the District of Columbia Circuit reversed, holding that because there is a statutory procedure for FDA to reclassify devices, FDA may not “short-circuit” this procedure by rescinding a 510(k) clearance to reclassify a device – in this case from Class II to Class III. Ivy Sports Med., LLC, v. Burwell, No. 13-5139 (D.C. Cir. Sept. 26, 2014). The Court of Appeals directed the District Court to vacate FDA’s decision (rescission of the 510(k)) and remand the matter to FDA for further proceedings.
The Court of Appeals generally analyzed the federal agency’s “inherent authority” to revisit a prior decision. The Court of Appeals explained that an Agency’s “inherent reconsideration authority does not apply in cases where Congress has spoken.” Id. at 10. In this case, although phrased differently, the Court ruled that both FDA’s claimed inherent authority to rescind a 510(k) substantial equivalence determination and Section 513(e) of the FDCA (device reclassification) achieved the same end result – to reclassify the Menaflex product from Class II into Class III. Thus, the Court of Appeals concluded that it would be unreasonable under the current “statutory scheme to infer that FDA retains inherent authority to short-circuit or end-run the carefully prescribed statutory reclassification process in order “to correct” a mistaken classification of a device into Class II which previously occurred through the 510(k) clearance process. Id. at 12.
The Court’s Opinion contains an extensive and interesting discussion about allegations that FDA’s prior decision had been tainted because of alleged improper outside and inside-FDA influences on that decision.
FDA argued that even if the reclassification provision in the statute could displace its inherent authority, it would not apply in this case because there was an exception created in American Methyl Corp. v. EPA, 749 F.2d 826 (D.C. Cir. 1984), when there is fraud or misconduct shown in the administrative record. The Court of Appeals disagreed that American Methyl created such an exception; however, even assuming such an exception had been created, the Court of Appeals determined that any misconduct in the case of the Menaflex 510(k) would not raise to the level necessary to reach the high bar that would have been set in what the court referred to as the “dicta” in American Methyl. The Court of Appeals noted that:
no senior leaders of FDA, executives of ReGen, or Members of Congress were disciplined for their involvement in the [Menaflex 510(k)] review process. Yet if FDA actually rendered a decision tainted by misconduct – as opposed to simply reaching a mistaken decision or a decision it no longer agrees with – that misconduct must have been due to the legally or ethically wrongful actions of some person or persons. FDA’s inability or unwillingness to identify those wrongdoers is an indication that, in fact, no American Methyl-level misconduct occurred, at least on the record before us.
Id. at 16. Here, the Court of Appeals found that whatever inherent authority FDA may have in other situations does not allow the Agency to rescind a 510(k) substantial equivalence determination when it would result in the de facto reclassification of the previously 510(k)-cleared Class II device into Class III.
Since this case was first filed in 2011, the Food and Drug Administration Safety and Innovation Act (“FDASIA”) changed the statutory provisions for device reclassification. Based on new information about a device, FDA may, on its own initiative or after petition by an interested person, reclassify the device and revoke any related regulation or requirement in effect under a PMA approval order. Prior to FDASIA, FDA was required to issue a reclassification regulation in order to perform this reclassification. Following FDASIA, FDA can accomplish the same thing by administrative order. 21 U.S.C. § 360c(e)(1)(A)(i). Practically speaking, issuing an administrative order may be less burdensome for FDA than issuing a reclassification regulation because an administrative order does not necessarily have to undergo outside-FDA Executive Branch scrutiny prior to issuance as does an agency regulation.
This decision was met by a vigorous dissent from Circuit Judge Pollard. She concluded that the FDC Act’s “text, structure, history, and purpose, in addition to past administrative practice, all show that the FDA permissibly read the statute not to displace its otherwise-undisputed implicit authority to correct erroneous substantial equivalence decisions.” Dissenting Op. at 2.
The two judges in the majority stated that their holding is very narrow and only relates to the rescission of a 510(k) substantial equivalence determination when it results in the de facto reclassification of a device. It remains to be seen if this ruling would apply to FDA’s presumed inherent authority to rescind a 510(k) substantial equivalence determination so long as the device remained a class II device, and the 510(k) holder was merely required to submit a new 510(k) for the device. Also, it remains to be seen if this decision will act as a check on other instances where FDA has asserted that it has the inherent authority to “correct” mistakes involving other product approval decisions and exclusivity matters. We have seen a number of such decisions in the drug approval arena.
FDA has other remedies besides simply issuing another decision. It can seek rehearing from the same three judges that heard the case, seek rehearing en banc from the entire D.C. Circuit, and/or seek review from the U.S. Supreme Court. The fact that there was a vigorous dissent in the case could suggest that FDA may take one or more of these steps.
For the past few days, industry has reacted with anxiety to the government’s decision to pursue an order to show cause why Bayer, Corp. should not be held in contempt of that company’s 2007 consent decree with FTC due to its marketing of the Phillips Colon Health probiotic dietary supplement. SeeMotion for Order to Show Cause Why Defendant Should Not Be Held in Contempt, No. 07-cv-00001, Docket No. 4 (D.N.J. Sept. 12, 2014). Specifically, many commentators fear that the FTC is attempting to impose a drug-level substantiation requirement on claims for probiotic dietary supplement products. See, e.g., here and here.
The FTC’s standard for substantiation in the Bayer case, while not consistent with the more flexible standard articulated in FTC guidance, is not particularly novel in the context of FTC litigation. We agree that is not appropriate for dietary supplements generally (although certainly not unprecedented). But we would add that FTC’s asserted substantiation standard is just that – asserted. And it has a key limitation that is inherent in the definition of “competent reliable scientific evidence”: It is dependent on the opinion of FTC’s expert.
FTC’s motion for an order to show cause expressly relies on the opinion of Dr. Loren Laine, a gastroenterologist and professor at Yale University, both (1) for the substantiation requirements that should apply to Phillip’s Colon Health, and (2) to apply those substantiation requirements to the data and information provided by Bayer in support of its claims. This reliance on an expert is seemingly unavoidable for FTC, where the order in question – as well as the body of FTC case law beyond this order – defines “competent and reliable scientific evidence” specifically based on the “expertise of professionals in the relevant area.” (The Bayer 2007 order defines “competent and reliable scientific evidence” as “tests, analyses, research, studies, or other evidence based on the expertise of professionals in the relevant area, that has been conducted and evaluated in an objective manner by persons qualified to do so, using procedures generally accepted in the profession to yield accurate and reliable results.”) But it provides an opportunity for companies to insure themselves against an FTC motion like the one faced by Bayer, as was made abundantly clear by FTC’s loss in the Garden of Life case, where the district court determined – and the 11th Circuit agreed – that a “battle of the experts” did not constitute contempt.
Accepting the lessons of Garden of Life and Bayer, the appropriate insurance for companies is a process for substantiation of claims that relies on the opinions of a qualified expert, at least for claims that are novel or otherwise high priority for FTC action. Specifically, if a company engages a qualified expert to evaluate the scientific evidence for the company’s proposed advertising claims, then uses its claims in reliance on the expert’s opinion, that company can hardly be said to have acted in contempt of a court order. And even when there is no existing consent decree, documented reliance on the opinions of a qualified expert puts the company in a much better position vis-à-vis FTC with regard to the “competent and reliable scientific evidence” standard as presently defined.
Finally, we note that in addition to the opportunity for an ounce of prevention presented by FTC’s necessary reliance on experts for its substantiation standard, any opinion set forth by such an expert on a broadly-applicable standard (i.e. all studies on probiotics must be strain-specific because it is impossible to extrapolate between one strain and another) is vulnerable to challenge by another qualified expert, depending on the specifics of the case. For example, the company’s expert may agree that, in general, it is difficult to extrapolate from the demonstrated efficacy of a one strain in humans to the efficacy of another strain, but for certain types of probiotics or with certain additional data, extrapolation is appropriate. And a court may find the company’s expert’s views as convincing as those of the FTC’s expert(s).
No doubt Bayer has engaged its own expert to rebut Dr. Laine’s opinion. We look forward to reading the company’s response to FTC’s motion, which is due October 3.
Senators John Cornyn (R-TX) and Sherrod Brown (D-OH) introduced legislation late last week that would allow a pharmacist to dispense a controlled substance prescription for a patient and deliver the drug to a practitioner for administration in the doctor’s office. S. 2825, titled “Ensuring Safe Access to Prescription Medication Act of 2014,” is designed to amend the Controlled Substances Act (CSA) to treat as “dispensing” the “delivery of a controlled substance by a pharmacy to a practitioner, pursuant to a patient-specific prescription of the practitioner, under certain circumstances.”
This legislation may seem like nothing more than overly technical change concerning the CSA’s definition of “dispense,” but that's not the case. For the last 44 years, since passage of the federal CSA, pharmacists have been limited to dispensing controlled substances only to the “ultimate user,” meaning the patient, a member of his or her household, or research subject pursuant to 21 U.S.C. § 802(a)(10) (definition of “dispense”). The “dispense” definition has proved troublesome for patients, pharmacists and physicians in those cases where controlled substances require in-office administration (e.g., treatment of chronic pain via intrathecal pump, use of testosterone pellets, etc.). Under the present definition of “dispense,” a pharmacy’s dispensing to anyone other than the ultimate user patient or research subject is illegal. Physicians, patients and pharmacists have grappled with the ultimate user requirement by creating work-arounds involving agency relationships (e.g., making the physician an agent of the patient, thus permitting dispensing to the doctor per that agency relationship), or creating the fiction of a “constructive transfer” of the controlled substance to the end user through the physician.
DEA’s position is that such interpretations violate 21 U.S.C. § 802(a)(10)’s definition of “dispense.” Proponents of the definitional change, however, have long asserted that pharmacy dispensing to the end user, patient or research subject instead of the physician, for certain types of medicine, actually increases the risk of loss and diversion of controlled substances to the extent that time passed between dispensing to the ultimate user and administration of the substance in the doctor’s office. Moreover, there are safety and efficacy concerns regarding how these medicines are stored and handled until ultimately administered by a practitioner.
Thus, the legislation would permit a pharmacist to deliver to a doctor’s office a controlled substance for administration under the following conditions: (1) the delivery is pursuant to a patient specific prescription of the practitioner; and (2) the “practitioner has deemed that it is medically necessary, acting in the usual course of professional practice, for the controlled substance to be administered by the practitioner to the patient.’’
In our view, this legislation is long overdue and will ensure appropriate care without increasing the potential for diversion.
Whether you call it “patient advocacy,” “patient engagement,” or maybe something a little fancier, in recent years incorporating the patient perspective has become a hot topic issue for FDA and drug developers alike. As FDA stated in announcing its Patient Focused Drug Development initiative, this is because “patients who live with a disease have a direct stake in the outcome of FDA’s decisions and are in a unique position to contribute to the understanding of their disease” (78 Fed. Reg. 21,613 (April 11, 2013)).
There has been much collaboration between FDA, industry, and patient groups to identify best practices for engaging patients and to conduct pilot programs that solicit patient input. In the midst of all of these larger efforts, I wanted to share a recent experience that very simply demonstrates the value and impact of the patient voice.
Earlier this year CDER was being asked for input by a sponsor seeking to enter phase 3 of development for a rare disease. It is not uncommon in rare diseases for the FDA review staff to not have direct clinical experience with the disease or a nuanced scientific understanding of the disease. To the sponsor and the expert consultants on this rare disease, the input from CDER seemed not quite tailored to the unique needs of the patients with this condition. The patient community for this disease had already been meeting with the company to make sure that the company officials understood their disease and unmet medical need, but had not yet contacted anyone at FDA. This situation presented a prime opportunity for these patient advocates to share their perspective on the critical aspects of their disease with FDA, and I suggested that they do so. I did not tell the patient advocates what they should or should not tell FDA, but gave advice on how to navigate the Agency and answered questions they had about the FDA regulatory framework.
Just a few months later, when CDER next provided further guidance to this drug sponsor, the very first thing the FDA reviewers mentioned to the sponsor was that they had met with representatives from the patient community and that they now understood the disease. The ensuing engagement between FDA and this sponsor was highly constructive and the conversations surrounding the planning of the phase 3 program allowed all parties to move forward on the same page.
This shows that FDA’s openness to and efforts to engage with patients are making a constructive difference in advancing innovation. Patients are in a unique position in their understanding of their disease, and their contributions can and will make an impact promoting development and review and new medicines.
FDA is authorized by the Federal Food, Drug, and Cosmetic Act of 1938, as amended (FDCA) to regulate the labeling of all medical devices and the advertising only of “restricted devices.” (21 U.S.C. §§ 352(a), 352(q) and (r).) FDA does have authority to take the advertising of non restricted devices into account in determining intended use (21 C.F.R. § 801.4), but it does not otherwise have authority to regulate their advertising.
FDA creates restricted devices in two ways. One is by issuing regulations designating particular device types as restricted. Only two such regulations are on the books, one for hearing aids and the other for analyte specific reagents (ASRs). (21 C.F.R. § 801.420; id. § 801.421; id., § 809.30.)
The other way for FDA to create restricted devices is by embedding such designations in orders granting premarket application (PMA) approval to Class III devices. (21 U.S.C. §§ 360e(d)(1)(B)(ii), 360j(e).) Since FDA does so routinely, it is fair to say that virtually all Class III devices that have received PMA approval are restricted.
Accordingly, no Class I or Class II devices are restricted except for hearing aids and ASRs. Additionally, the handful of remaining Class III preamendment devices are not restricted, because they are not subject to a PMA approval order.
What does this discussion have to do with the Internet? Given that most devices are not restricted, a crucial question is whether promotion on the Internet is “labeling” or “advertising.” If the former, then FDA has authority to regulate such promotion. (21 U.S.C. §§ 321(n), 352(a) & 352(f); 21 C.F.R. § 801.109(d).) If the latter, then FDA lacks such authority.
In the early years of the new century, FDA resisted calls to declare whether the Internet was labeling or advertising. As it turns out, the Internet enables communication in a variety of ways as it continues to evolve. At the turn of the century, for example, web sites were predominant and various social media platforms that are ubiquitous today (e.g., Twitter, Facebook) had not yet been developed or had not taken hold. So it turns out that FDA was prudent to resist calls for a sweeping determination as to whether the Internet as a whole would be considered labeling or advertising for regulatory purposes. It is quite likely that different areas of the Internet could be considered labeling or advertising depending upon their nature and functionality, and new judgments may be required as the Internet continues to evolve.
In keeping with this wait and see approach, FDA has issued no Internet specific regulations and few such guidances. Last June, however, FDA did issue two draft guidances focused on social media platforms on the Internet. The first draft guidance discussed presentation of risk/benefit information on internet based social media platforms with character space limitations (“Character Space Guidance”). The other one concerned efforts by firms to correct third party misinformation on these platforms (“Misinformation Guidance”). We blogged about these draft guidances here.
The Character Space Guidance is focused on “electronic/digital platforms that are associated with character space limitations – specifically on the Internet and through social media or other technological venues” (p. 1). As examples, FDA cites Tweets on Twitter and online paid search, such as sponsored links on search engines such as Google and Yahoo (id.).
The Misinformation Guidance is less exacting about the venue. It applies to “information . . . created or disseminated by independent third parties on the Internet or through social media or other technological venues . . ., regardless of whether that misinformation appears on a firm’s own forum or an independent third party forum or website” (p. 1). Such venues may include Internet/social media platforms that allow for real time interaction or those where communication is asynchronous (see id., p. 3).
In Section II of each draft guidance, there is a summary of FDA’s authority over device and drug labeling and advertising, and it is generally consistent with the scheme described above. In particular, FDA expressly notes that it has authority over the labeling of all medical devices and the advertising only of restricted devices.
The draft guidances do not, however, take the obvious next step and analyze whether the portions of the Internet under discussion are labeling or advertising. Interestingly, Section VI of the Character Space Guidance provides examples applying drug advertising requirements to tweets and sponsored links, among others. The Section VI discussion, therefore, could be read to imply that FDA considers at least some aspects of the Internet covered by the draft guidances to be advertising. Another hint at FDA’s position in the Character Space Guidance, p. 4, n.9, is a statement that “encourages” firms selling non restricted devices to follow the guidance, implying that such devices may not be subject to it.
What comes through most clearly, however, is that FDA has declined to forthrightly state its position. This coy approach is unfortunate, because the answer is crucial to whether the enforcement position in these draft guidances applies to most medical devices.
It is one thing to refrain from general pronouncements on the status of the Internet as a matter of prudence. It is quite another to fail to answer an obvious question implicated by a draft guidance directed at a specific portion of the Internet (i.e., social media platforms). Having chosen to provide guidance with respect to social media platforms, FDA should have indicated whether they consider these portions of the Internet to be labeling or advertising.
Absent such guidance, this blog post will try to answer the question. This task requires some guesswork, because the statute and regulations have not been updated for the Internet. But the alternative is complete confusion about whether the draft guidances apply to non-restricted medical devices.
Under the FDCA, “labeling” means “all labels and other written, printed, or graphic matter (1) upon any article or any of its containers or wrappers, or (2) accompanying such article.” (21 U.S.C. § 321(m).) As FDA notes in the draft guidances, “accompany” has been read broadly for more than half a century to include materials that textually supplement or explain an article, even if not physically attached to it. Kordel v. United States, 335 U.S. 345, 350 (1948).
The FDCA does not define advertising, but FDA long ago adopted a regulation giving examples of promotion that would be considered advertising: “Advertisements [subject to the FDCA] . . . include advertisements in published journals, magazines, other periodicals, and newspapers, and advertisements broadcast through media such as radio, television, and telephone communication systems.” 21 C.F.R. § 202.1(l)(1). (The regulation nominally applies to drugs, but FDA has long considered it applicable to devices as well. It is not clear exactly what was intended by the intriguing reference to advertisements broadcast through “telephone communication systems.”)
Obviously, these examples were provided prior to the development of the Internet and social media platforms. But an “advertisement” generally means: “A notice or announcement in a public medium promoting a product, service, or event or publicizing a job vacancy” (emphasis added). This definition is consistent with the examples provided in the regulation, e.g., placing an advertisement in a print journal or running a radio advertising spot are both ways in which a product may be promoted in a public medium.
The next subsection of the same regulation also provides examples of labeling: “Brochures, booklets, mailing pieces, detailing pieces, file cards, bulletins, calendars, price lists, catalogs, house organs, letters, motion picture films, film strips, lantern slides, sound recordings, exhibits, literature, and reprints. . . .” 21 C.F.R. § 202.1(l)(2). In these cases, rather than placing a notice or announcement in a public medium being used for a variety of messages, such as a newspaper or radio channel, it would appear that the message and the medium are essentially coterminous, and the sponsor disseminates it to the prospective customers. A brochure, for example, would typically consist entirely of a sponsor’s discussion of its products, and would be disseminated by the sponsor as a handout or mailer.
When a sponsor promotes a device with a tweet, or as a paid link on Google search results, which of these archetypes does such messaging most closely resemble? What about if the sponsor posts a reply to misinformation about its products on a public bulletin board?
One could argue that these activities most closely resemble advertising. A paid link on a Google search results page seems much like a traditional advertisement, with the search results page taking the place of a classified advertising in a newspaper. A sponsor issuing a tweet or posting a reply to a statement in a chat room is also essentially making an announcement in a public medium. That is the classic definition of advertising. However, Internet technology does tend to break down the pure separation of labeling and advertising. For example, a tweet could link to a product brochure that is itself labeling (and, therefore, should comply with the requirements for labeling).
Still, it is not unreasonable to see social media platforms as a kind of digital public square into which a sponsor steps to promote its medical devices. If this view is accepted, then such communications are advertising. Accordingly, the draft guidances would not apply to non restricted medical devices (i.e., almost all Class I and Class II devices).
It may be that FDA would disagree with this analysis. Rather than allowing uncertainty to persist, FDA should state its position openly. It would also be helpful for Congress to update the existing statutory authority for the Internet age. That would allow FDA to develop a considered policy, as opposed to the somewhat arbitrary exercise of extrapolating the existing statutory and regulatory definitions to new Internet technology – or worse, avoiding discussion of the issue altogether.
Thanks to everyone who participated in our “30 for 30” Hatch-Waxman Trivia! Based on the corrrespondence we received since posting the trivia questions earlier this week, FDA Law Blog readers enjoyed the trip down memory lane. . . and were entertained along the way. We know you are chomping at the bit to see the answers, so without further ado, we give you the answers to each of the trivia questions.
Q1: What U.S. Senator is a musician, songwriter and producer, a member of ASCAP, and whose works have been recorded by Gladys Knight, Donny Osmond and Brooks and Dunn, among others?
Q2: When standing at the base of the U.S. Capitol, this dome (pictured below) stands at 93.5 feet above sea level. To whom does this dome belong?
A. Representative Henry Waxman (D-CA). He stands at 5.5 feet tall and the base of the U.S. Capitol is 88 feet above sea level.
Q3: President Ronald Reagan returned from where before signing into law the Drug Price Competition and Patent Term Restoration Act of 1984 in the Rose Garden on September 24, 1984?
A. New York, New York after addressing the 39th Session of the United Nations General Assembly. President Reagan commented during the signing of Hatch-Waxman: “I just returned from New York — literally minutes ago — where I addressed the United Nations. . . .”
Q4: Who has a lower “Bacon Number”: President Ronald Reagan, Sen. Orrin Hatch, or Rep. Henry Waxman?
A. This is, of course, a reference to prolific Hollywood character actor Kevin Bacon and the game wherein movie buffs challenge each other to find the shortest path between an arbitrary actor and Kevin Bacon. President Reagan, Sen. Hatch, and Rep. Waxman have all appeared in movies. According to the Oracle of Bacon, all three are tied with a “Bacon Number” of 2. Here’s the path to Kevin Bacon for each:
Ronald Reagan was in Brother Rat (1938) with Eddie Albert was in The Big Picture (1989) with Kevin Bacon
Henry Waxman was in MoveOn: The Movie (2009) with Moby was in Come Together: A Night for John Lennon's Words and Music (2001) with Kevin Bacon
Orrin G. Hatch was in Traffic (2000) with John Slattery was in The 60th Primetime Emmy Awards (2008) with Kevin Bacon
Q5: Were rain umbrellas needed in the Rose Garden on September 24, 1984?
A: No. According to the Farmers’ Almanac, the high temperature in Washington, DC that day was 88°F with no precipitation. And, according to President Reagan, it was hot. He commented during the signing ceremony: “I don't know why it is on some of these hot rallies out in the countryside the chairs are black instead of white, and they get very warm when you stand too long.”
Q6: What is the typographical error in the text of FDC Act § 505(j) that was never corrected? (Hint: The affected section was replaced by the 2003 Medicare Modernization Act (“MMA”).)
FDC Act § 505(j)(5)(B)(iv), as enacted states:
If the application contains a certification described in subclause (IV) of paragraph (2)(A)(vii) and is for a drug for which a previous application has been submitted under this subsection continuing such a certification, the application shall be made effective not earlier than one hundred and eighty days after-
(I) the date the Secretary receives notice from the applicant under the previous application of the first commercial marketing of the drug under the previous application, or
(II) the date of a decision of a court. ..holding the patent which is the subject of the certification to be invalid or not infringed,
Q7: What is the significance of January 1, 1982 to the Orange Book?
FDC Act § 505(j)(7)(A)(i)(II) requires FDA to include in “the list” (i.e., the Orange Book) the date of approval and application number of drug products approved after 1981. Information on products approved prior to 1981 may be included in the Orange Book, however, no date of approval is included. Instead, the approval date field in the printed version of the Orange Book is left blank. In the electronic version of the Orange Book, products approved prior to January 1, 1982 contain the phrase “Approved prior to Jan 1, 1982.”
Q8: What is the significant difference between ANDA No. 076933 and ANDA No. 076934? (The answer is neither “1,” nor the drug name.)
A. ANDAs with a number less than or equal to 076933 are pre-MMA applications, and ANDAs with a number equal to or greater than 076934 are post-MMA applications.
Q9: What pharmaceutical industry trade organization executive referred to the pre-Hatch-Waxman hurdles to generic competition of post-1962 drugs as an “iron curtain”?
A: William F. Haddad, President of the Generic Pharmaceutical Industry Association, according to a June 8, 1984 article in The Washington Post, titled “FDA Lets Some Drugs Take Effect Slowly”: “But until the law is changed, the FDA will continue approving drugs according to the old rules — a system that William F. Haddad, president of the Generic Pharmaceutical Industry Association, and other critics say acts as an ‘iron Curtain’ that makes it difficult to get new generic drugs approved.”
Q10: What almost-U.S. President opposed efforts to pass legislation that would have extended brand-name drug patents without creating a generic drug approval process?
Q11: Donald Hare, R.Ph., who has since retired from FDA, is sometimes referred to as the Father of the Orange Book. To whom does the distinction of Mother of the Orange Book – or at least Mother-in-Law – belong?
A: CAPT Mary Ann Holovac, R.Ph., who oversaw the publication for nearly 25 years, until December 2013.
Q12: As of today, what is the longest, unexpired period of non-patent exclusivity listed in the Orange Book?
A: A period of GAIN exclusivity expiring on August 6, 2024 is listed for NDA No. 206334 for ORBACTIV (oritavancin diphosphate) Lyophilized Powder Injection. This is the latest of the few periods of GAIN exclusivity FDA has granted. The other GAIN Act approvals are NDA Nos. 205435 and 205346 for SIVEXTRO (tedizolid phosphate) (GAIN exclusivity expiring on June 20, 2024), and NDA No. 021883 for DALVANCE (dalbavancin HCl) (GAIN exclusivity expiring on May 23, 2024).
Q13: When were Reference Listed Drug (“RLD”) designations added to the Orange Book?
A: RLD designations (identified by a “+” in the paper version of the Orange Book) first appeared with publication of the 12th Edition (1992).
Q14: When was an electronic Orange Book search function added to FDA’s website?
A: An electronic Orange Book search function was added to FDA’s website on October 31, 1997. Beginning in 1998, current patent listings for approved drug products could be obtained from the electronic Orange Book through a search by active ingredient, proprietary name, application holder, or application number. Since February 2005 (25th Edition), FDA has provided daily electronic Orange Book product updates, and made the volume available in a downloadable PDF format.
Q15: What is the “Blue Book”?
A: Before the Orange Book came into existence, there was a predecessor publication known as the “Blue Book,” which was a list of manufacturers with approved NDAs and ANDAs (or manufacturers who were named as distributors in those applications) for drug products having known or potential bioequivalence problems.
Q16: Prior to FDA’s formal creation of Orange Book patent listing forms (Form FDA 3542a and Form FDA 3542) in 2003, did FDA offer any informal guidance to NDA sponsors on patent listing?
Q17: Can you identify 10 types of non-patent marketing exclusivities (or non-patent exclusivity extensions) recognized by the FDC Act?
A: (1) 5-year New Chemical Entity Exclusivity; (2) 3-year new clinical investigation exclusivity for an original NDA; (3) 3-year new clinical investigation exclusivity for a supplemental NDA; (4) 10-year window exclusivity; (5) 2-year window exclusivity; (6) 5-year Generating Antibiotic Incentives Now Act exclusivity; (7) 6-month pediatric exclusivity; (8) 5-year enantiomer exclusivity; (9) QI Act antibiotic exclusivity; (10) 180-day generic drug exclusivity; (11) 7-year orphan drug exclusivity
Q18: How long did it take after the December 8, 2003 enactment of the MMA for a member of Congress to propose a revision to the law (and specifically to the 180-day exclusivity forfeiture provisions)?
A: One day. On December 9, 2003, Sen. Hatch suggested changes to the failure-to-market 180-day exclusivity forfeiture provision. See149 Cong. Rec. S16104 (daily ed. Dec. 9, 2003) (statement of Sen. Orrin Hatch).
Q19: What U.S. law is modeled after the Hatch-Waxman Amendments, and how long has it taken FDA to issue implementing regulations?
A: The Generic Animal Drug and Patent Term Restoration Act of 1988, Pub. Law No. 98-417, 98 Stat. 1585 (1988), which is the Hatch-Waxman equivalent for generic animal drugs. FDA has not yet proposed regulations to implement the law.
Q20: How many times has FDA used its “active pursuit” regulation at 21 C.F.R. § 314.107(c)(3) (“[I]f FDA concludes that the applicant submitting the first application is not actively pursuing approval of its abbreviated application, FDA will make the approval of subsequent [ANDAs] immediately effective if they are otherwise eligible for an immediately effective approval.”) to effectively take away a first applicant’s 180-day exclusivity eligibility?
A: None.
Q21: What case (and involving what drug) was the first judicial test of the 3-year exclusivity provisions of the Hatch-Waxman Amendments?
A: Zenith Labs., Inc. v. Bowen, Case No. 85-cv-3646 (D.N.J. 1986), which involved the drug Tolazamide.
Q22: Who is Gary P. Jordan?
A: Gary P. Jordan is the the first assistant U.S. attorney who prosecuted a case arising from the so-called “generic drug scandal.”
Q23: Who is Marion J. Finkel?
A: Marion J. Finkel is credited with developing the framework for the so-called “paper NDA,” which is a predecessor to the 505(b)(2) NDA.
Q24: What is the only instance in which a court has ordered FDA to approve an ANDA during another sponsor’s period of 180-day exclusivity?
A: In Watson Laboratories, Inc. v. Sebelius, et al., Case No. 12-1344 (ABJ) (D.D.C. Oct. 22, 2012), which concerned 180-day exclusivity for generic ACTOS (pioglitazone) under the pre-MMA statute, the district court overruled FDA’s determination that Watson was not eligible to share in 180-day exclusivity because the company was not the first (or among the first) to amend its pending ANDA to convert a patent certification to Paragraph IV. Instead, the district court ruled that Watson was entitled to share in another applicant’s 180-day exclusivity period, because FDA’s long-standing interpretation of the FDC Act was contrary to the terms of the statute, and ordered the Agency to approve Watson’s ANDA. FDA appealed the decision to the U.S. Court of Appeals for the District of Columbia Circuit (Docket Nos. 12-5332 & 12-5342), where a motion for vacatur (based on mootness) was ultimately granted.
Q25: What is the only instance in whch FDA was faced with a leap year NCE NDA approval?
A: FDA approved PRISTIQ (desvenlafaxine) Extended-Release Tablets under NDA No. 021992 in a leap year, on February 29, 2008, and granted NCE exclusivity expiring in a non-leap year, on March 1, 2013. FDA added a note to the Orange Book stating: “Applications referencing NDA 021992 Pristiq (Desvenlafaxine Succinate) and challenging the listed patent may be received by the Agency beginning on Feb 29, 2012, four years from the NDA approval date” (see our previous post here).
Q26: FDA’s regulation at 21 C.F.R. § 314.94(a)(12)(viii) states, in relevant part, “an applicant who has submitted a paragraph IV patent certification may not change it to a paragraph III certification if a patent infringement suit has been filed against another paragraph IV applicant unless the agency has determined that no applicant is entitled to 180-day exclusivity or the patent expires before the lawsuit is resolved or expires after the suit is resolved but before the end of the 180-day exclusivity period.” What is the status of this regulation?
A: This regulation has not been enforced by FDA for several years. The regulation was promulgated in the early 1990s at a time when it was unclear to FDA whether a first-filer’s period of 180-day exclusivity could extend beyond the life of the patent(s) on which eligibility to exclusivity was based. At the time, FDA was concerned that a subsequent ANDA Paragraph IV filer would convert its certification in an effort to circumvent a first-filer’s 180-day exclusivity. As such, the above passage from 21 C.F.R. § 314.94(a)(12)(viii) was included to guard against that possibility. Subsequently, FDA and the courts have ruled that 180-day exclusivity cannot extend beyond the expiration of the patent(s) on which such exclusivity is based. As such, the need for this regulation has, as a general matter, been outlived. (The only time such a prohibition might still arise is in the case where an ANDA sponsor submits an ANDA with a Paragraph IV certification during the NCE-1 year, and then, after FDA receives – i.e., files – the ANDA, converts that Paragraph IV certification to a Paragraph III certification. In that case, the conversion would remove the basis for the ANDA submission in the first place. But even in this case, FDA still has not taken action to enforce the general prohibition at 21 C.F.R. § 314.94(a)(12)(viii).)
Q27: Can a single patent use code serve as the basis for a split Paragraph IV certification and “section viii” statement? (This question is a nod to recent controversies involving patent use codes.)
A: Yes. ANDA No. 076565 for Venlafaxine HCl Extended-Release Capsules included such a split certification with respect to the “U-459” (TREATMENT OF DEPRESSION AND GENERALIZED ANXIETY DISORDER) patent use code associated with U.S. Patent No. 6,419,958.
Q28: In what case was the U.S. Patent and Trademark Office’s (“PTO”) longstanding interpretation of 35 U.S.C. § 156(a)(5)(A) concerning Patent Term Extensions (“PTE”) struck down?
A: On May 10, 2010, the U.S. Court of Appeals for the Federal Circuit issued its decision in PhotoCure v. Kappos, 603 F.3d 1372 (Fed. Cir. 2010) (and in a second case, Ortho-McNeil Pharm., Inc. v. Lupin Pharms., Inc., 603 F.3d 1377 (Fed. Cir. 2010)) concerning the proper interpretation of 35 U.S.C. § 156(a)(5)(A), which states that the term of a patent claiming a drug shall be extended from the original expiration date of the patent if, among other things, “the permission for the commercial marketing or use of the product . . . is the first permitted commercial marketing or use of the product under the provision of law under which such regulatory review period occurred.” For several years, the PTO interpreted the term “product” in 35 U.S.C. § 156(a)(5)(A) to mean “active moiety” rather than “active ingredient.” The Federal Circuit’s PhotoCure and Ortho-McNeil decisions say that the an “active ingredient” interpretation of the statute should be applied for PTE purposes.
Q29: What is the connection between the drugs INDOCIN (indomethacin) and CAPOZIDE (captopril and hydrochlorothiazide), U.S. Patent Nos. 3,849,549 (INDOCIN) and 4,217,347 (CAPOZIDE), and Title II of the Hatch-Waxman Amendments?
A: Both drugs and both patents were cited in a March 25, 1985 letter from Reps. Henry Waxman and Robert Kastenmeier (D-WI) to the PTO Commissioner as examples of drug products covered by a patent that the Congressmen did not believe should be granted a PTE because the drugs contain an active ingredient previously approved by FDA.
Q30: What patent concerning what drug led to a change in the PTE statute at 35 U.S.C. § 156 involving the deadline for submitting a PTE application to PTO?
A: U.S. Patent No. 5,196,404 covering ANGIOMAX (bivalirudin) (see our previous post here).
With the posting on Friday of a report, a special advisory bulletin and a podcast, the HHS OIG staked out some new ground in the healthcare fraud and abuse landscape. The report shows that significant numbers of Medicare beneficiaries use copay coupons from drug companies. The OIG believes that this situation could impose significant costs on the Medicare Part D program. The OIG also believes that drug companies have the ability to change the situation. Therefore, in the special advisory bulletin (SAB), the OIG cautions drug companies that they are at risk of sanctions if they fail to take “appropriate steps” to ensure that their copayment coupons do not induce the purchase of Medicare Part D drugs. The SAB also recommends that companies work with CMS and other industry stakeholders to identify solutions, and that CMS coordinate such industry efforts.
Over the last decade, drug companies have dramatically increased their offering of copayment coupons. This increased offering has paralleled the trend toward larger copayments for all drugs, but particularly for brand name drugs. Copayment coupons have not been without controversy – in 2012 union health plans filed multiple lawsuits against nine drug companies alleging that their copay programs violated the antitrust laws and RICO (see our previous posts here and here). The issue did not escape the notice of OIG, which it announced its plans to conduct a study in its 2014 work plan (see our post here).
The report bears the straightforward title of Manufacturer Safeguards May Not Prevent Copayment Coupon Use for Part D Drugs. Noting that two previous surveys by third parties found that 6-7 percent of seniors reported using copay coupons, the OIG interviewed 30 large drug companies about their copay programs. The OIG also spoke with CMS and various entities involved in claims processing.
The report contains four significant findings. First, all of the manufacturers provided notices to beneficiaries and pharmacists that copayment coupons may not be used by Federal health care program beneficiaries, although sometimes these disclaimers are present in some coupon formats (e.g., print, electronic) but not others. Second, most manufacturers use pharmacy claims edits to prevent use of copayment coupons by Part D beneficiaries. Third, despite these safeguards, some copayment coupons are presented by Medicare beneficiaries and processed by drug companies. Fourth, Part D plans and other healthcare entities cannot identify when copayment coupons are being used in any individual drug reimbursement claims – only the drug companies that issue the coupons can, and Medicare claims are often paid before coupons are processed.
The conclusions that the OIG draws from the report are that the reliability of pharmacy claims edits needs to be improved and that the use and existence of coupons needs to be made transparent within the whole pharmacy claim process. OIG recognizes that making these changes requires the coordination and cooperation of multiple stakeholders in the process, including CMS (whose input and concurrence the OIG sought and obtained). But in the SAB, the OIG places the responsibility for currently ensuring that copay coupons do not violate the antikickback statute squarely upon the shoulders of the drug companies that issue copay coupons. Interestingly, a footnote in the SAB states that pharmacies that accept coupons from Medicare beneficiaries may also face sanctions
What remains unknown is how and when CMS will take up the OIG’s call to lead effort to make changes, and whether OIG enforcement actions may occur in this area, either before or after CMS takes action.
The U.S. Department of Justice recently announced the convictions of former officials and a broker of the Peanut Corporation of America (“PCA”) – the company at the heart an outbreak of salmonellosis five years ago that was traced to the company’s peanut products. In particular, PCA owner Stewart Parnell was convicted of conspiracy, mail and wire fraud, obstruction of justice, and introduction of adulterated and misbranded food into interstate commerce. The court has not set a date for sentencing.
According to DOJ’s press release, the trial ran for seven weeks and featured the testimony of 45 witnesses for the prosecution – including former operations managers who had already pled guilty to crimes arising from their roles in the sale of the products. Among the schemes to defraud customers for which evidence was presented at trial was the falsification of certificates of analysis. As we noted in a prior posting, the PCA case raised difficult questions about the adequacy of certain approaches to supplier verification – an element left out of the text of FDA’s proposed rule to implement FSMA’s preventive controls requirements.
Although the timing is almost certainly coincidental, it is not surprising that FDA has now proposed changes to the preventive controls rule for human food to require a receiving facility to “establish and implement a risk-based supplier program for those raw materials and ingredients for which the receiving facility has identified a significant hazard when the hazard is controlled before receipt of the raw material or ingredient” – with certain exceptions that we won’t belabor here. There is some flexibility in the selection of appropriate verification activities, but the receiving facility must consider the following:
The hazard analysis, including the nature of the hazard, applicable to the raw material and ingredients;
Where the preventive controls for those hazards are applied for the raw material and ingredients – such as at the supplier or the supplier’s supplier;
The supplier’s procedures, processes, and practices related to the safety of the raw material and ingredients;
Applicable FDA food safety regulations and information relevant to the supplier’s compliance with those regulations, including an FDA warning letter or import alert relating to the safety of the food;
The supplier’s food safety performance history relevant to the raw materials or ingredients that the receiving facility receives from the supplier, including available information about results from testing raw materials or ingredients for hazards, audit results relating to the safety of the food, and responsiveness of the supplier in correcting problems; and
Any other factors as appropriate and necessary. Examples of factors that a receiving facility may determine are appropriate and necessary are storage and transportation practices.
For raw materials and ingredients, the receiving facility must conduct and document at least one of following activities initially and periodically:
Onsite audits;
Sampling and testing of the raw material or ingredient, which may be conducted by either the supplier or receiving facility.
Review by the receiving facility of the supplier’s relevant food safety records; or
Other appropriate supplier verification activities based on the risk associated with the ingredient and the supplier.
However, “when a hazard in a raw material or ingredient will be controlled by the supplier and is one for which there is a reasonable probability that exposure to the hazard will result in serious adverse health consequences or death to humans,” the receiving facility must conduct an onsite audit initially and at least annually thereafter – unless the receiving facility can show that such auditing is unnecessary to control the hazard.
Additional information on FDA’s proposed changes to the preventive controls rule and to several other rules (preventive controls for animal food, produce safety, and foreign supplier verification) is available here.
It’s difficult to believe that almost 30 years have passed since President Ronald Reagan signed into law the Drug Price Competition and Patent Term Restoration Act of 1984 on September 24, 1984. So much in Hatch-Waxman law (or Waxman-Hatch law if you are a food and drug attorney “of a certain age”) – and the world – has changed since that signing in the Rose Garden. President Reagan is no longer with us; Representative Henry Waxman (D-CA), now 74 years old, is retiring after the conclusion of the 113th Congress; Senator Orrin Hatch (R-UT), now 80 years old, is still going strong, but announced that he plans to retire in 2018.
If you’re a regular reader of this blog, then you know that we have more than a passing interest in the Hatch-Waxman Amendments. It’s a bit of an obsession. And we also have a thing for anniversaries. Over the past couple of years we’ve celebrated the 30th Anniversary of the Orphan Drug Act (see our post here), and the 75th Anniversary of the enactment of the FDC Act (see our post here). This blogger also authored an article for the William Mitchell Law Review’s Hatch-Waxman 30th Anniversary issue providing the first ever analysis of FDA’s nearly 30-year track record of responding to ANDA suitability petitions (see our post here).
Five years ago we celebrated the 25th Anniversary of the Hatch-Waxman Amendments with a trivia contest (see our post here). We came up with a mere 20 questions for FDA Law Blog readers to answer. It’s five years later and once again we’ve decided to challenge FDA Law Blog readers with Hatch-Waxman trivia. This time we’re going “30 for 30.” We had to dig deep . . . real deep . . . to come up with new trivia. We hope you enjoy it! We’ll reveal the answers in a separate post later this week.
Q1: What U.S. Senator is a musician, songwriter and producer, a member of ASCAP, and whose works have been recorded by Gladys Knight, Donny Osmond and Brooks and Dunn, among others?
Q2: When standing at the base of the U.S. Capitol, this dome (pictured below) stands at 93.5 feet above sea level. To whom does this dome belong?
Q3: President Ronald Reagan returned from where before signing into law the Drug Price Competition and Patent Term Restoration Act of 1984 in the Rose Garden on September 24, 1984?
Q4: Who has a lower “Bacon Number”: President Ronald Reagan, Sen. Orrin Hatch, or Rep. Henry Waxman?
Q5: Were rain umbrellas needed in the Rose Garden on September 24, 1984?
Q6: What is the typographical error in the text of FDC Act § 505(j) that was never corrected? (Hint: The affected section was replaced by the 2003 Medicare Modernization Act (“MMA”).)
Q7: What is the significance of January 1, 1982 to the Orange Book?
Q8: What is the significant difference between ANDA No. 076933 and ANDA No. 076934? (The answer is neither “1,” nor the drug name.)
Q9: What pharmaceutical industry trade organization executive referred to the pre-Hatch-Waxman hurdles to generic competition of post-1962 drugs as an “iron curtain”?
Q10: What almost-U.S. President opposed efforts to pass legislation that would have extended brand-name drug patents without creating a generic drug approval process?
Q11: Donald Hare, R.Ph., who has since retired from FDA, is sometimes referred to as the Father of the Orange Book. To whom does the distinction of Mother of the Orange Book – or at least Mother-in-Law – belong?
Q12: As of today, what is the longest, unexpired period of non-patent exclusivity listed in the Orange Book?
Q13: When were Reference Listed Drug (“RLD”) designations added to the Orange Book?
Q14: When was an electronic Orange Book search function added to FDA’s website?
Q15: What is the “Blue Book”?
Q16: Prior to FDA’s formal creation of Orange Book patent listing forms (Form FDA 3542a and Form FDA 3542) in 2003, did FDA offer any informal guidance to NDA sponsors on patent listing?
Q17: Can you identify 10 types of non-patent marketing exclusivities (or non-patent exclusivity extensions) recognized by the FDC Act?
Q18: How long did it take after the December 8, 2003 enactment of the MMA for a member of Congress to propose a revision to the law (and specifically to the 180-day exclusivity forfeiture provisions)?
Q19: What U.S. law is modeled after the Hatch-Waxman Amendments, and how long has it taken FDA to issue implementing regulations?
Q20: How many times has FDA used its “active pursuit” regulation at 21 C.F.R. § 314.107(c)(3) (“[I]f FDA concludes that the applicant submitting the first application is not actively pursuing approval of its abbreviated application, FDA will make the approval of subsequent [ANDAs] immediately effective if they are otherwise eligible for an immediately effective approval.”) to effectively take away a first applicant’s 180-day exclusivity eligibility?
Q21: What case (and involving what drug) was the first judicial test of the 3-year exclusivity provisions of the Hatch-Waxman Amendments?
Q22: Who is Gary P. Jordan?
Q23: Who is Marion J. Finkel?
Q24: What is the only instance in which a court has ordered FDA to approve an ANDA during another sponsor’s period of 180-day exclusivity?
Q25: What is the only instance in whch FDA was faced with a leap year NCE NDA approval?
Q26: FDA’s regulation at 21 C.F.R. § 314.94(a)(12)(viii) states, in relevant part, “an applicant who has submitted a paragraph IV patent certification may not change it to a paragraph III certification if a patent infringement suit has been filed against another paragraph IV applicant unless the agency has determined that no applicant is entitled to 180-day exclusivity or the patent expires before the lawsuit is resolved or expires after the suit is resolved but before the end of the 180-day exclusivity period.” What is the status of this regulation?
Q27: Can a single patent use code serve as the basis for a split Paragraph IV certification and “section viii” statement? (This question is a nod to recent controversies involving patent use codes.)
Q28: In what case was the U.S. Patent and Trademark Office’s (“PTO”) longstanding interpretation of 35 U.S.C. § 156(a)(5)(A) concerning Patent Term Extensions (“PTE”) struck down?
Q29: What is the connection between the drugs INDOCIN (indomethacin) and CAPOZIDE (captopril and hydrochlorothiazide), U.S. Patent Nos. 3,849,549 (INDOCIN) and 4,217,347 (CAPOZIDE), and Title II of the Hatch-Waxman Amendments?
Q30: What patent concerning what drug led to a change in the PTE statute at 35 U.S.C. § 156 involving the deadline for submitting a PTE application to PTO?
