By Ricardo Carvajal –

The Government Accountability Office ("GAO") published a report that examines FDA’s progress in implementing provisions of the Food Safety Modernization Act ("FSMA") that direct the agency to establish a third-party certification system for imported foods.  Among other things, that system is a prerequisite to implementation of the Voluntary Qualified Importer Program ("VQIP"), which would provide expedited entry for foods certified by third-party auditors as meeting applicable domestic requirements.  The report examines numerous significant challenges that FDA faces in developing a third-party certification system.  These include the development of model accreditation standards and conflict-of-interest regulations, for which there is as yet no time frame for issuance. 

Given these challenges and associated delays, GAO recommends that FDA be more flexible in its conduct of comparability assessments for food safety systems.  Under its current approach, which FDA has begun testing in pilot programs with select countries, FDA examines and demands comparability of a country’s entire food safety system.  If a country’s entire food safety system is deemed comparable, then that country’s exports could receive expedited entry.  The breadth of this approach is expected to disqualify all but a few countries.  Citing FSIS’s more targeted approach for imported meat and poultry products and FDA’s own work with assessment of foreign aquaculture programs, GAO recommends that FDA narrow the scope of its comparability assessments to address specific foods (e.g., seafood).

FDA’s comments on the report suggest that FDA intends to stick with its current approach pending the receipt of public comment:

FDA believes that comparability is a more efficient and appropriate tool for FDA to use in assessing whether a country’s entire food safety system provides adequate assurances of comparable public health outcomes, and third-party certification is a more appropriate approach for FDA to use when assessing a particular segment of the food safety system – e.g., export controls for one or more commodities.  FDA intends to seek public comment on FDA’s current approach to comparability, and in that context, stakeholders will have an opportunity to comment on GAO’s recommended approach.

In summary, it appears that viable mechanisms for gaining expedited entry of imported foods are not on the near horizon, given FDA’s acknowledgement that both the comparability and third-party certification programs “are still in the formative stages.”

Frank Sasinowki, Director at Hyman, Phelps & McNamara, P.C. and board member of the National Organization for Rare Disorders ("NORD"), is giving the keynote address for the Campaign Urging Research for Eosinophilic Disease’s ("CURED’s") first research symposium on eosinophilic gastrointestinal disorders ("EGID").  CURED is a non-profit foundation dedicated to helping individuals suffering from rare eosinophilic disorders by raising funds for research and increasing public awareness.  The first EGID symposium begins on November 2nd and runs through November 3rd at the Cincinnati Children’s Hospital Medical Center in Cincinnati, Ohio.  The symposium has several objectives, one of which is to discuss potential pathways to develop drugs for the treatment of eosinophilic disorders. 

Mr. Sasinowski’s November 2nd keynote presentation will focus on drug development issues relevant to rare conditions such as eosinophilic disorders, including:

1. Current FDA policies related to rare diseases;
2. FDA flexibility in reviewing orphan drugs (see here);
3. The role of patients in drug development in light of the Food and Drug Administration Safety and Innovation Act (FDASIA); and 
4. The President’s Council of Advisors on Science and Technology ("PCAST") report (see here), its recommendations to accelerate drug development and approval, and Mr. Sasinowki’s important contributions to that effort.

Hyman, Phelps & McNamara, P.C., the nation’s largest boutique food and drug regulatory law firm, seeks an associate with three to five years experience in food, dietary supplement, and OTC drug laws and regulations to assist with a growing practice.  Experience in regulation of labeling and advertising, food safety, and cosmetics would be desirable. Candidates should have prior law firm or government agency experience.  Strong writing skills are required.  Compensation is competitive and commensurate with experience.  HP&M is an equal opportunity employer.

Please send your curriculum vitae, transcript, and a writing sample to Jeffrey N. Wasserstein (jnw@hpm.com).

By Kurt R. Karst –     

The recent lawsuit filed against FDA in the U.S. District Court for the District of Columbia in which Mylan Laboratories Limited and Mylan Pharmaceuticals Inc. are challenging FDA’s decision that Ranbaxy Inc. is eligible for 180-day exclusivity for its generic versions of DIOVAN (valsartan) Tablets (see our previous post here) got us thinking about the instances in which FDA determined that 180-day exclusivity was not forfeited under FDC Act § 505(j)(5)(D)(i)(IV) because of some “extenuating circumstance.”  Under that provision added by the 2003 Medicare Modernization Act (“MMA”), 180-day exclusivity eligibility is forfeited if:

The first applicant fails to obtain tentative approval of the application within 30 months after the date on which the application is filed, unless the failure is caused by a change in or a review of the requirements for approval of the application imposed after the date on which the application is filed. [(Emphasis added)]

The 2007 FDA Amendments Act clarified FDC Act § 505(j)(5)(D)(i)(IV), such that if “approval of the [ANDA] was delayed because of a [citizen] petition, the 30-month period under such subsection is deemed to be extended by a period of time equal to the period beginning on the date on which [FDA] received the petition and ending on the date of final agency action on the petition (inclusive of such beginning and ending dates) . . . .”  FDC Act § 505(q)(1)(G).  The 2012 FDA Safety and Innovation Act made further changes with respect to the application of FDC Act § 505(j)(5)(D)(i)(IV) to certain ANDAs (see our previous post here).

So what are the various types of changes or reviews that have excused a first applicant’s failure to obtain a timely tentative approval (or final approval when tentative approval is not warranted)?  We compiled a list of the 15 public cases, as well as an honorable mention.  We think there might be somewhere in the neighborhood of 20 instances; however, FDA has not yet, for one reason or another, made all of them public.  In some cases, FDA’s approval letter specifically states the reason for excusing the failure to obtain timely tentative approval.  In other cases, the approval letter is rather opaque and required additional investigative research to uncover the reason for excusing the failure to obtain timely tentative approval.   

(1) ANDA No. 078548; Approved on 2/25/2010 – Imiquimod Cream, 5% (ALDARA)

This is, to our knowledge, the first final approval in which FDA excused an applicant’s failure to obtain timely tentative approval and granted 180-day exclusivity.  FDA’s ANDA Approval Letter merely states that “the agency has determined that the failure to obtain tentative approval within 30 months was caused by the agency’s ongoing review of the requirements for approval of Imiquimod Cream, 5%. . . .”  The approval of ANDA No. 078548 coincides with FDA’s publication of a draft bioequivalence guidance for Imiquimod Cream, 5%, and is likely the basis for FDA’s proffered “ongoing review of the requirements for approval” of the drug.

(2) ANDA No. 040445; Approved on 3/31/2010 – Metaxalone Tablets, 800 mg (SKELAXIN)
 
FDA’s ANDA Approval Letter states that “during the entire time the ANDA was under review, the agency had pending before it a citizen petition that created a review of the appropriate labeling for generic metaxalone in light of certain patent-protected language in the labeling of the RLD,” and, as a result, 180-day exclusivity was not forfeited.  As we previously discussed, the citizen petition identified by FDA in the approval letter was submitted to the Agency in March 2004 (FDA Docket No. FDA-2004-P-0426) and concerns certain labeling carve-out issues. 

(3) ANDA No. 078179; Approved on 10/13/2010 – Zolpidem Tartrate Extended-release Tablets, 6.25 mg (AMBIEN CR)
 
In yet another instance of an opaque decision, FDA’s ANDA Approval Letter merely states that the failure to obtain timely tentative approval “was caused by a change in or a review of the requirements for approval of the application imposed after the date on which the application was filed.”  It seems likely that the “change in or a review of the requirements for approval” of the ANDA was due to a change in the bioequivalence requirements.  On the same day FDA approved ANDA No. 078179, the Agency issued a Citizen Petition Decision (Docket No. FDA-2007-P-0182) establishing certain partial AUC bioequivalence requirements for generic versions of AMBIEN CR.

(4) ANDA No. 090229; Approved on 11/26/2010 – Levocetirizine Dihydrochloride Tablets, 5 mg (XYZAL)     
 
In this case, FDA’s ANDA Approval Letter provides some additional information on the “change in or a review of the requirements for approval” of the ANDA that excused the failure to obtain timely tentative approval.  The letter states:

The agency has determined that there was a change in the requirements for approval of this ANDA.  Specifically, the labeling of the RLD changed after submission of the ANDA.  The agency has also determined that this change was the cause of your not obtaining tentative approval of the ANDA within 30 months after the date on which it was filed.

The change in RLD labeling appears to be a reference to a NDA supplement FDA approved amending the labeling for XYZAL “for the relief of symptoms associated with seasonal allergic rhinitis (SAR) in children 2 years of age and older, and for the relief of symptoms of perennial allergic rhinitis (PAR) and treatment of uncomplicated skin manifestations of chronic idiopathic urticaria (CIU) for children 6 months of age and older.”

(5) ANDA No. 090505; Approved on 12/28/2010 – Doxycycline Hyclate Delayed-release Tablets, 75 mg and 100 mg (DORYX)

(6) ANDA No. 090431; Approved on 12/28/2010 – Doxycycline Hyclate Delayed-release Tablets, 75 mg and 100 mg (DORYX)
     
Although only one of the two approval letters is available, we assume the basis for each exclusivity decision is the same.  FDA’s Approval Letter for ANDA No. 090505 states in a footnote that:

A citizen petition that was subject to section 505(q) of the Act was submitted that required the agency to review the requirements for approval for Doxycycline Hyclate Delayed-release drug products. . . . Furthermore, the requirements for approval were changed when the RLD was approved for a scored tablet configuration; [the ANDA sponsor] was required to change to a scored tablet and conduct additional dissolution testing.

The referenced citizen petition (Docket No. FDA-2008-P-0586) was submitted in November 2008.  In May 2009, FDA issued a Citizen Petition Decision partially granting and partially denying the petition. 

(7) ANDA No. 090738; Approved on 4/18/2011 – Cyclobenzaprine HCl Extended-release Capsules, 15 mg and 30 mg (AMRIX)
 
FDA has not yet posted the approval letter for ANDA No. 090738, but we have been able to piece together the facts.  This is a case in which FDA changed the ANDA bioequivalence requirements after the submission of the first ANDA containing a Paragraph IV certification.  According to FDA’s Paragraph IV Certifications List, the first ANDA for generic AMRIX was submitted to FDA on August 11, 2008.  Shortly after the submission of ANDA No. 090738, FDA issued a draft bioequivalence guidance with recommendations that presumably differed from what was submitted in ANDA No. 090738. 

(8) ANDA No. 078854; Approved on 6/7/2011 – Clobetasol Propionate Topical Shampoo, 0.05% (CLOBEX)

FDA’s Approval Letter for ANDA No. 078854 is pretty straightforward.  It states that the first applicant’s failure to obtain timely tentative approval was excused, because “during its bioequivalence review, the agency asked [the first applicant] to perform comparative vasoconstrictor bioassay studies; the agency later told [the first applicant] the agency was reviewing the appropriateness of vasoconstrictor bioassay studies for topical corticosteroid drug products that are applied to the hirsute scalp.”  FDA issued a draft bioequivalence guidance for this drug in February 2011.

(9) ANDA No. 077159; Approved on 3/30/2012 – Irbesartan Tablets, 75 mg, 150 mg, and 300 mg (AVAPRO)

FDA’s ANDA Approval Letter states: “Toward the end of the 30-month period described in section 505(j)(5)(D)(i)(IV), FDA changed the approval requirements for Teva’s proposed product.  As a result, Teva was required to perform additional testing and include an additional drug substance specification prior to approval.”  FDA stated the same basis in a related Citizen Petition Decision issued on the same day FDA approved ANDA No. 077159.

(10) ANDA No. 090869; Approved on 5/17/2012 – Ropinirole HCl Extended-release Tablets, 2 mg, 4 mg, 6 mg, and 8 mg (REQUIP XL)

Acknowledging that “size matters,” FDA’s ANDA Approval Letter states that the failure to obtain timely tentative approval was caused by “a review of ANDA approval requirements with respect to the size of certain solid oral dosage form products.”  As we previously reported, FDA has issued letters to companies with pending ANDAs stating that the applications are not approvable because of tablet size differences when compared to the corresponding strengths of the RLD.  According to the Performance Goals and Procedures letter accompanying the Generic Drug User Fee Amendments of 2012, FDA has agreed to evaluate drug product physical attributes on patient acceptability, including tablet size and shape, “to provide better guidance to applicants on how these physical attributes should be controlled and compared to the RLD.”

(11) ANDA No. 077707; Approved on July 19, 2012 – Methylphenidate HCl Extended-release Capsules (CD), 10 mg, 20 mg, and 30 mg (Once Daily) (METADATE CD)

(12) ANDA No. 078873; Approved on July 19, 2012 – Methylphenidate HCl Extended-release Capsules (CD), 40 mg (Once Daily) (METADATE CD)

The Approval Letters for both ANDA No. 077707 and ANDA No. 078873 use identical language describing the basis for excusing the applicants’ failure to obtain timely tentative approval: “A citizen petition was submitted that required the agency to review the requirements for approval for generic drug products for which Metadate CD is the RLD.”   

The referenced citizen petition (Docket No. FDA-2004-P-0290) was submitted in May 2004 and was responded to on the same day FDA approved ANDA No. 077707 and ANDA No. 078873.  FDA’s Citizen Petition Decision establishes certain partial AUC bioequivalence requirements for generic versions of METADATE CD.

(13) ANDA No. 200435; Approved on 9/25/2012 – Amlodipine, Hydrochlorothiazide, and Valsartan Tablets, 5 mg/12.5 mg/160 mg, 5 mg/25 mg/160 mg, 10 mg/25 mg/160 mg, and 10 mg/25 mg/320 mg (EXFORGE HCT)
 
In a second instance in which tablet size formed the basis for excusing an applicant’s failure to obtain timely tentative approval, FDA’s ANDA Approval Letter states: “[T]he agency has determined that the failure to obtain tentative approval within the 30-month period was caused by a change in or a review of the requirements for approval of the application imposed after the date on which the application was filed, specifically a review of ANDA approval requirements with respect to tablet size.”

(14) ANDA No. 090040; Tentatively Approved on 3/15/2011 – Doxercalciferol Injection, 2 mcg/mL (HECTOROL)

In this case, FDA only tentatively approved the first applicant’s ANDA and that tentative approval letter is not yet posted on FDA’s website.  Nevertheless, FDA addressed the issue of 180-day exclusivity forfeiture for this drug in a September 20, 2011 Citizen Petition Decision (Docket No. FDA-2010-P-0632).  In that response, FDA stated:

When a change in formulation for a listed drug referenced requires an ANDA applicant to respond (either by seeking approval for a change in formulation or by seeking a determination that the old formulation was not withdrawn for safety reasons and a waiver) we will consider this a “change in or review of the requirements for approval” within the meaning of 505(j)(5)(D)(i)(IV) of the FD&C Act.

FDA issued the Citizen Petition Decision on the same day the Agency tentatively approved ANDA No. 091101, which was submitted by a subsequent applicant.  

(15) ANDA No. 077492; Tentatively Approved on 10/25/2007 – Valsartan Tablets, 40 mg, 80 mg, 160 mg and 320 mg (DIOVAN)
 
As we noted at the top of this post, FDA’s determination that Ranbaxy did not forfeit 180-day exclusivity eligibility for generic DIOVAN for failure to obtain timely tentative approval is the subject of current litigation.  FDA's Tentative Approval Letter states:

This letter does not address issues related to the 180-day exclusivity provisions under section 505(j)(5)(B)(iv) of the Act, except to note that for purposes of sections 505(j)(5)(B)(iv) and 505(j)(5)(D)(i)(IV), the agency regards the change in the USP monograph for Valsartan, published on May 1, 2007, . . . to be a change in the requirements for approval imposed after the date on which your ANDA was filed.

FDA recently filed under seal a Motion to Dismiss or, in the Alternative, for Summary Judgment in the litigation initiated by Mylan.  Similarly, Ranbaxy has filed (also under seal) a Motion for Summary Judgment.

And that brings us to our honorable mention . . . .

ANDA No. 077532; Approved on 5/7/2008 – Acarbose Tablets, 25 mg, 50 mg, and 100 mg (PRECOSE)
 
FDA ruled in a Letter Decision that a change in bioequivalence requirements resulted in a delay in obtaining a tentative approval.  Specifically, FDA stated:

Throughout the relevant period, FDA identified the 100-mg strength tablet in the Orange Book as the drug product to be used in a bioequivalence study.  Cobalt initially conducted its bioequivalence study using that strength of the drug, but was informed by FDA on August 8, 2006, that its in vivo bioequivalence using the 100 mg strength was not acceptable. After further study by Cobalt, it relied upon a different strength of acarbose tablets for its in vivo bioequivalence study.  This change in requirements for bioequivalence data necessitated a longer review of the Cobalt ANDA.

But because FDA also determined that exclusivity was forfeited under the failure-to-market (FDC Act § 505(j)(5)(D)(i)(I)) forfeiture provisions, we do not count Acarbose Tablets as a true failure to obtain timely tentative approval precedent. 

Hyman, Phelps & McNamara, P.C. is very pleased to announce that Dara Katcher Levy and Anne K. Walsh have been named Directors of the firm. Ms. Levy devotes a significant portion of her practice to the review of launch and post-launch promotional materials, and also concentrates on import/export issues.  Ms. Walsh has extensive knowledge of issues concerning health care fraud, off-label promotion, and clinical study fraud, with a particular emphasis on potential False Claims Act liability and exclusion by the HHS Office of Inspector General.  Prior to joining the firm, Ms. Walsh served as an Associate Chief Counsel with FDA’s Office of Chief Counsel from 2004 to 2010.

By Karla L. Palmer & Delia A. Stubbs –

As previously reported, FDA scheduled an advisory committee meeting (“ADCOM”) to take place on October 29th and October 30th to take public comments on the potential rescheduling of combination hydrocodone products from Schedule III to Schedule II.  (Because of Hurricane Sandy, the meeting has been postponed to a later date.)  The committee meeting stems from Congress’s requirement pursuant to the recently passed Food and Drug Administration Innovation Safety Act (“FDASIA”) that FDA convene a meeting “to solicit advice and recommendations to assist in conducting a scientific and medical evaluation” on whether to reschedule combination drug products containing hydrocodone.  77 Fed. Reg. 34,051 (June 8, 2012); FDASIA, Pub. L. No. 112-144, 126 Stat. 993, § 1139(a) (2012). 

FDA published a briefing document Thursday, October 25, 2012, that informs interested parties of some of the core issues that will be discussed during that meeting and which in some respects forecasts FDA’s position on the rescheduling issue.  The briefing states that in 2004, DEA requested that the Secretary of HHS make a scientific and medical evaluation and rescheduling recommendation for combination hydrocodone products.  FDA Briefing Document, Drug Safety and Risk Management Advisory Committee (DSaRM) Meeting 1, 5 (Oct. 2, 2012).  In 2008, FDA fulfilled that request, and recommended that DEA not reschedule the drug.  Id. at 6.  DEA renewed its request in 2009, submitting new data to FDA’s Center for Drug Evaluation and Research.  Id.  FDA states that its October 2, 2012 briefing is in response to, and a re-evaluation of data concerning, that 2009 request. 

FDA’s latest briefing at least suggests that FDA is not readily inclined to change its earlier position to leave hydrocodone products in Schedule III.  FDA acknowledges that single entity hydrocodone is classified in Schedule II, and that substances are scheduled under the Controlled Substances Act according to their abuse potential.  However, FDA also recognized the important role served by Schedule III combination hydrocodone products such as antitussive/cough suppressants, and it detailed their use in the effective medical treatment of pain (as demonstrated by their widespread availability).  Id. at 7-8.  Further, while FDA recognized that a review of scientific literature showed that combination hydrocodone products produce abuse-related effects similar to those of the typical Schedule II mu-opioid agonists, it emphasized that those effects are “dose related,” and are “only observed in doses of hydrocodone bitartrate equal to or greater than 15 mg when taken orally.”  Id. at 16-17.  The briefing noted that “currently the highest strength of hydrocodone combination products is of 10mg,” although combination products containing as much as 15 mg of hydrocodone are permissible.  Id. at 17.  Moreover, after explaining its rationale behind the best measure of actual abuse of combination hydrocodone products (FDA considered Drug Abuse Warning Network data that collects a nationally representative sample of emergency department visits and total number of extended units dispensed), FDA concluded that “there is insufficient evidence to support DEA’s finding that combination hydrocodone-containing products have a similar potential for abuse to oxycodone products.”  Id. at 24.   

The briefing goes on to describe the effects of hydrocodone combination product rescheduling on clinical access.  It explains that hydrocodone combination products would no longer be available for prescription by mid level practitioners such as nurses, physicians, and optometrists, who are not authorized in some states to prescribe Schedule II controlled substances.  This finding is consistent with several public comments written by practitioners that uniformly support a decision by FDA not to recommend rescheduling. See Drug Safety and Risk Management Advisory Committee Notice, Comments, FDA-2012-N-0548.

In its conclusion, FDA left the ultimate issue open.  It stated, “[o]verall a scientific and comprehensive evaluation of the relative abuse potential of hydrocodone combination products needs to be weighed in the final recommendation” of whether to reschedule the drug.  Id. at 27.  It further stated, “[t]he question that still remains is how to reduce the levels of abuse of hydrocodone combination products.  Alternatives to up-scheduling may also decrease the levels of abuse and misuse of these products and may prove beneficial and effective in addressing abuse and misuse of hydrocodone combination products.”  Alternatives mentioned by FDA include Prescription Drug Monitoring Programs and increased educational efforts.  Id.

We will update this post with the date, time and place of the rescheduled ADCOM meeting on rescheduling hydrocodone combination products. 

By Kurt R. Karst –      

When the word came out early last week that Judge Amy Berman Jackson of the U.S. District Court for the District of Columbia ruled against FDA in litigation over 180-day exclusivity for generic versions of ACTOS (pioglitazone HCl) Tablets, we immediately went to the court docket to retrieve a copy of the decision.  After all, the decision is big news: it is the first time a court has ever ordered FDA to approve a marketing application for a drug.  Unfortunately, the decision was placed under seal for a few days, so we had to wait (patiently) to read it.  Meanwhile, the litigation progressed to the U.S. Court of Appeals for the District of Columbia Circuit.  We finally got our hands on a copy of the decision.  The 41-page decision is quite an interesting read.

As we previously reported, 180-day exclusivity for generic ACTOS is governed by the pre-Medicare Modernization Act (“MMA”) version of the statute, under which exclusivity is patent-by-patent and can be shared by cross-Paragraph IV filers to different patents.  At the time the first ANDA containing a Paragraph IV certification could be submitted to FDA for generic ACTOS on July 15, 2003, the Orange Book listed several patents expiring in 2016 that are referred to in court filings as the Composition Patents and the Combination Therapy Patents.

Watson (ANDA No. 076798), Mylan (ANDA No. 076801), and presumably Ranbaxy (ANDA No. 076800) submitted ANDAs to FDA on July 15, 2003 containing Paragraph IV certifications to certain ACTOS patents listed in the Orange Book.  FDA contends that, as submitted, Watson’s ANDA was defective because the ANDA contained Paragraph IV certifications to the Combination Therapy Patents, but also proposed labeling that sought to omit the methods of use protected by the Combination Therapy Patents.  Watson submitted a telephone amendment to FDA on August 27, 2003 amending its ANDA to change its Paragraph IV certifications to the Combination Therapy Patents to “section viii” statements.  But Watson only did so under protest, and in the telephone amendment reserved its right “to reinstate its original Paragraph IV Certifications with the effective date of original submission on July 15th, 2003, should a court or the Agency hold in the future that Paragraph IV Certifications should have been made and/or maintained.”

After FDA received ANDA No. 076798 as of July 15, 2003, Watson provided notice of the Paragraph IV certifications as to the Composition Patents to Takeda and was sued for patent infringement.  Ultimately, the patent infringement litigation was settled and Takeda granted Watson and Mylan a non-exclusive license to the Composition Patents and to the Combination Therapy Patents as of August 17, 2012.  (Mylan’s ANDA presumably included “section viii” statements to the Combination Therapy Patents.)  Under FDA’s regulation at 21 C.F.R. § 314.94(a)(12)(v), “if the [ANDA] is for a drug or method of using a drug claimed by a patent and the applicant has a licensing agreement with the patent owner,” the application must contain a Paragraph IV certification as to that patent “and a statement that it has been granted a patent license.”  Watson and Mylan  amended their respective ANDAs to include Paragraph IV certifications to the Combination Therapy Patents.  Mylan did so first on March 22, 2010.  Watson amended its ANDA on March 7, 2012, and characterized its amendment as “reinstating” the Paragraph IV certifications to the Combination Therapy Patents in its original ANDA.

Watson sued FDA on August 15, 2012 to enjoin FDA from granting final approval (or causing or allowing final approval to be granted) to any ANDA for generic ACTOS prior to granting final approval to Watson’s ANDA No. 076798, or, alternatively, to require FDA to approve ANDA No. 076798 if FDA grants final approval to any other ANDA for generic ACTOS.  (The Complaint and Motion for a Temporary Restraining Order and a Preliminary Injunction are available here and here.)  One day later, the court denied Watson’s Motion for a Temporary Restraining Order based on an apparent deficiency in Watson’s ANDA identified by FDA.  Watson addressed the deficiency and renewed its Motion for a Temporary Restraining Order, which the court denied in a Minute Order on August 17th after finding that Watson did not show a substantial likelihood of success on the merits in the company’s motion.  FDA approved Mylan’s ANDA No. 076801 on August 17th and granted the company 180-day exclusivity. 

On August 24th, Watson filed an Amended Complaint, and on August 27th, Watson filed a Motion for Summary Judgment asking the court to order FDA to: (1) “refrain from denying Watson’s ANDA approval on the basis of FDA’s determination that such approval is barred by exclusivity granted to any other ANDAs” and (2) grant final approval to Watson’s ANDA No. 076798.  FDA opposed Watson’s Motion and filed a Motion to Dismiss or, in the Alternative, for Summary Judgment.  Mylan, which had intervened in the case, also opposed Watson’s Motion for Summary Judgment.  According to FDA, “Watson filed certifications to the relevant patents and patent claims two years after Mylan filed its certifications, and it is Watson’s own delay that led to its loss of a right to exclusivity” (emphasis in original).  According to Watson, however (see Reply Brief):

FDA’s decision to delay approval of Watson’s ANDA is contrary to the governing statute and FDA’s own regulations.  The decision is also inconsistent with FDA’s past practice and statements, and it leads to absurd results inconsistent with Congressional intent.  Watson is a First Filer with respect to all the pioglitazone patents because no other ANDA filer preceded its substantially complete July 15, 2003 filing, which contained Paragraph IV certifications to all patents listed for pioglitazone.  And at minimum, Watson is entitled to shared exclusivity because it is, as FDA does not contest, a First Filer with respect to the composition claims of the Composition Patents.  Finally, to the extent that Watson is not entitled to exclusivity with respect to the Combination Therapy Patents, it is because that exclusivity was rendered unavailable for any party when Watson amended its ANDA, leaving Watson and Mylan as shared First Filers in the remaining claims of the Composition Patents.

Applying the familiar two-step Chevron analysis, Judge Jackson ultimately found that “FDA’s decision to deny Watson shared exclusivity was contrary to the plain language of the statute, and that even if the statute is ambiguous and FDA’s interpretation of the relevant provision is reasonable as a general matter, its decision was arbitrary and capricious under the unique factual circumstances of this case.”  In coming to her decision, Judge Jackson covered a lot of ground.  We won’t get into all of the intricacies here, but we note some of the more interesting passages from the decision.  For example, Judge Jackson states the following under her Chevron Step One analysis:

So the question at Chevron step one is: does the FDCA exclusivity provision permit the FDA to use the date that Mylan changed its section viii statements for the use-only patents to paragraph IV certifications as the critical date instead?  Is that when the exclusivity attached? . . .  [O]n its face, the statute refers to the date an application is submitted containing a certification, not the date of any later, additional certifications, and not the date of the amendment of an application (much less the “minor amendment” of an application) to substitute a paragraph IV certification for a section viii statement. . . .

And did FDA properly interpret the statute as commanding it to award exclusivity to the first applicant with paragraph IV certifications for “all” of the patents?  Again, such a decision is not mandated by the language of the [statute]. . . .  [T]he statute is written in terms of the drug, not one or all of the patents.  It does not say that an applicant has to wait 180 days if the application involves any patent that claims the drug for which a previous certification has been submitted; it says if the application contains a paragraph IV certification and is for a drug for which a previous application has been submitted.  Nor does it say: “and is for a drug for which a previous application has been submitted containing paragraph IV certifications for all of the patents.” . . .

The Court concludes that FDA’s decision is contrary to the plain language of the statute.  As noted above, the FDCA says if the application contains a paragraph IV certification and it is for a drug for which there was a previous application containing such a certification, approval of the application is delayed for 180 days.  Here, when Watson filed its application containing a paragraph IV certification for the drug composition/use patents on July 15, 2003, there was no previous application containing such a certification on file for that drug.  Mylan’s application came in on the same day. [(Emphasis in original)]

Under her Chevron Step Two analysis, Judge Jackson writes that “FDA’s reading of the exclusivity provision is reasonable,” but that FDA’s decision was arbitrary and capricious in this particular case:

The Court finds that FDA’s decision to deny Watson shared exclusivity in this circumstance is arbitrary and capricious because it produces absurd results that are contrary to the purpose of the Hatch-Waxman Amendments and the exclusivity provision in particular. . . .  Here, although denial of shared exclusivity to Watson does not mean that generic pioglitazone cannot be marketed at all . . . the result is still at odds with the sole purpose of the exclusivity provision: to encourage generic applicants to file paragraph IV certifications and incur the risks and costs of patent litigation necessary to clear the patents out of the way and facilitate the entry of generics into the market.

It is true that after the litigation was resolved, Mylan amended its original ANDA to include the relevant paragraph IV certifications first, but that was nothing more than a formality.  Filing those certifications did not put the patent holder on notice of anything it did not already know.  Moreover, it did not require Mylan to risk patent litigation.  The litigation was over.  It is thus unfair and inconsistent with the sole purpose of the 180-day exclusivity provision to reward Mylan with sole exclusivity simply because it accomplished the final housekeeping task of amending its ANDA to reflect the results of the litigation first.  Such a decision elevates form over substance.

We found the above-quoted provisions of particular interest not because of their potential to affect the remaining handful or less of drugs governed by the pre-MMA rules on 180-day exclusivity, but because of their portential to affect the post-MMA 180-day exclusivity regime. 

Judge Jackson’s decision seems to say that what is in an amendment to an ANDA does not count for 180-day exclusivity purposes.  Rather, it is the original ANDA submission that counts.  If that is true, then an ANDA sponsor that initially submits an application without a Paragraph IV certification and later amends that application to contain a Paragraph IV certification (because, for example, of a change from a Paragraph III certification to a Paragraph IV certification, or because information on the first patent on the Reference Listed Drug is listed after an original ANDA is received) would not be eligible for 180-day exclusivity.  Taking that example further, what if the sponsor of a pending ANDA amends its application first to contain a Paragraph IV certification, and another ANDA sponsor later includes a Paragraph IV certification in its original application.  Would that later ANDA sponsor, whose original submission includes a Paragraph IV certification, be eligible for 180-day exclusivity, while the first ANDA sponsor (via an amendment) would not be eligible? 

Of course, this all matters only if Judge Jackson’s decision stands.  Last week, after Judge Jackson handed down her Order that FDA approve Watson’s ANDA No. 076798, Mylan filed an Emergency Motion to Stay the Order, in which FDA joined.  Watson opposed the motion, saying that Mylan “seeks to flip this Court’s decision on its head.”  Mylan’s motion was denied a day after it was filed based on Judge Jackson’s determination that Mylan “failed to demonstrate that a stay pending appeal is warranted.”

Mylan then appealed to the DC Circuit (Docket No. 12-5332) and filed for an Emergency Motion for a Stay Pending Appeal and a Motion for an Administrative Stay.  Last Friday, the DC Circuit denied Mylan’s emergency stay motion, saying that Mylan “has not satisfied the stringent requirements for a stay pending appeal,” and dismissed as moot Mylan’s administrative stay motion.  The Court has set a briefing schedule for the case.  FDA has not yet indicated whether the Agency will also appeal Judge Jackson’s decision, but we suspect that will happen soon.  Meanwhile, FDA, consistent with Judge Jackson’s Order, approved Watson’s ANDA No. 076798.  The approval letter is silent on the issue of 180-day exclusivity.  

By John A. Gilbert & William T. Koustas –

Pharmaceutical companies, wholesale distributors, FDA, and many other stakeholders have long sought a uniform national prescription “drug pedigree,” track-and-trace, and distributor licensing regime.  While the Prescription Drug Marketing Act (“PDMA”) and the implementing regulations have included a requirement for a drug pedigree, (see 21 U.S.C. § 353(e), 21 C.F.R. § 203.50), the implementation of these requirements has been controversial and challenged in well publicized litigation (see RxUSA Wholesale, Inc. v. Dep’t of HHS, 467 F.Supp.2d 285 (E.D.N.Y. 2006)).  In the interim, there have been a number of false starts to create a national standard, the most recent of which was an attempt to include track-and-trace legislation in the Food and Drug Administration Safety and Innovation Act (“FDASIA”) which was signed into law this past June.  Now Congress appears to be gearing up to try it again.  According to news reports, Senators Richard Burr and Michael Bennet and Representatives Brian Bilbray and Jim Matheson are leading the charge on proposed track-and-trace legislation.  These reports indicate that Congress may even take up the proposed legislation in early 2013. 
 
The PDMA and FDA regulations provide a floor with respect to drug pedigree and distributor licensing requirements.  However, states retain the authority to impose their own requirements and many have done so or have pending legislation to do so.  For example, Florida was one of the first states to implement a detailed drug pedigree requirement.  More recently, California has proposed a pedigree/track-and-trace requirement which could have a significant impact on the drug distribution industry when it becomes effective in 2015.  Thus, there is currently a patchwork of drug pedigree and licensing requirements between the Federal government and states that must be navigated by drug manufacturers and distributors.  It appears that the proposed legislation seeks to end this patchwork and create a single national standard. 

While not in its final form, the proposed legislation essentially creates a national standard for drug pedigree, track-and-trace, and drug distributor licensing requirements.  The draft legislation creates a national “transaction history,” (aka pedigree) requirement for drug manufacturers, wholesalers, third-party logistics providers (“3PLs”), repackagers, and dispensers (to the extent they distribute drugs to entities other than patients with a valid prescription).  Within 6 months to a year after the bill is enacted, such entities would be prohibited from accepting drugs without a pedigree, required to supply a pedigree with any drugs they distribute, implement a system to authenticate pedigrees, and maintain pedigree records for up to 10 years.  Manufacturers would also be required to add a product identifier to each package and “homogenous case” of drug products “intended to be introduced in a transaction in commerce.”  Dispensers could elect to contract with a third party to maintain pedigrees.
 
The proposed legislation also looks to implement an interoperable electronic track-and-trace system with a product identifier, likely similar to what will be required by California beginning in 2015.  FDA would be required to publish a final rule on this requirement at least 2 years before its effective date, presumably to allow the stakeholders ample time to prepare.  The legislation would also call on FDA to establish one or more pilot projects in coordination with various stakeholders to evaluate the use of such interoperable systems, possibly within 4 years of the legislation going into effect.  It also provides FDA with authority to implement additional regulations to prevent drug counterfeiting, theft, or diversion as it deems necessary.
 
In addition to a national pedigree requirement, the proposed legislation would also create a national licensing requirement for drug distributors.  The proposed bill specifies that drug wholesaler and 3PL establishments must either be licensed by the state in which they are located or by FDA if that state does not license such establishments.  Currently, more than 48 states require some type of in-state and non-resident licensing of drug manufacturers or distributors.  The proposed legislation would also create a federal requirement that drug wholesalers and 3PL establishments obtain out-of-state licenses from states they distribute drugs into (assuming the relevant state has such a licensing requirement).  In addition to licensing, wholesalers and 3PLs would be required to list their establishments with FDA on an annual basis (for a fee to be determined by FDA). 
 
The vast majority of states currently require drug distributors to operate within certain standards in handling prescription drugs (see generally, 21 C.F.R. Part 205).  These regulations set minimum requirements that states must impose on drug distributors with respect to, among other things, establishment security, drug storage, recordkeeping, and the handling of suspected counterfeit drugs.  The proposed legislation would seek to standardize those operating requirements nationally by either codifying Part 205, requiring FDA to promulgate new regulations, or essentially adopting California’s drug distributor licensing and operating requirements.  
 
This proposed bill appears to have the support of many stakeholders, including the Pharmaceutical Distribution Security Alliance, which includes the Pharmaceutical Research and Manufacturers of America and the Generic Pharmaceutical Association.  However, many of the same challenges that have made a national drug pedigree system elusive in the past still exist, e.g., technological challenges and addressing state authority and differing standards.  It will be interesting to see if the current proposal can succeed where others have failed.

By Carmelina G. Allis –

FDA has issued a draft guidance document to explain how FDA plans to implement the new eCopy program under Section 745A(b) of the Federal Food, Drug, and Cosmetic Act (“FDC Act”), which was added by the Food and Drug Administration Safety and Innovation Act (“FDASIA”).  When implemented, this program will allow the immediate availability to FDA reviewers of an electronic version of the submission instead of relying solely on the paper version for review.

Section 745A(b) to the FDC Act requires that FDA issue a guidance document implementing the requirement that “presubmissions and submissions for devices under section 510(k), 513(f)(2)(A), 515(c), 515(d), 515(f), 520(g), 520(m), or 564” of the FDC Act, and for devices regulated by CBER under Section 351 of the Public Health Service (“PHS”) Act, and “any supplements to such presubmissions or submissions, [] include an electronic copy of such presubmissions or submissions.”  The statute permits FDA to include in the guidance document the “standards for the electronic copy” and the “criteria for waivers of and exemptions from the requirements [under Section 745A].”

An eCopy as an exact duplicate of the paper submission.  It may be submitted on a CD, a DVD, or in another electronic media format accepted by FDA.  It must be accompanied by a copy of the signed cover letter and the complete original paper submission.  If a submission is received by FDA without an eCopy or the eCopy submission does not meet the standards provided in the guidance, FDA will put the application on hold (that is, the review clock will not start) until a valid eCopy is submitted.

Once the FDA finalizes this draft guidance document, FDA will require the submission of an eCopy for the following applications: 510(k)s, de novo requests, PMAs, PDPs, IDEs, HDEs, HUDs, and pre-submissions (formerly known as “pre-IDEs”).  In addition, any subsequent submission, such as amendments, annual reports, or supplements, must be submitted under the eCopy program.  This requirement regarding subsequent submissions will apply even if the original submission was submitted to FDA prior to the implementation of the eCopy program.

FDA has specifically exempted compassionate use and emergency use IDEs and Emergency Use Authorizations (“EUAs”) from the eCopy requirement.  In addition, FDA plans to allow waivers for device submissions that are subject to licensure under the PHS Act (e.g., BLAs, INDs) that are submitted entirely as electronic submissions to CBER.  CBER has already issued guidance documents for applicants who choose to submit electronic submissions.

The criteria and specifications required for an eCopy described in the draft guidance document are not being implemented by FDA until the document is finalized.  You may submit written comments regarding this draft guidance to FDA’s Division of Dockets Management (via http://www.regulations.gov) at any time.  But to ensure that your comments are considered prior to finalizing the draft guidance, you should submit them by November 16, 2012.

By Kurt R. Karst – 

A lot has been happening at FDA over the past two months – and in particular in recent weeks – as the Agency works diligently to implement the Generic Drug User Fee Amendments of 2012 (“GDUFA”).  There have been various notices published in the Federal Register, draft guidance documents published, meetings planned, and policies and procedures updated.  We won’t get into all of those documents here, but note in particular new guidance on stability testing of drug substances and drug products intended to bring generic drug requirements in line with International Conference on Harmonisation stability recommendations, and a new Manual of Policies and Procedures to help reviewers in the Office of Generic Drugs determine whether an amendment to a pending ANDA should be categorized as major or minor.  Under the GDUFA Performance Goals and Procedures, amendments can affect the goal date for action on an application.

GDUFA was enacted in July as Title III of the FDA Safety and Innovation Act (“FDASIA”), and went into effect on on October 1, 2012 – the start of Fiscal Year (“FY”) 2013 (see our FDASIA summary and analysis here).  Shortly after the start of FY 2013, the FDA User Fee Corrections Act of 2012 was signed into law to enable collection of FY 2013 GDUFA user fees without enactment of an appropriations act (see our previous post here).  GDUFA establishes several types of user fees that together will generate $299 million in funding for FDA in FY 2013, and adjusted annually thereafter.  Application fees include an original ANDA fee and a Prior Approval Supplement (“PAS”) fee, which is one half of the ANDA fee, and a Type II Drug Master File (“DMF”) “first reference fee.”  An application containing information concerning the manufacture of an Active Pharmaceutical Ingredient (“API”) at a facility by means other than reference to a Type II DMF, must pay, in addition to an application fee, a special “API fee” (also referred to as the “(a)(3)(F) fee”) if “a fee in the amount equal to the [Type II DMF] fee . . . has not been previously paid with respect to such information.”  An annual facility fee must be paid by both Finished Dosage Form (“FDF”) and API  manufacturers.  There is a fee differential of not less than $15,000 and not more than $30,000 for foreign FDF and API facilities, which is intended to reflect the added costs of foreign inspections conducted by FDA.  Finally, there is a one-time ANDA backlog fee that will be assessed in FY 2013 for ANDAs pending on October 1, 2012.  Under GDUFA, an ANDA that is “pending” on October 1, 2012, is an application “that has not received a tentative approval prior to that date.”  That fee is calculated by dividing $50 million by the number of ANDAs in the backlog.

FDA has initiated the process for the Agency to calculate the FY 2013 facility fee rates, which FDA will publish by January 13, 2013.  In draft guidance and other documents published on FDA’s website (here and here), FDA lays out the so-called self-identification process by which the Agency will obtain an accurate inventory of facilities, sites, and organizations involved in the manufacture of generic drugs for purposes of setting annual facility fee user fee rates and targeting inspections.  FDA recently noted in a Federal Register notice that for FY 2013, identification information must be submitted by December 3, 2012.  For subsequent FYs, identification information must be submitted, updated, or reconfirmed on or before June 1 of the preceding FY.  Failure to pay a facility fee within 20 calendar days of the due date will result in the several consequences, including that all FDF or API products manufactured at the facility and all FDFs containing APIs manufactured at the facility will be deemed misbranded.

The remaining GDUFA user fees are addressed in a pair of Federal Register notices published on October 25, 2012.  In one notice FDA addresses the original ANDA fee, PAS fee, and Type II DMF fee.  In a second notice, FDA addresses the ANDA backlog fee.

Based on an estimation of 1,160 full application equivalents that will be submitted in FY 2013, and by dividing that number into $59,760,000, which is the fee revenue amount to be generated from application fees in FY 2013 under GDUFA, FDA establishes an original ANDA application fee of $51,520 per ANDA (rounded to the nearest $10).  The PAS fee, which is equal to half of the ANDA fee, is $25,760.  Payment of the application fee is due on the later of the date of submission of an ANDA or PAS, or 30 days after October 25, 2012.  Applications submitted since October 1, 2012 and prior to October 25, 2012 are subject to fees and sponsors will be required to pay.  Failure to pay the application fee within 20 calendar days of the due date will result in the application not being received by FDA until the fee is paid.  (Of course, ANDA receipt date is particularly important when 180-day generic drug exclusivity is at stake.)

With respect to the “(a)(3)(F) fee” (i.e., the special “API fee”) for those ANDAs that include information about the production of APIs other than by reference to a DMF, FDA comments in the notice that the Agency “considers this additional fee to be unlikely to be assessed often.”  The “(a)(3)(F) fee” rate ia set by statute at an amount equal to the DMF fee.

FDA establishes the FY 2013 Type II DMF fee, which is a one-time fee for each individual DMF.  Based on an estimation of 700 DMFs that will be referenced by an initial letter of reference in FY 2013, and by dividing that number into $14,940,000, which is the fee revenue amount to be generated from DMFs in FY 2013 under GDUFA, FDA establishes a Type II DMF fee of $21,340 for FY 2013 (rounded to the nearest $10).  In separate draft guidance published earlier this month, FDA provides recommendations for information that should be included in TYPE II DMFs to facilitate an initial completeness assessment required by GDUFA.  Payment of the Type II DMF fee is due on the later of the date on which the first generic drug submission is submitted that references the associated DMF, or 30 days after October 25, 2012.  Failure to pay the Type II DMF fee within 20 calendar days of the due date results in the Type II API DMF not being deemed available for reference, and an affected ANDA will not be received unless the fee has been paid within 20 calendar days of FDA notification of the failure to pay the fee.

Moving on to the one-time ANDA backlog fee, FDA calculates the fee to be $17,434.  This amount is calculated based on dividing $50,000,000, which is the fee revenue amount to be generated from the backlog fee under GDUFA, by 2,868 pending ANDAs.  Payment of the backlog fee is due no later than 30 days after October 25, 2012.  Failure to pay the backlog fee will result in placing the ANDA sponsor on a public arrears list, such that no new ANDAs or supplements will be received (submitted by the applicant or its affiliates).

Over the past several months, FDA has taken pains to make sure that the ANDA backlog is accurate and implored ANDA sponsors to withdraw any pending ANDAs they are no longer interested in to avoid assessment of the backlog fee.  A reduced ANDA backlog means a slightly higher fee for each pending ANDA, but also reduces FDA’s review burden.  Under GDUFA, FDA agreed to review and act on 90% of all ANDAs, ANDA amendments, and ANDA PASs pending on October 1, 2012 by the end of FY 2017. 

Although FDA probably quietly hoped there would be a mass withdrawal of pending ANDAs, that did not happen.  In fact, only a few ANDAs were withdrawn.  Moreover, there was an increase in the number of last minute ANDA submissions.  There were 159 ANDAs submitted to FDA in September alone (and a total of 1,103 over the past 12-month period).  That left FDA with a an ANDA backlog of 2,933 ANDAs at the end of FY 2012, as shown in the table below. 

The 2,933 figure does not jibe with the figure of 2,868 pending ANDAs identified in the Agency’s Federal Register notice on the ANDA backlog fee.  It is off by 65 ANDAs.  We understand that’s because for GDUFA ANDA backlog purposes FDA excluded from the 2,933 figure certain ANDAs, such as those subject to FDA’s Application Integrity Policy.

FDA’s user fee notices provide information on payment options and procedures.  Additional information is available on FDA’s website (here).  Completion of the new GDUFA Cover Sheet will generate a user fee payment identification number that will facilitate payment.    

By Kurt R. Karst –      

We were hardly surprised when we learned that Momenta Pharmaceuticals, Inc. and Sandoz Inc. (“Plaintiffs-Appellees”) filed a Petition for Rehearing en banc seeking reconsideration of an August 3, 2012 decision by a divided (2-1) panel of judges from the U.S. Court of Appeals for the Federal Circuit in Momenta Pharmaceuticals, Inc. v. Amphastar Pharmaceuticals, Inc. (Docket Nos. 2012-1062, -1103, -1104) concernng the scope of the Hatch-Waxman “safe harbor” provision at 35 U.S.C. § 271(e)(1).  After all, Chief Judge Rader, who lodged a blistering 29-page dissent in the case, urged rehearing by the full court, saying that the “decision should instead request the entire court to resolve the issue en banc.”

By way of background, 35 U.S.C. § 271(e)(1), which was added to the patent laws by the Hatch-Waxman Amendments, states:

It shall not be an act of infringement to make, use, offer to sell, or sell within the United States or import into the United States a patented invention (other than a new animal drug or veterinary biological product (as those terms are used in the Federal Food, Drug, and Cosmetic Act and the Act of March 4, 1913) which is primarily manufactured using recombinant DNA, recombinant RNA, hybridoma technology, or other processes involving site specific genetic manipulation techniques) solely for uses reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use, or sale of drugs or veterinary biological products.

As we previously reported, Momenta Pharmaceuticals, Inc. (“Momenta”) sued Amphastar for patent infringement alleging that Amphastar infringed U.S. Patent No. 7,575,866 (“the ‘866 patent”) assigned to Momenta and that generally relates “to methods for analyzing heterogeneous populations of sulfated polysaccharides” such as enoxaparin sodium (marketed as LOVENOX by Sanofi, and generic versions of which Sandoz and Amphastar have approval for under ANDAs).  The U.S. District Court for the District of Massachusetts granted Momenta a preliminary injunction and denied two emergency motions filed by Amphastar for relief from the preliminary injunction.  According to the District Court, Amphastar’s activity fell outside of the “safe harbor” provision at 35 U.S.C. § 271(e)(1), because “the alleged infringing activity involves use of plaintiffs’ patented quality control testing methods on each commercial batch of enoxaparin that will be sold after FDA approval,” and while the “safe harbor” provision “permits otherwise infringing activity that is conducted to obtain regulatory approval of a product, it does not permit a generic manufacturer to continue in that otherwise infringing activity after obtaining such approval.”  Amphastar subsequently appealed each of the District Court’s preliminary injunction decisions to the Federal Circuit.

The Federal Circuit panel, after ascertaining the scope of 35 U.S.C. § 271(e)(1), ruled that the District Court “applied an unduly narrow interpretation of the Hatch-Waxman safe harbor,” vacated the grant of a preliminary injunction, and remanded the case for further proceedings consistent with the Court’s decision.  According to the majority panel decision, the information at issue in the case falls under the 35 U.S.C. § 271(e)(1) umbrella, “because the information submitted is necessary both to the continued approval of the ANDA and to the ability to market the generic drug.”  Moreover, “[h]ere, the submissions are not ‘routine submissions’ to the FDA, but instead are submissions that are required to maintain FDA approval,” according to the panel decision.

In coming to a decision, the Federal Circuit was faced with the Court’s prior decision in Classen Immunotherapies v. Biogen IDEC, 659 F.3d 1057 (Fed. Cir. 2011), which is on appeal to the U.S. Supreme Court (Docket No. 11-1078).  In Classen, the Federal Circuit held, among other things, that 35 U.S.C. § 271(e)(1) “does not apply to information that may be routinely reported to the FDA, long after marketing approval has been obtained.”  According to the Federal Circuit’s majority panel, Amphastar’s activities fit within the “safe harbor” provision: 

Under a proper construction of 35 U.S.C. § 271(e)(1), the fact that Amphastar’s testing is carried out to “satisfy the FDA’s requirements” means it falls within the scope of the safe harbor, even though the activity is carried out after approval.  Unlike Classen, where the allegedly infringing activity “may” have eventually led to an FDA submission, there is no dispute in this case that Amphastar’s allegedly infringing activities are carried out to “satisfy the FDA’s requirements.” 

According to the rehearing petition filed by Plaintiffs-Appellees, given the “two conflicting interpretations of the scope of Section 271(e)(l)” in Classen and Momenta, the full Federal Circuit needs to address a precedent-setting question of exceptional importance: “What is the proper scope of Section 27l(e)(1)?” 

Plaintiffs-Appellees contend that a proper interpretation of 35 U.S.C. § 271(e)(1) strikes a balance between patent protection and timely competition by allowing “a potential market entrant to perform the experimental conduct necessary to engage in the development of information to submit to the FDA to obtain FDA approval of commercial sales – conduct that does not impair the value of an unexpired patent – while not sanctioning otherwise infringing commercial conduct that derogates from, or destroys the value of, a patent during its unexpired term.”  The Federal Circuit’s panel decision, however, “expands Section 271(e)(1)’s safe harbor into a safe ocean,” and “calls into question not only all manner of patents claiming methods of manufacturing and formulating drugs but also the viability of many patents claiming the active ingredient in the drugs themselves,” write Plaintiffs-Appellees. 

The Defendants-Appellants in the case, including Amphastar, have urged the Federal Circuit in a Response to deny Plaintiffs’-Appellees’ rehearing petition.  According to them,

The purported conflict in circuit law on which [Plaintiffs-Appellees] hinge their claim for rehearing en banc cannot survive a straightforward reading of the panel’s decision or of [Classen].  Specifically, this safe harbor case involves the unusual situation where both Congress and the FDA have mandated the use of a particular test, specified in the official USP compendium, as a continuing condition of approval pre-marketing for a generic drug.  Classen, by contrast, involved the voluntary use of a research tool patent to obtain information for non-regulatory purposes that might nevertheless be “routinely reported to the FDA, long after marketing approval has been obtained,” and the Court expressly eschewed any ruling governing “submissions for regulatory approval of generic products” or “like policy considerations.” [Emphasis in original; Internal citation omitted.]

“Worse still,” say Defendants-Appellants, Plaintiffs-Appellees ask the Federal Circuit “to adopt en banc an atextual approach to interpreting the safe harbor provision that the Supreme Court has twice considered and twice rejected” in Eli Lilly & Co. v. Medtronic, Inc., 496 U.S. 661 (1990) and Merck KGaA v. Integra Lifesciences, Ltd., 545 U.S. 193 (2005).  In those cases, the U.S. Supreme Court ruled that 35 U.S.C. § 271(e)(1) applies to FDA’s “entire statutory scheme of regulation” (Eli Lilly) and that the “safe harbor” provision did not “create an exemption applicable only to the research relevant to
filing an ANDA for approval of a generic drug” (Merck).

Classen Immunotherapies, Inc. (“Classen”) has filed an amicus brief in support of Plaintiffs’-Appellees’ rehearing petition saying that the Momenta panel decision directly conflicts with the Classen decision.  According to Classen:

Extending the safe harbor to cover post-approval activities, such as safety testing of pharmaceuticals, sounds like a good idea for judicial legislation, which would appear to save lives.  However, the net result of foreclosing this area to patent protection will be the loss of tens of billions of dollars that are annually invested in developing new methods and devices for ensuring the safety of drugs and medical devices which regularly save and improve the lives of countless people. . . .

As was correctly found by this Court in Classen, nothing in the text or purpose of Section 271(e)(1) warrants a wholesale expansion of the safe harbor into the post-marketing approval period, where it would be totally divorced from the balancing of interests, and concerns about distortions to the patent term that the safe harbor was intended to address.  The danger of the unintended consequences described above are too stark to ignore – or to allow to come to pass.

Indeed, the stakes are high.  As we suggested in our previous post, a final decision could affect not only drug development, but the development of biolsimilar versions of biological products licensed under the Public Health Service Act.  In the biosimilars space, method patents – and in particular analytical-method patents claiming FDA-mandated testing methods – are likely to be of great importance.  

UPDATE:

• Plaintiffs’-Appellees’ Reply Brief was filed on October 18th and is available here.

By Ricardo Carvajal –

As the November 6 election draws near, debate over California’s Proposition 37 is heating up.  If the measure passes, genetically engineered ("GE") foods sold at retail in the state would have to be labeled as such – a requirement that would have national (if not international) implications for the conventional food and dietary supplement industries.  For those not yet familiar with the measure, the state’s Official Voter Information Guide provides the text, an analysis, and arguments for and against.

Among other things, Prop 37 would restrict the use of the term “natural” in relation to GE foods.  One issue that has drawn attention is whether Prop 37 would also restrict the use of the term “natural” in relation to processed foods that are not GE.  The analysis by the Legislative Analyst’s Office states:

Given the way the measure is written, there is a possibility that these restrictions would be interpreted by the courts to apply to all processed foods regardless of whether they are genetically engineered.

(Emphasis in original).  In relevant part, the text of the measure reads as follows:

[I]f a food meets any of the definitions in subdivision (c) or (d) of section 110808, and is not otherwise exempted from labeling under section 110809.2, the food may not in California, on its label, accompanying signage in a retail establishment, or in any advertising or promotional materials, state or imply that the food is “natural,” “naturally made,” “naturally grown,” “all natural” or any words of similar import that would have any tendency to mislead any consumer.

(Emphasis added).  The definitions referred to are those of the terms “genetically engineered” (subdivision c) and “processed food” (subdivision d) – and therein lies a potential source of confusion.  As written, the reference to the definitions could be read to suggest that if a food is either GE or processed, then it may not be promoted as “natural.”  The definition of “processed food” is so broad that essentially all foods other raw agricultural commodities would be affected.  However, that outcome does not seem to be what the legislature had in mind, as signaled by the qualifying clause that immediately follows the reference to the definition of processed foods (i.e., “…and is not otherwise exempted from labeling under section 110809.2…”).

Section 110809.2 provides several exemptions from the GE labeling requirement, including for (1) a processed food that would be subject to the labeling requirement solely because it includes small quantities of GE ingredients (until July 1, 2019) or a GE processing aid or enzyme, and (2) a processed food that is not packaged for retail sale and is prepared and intended for immediate human consumption.  Also exempt would be any “raw agricultural commodity or food derived therefrom [presumably including processed food] that has been grown, raised, or produced without the knowing and intentional use of genetically engineered seed or food.”

The debate over Prop 37’s impact on the use of “natural” claims is just one of several already spawned by the measure.  Also noteworthy is the fact that the measure is very friendly to plaintiffs because it can be enforced by “any person,” and that person is not “required to allege facts necessary to show, or tending to show, lack of adequate remedy at law, or to show, or tending to show, irreparable damage or loss, or to show, or tending to show, unique or special individual injury or damages.”  Further, plaintiffs can recover “reasonably attorney’s fees and all reasonable costs incurred in investigating and prosecuting the action.”  Whatever the merits of Prop 37, one thing is clear: it will generate lots of work for lawyers.

By Karla L. Palmer & Larry K. Houck –
 
Representative Edward Markey (D-MA) sent a written request to the U.S. Department of Justice on October 15th asking Attorney General Eric Holder to commence an investigation into whether the New England Compounding Center (“NECC”) violated the federal Controlled Substances Act and its implementing regulations.  The letter states that NECC shipped nearly 18,000 vials of contaminated steroid products to 76 healthcare facilities in 24 states; an estimated 14,000 patients have been injected with the tainted products, which have sickened at least 214 individuals and resulted in 15 deaths.  The letter notes that almost 1,000 specific formulations of recalled NECC drug products contain controlled substances such as cocaine, morphine, hydromorphone, meperidine, sufentanil, fentanyl and ketamine.  (All of these substances are schedule II substances except for ketamine, which is a schedule III substance).

The letter further states that Drug Enforcement Administration (“DEA”) regulations require that “retail pharmacies that compound or sell controlled substances” must be registered with the DEA as retail pharmacies.  DEA-registered compounding pharmacies can only sell directly to patients (specifically, the “end user” of the product) compounded pharmaceuticals that contain controlled substances pursuant to a patient-specific prescription from a DEA-registered practitioner.  If the pharmacy compounds controlled substances and distributes the formulations to other DEA registrants, it must also be registered with DEA as a manufacturer.  Citing to a letter from John Partridge, then-Chief of DEA’s Liaison and Policy Section, dated June 19, 2012, yet not citing to any statute, regulation or DEA guidance document (likely because there is none), Congressman Markey reiterates DEA’s “position” that “compounding a controlled substance other than pursuant to a valid patient-specific prescription or medical order, is manufacturing.”  According to a conversation between Markey’s congressional staff and DEA on October 16, 2012, DEA stated that NECC is not registered with DEA as a manufacturer.  (Manufacturing, in addition to requiring DEA registration as a manufacturer, also subjects the manufacturer to DEA quota, ARCOS reporting, labeling/packaging and DEA-222 official order form requirements.)

Representative Markey asserts that NECC requires “further investigation” by DEA to determine whether NECC, “already believed to have broken Massachusetts state law, has not also skirted federal law related to controlled substances.”  The letter specifically asks the Justice Department to provide answers to the following questions and requests for information:

• As a retail pharmacy, what types of controlled substances NECC was authorized to use to compound under DEA regulations?
• Whether DEA has issued guidance for compounding pharmacies in handling controlled substances.  If so, provide copies of such guidance.
• For each drug on both NECC’s recall list and DEA’s list of controlled substances , whether NECC sold each substance (or compounded drug) in compliance with DEA regulations.
• For each of the past ten years, a) how many DEA enforcement actions were brought against pharmacies that failed to comply with DEA regulations, and b) for each violation, the name and location of the pharmacy, the identity of the regulation that was violated and the resolution of that action (i.e., registration suspended, fines levied, warning letter, etc.).
• A description of enforcement actions that DEA could take against a pharmacy that violates the DEA’s controlled substance regulations (including maximum fines, penalties, or other actions).
• Whether the Department of Justice believes that it “has sufficient statutory authority and resources to perform its oversight and enforcement responsibilities with respect to compounding pharmacies” and if not, what recommendations can the Department put forth to strengthen its “capabilities to perform its duties” in this area.

The letter requests a response to all of the above questions by no later than November 2, 2012.  Controlled substance compounders (both manufacturers and pharmacies) across the nation await the DOJ’s and DEA’s responses to Congressman Markey’s requests for information concerning what, in most respects, has been a relatively unregulated area of the pharmaceutical industry. 

By Karla L. Palmer & Delia A. Stubbs –

Last week, DEA continued the temporary scheduling of a single synthetic cathinone, methylone (3, 4-methylenedioxy-N-methylcathinone) in Schedule I of the Controlled Substances Act (“CSA”).  The temporary scheduling will expire on April 20, 2013, or upon completion of rulemaking proceedings, whichever occurs first.  77 Fed. Reg. 64,032 (Oct. 18, 2012).  DEA also initiated rulemaking proceedings to permanently schedule methylone on October 17, 2012.  77 Fed. Reg. 63,766 (Oct. 17, 2012).  This represents DEA’s latest step in combatting synthetic drug abuse in response to increased reports of abuse of substances contained in products marketed as “bath salts” and “plant food” and incense.  See 76 Fed. Reg. 55,616, 55,617 (Oct. 21, 2011).  As previously reported, DEA Administrator Leonhart stated DEA is “committed to targeting these new and emerging drugs with every scientific, legislative and investigative tool at [its] disposal.”

As background, methylone was subject to DEA’s October 2011 final order temporarily scheduling it and two other synthetic cathinones in Schedule I on an emergency basis.  See 21 U.S.C. § 811(h); 76 Fed. Reg. 65,371 (Oct. 21, 2011).  Then, after introduction of the Synthetic Drug Control Act (“SDCA”), Congress permanently scheduled 11 cathinones (including two of the three that DEA had temporarily placed in Schedule I in the October 2011 emergency order) as part of FDASIA.  Methylone is the only substance from that order that Congress did not legislatively add to Schedule I when it enacted FDASIA, despite being in earlier drafts of the SDCA.  See FDASIA, Pub. L. No. 112-144, § 1152 (2012); 77 Fed. Reg. 64032 (Oct. 18, 2012); H.R. 1254 112th Cong. (2012). See also S. 3189 112th Cong. (2012).  DEA continued its synthetic drug war on yet another front through “Operation Log Jam.”  On July 26, 2012, the operation seized 167,000 packets of synthetic cathinones (and products to produce an additional 392,000 cathinone products).  In additional legislative efforts, in August 2012, a bill was introduced to place 15 cathinones in Schedule I, to include methylone.  H.R. 6312, 112th Cong. (2012).  The bill was referred to committee but no further action was taken.

It is unclear why methylone was left off of FDASIA’s Schedule I classification, which included other cathinones.  It may be because, as lawmakers raised in debates about the SDCA concerning cathinones and other substances generally, it is more difficult to obtain a substance for research purposes (or any purpose) in Schedule I.  See 112 Cong. Rec. H8238 (daily ed. Dec. 7, 2011).  It appears, based on aggregate quotas that DEA has granted for the substance, that researchers are interested in methylone.  See 77 Fed. Reg. 39,737 (July 5, 2012), 77 Fed. Reg. 55,500 (Sept. 10, 2012), 77 Fed. Reg. 59,980 (Oct. 1, 2012).  Once scheduled, DEA limits via quotas the aggregate amount of a Schedule I substance that may be manufactured annually, making the product more difficult to obtain. 21 U.S.C. § 826; 21 C.F.R. § 1303.11.

It is significantly more onerous for DEA to pursue a scheduling classification through the rulemaking process than it is for a drug to be scheduled via legislative process.  The administrative rulemaking process mandates that the agency procure a scientific and medical report from FDA, conduct a detailed, multifactor analysis, and provide the public an opportunity to comment, unlike the simpler statutory scheduling procedures observed with the passage of FDASIA.  See 21 U.S.C. § 811. 

The scheduling of methylone is not the only scheduling proceeding that DEA could face in the near future.  On October 29 and 30th, the FDA will convene a meeting to take public comment on the potential rescheduling of hydrocodone, likely a much more controversial initiative.  77 Fed. Reg. 34,051 (June 8, 2012).

By Kurt R. Karst & Jeffrey N. Gibbs –  

We’ve been following litigation involving the Florida veterinary compounding pharmacy Franck’s Lab, Inc. (“Franck’s”) for a couple of years.  We won’t get into all of the case details here – for that, see our previous posts here, here, here, and here – but here’s a summary . . . .

In September 2011, the U.S. District Court for the Middle District of Florida ruled that FDA did not have authority to enjoin the “long-standing, widespread, state-regulated practice of pharmacists filling a veterinarian’s prescription for a non-food producing animal by compounding from bulk substances.”  The court reached its decision after wading through the various guidance documents FDA had issued through the years laying out the Agency’s criteria for when it would decline to exercise “enforcement discretion,” and instead initiate enforcement action against a compounding pharmacy.  In November 2011, the government appealed that decision to the U.S. Court of Appeals for the Eleventh Circuit.  Briefing in the case was completed, several amici weighed in, and oral arguent was scheduled to take place on November 1, 2012.

That’s right . . .  we used the past tense in our last sentence. 

Our hopes for a decision out of the Eleventh Circuit were dashed when the government and Franck’s filed a Joint Motion to Vacate and Dismiss as Moot that we expect the Court will grant.  According to the motion, Franck’s was acquired by Wells Pharmacy Network, LLC (“Wells”) through an asset sale and “no longer engages in compounding and no longer owns or operates the facilities at issue.”  “Nor is there any reasonable probability that [Franck’s] will resume the challenged conduct,” and the company “has turned in the permits required by Florida law to operate as a compounding pharmacy, sold all its assets, and terminated all its employees.”  Moreover, Paul Franck, the owner of Franck’s and the individual defendant in the case, “is no longer engaged in veterinary compounding of any kind,” “has no intention of reentering that profession in the anticipated future,” and has “executed a seven-year non-competition agreement with Wells,” according to the motion.

Given these circumstances and controlling law (i.e., Laidlaw Envtl. Servs., 528 U.S. 167 (2000)), the parties agreed that the case has become moot and jointly moved the Eleventh Circuit not only to dismiss the appeal, but to vacate the Florida district court’s judgment, and remand the case with instructions to dismiss the complaint. 

That’s unfortunate.  As Hyman, Phelps & McNamara, P.C.’s Karla L. Palmer and Jeffrey N. Gibbs noted in a Legal Backgrounder published by the Washington Legal Foundation, if the Eleventh Circuit ultimately upheld the Florida federal district court ruling, the implications from such a decision would have extended broadly to other areas of FDA law, particularly as it relates to FDA’s increasing use of guidance documents to expand regulatory requirements (see our previous post here for more on that topic).  Why?  Because the decision “will be invoked by interested parties seeking to constrain FDA’s use of non-binding guidance documents to define prohibitions against which FDA may take enforcement action or impose new requirements on applicants, and to attack FDA assertions that it is entitled to Chevron deference,” wrote Ms. Palmer and Mr. Gibbs. 

It is also unfortunate because an Eleventh Circuit ruling could have brought greater clarity to a contentious issue: whether all compounding is illegal, as FDA has maintained.  Given recent developments and the renewed focus on FDA’s authorty to regulate compounding pharamcies (see our previous post here), such a decision would have been particularly timely.  C’est la vie!  Still, the logic of the district court decison will provide a roadmap for other parties disputing FDA’s use of guidance documents and FDA’s theory that pharmacists violate the law whenever they compound drugs. 

Adieu Franck’s.  We enjoyed the ride while it lasted.