By Jennifer D. Newberger –

Section 520(b) of the Federal Food, Drug, and Cosmetic Act ("FDC Act") exempts “custom devices” from the performance standards or premarket approval ("PMA") requirements of sections 514 or 515 if certain criteria are met.  The Food and Drug Administration Safety and Innovation Act ("FDASIA"), signed into law in July 2012 (see here), amended section 520(b).  Though Congress may have been trying to make it easier for a manufacturer to qualify for the custom device exemption, the FDASIA amendment appears to have enumerated additional requirements, making it more difficult to meet the exemption.
 
As amended, section 520(b) will exempt devices from the requirements of section 514 or 515 if the device:

1. Is “created or modified in order to comply with the order of an individual physician or dentist” or other specified healthcare practitioner;
2. Must deviate from a requirement of section 514 or 515 in order to comply with the order of the practitioner;
3. “[I]s not generally available in the United States in finished form through labeling or advertising by the manufacturer, importer, or distributor for commercial distribution”;
4. “[I]s designed to treat a unique pathology or physiological condition that no other device is domestically available to treat”;
5. Is intended to meet the special needs of a practitioner “in the course of the professional practice” of the practitioner or  is “intended for use by an individual patient named in such order” of the practitioner;
6. Is made on a case-by-case basis “to accommodate the unique needs of individuals” described above.

Additionally, to qualify as a custom device, the device must be “for the purpose of treating a sufficiently rare condition, such that conducting clinical investigations on such device would be impractical,” production of the device must be limited to no more than five per year of a particular device type, and the manufacturer of the custom device must notify FDA annually about the production of such devices.

Earlier this week, FDA issued a notice stating that the Agency is now seeking “information on and examples of appropriate uses of the custom device exemption.”  77 Fed. Reg. 69,488, 69,488 (Nov. 19, 2012).  In particular, FDA is seeking information related to instances where the manufacturers or healthcare practitioners have used, would like to have used, or plan to use, the exemption; product areas other than orthopedic and dental devices in which the exemption may be useful; and how often custom devices are ordered to due a unique need of the practitioner (as opposed to the patient).

Historically, FDA has taken a very restrictive view of custom devices.  The amended criteria required will result in fewer devices qualifying for the custom device exemption.  Hopefully the comments will provide FDA with a better understanding of the types of patients, practitioners, and circumstances that would result in appropriate use of the exemption.

Hyman, Phelps & McNamara’s Robert A. Dormer will be speaking at the American Conference Institute’s upcoming conference, “Orphan Drugs and Rare Diseases – Maximizing Opportunities and Overcoming Stumbling Blocks in the Designation and Development Process.”  The conference will take place on November 28th and 29th at the Hyatt Regency in Boston, Massachusetts.  The conference is designed to give practitioners the complete picture of the orphan drugs and rare diseases landscape, including evolving laws and regulations, commercial implications, patent considerations, and the international framework.  Among other things, speakers, including Mr. Dormer, will discuss strategies to offset potential risks inherent to orphan drug development including:

• Understanding and factoring in the unique incentives, including favorable exclusivity, pricing, and tax benefits, for companies who decide to pursue designation; 
• Replenishing product pipelines in the face of the patent cliff through novel therapies;
• Preparing for eventual pharmacovigilance and labeling issues downstream as designation takes off; 
• Designing clinical trials endpoints and proving safety and efficacy in a smaller population; and
• Protecting orphan drug status and keeping competitors at bay.

To view the conference brochure and register for the conference see here.  FDA Law Blog readers may obtain a $200 registration discount by using code FDALB 200.

By Ricardo Carvajal –

The Center for Science in the Public Interest (“CSPI”) is taking on caffeination and fortification of foods with renewed vigor.  In a letter to FDA/CFSAN’s Office of Compliance, CSPI alleges that certain foods to which caffeine is added “appear to violate [FDA’s] determination (21 CFR 182.1180) that caffeine is generally recognized as safe only in cola-type beverages at concentrations of 0.02 percent or less.”  CSPI further contends that “the proliferation of caffeinated foods and beverages could lead to troublesome or serious health problems for children and adults who consume those products – especially when they consume multiple products over the day.” 

CSPI also filed a class action against Dr. Pepper Snapple Group, Inc. alleging that the company’s addition of vitamin E to its carbonated beverages violates FDA’s Fortification Policy at 21 C.F.R. § 104.20.  CSPI contends that both FDA and federal courts have recognized that the Fortification Policy is legally binding.  CSPI further alleges that the products’ labeling is misleading because it implies that the products’ antioxidant content is derived from real fruit (as opposed to vitamin E), and because the products contain insufficient vitamin E to “provide the health benefits that reasonable consumers associate with antioxidants.”

REMINDER:  You can follow us on Twitter @fdalawblog

By Jennifer D. Newberger –

FDA is amending its proposed rule to establish a unique device identification (“UDI”) system, published on July 10, 2012 (see our previous post here), to meet the requirements of section 614 of the Food and Drug Administration Safety and Innovation Act ("FDASIA"), signed into law on July 9, 2012 (see our FDASIA summary and analysis here).  77 Fed. Reg. 69393 (Nov. 19, 2012).  The amendment affects only implantable, life-supporting, or life-sustaining devices, primarily those that are not Class III devices or are not devices licensed under the Public Health Services Act ("PHS Act"), which are affected only as to the direct marking requirement.

FDASIA section 614 amends section 519(f) of the Federal Food, Drug, and Cosmetic Act ("FDC Act"), requiring FDA to implement “final regulations with respect to devices that are implantable, life-saving, and life sustaining” within two years of finalization of the UDI rule.  The July 10 proposed rule required all Class III devices and devices licensed under the PHS Act to bear a UDI within one year of publication of the final rule.  The effective date for those devices therefore meets the two year requirement in FDASIA and is not affected by this amendment. 

To comply with the FDASIA requirements, FDA “is now proposing to require all other implantable, life-supporting, and life-sustaining devices (i.e., those that are not already subject to the 1-year effective date) to bear a UDI” within two years of publication of the final rule.  77 Fed. Reg. at 69394.  In other words, any Class II, Class I, or unclassified devices that are implantable, life-supporting, or life-sustaining must also bear a UDI within two years of publication of the final rule, as opposed to three years as originally proposed.  This is unlikely to have a practical effect on Class I devices, since few, if any, are implantable, and by definition they are not life-supporting or life-sustaining.

The proposed rule also requires direct marking of the UDI on certain limited categories of devices, including implantable devices.  The direct marking requirement was to go into effect two years after the date on which the product was otherwise required to bear the UDI.  For Class III implantables, this would have been three years after finalization of the rule, for Class II, five years, and for Class I, seven years.  To comply with amended section 519(f), FDA is amending the proposed rule to require direct marking of all implantable devices, regardless of classification, within two years of finalizing the rule.

The biggest impact of this amendment will likely be on devices, primarily Class II, that are implantable, life-sustaining, or life-supporting, originally proposed to comply with the UDI requirements within three years of the final rule, and now required to comply within two years.  Additionally, the amendment will affect implantable devices of all classes, primarily Class III and II, which now must bear a permanent marking one year and three years earlier than first proposed, respectively.  Comments to the proposed rule closed on November 7, 2012.  It is not clear when FDA will issue the final rule.

By Jess Ritsick & Bill Koustas –

The Healthcare Distribution Management Association (“HDMA”) held its annual Track and Trace Technology Seminar on November 12 – 14, 2012, designed to address drug pedigree and track and trace requirements being developed in the United States and to explore how stakeholders will play a role—and what those roles may be—going forward.  Perhaps most interesting at the conference was the seemingly unanimous support from industry for the implementation of a national pedigree program in some form.  What follows below are some of the highlights of the conference speakers.

HDMA’s General Counsel and Vice President for Government Affairs, Elizabeth Gallenagh, discussed recent developments in track and trace, pedigree, and serialization at the federal level.  In addition to discussing the recent draft track and trace legislation, which we recently blogged about here, she also discussed the work being done by a “bi-partisan, bi-cameral” congressional working group, which brings together legislators, regulators, and industry and is looking to create a national pedigree system within the next year.  Congress tried to include a national pedigree in the most recent round of PDUFA legislation, but that was obviously not successful.  Ms. Gallenagh also noted that HDMA believed that a national pedigree system should have the effect of preempting state track and trace and pedigree systems. 

Turning to the state level, Virginia Herold, the Executive Officer of the California Board of Pharmacy, spoke about California’s state pedigree requirements, which are slated to begin taking effect in 2015—a date which Ms. Herold emphasized would not be pushed back by the Board of Pharmacy.  Ms. Herold expressed her hope that there would eventually be a national pedigree, but punctuated that hope with the fact that California would only be satisfied with a national pedigree system that proves to be “sufficient.”  Interestingly, with all the work done to draft California’s pedigree requirements, Ms. Herold stated there are no requirements for “passing” the pedigree; rather, the relevant information just needs to exist in an interoperable electronic system.  How this will apply practically, e.g., potential for fraudulent pedigrees, remains to be seen.  Ms. Herold also noted that failure to comply with the pedigree requirements may result in a $5,000 fine per transaction.  The California Board of Pharmacy will hold a public hearing on December 4, and a board meeting on December 13, 2012 to address the implementation of the state’s pedigree requirements. 

Lieutenant Commander TJ Christl, FDA’s Acting Director of the Office of Drug Security, Integrity, and Recalls also spoke briefly, and emphasized FDA’s support for a national pedigree and a robust track and trace system.  He emphasized that FDA hopes to work with industry towards a system that suits both the industry and the Agency.  FDA also remains committed to ferreting out counterfeit drugs in the national drug supply.  In that vein, Lieutenant Commander Christl stated that FDA recently sent letters to practitioners and the relevant state boards and agencies regarding the purchase of suspected counterfeit drugs from online retailers.  While the letters were purely informational and not considered enforcement actions, Lieutenant Commander Christl stated that the follow-up on the letters has yielded “successful outcomes.”

By Kurt R. Karst –      

Earlier this week, Cumberland Pharmaceuticals Inc. (“Cumberland”) filed a Complaint in the U.S. District Court for the District of Columbia challenging FDA’s November 7, 2012 denial of a Citizen Petition (Docket No. FDA-2012-P-0507) and approval of InnoPharma, Inc.’s (“InnoPharma’s”) ANDA No. 200644 for a generic version of Cumberland’s  acetaminophen overdose treatment, ACETADOTE (acetylcysteine) Injection, 200mg/mL, which is approved under NDA No. 021539.  Cumberland alleges that FDA’s actions violate the FDC Act and the Administrative Procedure Act (“APA”) and requests that the court set aside FDA’s approval of ANDA No. 200644 and order FDA not to accept for review or approve any ANDA for generic ACETADOTE containig edetate disodium (“EDTA”).

FDA approved a formulation of ACETADOTE on January 23, 2004 containing the chelating agent EDTA with a postmarketing study commitment that Cumberland “evaluate the potential benefit of [EDTA] on the stability of the drug product.”  Cumberland conducted the evaluation, and on January 10, 2011, FDA approved a Suppemental NDA for an EDTA-free formulaton of ACETADOTE.  Cumberland then withdrew the EDTA-containing version of ACETADOTE from the market. 

After the issuance and Orange Book listing of information on a patent covering EDTA-free ACETADOTE, and subsequent notices of ANDA Paragraph IV certifications, Cumberland learned that FDA had received and was reviewing ANDAs for EDTA-containing versions of generic ACETADOTE.  In addition, in May 2011, a Citizen Petition (Docket No. FDA-2011-P-0339) was submitted to FDA requesting that the Agency make a determination as to whether the discontinued, EDTA-containing version of ACETADOTE was discontinued for reasons of safety or effectiveness.  Under FDA’s regulations implementing the FDC Act (21 C.F.R. § 314.122 and § 314.161), an ANDA for a generic version of a listed drug that has been voluntarily withdrawn from sale is to be accompanied by a petition seeking a determination as to whether the listed drug was widrawn for safety or effectiveness reasons, and FDA must make such a determination before approving an affected ANDA.

Cumberland’s Citizen petition, which was submitted to FDA in May 2012, requests that FDA not approve any ANDAs for generic ACETADOTE containing EDTA.  Cumberland argues that the EDTA-containing version of ACETADOTE was discontinued for safety reasons.  According to Cumberland, “EDTA has generally been associated with adverse events, such as significant drops in serum calcium levels, which might result in fatality, hypokalemia, hypomagnesemia, or hypotension,” “EDTA has also been associated with adverse events such as syncope, and allergic contact dermatitis,” and “[a]llergic reactions to EDTA may lead to a problematic interruption of therapy that occurs while these reactions are treated.”  FDA says in the Agency’s petition response, however, that available data “do not provide a reasonable basis upon which to conclude that the original, EDTA-containing formulation of Acetadote was unsafe,” and notes that EDTA is a component in several currently marketed drug products – some with higher quantities of EDTA than in “old” ACETADOTE.  FDA concludes that “although there is a theoretical safety concern with EDTA in Acetadote . . . . we have insufficient evidence to conclude that the original formulation was withdrawn for reasons of safety.” 

Given FDA’s determination, as well as a waiver of FDA’s so-called “exception excipient” regulations for generic versions of injectable drug products that differ from the RLD in formulation (something other than a permitted difference in preservative, buffer, or antioxidant), FDA was able to approve InnoPharma’s ANDA No. 200644.  (See our prior post concerning a challenge to the approval of generic ZOSYN for a discussion FDA’s excipient regulations.)

Cumberland alleges in the company’s Complaint that:

FDA’s denial of Cumberland’s Citizen Petition and acceptance for review and approval of InnoPharma’s acetylcysteine injection ANDA is in violation of the FDCA because Cumberland’s original EDTA-containing Acetadote® formulation was withdrawn for reasons of safety and replaced by an EDTA-free formulation.  As such, FDA cannot lawfully approve an ANDA under section 505(j)(4)(H) of the FDCA for acetylcysteine injection containing EDTA because the EDTA-containing formulation was withdrawn for reasons of safety.

FDC Act § 505(j)(4)(H) states that FDA must approve an ANDA unless, among other things:

information submitted in the application or any other information available to [FDA] shows that (i) the inactive ingredients of the drug are unsafe for use under the conditions prescribed, recommended, or suggested in the labeling proposed for the drug, or (ii) the composition of the drug is unsafe under such conditions because of the type or quantity of inactive ingredients included or the manner in which the inactive ingredients are included.

FDA’s regulations implementing FDC Act § 505(j)(4)(H), generally, are found in the Agency’s ANDA content and format regulations at 21 C.F.R. 314.94.  Pertinent regulations on inactive ingredient changes for generic parenteral drug products are set forth in 21 C.F.R. § 314.94(a)(9). 

Cumberland also alleges that FDA’s petition denial and ANDA approval “without requiring InnoPharma to demonstrate that an EDTA-containing formulation is as safe as the reference-listed drug . . . is fundamentally inconsistent with the agency’s previous decision to require Cumberland to undertake the postmarketing study of Acetadote® . . . and is thus, arbitrary and capricious.”  Finally, Cumberland alleges that FDA’s waiver of the Agency’s exception excipient regulation permitting the approval of ANDA No. 200644 violates the APA in that it is arbitrary and capricious and otherwise not in accordance with law.

For the third year in a row, Hyman, Phelps & McNamara, P.C. has been ranked as a “Tier 1” law firm in the area of “FDA Law” by the folks over at U.S. News & World Report, who once again teamed up with Best Lawyers for the “America’s Best Law Firms 2013” rankings.  More than 10,300 law firms are ranked in 80 practice areas, “taking into account a firm’s expertise, responsiveness, cost, and civility,” according to U.S. News.  The 2013 list of America’s Best Law Firms can be searched here, or viewed here (we’re noted on page 47).

Hyman, Phelps & McNamara, P.C. is pleased to announce that David B. Clissold will be speaking at an upcoming Management Forum conference on myriad topics, including orphan drug exclusivity, FDA regulatory strategies, and advanced therapy products.  The conference, titled “EU and US Regulatory Issues for IP Professionals,” will take place on November 29-30, 2012 at The Rembrandt Hotel in London.  A copy of the conference brochure is available here. 

FDA Law Blog readers can receive a 25% discount off the conference registration price.  To receive the discount, please contact Sarah Packham at sarah.packham@management-forum.co.uk and mention FDA Law Blog.  For more information and to register, visit the conference website. 

By Kurt R. Karst –      

Back in August, we posted on a Petition for Writ of Certiorari filed by Mutual Pharmaceutical Company, Inc. (“Mutual”) appealing a May 2, 2012 decision from the U.S. Court of Appeals for the First Circuit in Bartlett v. Mutual Pharmaceutical Co. concerning design-defect, generic drug preemption, and the non-steroidal anti-inflammatory drug Sulindac Tablets, which Mutual markets under an ANDA FDA approved in 1991 (ANDA No. 072051).  The First Circuit, in affirming a decision from the U.S. District Court for the District of New Hampshire (Bartlett v. Mutual Pharm. Co., 760 F. Supp. 2d 220 (D.N.H. 2011) – see here), concluded that state law design-defect claims against generic drug manufacturers are not preempted by the Hatch-Waxman Amendments to the FDC Act, and that to avoid state tort law liability a company could simply stop making its generic drug products.  Obviously, that decision did not sit well with Mutual, and the appeal to the U.S. Supreme Court followed (Docket No. 12-142), with the following question presented to the Court:

Whether the First Circuit erred when it created a circuit split and held—in clear conflict with this Court’s decisions in PLIVA, Inc. v. Mensing, 131 S. Ct. 2567 (2011); Riegel v. Medtronic, Inc., 552 U.S. 312 (2008); and Cipollone v. Liggett Group, Inc., 505 U.S. 504 (1992)—that federal law does not preempt state law design-defect claims targeting generic pharmaceutical products because the conceded conflict between such claims and the federal laws governing generic pharmaceutical design allegedly can be avoided if the makers of generic pharmaceuticals simply stop making their products.

Over the past couple of months, interested parties have chimed in with amicus briefs asking the Supreme Court to take up the case.  The Generic Pharmaceutical Association says in its amicus brief that the First Circuit’s decision “reopens avenues of liability” that the Supreme Court closed in Mensing, and that Bartlett “is logically and legally indistinguishable from Mensing.”  Several generic drug manufacturers express similar concerns in their amicus brief, and the particular concern that “the state-by-state approach to labeling rejected in Mensing not be revived under a new name.”  In Mensing, the Supreme Court ruled that FDA’s regulations preventing generic drug manufacturers from changing their labeling except to mirror the label of the brand-name manufacturer preempt state-law failure-to-warn claims against generic drug manufacturers, because generic drug manufacturers are unable to comply with both federal and state duties to warn. 

Respondent, Karen L. Bartlett, who, of course, has her own take on the question posed to the Supreme Court – i.e., “Whether this Court should grant certiorari to review the First Circuit’s conclusion that federal law does not preempt respondent’s strict products liability claim seeking compensation for severe injuries resulting from use of a generic pain medication manufactured by petitioner, where the First Circuit’s decision does not conflict with any decision of this Court or of any other court of appeals” – says in her Opposition Brief that Supreme Court review is not warranted here.  Respondent argues, among other things, that Mutual “erroneously attempts to depict the [First Circuit’s] decision as having blatantly departed” from Mensing, and that First Circuit’s decision does not create a circuit split with decisions in Smith v. Wyeth, Inc., 657 F.3d 420 (6th Cir. 2011) (here) and Mensing v. Wyeth, 658 F.3d 867 (8th Cir. 2011) (here).  Moreover, says Respondent, “[c]ases such as this one, in which an injured patient obtains a damages judgment against a drug manufacturer based on a products liability theory other than failure to warn, are exceedingly rare” and don’t recur with sufficient frequency to warrant Supreme Court review.  In fact, according to Respondent, this case is “fundamentally different” from Mensing, beause, in contrast to Mensing, “nothing in New Hampshire law requires petitioner to change sulindac’s design, and nothing in federal law prohibits petitioner from declining to sell the drug.”

Mutual, which filed its Reply Brief on November 13th, immediately jumps on several claims made by Respondent.  Right off the bat, Mutual says that the First Circuit recognized that its decision created a “split in the lower courts” an practically begged the Supreme Court to take up the case to provide “a decisive answer.”  Mutual points out that both the Sixth and Eighth Circuits rejected stop-selling arguments, and that just before respondent filed its Opposition Brief, the Fifth Circuit rejected the same theory for a second time in Demahy v. Schwarz Pharma, Inc., Case No. 11-31073, 2012 WL 5261492 (Oct. 25, 2012) (here).  (The first time having been in Demahy v. Actavis, Inc., 650 F.3d 1045 (5th Cir. 2011) (here)).  Indeed, says Mutual,

this case demonstrates in spades that there is no plausible basis for distinguishing design-defect claims from failure-to-warn claims for purposes of the stop-selling theory.  Consistent with comment k, the instructions in this case make clear that the jury’s verdict hinged on precisely what Mensing barred: a finding that petitioner’s FDA-mandated warnings were inadequate.  More broadly, the First Circuit conceded that Hatch-Waxman’s sameness mandate applies equally to design-defect and failure-to-warn claims, and that the stop-selling theory could be deployed equally against both claims.  Given the record and those concessions, the stop-selling theory can be right only if Mensing is wrong—which is why the First Circuit effectively challenged this Court to reconsider that decision. [(Internal citations omitted; emphasis in original)]

Delving more deeply into the Fifth, Sixth, and Eighth Circuit decisions, Mutual argues that failure-to-warn and design-defect claims are really two sides of the same coin and are materially indistinguishable:

Respondent nonetheless seeks to reconcile these decisions by asserting that failure-to-warn claims are based on a duty to change product warnings (conduct federal law bars), whereas design-defect claims are based on a duty to stop selling the product (conduct federal law permits).  That is just wordplay.  Saying that failure-to-warn liability is imposed because a manufacturer failed to change the warning is just the flipside of saying that liability is imposed because the manufacturer sold a product with a defective warning.  The manufacturer’s duty is “to adequately and safely label [its] products” for sale, Mensing, 131 S. Ct. at 2577, so it has two options: Change the label or stop selling it.

That is just like respondent’s design-defect claim, which asserted petitioner sold a product with a defective design.  State law offered the same two options: Change the design or stop selling it. And because Hatch-Waxman equally precludes labeling and design changes, state law in both cases seeks equally to impose liability for selling products that manufacturers cannot lawfully “fix.”  [(Internal citation omitted; emphasis in original)]

Because of this interplay, “Mensing’s rejection of the stop-selling theory thus cannot be limited to failure-to-warn claims,” according to Mutual, and the Supreme Court’s logic must extend to every claim, “because every products case begins with a sale,” and “[w]ithout one, there is no basis to sue—and no need for a preemption defense.”

The Supreme Court is scheduled to consider Mutual’s Petition at a November 30, 2012 conference.

By Ricardo Carvajal –

FDA published a draft Compliance Policy Guide ("CPG") that sets out enforcement criteria for ackee fruit products that contain hypoglycin A, a toxin that is naturally present in the fruit.  Adverse effects of consuming the toxin can range from none to vomiting, seizures, and even death (a.k.a. Jamaican vomiting sickness).  At first blush, it would seem that FDC Act § 402(a)(1) provides the framework for addressing this issue, as that section specifies the circumstances under which a food is deemed adulterated by virtue of containing a poisonous or deleterious substance, and specifies different standards depending on whether the poisonous or deleterious substance is added or naturally occurring.  On further examination, deciding which standard to apply in the case of ackee presents an unusual challenge. 

In unripe fruit, hypoglycin A is found at high levels, which drop to negligible levels in certain parts of the fruit as it ripens and splits open of its own accord.  It follows that if a processor includes the “wrong” parts of the fruit in the finished product or does not allow sufficient time for the fruit to ripen, levels of the toxin will be higher than would otherwise be the case.  To complicate matters, there are methods of accelerating the splitting of the fruit that are not accompanied by a drop in the levels of the toxin.  In these scenarios, the levels of the toxin are not actually increased by human intervention, which begs the question of whether the toxin could be regarded as having been added for purposes of a § 402(a)(1) analysis.

Rather than wrestle with this issue, FDA pressed into service the ever pliable § 402(a)(4):

The presence of hypoglycin A in the finished ackee product at levels above 100 ppm can be attributed to improper processing of the product and may pose a health risk. . . .  Under section 402(a)(4) of the Federal Food, Drug, and Cosmetic Act (FD&C Act; 21 U.S.C. 342(a)(4)), a food shall be deemed adulterated if it has been prepared, packed, or held under insanitary conditions whereby it may have been rendered injurious to health. Canned ackee, frozen ackee, and other ackee products may be considered adulterated within the meaning of section 402(a)(4) of the FD&C Act when hypoglycin A is present in the food at levels greater than 100 ppm.

If that approach makes you want to run away to a tropical island, you could find yourself in good company (extra credit for an accurate transcription of the reference to ackee).

By Kurt R. Karst –      

FDA’s opening brief in the Agency’s appeal of a March 27, 2012 Memorandum Opinion and accompanying Order issued by Judge Richard J. Leon of the U.S. District Court for the District of Columbia (as modified by a June 22, 2012 Order) in Beaty v. FDA, 853 F. Supp. 2d 30 (D.D.C. 2012) (now Cook v. FDA) concerning FDA’s exercise of enforcement discretion with regard to the importation of unapproved sodium thiopental for use by state Departments of Corrections to carry out death sentences by lethal injection is all about the U.S. Supreme Court’s decision in Heckler v. Chaney, 470 U.S. 821 (1985).  In Heckler, the Court rejected a challenge to FDA’s determination that the Agency would not take enforcement action in the lethal injection context, and held that FDA’s determinations about the circumstances in which the Agency would take enforcement action were not subject to judicial review, because “agency refusals to institute investigative or enforcement proceedings are committed to agency discretion.”  In Beaty, the outcome was different.  

As we previously reported (here and here), Judge Leon’s decision to grant summary judgment to Plaintiffs stems from a February 2011 lawsuit (amended in July 2011) brought against FDA by death row inmates alleging violations of the Administrative Procedure Act (“APA”) and the FDC Act.  Specifically, the Plaintiffs alleged that FDA violated the APA (5 U.S.C. § 706(2)(A)) by improperly allowing shipments of a misbranded and unapproved new drug to enter the U.S. contrary to the FDC Act, and violated the APA (5 U.S.C. § 706(2)(A)) by departing from longstanding Agency policies and undermining the purpose of the FDC Act. 

At issue in the case is FDC Act § 801(a), which concerns imports.  The statute states, in relevant part, that “[i]f it appears from the examination of such [imported] samples or otherwise” that the product violates the FDC Act’s misbranding or new drug approval requirements, “then such article shall be refused admission” (emphasis added).   Although FDA contended that FDC Act § 801(a)does not impose a mandatory duty on the Agency to refuse admission of an import, Judge Leon, in a rather colorful decision, ruled that the statute is clear: “Congress’ intent was for ‘shall’ to impose a mandatory obligation on [FDA] to refuse to admit the misbranded and unapproved drug, thiopental, into the United States.”  Judge Leon also ruled that FDA’s determination not to pursue enforcement action was arbitrary and capricious.  As a result, Judge Leon permanently enjoined FDA “from permitting the entry of, or releaseing any future shipments of, foreign manufacted thiopental that appears to be misbranded or in violation of (FDC Act § 505].” 

FDA had argued that U.S. Supreme Court’s Heckler decision should apply to the case at bar.  In issuing his decisions, however, Judge Leon distinguished Heckler, and wrote that “[u]nlike in Heckler, here, the FDA’s decision did not involve a decision whether to initiate enforcement proceedings against a violator of the Act; rather, it involved a decision to ignore an administrative directive.”  The bottom line, wrote Judge Leon, is that “FDA appears to be simply wrapping itself in the flag of law enforcement discretion to justify its authority and masquerade an otherwise seemingly callous indifference to the health consequences of those imminently facing the executioner’s needle.  How utterly disappointing!”

FDA, in the Agency’s opening brief, attempts to hammer home for the DC Circuit why Heckler applies and is in controlling in this case: 

The district court’s contrary conclusion was premised almost entirely on the use of the word “shall” in a sentence providing that “[i]f it appears” that an FDA-regulated article fails to comply with certain requirements, “then such article shall be refused admission.”  21 U.S.C. § 381(a).  The presumption in favor of enforcement discretion is not overcome by the bare use of words like “shall,” which are routinely interpreted to preserve rather than eliminate administrative discretion in the enforcement context.  Here, the sentence upon which the district court relied merely describes the consequences of a determination by FDA, after any appropriate administrative procedures, that enforcement action is warranted and a given article is subject to removal.  It in no way constrains the agency’s discretion over whether to make such a determination in the first place.

As the Supreme Court recognized in Heckler, overriding an agency’s discretion to decide whether to engage in enforcement proceedings interferes with the agency’s determinations about whether particular enforcement actions are counterproductive or unduly tax agency resources in relation to other responsibilities that the agency may regard as more pressing.  FDA exercises enforcement discretion to not impede controlled imports of medically necessary drugs in response to drug shortages in the United States, and to avoid diverting agency resources on individual attempts to import small amounts of foreign prescription drugs for personal use.  The district court’s reasoning provides no basis for curtailing these exercises of the agency’s discretion in favor of an inflexible mandate to undertake enforcement proceedings in response to every apparent violation of the statute that occurs in the import context, and its judgment should be reversed. 

Interestingly, in another recent case also concerning FDA’s exercise of enforcement discretion, but in the context of compounded versions of hydroxyprogesterone caproate injection that compete with the approved drug MAKENA marketed by K-V Pharmaceutical Company, Judge Amy Berman Jackson of the DC District Court ruled for FDA.  In that case, which is not cited in FDA’s opening brief, Judge Jackson found the Plaintiff’s claims unreviewable, because the APA “precludes judicial review of final agency action, including refusals to act, when review is precluded by statute or ‘committed to agency discretion by law,’” and because Heckler is controlling (see our previous post here).  Last week, K-V appealed that decision to the DC Circuit (Docket No. 12-5349). 

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By Karla L. Palmer –

The Committee on Energy and Commerce’s Subcommittee on Oversight and Investigations issued a Majority Memorandum announcing that it is holding a hearing titled “The Fungal Meningitis Outbreak: Could It Have Been Prevented?”  The hearing will begin at 10:00 am at Room 2123 of the Rayburn House Office Building.  The hearing will consider the facts surrounding the recent meningitis outbreak and other infections linked to reportedly contaminated injectable products that were made and distributed by New England Compounding Center (“NECC”).  The hearing will also examine the history of state and federal complaints and actions taken against NECC and its affiliated entities by both the FDA and the Massachusetts Department of Public Health.  Listed invitation-only witnesses include: Ms. Joyce Lovelace (whose husband, it has been reported, died of a stroke after receiving steroid injections); Barry Cadden (President, Co-owner and Director of Pharmacy, NECC); Margaret Hamburg (FDA Commissioner); and Lauren Smith (Interim Commissioner, Massachusetts Department of Public Health).  House Energy and Commerce Committee Chairman Fred Upton (R-MI), after consultation with Ranking Member Henry A. Waxman (D-CA), issued a subpoena for Barry Cadden to appear because, through his counsel, Mr. Cadden declined to appear voluntarily.  The 25-page Memorandum describes the background of the current meningitis outbreak and the state and federal investigation thereof.  It also discusses the federal and state investigative history of NECC since Massachusetts approved the company’s pharmacy license application in 1998. 

The following issues will be explored at Wednesday’s hearing:

• Whether FDA’s and the Massachusetts Board of Pharmacy’s enforcement actions were appropriate in light of deficiencies and violations reported by State and Federal inspectors at NECC since as early as 2002.
• Whether FDA should have pursued any enforcement actions against the NECC, when FDA emphasized in 2003 the potential for serious public health consequences if the company’s compounding practices, in particular those relating to sterile products, were not improved.
• Prior to this outbreak, according to the Memorandum, the Massachusetts Board of Pharmacy had investigated at least twelve separate complaints relating to NECC and its management.  While many of these complaints covered NECC’s sales and marketing tactics, several were associated with serious adverse events and uncovered deficiencies with NECC’s compounding operations, according to the report.  The Committee will examine whether NECC should have been permitted to maintain its pharmacy license despite repeated violations.
• What did state and federal authorities do to confirm that sufficient corrective measures were taken after these inspections? How did they communicate with each other to ensure such responses were adequate to protect the public health? 

See Majority Memorandum at 25.  The hearing webcast will be available at http://energycommerce.house.gov/.

By Jeff Wasserstein & Dara Katcher Levy –

FDA’s Office of Prescription Drug Promotion (“OPDP”) recently issued an untitled letter to Cornerstone Therapeutics, Inc. relating to Cornerstone’s drug Curosurf (see here and here).  The allegations in the letter are unremarkable and contain the usual claims that the company failed to provide risk information, made unsubstantiated superiority claims, the likes of which are so standard that we are tempted to just say “yada yada yada.”

What makes this letter noteworthy is that the promotional materials complained about included a letter to the media pitching a story about Curosurf (a “pitch letter”) that included an attached press release.  In our experience, there is often a sense among those in the industry that media pitch letters do not need to meet the same requirements as more traditional promotional materials.  This untitled letter clearly indicates that FDA does not take this position. 

What’s also interesting is that FDA criticized the pitch letter for lacking any risk information associated with the drug, even though the press release that was attached to the pitch letter did contain important safety information.  Companies often look at the totality of a promotional presentation in determining whether there is sufficient fair balance.  With this letter, FDA seemingly rejects the gestalt approach and would require each piece of a promotional presentation to contain adequate risk information. 

Also notable is that this is the second letter posted within the past week that mentions a press release.  In the other instance, the press release related to an investigational product (see here and here).  However, both these letters are notable because FDA letters relating to statements in press releases have been few and far between (other than a letter issued in 2009 relating to a video news release, DDMAC/OPDP has not issued a letter relating to a product press release since 2001).  We also note that Cornerstone submitted the media pitch package including the press release on a Form FDA 2253, as is required for promotional labeling.   Query whether the press release, alone, distributed through normal press release channels (and not submitted on a 2253 as is the practice of many companies) would have triggered a letter.

While it’s too soon to tell if this is an enforcement trend or happenstance, it bears watching and remembering that FDA will consider press releases to be promotional labeling in certain circumstances.  

By Kurt R. Karst –       

From time to time throughout Hatch-Waxman history the question has come up: What court decisions terminate a 30-month litigation stay arising as a result of a timely filed patent infringement action in response to a Paragraph IV certification (in either an ANDA or a 505(b)(2) aplication)?  We were thinking about this issue recently – for no particular reason other than our obsession with Hatch-Waxman – and wondered whether a court decision as a result of a counterclaim asserted pursuant to the provisions added to the FDC Act by the 2003 Medicare Modernization Act (“MMA”) might terminate a 30-month litigation stay.

By way of background, the patent delisting counterclaim provisions at FDC Act §505(j)(5)(C)(ii)(I) applicable to ANDAs, as added by the MMA, state that:

If an owner of the patent or the holder of the approved application under [FDC Act § 505(b)] for the drug that is claimed by the patent or a use of which is claimed by the patent brings a patent infringement action against the applicant, the applicant may assert a counterclaim seeking an order requiring the holder to correct or delete the patent information submitted by the holder under [FDC Act § 505(b)] or (c) on the ground that the patent does not claim either – (aa) the drug for which the application was approved; or (bb) an approved method of using the drug.

The MMA also added an almost identical counterclaim provisions at FDC Act § 505(c)(3)(D)(ii)(I) applicable to 505(b)(2) application sponsors. 

Although it has been almost nine years since the enactment of the MMA, there are less than a handful of cases we know about in which a patent delisting counterclaim has been asserted by a defendant.  A couple of those cases have been with respect to patent use code correction – most famously in litigation over generic PRANDIN (repaglinide) Tablets (see here), but also in litigation over generic BONIVA (ibandronate sodium) Tablets (see here).  In a couple of cases, the patent delisting counterclaim has been used to seek actual delisting of Orange Book-listed patents on the listed drug – for example in litigation involving Auvi-Q (epinephrine) Auto-Injector (see here) and in litigation in the U.S. District Court for the Southern District of New York involving generic OxyContin (oxycodone hydrochloride) Controlled-Release Tablets (Case No. 10-cv-03734).  In both of these cases, the litigation was ultimately resolved with respect to the counterclaim without a court decision.  As such, the question of whether a decision on a patent delisting counterclaim is a stay-terminating decision appears to remain unanswered.

FDC Act § 505(c)(3)(C)(i) states that the 30-month litigation stay, if it does not naturally expire at the end of the 30-month period, is terminated once “the district court decides that the patent is invalid or not infringed (including any substantive determination that there is no cause of action for patent infringement or invalidity)” (emphasis added).  Could the parenthetical language at FDC Act § 505(c)(3)(C)(i) include a court-ordered patent delisting?  After all, such a delisting would seem to mean that there is no cause of action under the Hatch-Waxman Amendments with respect to that patent.  We did some digging and came up with something interesting.

Way back in October 2002, as Congress was debating a draft bill that largely became part of the MMA, the Subcommittee on Health of the House Energy and Commerce Committee held a hearing to examine issues related to competition in the pharmaceutical marketplace, and in particular the Federal Trade Commission’s then-recent July 2002 report, titled “Generic Drug Entry Prior to Patent Expiration.”  Then-FTC Chairman Timothy J. Muris made some interesting comments in testimony before the Subcommittee.  A copy of the hearing transcript is available here). 

First, during the hearing, Mr. Muris commented (page 69 of the transcript) in response to concerns raised by Representative Henry Waxman (D-CA) over the need for “an artificial 30-month stay” that “the counterclaim would terminate, if you went with the counterclaim, it would terminate the 30-month stay, just as now, if you win, it terminates a 30-month [stay]” (emphasis added).  Second, in follow-up written testimony, Mr. Muris responsed to several questions posed by former Congressman Michael Bilirakis (R-FL).  Representative Bilirakis had asked, in relevant part (pages 133-134 of the hearing transcript), about creating a private right of action for delisting patents.  Mr. Muris responded:

[T]he FDA does not review the propriety of patents listed in the Orange Book, and courts have ruled that generic applicants have no private right of action to challenge those listings.  The lack of any mechanism to challenge a listing may have real world consequences in that the Commission is aware of a few instances in which a 30-month stay was generated solely by patents in which the propriety of the Orange Book listing was questionable.  To address this situation, the Commission suggested that the FDA may want to clarify its listing regulations along the lines the FTC Report suggested.  It also recommended that Congress consider enacting a private right to counterclaim and raise the issue of whether the patent properly claims the brand-name product; this may eliminate the delay that the 30-month stay could be causing for improperly listed patents in the Orange Book. [(Emphasis added)]

Of course, these statements were the position of the FTC.  FDA has not publicly addressed the issue, and has not had to do so to our knowledge.  Perhaps it is an issue FDA will tackle in the Agency’s proposed regulations implementing the MMA.  For those of you counting, we are now at 3,258 days since the enactment of the MMA.

By Jennifer D. Newberger –

CDRH recently announced that, as of November 1, 2012, the Office of Device Evaluation ("ODE") has been reorganized.  There are two new divisions—the Division of Surgical Devices and the Division of Neurological and Physical Medicine Devices—and 12 new branches across all seven review divisions. 

CDRH stated that the intent behind the reorganization is to “reduce the manager to staff ratios and better align product areas as well as accommodate the new MDUFA hires that will be coming into the Center.”  CDRH has hired some staff to help fill the newly created manager positions, though “it is anticipated that a good portion of the positions will likely be filled with existing staff.”  Until new staff is in place, CDRH “did not want to create voids in the review positions that would impair [its] ability to meet performance goals.”  In the coming weeks, CDRH will be advertising and interviewing to fill the new positions.

In addition to the new divisions and new branches, FDA will also shift the responsibility for reviewing “30-day notices” regarding changes to cardiac devices from the Office of Compliance to ODE’s Division of Cardiovascular Devices.  This change is expected to take place beginning January 1, 2013.