By Ricardo Carvajal –

In several letters issued to trade associations on June 18th (for an example, see here), FDA stated that it “will expect to enforce compliance” with the preventive controls provision in section 103 of the Food Safety Modernization Act ("FSMA") and the foreign supplier verification provision in FSMA section 301 “in timeframes that will be described in the final rules.”  Given that the proposed rules for those provisions have yet to publish, it is clear that industry will have substantial additional time to come into compliance with the requirements in those provisions.  However, that time will not be unlimited.  If the delay in publication of proposed and final rules proves too protracted, consumer advocates can be expected to put FDA’s feet to the fire. 

By JP Ellison & Jennifer M. Thomas –

If you have ever sat in a meeting, received a letter or brief, or otherwise heard an interpretation from a regulatory agency that surprised, confounded or frustrated you, then you should read the Supreme Court’s recent decisions in Christopher v. SmithKline Beecham Corp., No. 11-204, 567 U.S. — (June 18, 2012) and FCC v. Fox Television Stations, Inc., No. 10-1293 (June 21, 2012).  If you don’t have the time or inclination to wade into these decisions, we will explain why they are significant rulings for companies regulated by FDA and other federal agencies. 

Both decisions give teeth and expanded reach to the often-cited principle that the Due Process Clause of the Fifth Amendment to the United States Constitution requires that federal agencies provide “fair warning” or “fair notice” of required or prohibited conduct.  While neither decision involved an agency before which we regularly appear, the cases should have significant implications for FDA, FTC, DEA, and other regulatory agencies. 

Companies frequently battle with government agencies when: (1) A company disagrees with an agency interpretation of law that the agency put forth after the company engaged in some business practice or decision without the benefit of knowing the agency’s current interpretation; or (2) the government files an enforcement action against the company alleging violations of law, but the government did not set forth its interpretation before the company engaged in the allegedly unlawful conduct. 

In Christopher v. SmithKline Beecham Corp., the question before the Court was the interpretation of the statutory phrase “in the capacity of outside salesman” with respect to pharmaceutical detailers.  The task of interpreting that phrase was delegated to the Department of Labor ("DOL"), which had issued regulations.  Those regulations did not address how the phrase applied to pharmaceutical detailers.  In 2009, in an amicus brief, the DOL first articulated its view that pharmaceuticals detailers were not employed in the capacity of outside salespersons, and thus were entitled to overtime pay.  The agency later altered its interpretation on several occasions.  Despite acknowledging that the regulation at issue was ambiguous, and that Supreme Court precedent typically calls for deference to an agency’s interpretation of its own ambiguous regulations, the Court withheld giving the agency’s decision any deference.  The Court ruled:

Petitioners invoke the DOL’s interpretation of ambiguous regulations to impose potentially massive liability on respondent for conduct that occurred well before that interpretation was announced. To defer to the agency’s interpretation in this circumstance would seriously undermine the principle that agencies should provide regulated parties fair warning of the conduct [a regulation] prohibits or requires. 

The Court cited cases that had applied the “fair warning” principle in the context of enforcement or penalty actions brought by a federal regulatory agency.  However, notably, in Christopher v. SmithKline Beecham Corp., there was no agency enforcement action.  Instead, the issue of the agency’s interpretation arose in the context of potential  “massive liability” in a private lawsuit.  The Court also noted that when an agency announcement of its interpretation of a statute or regulation is preceded by a very lengthy period of “conspicuous inaction” in terms of government enforcement actions, “the potential for unfair surprise is acute.”  This enforcement inactivity by the government in the face of a practice that may be occurring in an entire industry suggests, according to the Court, that the practice was not even unlawful.  This is often the case in many FDA interpretations.  

In addition, the Court criticized the practice of government agencies promulgating “vague and open-ended regulations that they can later interpret as they see fit, thereby ‘frustrat[ing] the notice and predictability purposes of rulemaking.’”

The Court also warned that it “is one thing to expect regulated parties to conform their conduct to an agency’s interpretations once the agency announces them; it is quite another to require regulated parties to divine the agency’s interpretations in advance or else be held liable when the agency announces its interpretations for the first time in an enforcement proceeding and demand deference.”

The application by the Court of the “fair warning” doctrine in this context demonstrates that it can be validly raised outside the traditional enforcement context, and that various types of significant expenses could trigger “fair warning” scrutiny.  For example, a change in agency practice or position that requires additional expense in obtaining an approval might raise these same constitutional concerns.  Certainly, civil or criminal penalties, injunctions, or forfeiture actions would continue to be subject to the fair warning requirement.  We are confident that the Court’s ruling would apply in many other contexts.

FCC v. Fox Television Station, Inc. concerned whether the FCC could apply its current position — that the fleeting use of expletives violates the FCC’s indecency standards—to conduct that occurred before the FCC articulated that new policy.  The Court concluded that under the FCC’s “old” policy, fleeting expletives were not actionable.  The Court had previously concluded that the FCC’s decision to modify its policy was not arbitrary and capricious.  On its second review of the case, the Court reached the constitutional question.  The Court held that the FCC’s enforcement actions were invalid because they ran afoul of the fair notice/fair warning constitutional requirement.  The Court explained: “[a]  conviction or punishment fails to comply with due process if the statute or regulation under which it is obtained ‘fails to provide a person of ordinary intelligence fair notice of what is prohibited, or is so standardless that it authorizes or encourages seriously discriminatory enforcement.’”  In further describing the constitutional underpinnings of this doctrine, the Court explained that it was animated by “two connected but discrete due process concerns: first, that regulated parties should know what is required of them so they may act accordingly; second, precision and guidance are necessary so that those enforcing the law do not act in an arbitrary or discriminatory way.”

Significant to the Fox decision is the Court’s mandate that due process not only demands some level of clarity by the agency, but also that even if clear, the standard must be sufficiently precise as to not promote arbitrary or discriminatory enforcement.  Query whether, for example, a corporate defendant could argue that the misdemeanor provisions of the FDC Act fail to satisfy this standard for a prosecution against a regulated entity or whether responsible corporate officer facing a Park prosecution could argue that FDA’s guidance in the Regulatory Procedures Manual for a such prosecutions, does not pass constitutional muster. 

A company or individual might argue that because it is entirely within the government’s discretion whether an alleged FDC violation should result in enforcement discretion,  a warning letter, consent decree, or criminal prosecution is, in this regard,  “so standardless that it authorizes or encourages seriously discriminatory enforcement.”  Similarly, why can not companies facing these FDA actions defend by arguing that the conduct the government now claims is unlawful was not preceded by a prior clear public articulation of the government’s position?

Indeed, we expect that particularly in the context of a criminal case, a defendant facing charges now stands a much better chance of acquittal by articulating the principles set forth in these cases.  Individuals and companies will have increased incentives to take their chances at trial, much like as occurred in a decision that we explained in a recent post.     

In Fox, the Court also addressed an argument by the government that there was no constitutional violation because no penalty had been assessed against Fox, and moreover, the FCC had represented that “it would not consider the indecent broadcasts  “in any context.”  Despite this “policy of forbearance”—akin to FDA “enforcement discretion” the Court found that the constitutional issue was appropriately before the Court.  In reaching that conclusion, the Court noted that because the agency had the statutory authority to consider the conduct, its representation that it would not was “insufficient to remedy the constitutional violation.”  The Court’s analysis in this regard is important because it suggests that a constitutional “fair notice” challenge can be brought against agency action even when there is no immediate injury to the regulated person or entity, if the agency has the authority to later cite it against the company—such as when FDA recites prior 483 observations, in a later complaint for a permanent injunction.  When coupled with the Court’s decision in Sackett earlier this term regarding when allegedly non-final agency action can be challenged (see our previous post here), this aspect of Fox should provide additional support for companies seeking to challenge new or novel interpretations by regulatory agencies.

Christopher v. SmithKline Beecham Corp. and FCC v. Fox Television Stations, Inc., provide clear and dramatic support for arguments that can be brought to bear to challenge unwarranted agency action.  Because neither case involved FDA, the Court rulings’ application in the FDA context is somewhat uncertain.  However, these rulings present opportunities for companies and individuals and their counsel to carefully craft legal and factual arguments to challenge the government when it violates these Due process “fair notice” requirements.  

By Kurt R. Karst –       

Earlier this week, the Presidential Commission for the Study of Bioethical Issues (“Commission”) announced in a Federal Register notice that it is seeking comment on several ethical issues associated with the development of medical countermeasures for children.  The announcement follows an October 2011 report from the National Biodefense Science Board, titled “Challenges in the Use of Anthrax Vaccine Adsorbed (AVA) in the Pediatric Population as a Component of Post-Exposure Prophylaxis,” in which the Board recommended that the Department of Health and Human Services (“HHS”) move forward with testing AVA before a public health emergency, but only after certain ethical considerations are adequately addressed and reviewed.  Earlier this year, HHS Secretary Kathleen Sebelius asked the Commission to “conduct a thorough review of the ethical considerations of conducting clinical trials of medical countermeasures in children,” including with AVA. 

The Commission is interested in public comment on myriad issues, but specifically:

• How to conceptualize and consider risk and societal value when reviewing pediatric clinical research in general and for medical countermeasures in particular;

• The types of information, data, or facts needed to ensure evidence-based decision-making for conducting pediatric medical countermeasure research;

• Possible criteria, if any, that might classify proposed studies testing medical countermeasures for pediatric use as minimal risk;

• Ethical issues related to access to and allocation of medical countermeasures previously studied within pediatric populations in a public health emergency;

• Scientific and public health strategies that could minimize the risk or ethical concerns associated with pediatric medical countermeasure research;

• Strategies for communicating risk to prospective participants and their families; and

• The role communities play in the design and support of pediatric research and pediatric medical countermeasure research.

Over the past decade – since the anthrax attacks in late 2001 – FDA has played a key role in facilitating the development of medical countermeasures.  In addition to establishing the current Office of Counterterrorism and Emerging Threats, which, among other things, coordinates FDA’s Medical Countermeasures Initiative, FDA finalized regulations in May 2002 know as the “Animal Efficacy Rule.”  

The Animal Efficacy Rule provides that under certain circumstances, and where where human efficacy trials are not feasible or ethical, animal studies can be relied on to provide substantial evidence of effectiveness of a drug or biological product (21 C.F.R.  Part 314, Subpart I and 21 C.F.R. Part 601, Subpart H).  Evaluation of the product for safety in humans is still required, and cannot be addressed by animal studies alone.  In addition, approval under the Animal Efficacy Rule is subject to certain postapproval commitments. 

Only a few products have been approved under the Animal Efficacy Rule, beginning with the February 2003 approval of NDA No. 020414 for pyridostigmine bromide to increase survival after exposure to Soman "nerve gas" poisoning.  More recently, in April 2012, FDA approved NDA supplements for LEVAQUIN (levofloxacin) Injection, Tablets, and Oral Solution for the treatment and prophylaxis of plague due to Yersinia pestis in adults and pediatric patients 6 months of age and older. 

The lack of use of the Animal Efficacy Rule may be due to certain challenges, including the unavailability of qualified animal models that can predict efficacy of new drugs or biologics.  In 2011, the National Research Council prepared a consensus report, titled “Animal Models for Assessing Countermeasures to Bioterrorism Agents,” which addresses the challenges stemming from developing and testing medical countermeasures against biothreat agents in animal models, and that makes several recommendations.

By John A. Gilbert, Karla L. Palmer & Larry K. Houck –

The Food and Drug Administration Safety and Innovation Act (“FDASIA”) (S. 3187), which is on its way to the President for enactment after the Senate passed the bill by a 92-4 vote, may impact the scheduling of hydrocodone products, but not by the same means as Senator Joe Manchin’s (D-WV) earlier-introduced bill, S. 2297.

Senator Manchin introduced S.2297 in April of this year to amend the Controlled Substances Act (“CSA”) by legislatively rescheduling hydrocodone combination products from their current schedule III to the more restrictive schedule II.  This rescheduling would affect popular hydrocodone combination products such as Vicodin, Lortab, Lorcet, Norco, Hycodan and Vicoprofen.  (Bulk and single entity hydrocodone products have been classified in schedule II since the passage of the CSA in 1970).

Rescheduling hydrocodone combination products would impact every legitimate controlled substance handler including patients who rely on the products for pain relief.  The rescheduling would subject manufacturers, distributors, dispensers such as pharmacies and physicians, importers and exporters to more stringent regulatory requirements.  For example, schedule II substances can only be transferred between registrants via a triplicate, sequentially-numbered DEA Form 222 Official Order Form or its electronic equivalent while registrants need only document transfers of schedule III-V drugs with invoices, packing slips or other records.  Prescriptions for schedule II substances, with limited exceptions, must be written, and pharmacies must have the original prescriptions in-hand before dispensing.  Prescriptions for schedule III-V may be in a written, oral or faxed format.  Pharmacists cannot refill schedule II prescriptions; but they can, if authorized to do so, refill schedule III-V prescriptions up to five times within a six month period.  Manufacturers and distributors must secure schedule II substances in a safe, steel cabinet or vault while schedule III-V substances may be stored in a less secure controlled substance cage or other enclosure.

The legislative attempt to reschedule hydrocodone combination products quickly ran into significant and vocal opposition from numerous patient advocacy and pharmacy groups.  Several pharmacy groups including the National Association of Chain Drug Stores and the Generic Pharmaceutical Association, and the American Medical Association, have expressed concerns that rescheduling would unduly restrict legitimate patient access to needed medications and impose burdens upon pharmacies.

Thus, instead of legislatively rescheduling hydrocodone combination products from schedule III to schedule II as set forth in S.2297, FDASIA calls for the Secretary of Health and Human Services to hold a public meeting not later than 60 days after the enactment of the Act to assist the FDA with its scheduling recommendation to DEA for hydrocodone products.  If enacted, the law would require FDA to solicit input from stakeholders including patients, healthcare providers and others “regarding the health benefits and risks, including the potential for abuse and the impact of up-scheduling these products.”  Whether by legislative fiat or administrative action, the impact of rescheduling hydrocodone is significant, as noted above.

On a related note, FDA published notice of a public meeting of the Drug Safety and Risk Management Committee to be held at the FDA White Oak Campus on October 29 and 30, 2012.  77 Fed. Reg. 34,051 (June 8, 2012).  The Federal Register Notice states that purpose of the meeting is to discuss “the public health benefits and risks, including the potential for abuse, of drugs containing hydrocodone either combined with other analgesics or as an antitussive.”  The notice also states that FDA is calling for the meeting because DEA requested the Department of Health and Human Services to conduct a scientific and medical evaluation, and scheduling recommendation, for hydrocodone combination products, “in response to continued reports of misuse, abuse, and addiction related to these products.”  Interested persons can submit data, information and viewpoints orally or in writing.  Electronic and written submissions must be submitted on or before October 15, 2012.

This process may ultimately conclude with the DEA determining to reschedule hydrocodone combination products from schedule III to II pursuant to 21 U.S.C. §§ 811 and 812.  However, unlike the scuttled legislative rescheduling process, the administrative rescheduling process requires notice and public comment, and DEA’s analysis of eight statutory factors prior to rescheduling.  DEA must consider the following eight factors for rescheduling hydrocodone combination products (or any substance):  (1) Actual or relative potential for abuse; (2) scientific evidence of the substance’s pharmacological effects; (3) the state of the current scientific knowledge about the substance; (4) history and current pattern of abuse; (5) scope, duration and significance of abuse; (6) risk to the public health; (7) psychic or physiological dependence liability; and (8) whether the substance is an immediate precursor to an already controlled substance.  21 U.S.C. § 811(c).

Notwithstanding instigating an administrative process to reschedule hydrocodone combination products, FDASIA seeks to legislatively place dozens of synthetic cannabinoids in schedule I of the CSA (without the administrative notice and comment rulemaking, the eight-factor analysis or DEA’s use of emergency scheduling powers).  In a section dubbed the “Synthetic Drug Abuse Prevention Act of 2012,”  FDASIA’s enactment would place certain psychedelic/hallucinogenic dimethoxyphenethylamine drugs and synthetic cannabinoids into schedule I.  Schedule I controlled substances have a high potential for abuse and no recognized medical use in the United States.  In addition, the proposed law if passed would define the term “cannabimimetic agent,” and establish criteria for the control of similar cannabinoid compounds that meet the statutory definition.

FDASIA also seeks to double the term from 18 to 36 months DEA’s emergency authority to temporarily schedule substances in schedule I to avoid imminent hazard to the public health.  DEA exercised its emergency scheduling authority twice in the past two years to temporarily place in schedule I certain substances including some of the cannabinoids now subject to scheduling by FDASIA, in schedule I.  See DEA’s Press Release announcing the addition of 26 synthetic drugs to schedule I.

By Kurt R. Karst –    

We’ve been wondering for a while now when FDA might be asked in a public forum to decide on the issue of whether a “first applicant” eligible for a period of 180-day generic drug marketing exclusivity has forfeited such eligibility if FDA tentatively approves the ANDA on the date that is 30 months from the date of application submission.  That day has come with Sandoz Inc.’s (“Sandoz’s”) June 19, 2012 citizen petition (Docket No. FDA-2012-P-0661) seeking FDA’s determination as to whether purported first applicant Ranbaxy, the sponsor of ANDA No. 077830 for a generic version of NEXIUM (esomeprazole magnesium) Delayed-release Capsules, 20 mg and 40 mg, forfeited 180-day exclusivity eligibility in connection with its ANDA as a result of FDA’s February 5, 2008 tentative approval of the application.  According to FDA’s Paragraph IV Certifications List, August 5, 2005 is the first date on which an ANDA was submitted to FDA containing a Paragraph IV certification to a patent listed in the Orange Book for NEXIUM (NDA No. 021153).

Under FDC Act § 505(j)(5)(D)(i)(IV), which is one of the six 180-day exclusivity forfeiture provisions added to the FDC Act by the 2003 Medicare Modernization Act, 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 FDA Safety and Innovation Act (“FDASIA”) (§ 1133), which is awaiting the President’s signature, would further clarify FDC Act § 505(j)(5)(D)(i)(IV) with respect to certain ANDAs by extending the period during which a first applicant must obtain tentative approval (or final approval if tentative approval is not warranted).  FDASIA § 1133 would not come into play in this case given the 2005 submission date of ANDA No. 077830.

According to Sandoz:

Based on the apparent date on which Ranbaxy’s ANDA was submitted to FDA and the date on which it received tentative approval, Ranbaxy has forfeited its 180-day exclusivity under forfeiture condition (IV), failure to receive tentative approval “within” 30 months after ANDA submission, because Ranbaxy did not obtain tentative approval until the first day of the 31st month and thus not “within” 30 months. (Emphasis in original)

An FDA forfeiture decision is warranted in this case, argues Sandoz, for several reasons.  First, applying common dictionary definitions of the word “within” means that, “‘[w]ithin 30 months’ must be inside that 30-month time period, not outside it” (emphasis in original).  Moreover, counting months – i.e., “the first month after submission of Ranbaxy‘s ANDA on August 5, 2005 ended on September 4, 2005, the second month ended on October 4, 2005, and so on” – means that “February 4, 2008 is the last day that is ‘within’ 30 months of August 5, 2005, ” and as such, “Ranbaxy‘s tentative approval date of February 5, 2008 is one day after expiration of the statutory 30-month period.”  Second, long-standing FDA interpretations and applications of 5-year New Chemical Entity (“NCE”) exclusivity and 7-year orphan drug exclusivity support a forfeiture determination in the case of ANDA No. 077830.  In particular, Sandoz argues with respect to NCE exclusivity that:

[T]the NCE statutory language provides that a Paragraph IV ANDA “may be submitted . . . after the expiration of four years from the date of the approval” of the reference product. . . .  Since FDA has long allowed Paragraph IV ANDAs in this situation to be submitted on the NCE-1 date (the fourth anniversary of the approval of the reference product), FDA must regard the NCE-1 date as the first day of the fifth year after the approval of the reference product.  The logical conclusion is that the last day of “four years from the date of the approval” of the reference product is the day before a Paragraph IV] ANDA may be filed on the NCE-1 date.  (Emphasis in original)

Similarly, Sandoz argues with respect to orphan drug exclusivity that:

Seven-year orphan drug exclusivity prohibits FDA from, in relevant part, approving a generic version of the drug “until the expiration of seven years from the date of the approval of the approved application.” . . .  Just as FDA cannot accept a Paragraph IV ANDA where the RLD is protected by five-year NCE exclusivity until after the expiration of four years from the date of approval of the RLD, FDA cannot approve a generic drug where the innovator product is protected by seven-year orphan drug exclusivity until after the expiration of seven years from the date of approval of the innovator product.  (Emphasis in original)

Finally, Sandoz says that its interpretation of FDC Act § 505(j)(5)(D)(i)(IV) “best serves the public health and the intent of the Hatch-Waxman Amendments,” becuase it “would potentially open the generic market much sooner.”

Interestingly, this is not the first time Sandoz has raised the “within 30 months” issue with FDA.  As we previously reported, back in 2010, Caraco Pharmaceutical Laboratories, Ltd. (“Caraco”), a subsidiary of Sun Pharmaceutical Industries Limited, issued a quarterly report stating with respect to 180-day exclusivity for generic PRANDIN (repaglinide) Tablets that:

The Company believes that it is the first to file an ANDA with a Paragraph IV certification for this drug product and it intends to defend this action vigorously to capitalize on the potential for obtaining 180 days exclusivity available for this product.  On May 26th, 2010, the Company received correspondence from the FDA forwarding a letter sent by Sandoz Inc. to the FDA challenging the Company’s 180 day exclusivity based on when the Company received tentative approval for its product.  The Company responded to the FDA on June 17, 2010.  On June 28th, 2010, Sandoz Inc. replied to the Company’s correspondence.  The Company issued a further letter to the FDA stating its position regarding the 180 day exclusivity on July 9, 2010.  The Company believes it received tentative approval timely, and that it has the potential to obtain 180 day exclusivity for this product.  It intends to defend that position vigorously.

Sandoz notes in the company’s June 2012 petition (footnote 17) that the arguments the company raises with respect to generic NEXIUM Delayed-release Capsules apply “with equal force to the same factual scenario as found for generic versions of PRANDIN® (repaglinide) Tablets.”

Making things even more interesting is speculation that Ranbaxy’s ANDA No. 077830 for generic NEXIUM Delayed-release Capsules is one of the unidentified ANDAs in the Consent Decree (see here and here) the United States filed against Ranbaxy earlier this year and for which Ranbaxy agreed to forfeit 180-day exclusivity.  Although the list of ANDAs subject to forfeiture has not been made public, we note that FDA’s most recent update to the Paragraph IV Certifications List shows that long-pending ANDAs for generic DEPAKOTE ER (divalproex sodium) Extended-release Tablets, 250 mg, and DETROL (tolterodine tartrate) Tablets, 1 mg and 2 mg, were withdrawn (and presumably resulted in a forfeiture of any associated 180-day exclusivity under FDC Act § 505(j)(5)(D)(i)(II)).  FDA tentatively approved Ranbaxy’s ANDA No. 076953 for generic DETROL Tablets, 1 mg and 2 mg, on September 15, 2005.  FDA tentatively approved Ranbaxy’s ANDA No. 077143 for generic DEPAKOTE ER Extended-release Tablets, 250 mg, on September 12, 2005.

By Kurt R. Karst –      

In a June 25th decision from Judge Amy Berman Jackson of the U.S. District Court for the District of Columbia, the court gave a mixed bag ruling on Cross-Motions for Summary Judgment (here and here) filed by FDA and Stat-Trade, Inc. (“Stat-Trade”) in a long-running dispute over FDA’s assessment of user fees under the Prescription Drug User Fee Act (“PDUFA”) in relation to the Stat-Trade’s NDA No. 020353 for NAPRELAN (naproxen sodium) controlled-release tablets, 375 mg, 500 mg, and 750 mg, and the Agency’s process for granting waivers for prescription drug user fees submitted by Stat-Trade.  Legal challenges to FDA’s interpretation and application of PDUFA have been rare over the almost 20-year existence of the statute.  In fact, the Stat-Trade decision is only the second court decision of which we are aware (see here). 

As we previously reported, Stat-Trade filed a Complaint and a Motion for Preliminary Injunction in October 2011 seeking to compel FDA to rule on the company’s PDUFA user fee exception and waiver requests.  Subsequently, Stat-Trade agreed to withdraw the company’s Motion for Preliminary Injunction after FDA agreed to rule on the company’s pending requests. 

Briefly, Stat-Trade alleged that for several years FDA incorrectly assessed fees for certain NAPRELAN strengths that are the subject of an approved ANDA listed in the discontinued section of the Orange Book.  FDC Act § 379h(a)(3)(B) excepts a “prescription drug product” from annual product fees if “such product is the same product as another product approved under an [ANDA].”  FDA and Stat-Trade disagreed as to whether this statutory exception applies in any situation where there is an FDA-approved generic equivalent (regardless of whether the product is listed in the active or discontinued section of the Orange Book), or whether it applies only when the generic is being actively marketed. 

Stat-Trade also submitted multiple requests to FDA seeking waivers of PDUFA fee assessments under the so-called Barrier to Innovtion (“BTI”) and Fees-Exceed-the-Costs (“FEC”) statutory provisions.  The BTI provision at 21 U.S.C. § 379h(d)(1)(B) requires FDA to grant a partial or complete waiver of fees to any company that can demonstrate that “the assessment of the fee would present a significant barrier to innovation because of limited resources available to such person or other circumstances.”  The FEC provision at 21 U.S.C. § 379h(d)(1)(C) requires a fee waiver if the fees “will exceed the anticipated present and future costs incurred by [FDA] in conducting the process for the review of human drug applications for such person.”  Under 21 U.S.C. § 379h(i), to qualify for consideration for a BTI or FEC waiver request “a person shall submit to [FDA] a written request for such waiver . . . not later than 180 days after such fee is due.”

In late October 2011, FDA denied Stat-Trade’s BTI requests for Fiscal Years 2009 to 2011, partially granted the company’s Fiscal Year 2009 and 2010 FEC requests, and refused to rule on Stat-Trade’s FEC request for Fiscal Year 2011 “on the grounds that it could not issue its final determination until it had calculated its standard costs for fiscal year 2011, which, it estimated, would not occur until June 2012 at the earliest.”  With respect to FDA’s interpretation of the “generic exception,” the Agency issued a formal decision affirming the Agency’s interpretation of FDC Act § 379h(a)(3)(B) that active marketing is necessary for the exception to apply.

In November 2011, Stat-Trade filed a two-count Second Amended Complaint alleging violations of the Administrative Procedure Act (“APA”).  Judge Jackson distilled the amended complaint down to the following in her decision:

Count I of the second amended complaint asks the Court to determine whether Stat-Trade is entitled to reimbursement of product fees it paid for the 375 and 500 mg strengths of Naprelan for fiscal years 2009–2012 as well as the amounts it paid to FDA in penalties, interest, and administrative charges for its late payment of product fees for fiscal years 2009–2011. This presents two distinct legal questions:

1)  Whether FDA exceeded its authority under the PDUFA by interpreting the generic exception provision to be limited to situations where the generic is not only “approved,” but also in active production; and

2)  If the Court finds that the exception should have applied, whether FDA abused its discretion and acted in excess of statutory authority by denying Stat-Trade’s request to correct the FY 2009–2011 invoices on the grounds that they were time barred by 21 U.S.C. § 379h(i).

Count II of the complaint asks the Court to determine whether Stat-Trade is entitled to reimbursement for the penalties, interest, and administrative fees that it paid to FDA for the late payment of fees that were eventually waived under the FEC waiver provision of PDUFA. This count also presents two distinct legal questions:

1)  Whether FDA’s decision to defer processing Stat-Trade’s 2011 FEC waiver request until it can determine standard costs for that year constitutes unreasonable delay and is arbitrary and capricious; and

2)  Whether it was arbitrary and capricious for FDA to refuse to review Stat- Trade’s 2009–2010 FEC waiver requests until Stat-Trade had abandoned or exhausted its appeals for its BTI waiver requests.

Judge Jackson addressed each issue in turn.  With respect to Count I, Judge Jackson, in applying the familiar Chevron analysis, found that the case can be resolved at Chevron Step One.  “Stat-Trade takes the position that the statute is unambiguous and so the obligation to defer to the department is not triggered in this case.  Looking at the text of the provision, the Court agrees; the exception plainly applies when there is an approved generic without further limitation,” wrote Judge Jackson in her 26-page opinion.  That win for Stat-Trade was short-lived, however.  As a result of the 180-day deadline for making PDUFA user fee refund requests, and Stat-Trade’s untimely filed refund requests for certain Fiscal Years, Judge Jackson ruled that Stat-Trade is not entitled to a refund of the fees for the untimely filed refund requests.  With respect to Fiscal Year 2012 product fees and Stat-Trade's timely request, however, Judge Jackson ordered FDA to refund the disputed fees.  Moreover, the decision is short-lived because Congress is poised to change PDUFA in a manner consistent with FDA's interpretation of the generic exception.  According to FDA, the change “will clarify FDA’s longstanding policy to use the active portion of the Prescription Drug Product List in the [Orange Book] to identify fee-eligible prescription drug products,” 

With respect to Count II, Judge Jackson found that FDA’s decision to defer processing Stat-Trade’s 2011 FEC waiver request until it can determine standard costs for that year does not constitute unreasonable delay and is not arbitrary and capricious under the APA.  “Since it is the statute, and not FDA policy, that requires waiver applicants to pay their fees before they receive the waiver, the Court cannot find FDA’s timetable to be unreasonable merely because the upfront payment imposes a burden on some companies.  Furthermore, FDA offers a reasonable justification for its method of calculating standard costs.”  As to the second issue under Count II, Judge Jackson said that the issue is moot as a result of FDA’s voluntary review of the waiver requests.

REMINDER:  You can follow us on Twitter @fdalawblog

By Kurt R. Karst –      

Nearly seven years after having received a citizen petition (FDA Docket No. FDA-2005-P-0120) requesting that FDA apply more stringent and unconventional bioequivalence requirements (and twice supplemented – here and here – along the way) before approving generic versions of ADDERALL XR (dextroamphetamine mixed salts of a single-entity amphetamine product) 5mg, 10mg, 15mg, 20mg, 25mg, and 30mg Capsules, FDA finally issued a decision to Shire Pharmaceuticals Group, plc (“Shire”) late last Friday granting in part and denying in part the October 17, 2005 petition.  On the same day, FDA also approved Actavis’ ANDA No. 077302 for generic ADDERALL XR. 

In responding to Shire’s petition, FDA, for only the third time, determined that generic applicants must, in addition to demonstrating bioequivalence using the traditional metrics of area under the plasma concentration versus time curve (“AUC”) – calculated to both the last measured concentration time (“AUC0-t”) and AUC extrapolated to infinity (“AUC0-inf”) – and maximum (i.e., “peak”) drug concentration (“Cmax”), demonstrate bioequivalence using certain partial AUC (“pAUC”) metrics.  As we previously reported, FDA has set out pAUC requirements for generic versions of RITALIN LA (methylphenidate HCl) Extended-Release Capsules and AMBIEN CR (zolpidem tartrate) Extended Release Tablets.  (Still pending are decisions on two 2004 citizen petitions requesting that FDA apply pAUC bioequivalence metrics to generic versions of METADATE CD (methylphenidate HCl) Extended-Release Capsules and CONCERTA (methylphenidate HCl) Extended-Release Tablets.)

FDA approved ADDERALL XR, a dopamine agonist amphedamine, on October 11, 2001 under NDA No. 021303 for the treatment of Attention Deficit Hyperactivity Disorder (“ADHD”) in children ages 6-12 years).  FDA later approved NDA supplements for ADDERALL XR the treatment of adult ADHD (August 11, 2004) and for the treatment of adolescent ADHD (July 21, 2005).  ADDERALL XR contains the neutral sulfate salts of dextroamphetamine (d-amphetamine) and amphetamine with the dextro isomer of amphetamine saccharate and d,levo (l)-amphetamine aspartate monohydrate in two types of drug-containing beads – immediate-release (“IR”) and delayed-release (“DR”) – designed to prolong the release of amphetamine from the drug product.  ADDERALL XR is listed in FDA’s Orange Book with four unexpired patents – U.S. Patent Nos. 6,322,819 (“the ‘819 patent), 6,605,300 (“the ‘300 patent”), RE41,148 (“the ‘148 patent”), and RE42,096 (“the ‘096 patent”) – that are all scheduled to expire on October 21, 2018, but that are each subject to a period of pediatric exclusivity that expires on April 21, 2019. 

Shire’s October 2005 citizen petition made several requests, including that FDA establish certain therapeutic equivalence requirements, such as AUCpR (i.e., area under concentration-time curve truncated at the population median “Tmax”, which is the time to reach peak concentration) in addition to traditional pharmacokinetic parameters, and pAUC measurements for each time point up to 4 hours (AUC0-l, AUC1-2, AUC2-3, and AUC3-4).  A recent petition supplement also requests that FDA apply a pAUC metric of 1.5 hours, or, alternatively, a pAUC metric of 3 hours, and that the pAUC metric be applied in bioequivalence testing under fasting, sprinkled, and fed conditions with appropriate adjustments to the pAUC intervals. 

FDA, in the Agency’s petition response, acknowledged that “it is important to use parial AUC for some specialized dosage forms, because our current acceptance criteria . . . may not be adequate for certain drugs formulated as multiphasic [modified-release] products.”  Moreover, wrote FDA, “because the mixed amphetamine salts [modified-release] dosage form (1) contains IR and DR components; (2) is designed to achieve both rapid onset of activity and sustained activity throughout the day; and (3) does not show unusual accumulation at steady state, the additional metrics may be appropriate to ensure that generic versions are therapeutically equivalent to the reference product.”  FDA was unwilling, however, to accept Shire’s proposed pAUC parameters.  Instead, FDA found:

that using two partial AUCs, AUC0-5h and AUC5h-t, would be sufficiently sensitive to determine the bioequivalence of generic mixed amphetamine [modified-release] formulations.  We would require these two partial AUC metrics, in addition to Cmax, and AUCo-inf, for both d- and l- amphetamines in fasting, fasting sprinkle-in-applesauce, and fed bioequivalence studies of generic mixed amphetamine salts [modified-release] products referencing Adderall XR.

FDA also denied other requests made by Shire in the company’s petition and supplements, including that FDA require generic versions of ADDERALL XR to have identical or superimposable plasma concentration-time profies, that ANDA sponsors perform a deconvolution study, that FDA seek the advice of an advisory committee regarding the pAUC metrics for generic ADDERALL XR, that ANDA sponsors bioequivalence in the pediatric population, and that FDA require ANDA  applicants to conduct clinical effcacy studies if they have not demonstrated an identical plasma concentration-time profile.

Still unclear is how FDA resolved another round of 180-day generic drug marketing exclusivity for generic ADDERALL XR.  180-day exclusivity for generic ADDERALL XR is governed by the pre-Medicare Modernization Act version of the FDC Act where exclusivity is patent-by-patent and product-by-product.  Exclusivity with respect to the ‘819 and the ‘300 patents (for all strengths) was apparently triggered for another ANDA sponsor with the marketing of an authorized generic (see here).  In April 2010, Actavis submitted a citizen petition (Docket No. FDA-2010-P-0188) to FDA requesting the Agency’s determination that Actavis is entitled to 180-day exclusivity with respect to the ‘148 patent.  We understand that the petition was withdrawn.  (The ‘096 patent, which issued on February 1, 2011, first appeared in the February 2011 Orange Book Cumulative Supplement, and presumably triggered a certification from sponsors with pending ANDAs.)

By Kurt R. Karst –      

We’re always interested in cases where things, at first glance, just don’t seem to add up.  If we cannot find an explanation, we may put the case to the side for a while, and wait until an explanation becomes available.  That’s what happened when we saw the June 23, 2011 approval letter for Lannett Holdings, Inc.’s (“Lannett’s”) NDA No. 201517 for Morphine Sulfate Oral Solution, 100 mg per 5 mL (20 mg per mL), which was submitted pursuant to FDC Act § 505(b)(2).  The approval letter states that the NDA, dated February 26, 2010, was  received by (i.e., submitted to) FDA on March 1, 2010.  Shortly before FDA received Lannett’s NDA submission, the Agency, on January 25, 2010, approved a supplement to Roxane Laboratories, Inc.’s (“Roxane’s”) NDA No. 022195 (also submitted as a 505(b)(2) application) for Morphine Sulfate Oral Solution.  With that supplement, FDA approved a new strength: 100 mg per 5 mL (20 mg per mL).  What perplexed us is how FDA was able to accept Lannett’s application as a 505(b)(2) NDA in light of the Agency’s prior approval of the same drug product.  (Both drug products are approved for the same use: for the management of moderate to severe acute and chronic pain in opioid-tolerant patients.)  In other words, why didn’t FDA refuse to accept Lannett’s 505(b)(2) application and instead require that the application be submitted as an ANDA?

The premise of FDC Act § 505(j) is that an ANDA drug is a duplicate of the brand name drug (i.e., the Reference Listed Drug (“RLD”)).  Draft FDA guidance generally defines the term “duplicate” to mean:

drug products that contain identical amounts of the identical active drug ingredient, i.e., the same salt or ester of the same therapeutic moiety, in identical dosage forms, but not necessarily containing the same inactive ingredients, and that meet the identical compendial or other applicable standard of identity, strength, quality, and purity, including potency and, where applicable, content uniformity disintegration times and/or dissolution rates. 

Elsewhere, FDA has stated that the word “duplicate” means “a product that is the same as the listed drug with respect to active ingredient, dosage form, route of administration, strength, and conditions of use, among other characteristics.”

FDA’s regulation at 21 C.F.R. § 314.101(d)(9) states that “FDA may refuse to file an application if . . . . [t]he application is submitted as a 505(b)(2) application for a drug that is a duplicate of a listed drug and is eligible for approval under section 505(j) of the act.”  21 C.F.R. § 314.101(d)(9).  FDA explained how the Agency interprets this regulation in a June 2004 response to a citizen petition (Docket No. FDA-2003-P-0338).  In that case, which concerned a then-pending 505(b)(2) application for Loratadine Tablets, 10 mg, FDA determined that an intervening NDA approval for the same drug product does not bar the Agency from approving a pending 505(b)(2) application.  Specifically, FDA ruled that 21 C.F.R. § 314.101(d)(9) “bars 505(b)(2) applications for products eligible for approval under section 505(j) of the Act only if the product described in a 505(b)(2) application may be approved via section 505(j) at the time of the application’s submission” (emphasis added).  A 505(b)(2) application submitted to FDA before the approval of another NDA – an intervening NDA – that would otherwise render the 505(b)(2) application drug product a duplicate of an approved drug is, according to FDA, unaffected by the intervening NDA approval. 

More recently, FDA discussed the Agency’s intervening NDA approval policy as part of a May 17, 2012 decision granting a citizen petition to designate VELTIN (clindamycin phosphate and tretinoin) Gel, 1.2%/0.025% (NDA No. 050803) as a second RLD in the Orange Book.  A comment submitted to FDA contended, among other things, that VELTIN could have been submitted via an ANDA given the intervening approval of NDA No. 050802 for ZIANA (clindamycin phosphate and tretinoin) Gel, 1.2%/0.025%.  According to FDA, however:

Because there were no pharmaceutically equivalent products approved at the time that Veltin was submitted, it would not have been appropriate for the Veltin application to be submitted as a 505(j) application.  Although we approved the Ziana NDA while the Veltin application was under review, our policy is that we do not require applicants to withdraw and resubmit applications if another pharmaceutically equivalent drug product is subsequently approved.  Therefore, the 505(b)(2) NDA was an appropriate pathway for Veltin’s application.

(It should be noted that under somewhat analogous circumstances, FDA has decided – Docket No. FDA-2008-P-0329 – that the intervening approval of an NDA after the submission of an ANDA made pursuant to an approved suitability petition, and where the NDA approval renders the pending ANDA a duplicate of an approved drug, requires the generic applicant to submit a new ANDA citing the newly approved NDA drug product as the RLD.)

Given FDA’s regulation at 21 C.F.R. § 314.101(d)(9), we were hard pressed to come up with a simple explanation as to how FDA could have accepted Lannett’s application for Morphine Sulfate Oral Solution, 100 mg per 5 mL (20 mg per mL), as a 505(b)(2) NDA given the previous approval of the same drug product under NDA No. 022195.  After all, FDA’s intervening NDA approval policy interpreting 21 C.F.R. § 314.101(d)(9) did not seem to fit the facts here.  Then, when FDA recently made available the Summary Basis of Approval for NDA No. 201517, an explanation was provided.  According to FDA’s Summary Review: 

The question of evaluating this application as a 505(b)(2) as opposed to an ANDA has been discussed.  The concentration of sorbitol contained in Lannett’s morphine sulfate 100 mg per 5 mL (20 mg per mL) product is high enough that there is a theoretical possibility that doses of morphine sulfate oral solution at or in excess of 300 mg total dose may result in a different relative morphine exposure than doses below 300 mg.  The potential effect of sorbitol on morphine sulfate absorption is based on the effects of sorbitol concentration on ranitidine, a [Biopharmaceutics Classification System (“BCS”)[ class 3 drug.  However, the BCS classification of morphine sulfate oral solution is not clear, and therefore, it is not clear if this concern is relevant for morphine sulfate.

One approach to determining whether there is an effect of the sorbitol concentration on the absorption of morphine would be to perform a pharmacokinetic [sic]. Performing such a study with a dose of 300 mg of immediate-release morphine, even with naltrexone blockade, poses an unacceptable level of risk for opioid toxicity.  Therefore, given that such a study is impracticable, at this time we do not believe that bioequivalence can be effectively investigated, nor can Lannett’s product be AB rated to Roxane’s morphine sulfate oral solution 100 mg per 5 mL (20 mg per mL).  Additionally, because such a bioequivalence study cannot be performed, this product is not appropriate as an ANDA; approval requires a clinical judgment on whether this drug is safe and effective for use.

Quite an interesting theory.  And FDA’s Summary Review for NDA No. 201517 appears to be the only documentation of this theory. 

Just as interesting is the history of Lannett’s efforts to market its Morphine Sulfate Oral Solution, 100 mg per 5 mL (20 mg per mL), drug product without NDA approval.  As we previously reported, Lannett (along with Cody Laboratories, Inc.) sued FDA in July 2010 concerning the alleged grandfather status of Cody/Lannett’s marketed unapproved Morphine Sulfate Oral Solution, 100 mg per 5 mL (20 mg per mL).  The lawsuit stems from FDA’s March 2009 Warning Letters to Cody and Lannett (among other companies) to stop manufacturing certain unapproved narcotic drugs, including morphine sulfate oral solutions. 

Cody/Lannett raised three issues in the litigation: (1) FDA’s alleged determination that Cody/Lannett’s product is a “new drug;” (2) FDA’s alleged failure to develop an administrative record for its determination that Cody/Lannett’s Morphine Sulfate Oral Solution, 100 mg per 5 mL (20 mg per mL), product is a “new drug;” and (3) FDA’s alleged disparate treatment of Cody/Lannett’s standard review NDA compared to Roxane’s priority review NDA.  Ultimately, the U.S. Court of Appeals for the Tenth Circuit affirmed a November 2010 decision from the U.S. District Court for the District of Wyoming granting FDA’s Motion to Dismiss the case.  The Tenth Circuit also dismissed as moot Cody/Lannett’s claim of disparate treatment at FDA concerning the same drug submitted under an NDA.  One has to wonder whether or not there is any relationship between FDA’s decision discussed above concerning the basis for submission and approval of NDA No. 201517 and the litigation. 

Following that court battle, and perhaps in an effort to obtain final agency action to file a new lawsuit, Lannett petitioned FDA (Docket No. FDA-2012-P-0053), requesting that the Agency affirm, pursuant to the 1938 “grandfather clause” of the FDC Act, the grandfather status of morphine sulfate (see our previous post here).  Another Lannett petition (Docket No. FDA-2012-P-0189), seeks a similar determination with respect to certain Oxycodone HCl and Cocaine HCl drug products.  Both petitions are pending at FDA. 

Hyman, Phelps & McNamara, P.C. Director Douglas B. Farquhar is a key presenter at the Food and Drug Law Institute’s (“FDLI’s”) upcoming conference in São Paulo, Brazil.  The conference, which is scheduled for September 10-11, 2012, is titled “U.S. & Brazil: Navigating New Frontiers in Pharmaceutical, Medical Device & Food Law & Regulation,” and will focus on business opportunities and policy challenges of producing safe products and promoting public health.  Mr. Farquhar, who will discuss FDA enforcement activities relating to imported medical devices, will be joined by government officials and other internationally renowned experts who will discuss pharmaceutical, medical device and food law, regulation, and policy in the United States and Brazil.  A copy of the conference agenda is available here.

Brazil, one of the so-called “BRICS” countries, is rapidly emerging as a world leader in innovation and development in the pharmaceutical, medical device, and food industries.  Stakeholders ranging from multinational companies to small startups are staking a foothold in the region.  FDA and the Brazilian National Health Surveillance Agency (“ANVISA”) are working together to safeguard the integrity of the products being exchanged between the two countries, and, by extension, across the globe.  Understanding the current legal, regulatory, and economic environment for the development and sale of pharmaceuticals, medical devices, and foods in in the United States and Brazil is imperative for anyone doing business, or working with clients who are doing business, between the two countries. 

FDA Law Blog readers can receive a 15% discount off the conference registration price.  To receive the discount, use the following promotional code: BRAZIL2012.  To register for the event click here.

By Kurt R. Karst –      

Over the past year or so, we’ve seen a change in FDA policy concerning what approvals the sponsor of a 505(b)(2) NDA can cite in an application; that is, what previous FDA approvals a 505(b)(2) sponsor can rely on for the aproval of its drug product.  This change has not come about by rulemaking or by formal FDA guidance, but rather, has been communicated to potential 505(b)(2) applicants in general FDA correspondence.  As such, we thought the larger food and drug community would benefit from bringing this issue to light. 

FDC Act § 505(b)(2) describes a 505(b)(2) NDA as “[a]n application submitted under [FDC Act § 505(b)(1)] for a drug for which the investigations described in clause (A) of [FDC Act § 505(b)(1)] and relied upon by the applicant for approval of the application were not conducted by or for the applicant and for which the applicant has not obtained a right of reference or use from the person by or for whom the investigations were conducted. . . .”  Draft FDA guidance distills this statutory description down to “an application that contains full reports of investigations of safety and effectiveness but where at least some of the information required for approval comes from studies not conducted by or for the applicant and for which the applicant has not obtained a right of reference.” 

FDA’s regulations implementing FDC Act § 505(b)(2) provide that one component of a 505(b)(2) application is the “[i]dentification of the listed drug for which FDA has made a finding of safety and effectiveness and on which finding the applicant relies in seeking approval of its proposed drug product by established name, if any, proprietary name, dosage form, strength, route of administration, name of listed drug's application holder, and listed drug’s approved application number.”  21 C.F.R. § 314.54(a)(1)(iii) (emphasis added).  FDA’s regulations (21 C.F.R. § 314.3) further define the term “listed drug” to mean:

a new drug product that has an effective approval under [FDC Act § 505(c)] for safety and effectiveness or under [FDA Act § 505(j)], which has not been withdrawn or suspended under [FDC Act §§ 505(e)(1) through (e)(5) or FDC Act § 505(j)(5)], and which has not been withdrawn from sale for what FDA has determined are reasons of safety or effectiveness.  Listed drug status is evidenced by the drug product’s identification as a drug with an effective approval in the current edition of FDA’s [Orange Book] or any current supplement thereto, as a drug with an effective approval.  A drug product is deemed to be a listed drug on the date of effective approval of the application or abbreviated application for that drug product.

For years, FDA has permitted sponsors of 505(b)(2) applications to cite products approved under an ANDA as a “listed drug” in their application.  In most cases, this occurred when the brand name drug product was discontinued and FDA designated a therapeutic equivalent approved under an ANDA as the Reference Listed Drug (“RLD”).  In other cases, FDA approved an ANDA under a suitability petition, or approved an ANDA pre-Hatch-Waxman pursuant to a finding under the Drug Efficacy Study Implementaion (“DESI”) program, and designated the ANDA product as the RLD. 

Under FDA’s evolving thinking around 505(b)(2) applications, however, an ANDA can no longer be cited as a listed drug in a 505(b)(2) application.  According to recent guidance from FDA on this issue to would-be 505(b)(2) applicants:

If you intend to rely on the Agency’s finding of safety and/or effectiveness for a listed drug(s) or published literature describing a listed drug(s) (which we consider to be reliance on FDA’s finding of safety and/or effectiveness for the listed drug(s)), you should identify the listed drug(s) in accordance with the Agency’s regulations at 21 CFR 314.54.  It should be noted that 21 CFR 314.54 requires identification of the “listed drug for which FDA has made a finding of safety and effectiveness,” and thus an applicant may only rely upon a listed drug that is the subject of an NDA approved under section 505(c) of the FD&C Act (in other words, an application approved under section 505(j) of the Act (i.e., ANDA, generic drug) may not be cited as a listed drug).  The regulatory requirements for a 505(b)(2) application (including, but not limited to, an appropriate patent certification or statement) apply to each listed drug upon which a sponsor relies.

If you choose to rely on FDA’s finding of safety and/or effectiveness for a listed drug(s) and you intend to use your proposed comparative clinical trial to establish a bridge between your proposed drug product and the specified listed drug(s), then you should use the specified listed drug(s) (rather than a bioequivalent ANDA product) as the comparator.

In other words, the 505(b)(2) pathway, according to FDA, contemplates a 505(b)(2) applicant’s reliance on the Agency’s finding of safety and effectiveness that is contained in an NDA; and because an ANDA does not contain this finding, it cannot serve as a “listed drug for which FDA has made a finding of safety and effectiveness.” 

It is unclear whether FDA’s new policy is a one-size-fits-all policy, or whether there are exceptions.  For example, there might be some unique cases where FDA would permit a 505(b)(2) sponsor to cite an ANDA approved pursuant to a DESI proceeding as as a listed drug.  And what about an ANDA approved pursuant to a suitability petition that FDA has designated as a RLD – can a 505(b)(2) sponsor cite such a drug as a listed drug?  Perhaps FDA’s long-awaited proposed regulations implementing the Medicare Modernization Act will address these issues in greater detail. 

By Ricardo Carvajal –

In a relatively rare example of a request for regulatory action intended to benefit a specific racial or ethnic group, a coalition of businesses and nonprofits submitted a food additive petition (see here and here) asking FDA to amend the food additive regulation for folic acid to permit its addition to corn masa flour – a staple among populations of Latin American descent.  Since the late 1990’s, standards of identity for several grain-based foods have required the addition of folic acid.  According to the petition, that requirement is credited with decreasing the prevalence of neural tube defects among Hispanics and non-Hispanics.  However, Hispanic women continue to have a higher rate of neural tube defects, and fewer of them consume folic acid from fortified foods.  The petition contends that “[f]ortification of corn masa flour presents a clear opportunity to improve intake in those who consume corn masa flour products as a significant portion of their diet,” and could potentially decrease neural tube defects among Hispanic women. 

The observation that diet-related risk factors for certain diseases may vary among racial and ethnic groups is not novel (see, e.g., CDC’s estimation of disparate rates of obesity for Whites, Blacks, and Hispanics).  Nonetheless, it is not clear that a systematic approach to these issues has emerged in relation to food, as it has for drugs.  A 1995 FDA guidance document geared to drug and biologics developers provides recommendations for the collection of race and ethnicity data in clinical trials, in recognition of the fact that numerous “[d]ifferences in response to medical products have already been observed in racially and ethnically distinct subgroups of the U.S. population.”  That same year, FDA approved the first drug to treat a disease in patients identified by race (BiDil, for heart failure in Black patients). 

Although perhaps difficult to estimate, the potential cost savings associated with dietary interventions that reduce the risk of disease could be significant, particularly in relation to the cost of the intervention.  The corn masa petition estimates that the addition of folic acid to corn masa could prevent 40 cases of neural tube defects annually, each of which could generate direct lifetime costs of a half-million dollars.

By Kurt R. Karst –      

A new article, titled “Citizen Petitions: An Empirical Study,” analyzes citizen petitions submitted to FDA between 2001 and 2010 and concludes that petitions submitted to FDA concerning drug products are on the rise and show no signs of abating.  The paper, which is co-authored by Michael Carrier, a professor at the Rutgers School of Law-Camden, and Daryl Wander (currently a Law Clerk to the Hon. Francine Axelrad, P.J.A.D. of the Superior Court of New Jersey, Appellate Division) and that will be published in the Cardozo Law Review, also concludes that FDC Act § 505(q), which was added to the law by Section 914 of the FDA Amendments Act of 2007 (“FDAAA”), Pub. L. No. 110-85 (2007), as amended by § 301 of Pub. L. No. 110-316 (2008), and that is intended to prevent the citizen petition process from being used to delay approval of ANDAs and 505(b)(2) applications, “has not been successful in reducing the number of petitions.”  (Under FDC Act § 505(q), “[FDA] shall take final agency action on a petition not later than 180 days after the date on which the petition is submitted.”  As we previously reported (here and here), pending legislation would shave 30 days off of FDA’s response timeframe, from 180 days to 150 days.)

The authors culled information from Regulations.gov on citizen petitions submitted to FDA between 2001 and 2010 concerning human drugs (excluding citizen petitions that are suitability petitions) and cross-referenced their results with the FDA Law Blog 505(q) Citizen Petition Tracker for post-FDAAA petitions containing a 505(q) certification to come up with a universe of 258 petitions for the analysis.  The authors classified FDA petition responses (177 of them) as “granted,” “denied,” or “mixed.”  For those petition decisions (51 one of them) in which FDA issued a “mixed” decision (i.e., granted in part and denied in part), the authors analyzed each response and determined that the petition was either essentially granted (24%), essentially denied (45%), or was truly a mixed decision (31%). 

Using the universe of citizen petitions and FDA petition decisions, Carrier and Wander then drilled down on the data and performed several broad and sub-group analyses.  For example, their analysis shows (Table 1 below) an increase in the average number of petition submissions pre- and post-FDAAA from 27 to 34 in the three years before and after enactment of FDC Act § 505(q), respectively.

These data comport with data FDA reported on in the Agency’s Annual Reports On Delays In Approvals Of Applications Related To Citizen Petitions And Petitions For Stay Of Agency Action (see our previous posts here, here, and here).  We are eagerly awaiting the release of FDA’s fourth annual report on FDC Act § 505(q) petitions later this year.

In terms of citizen petition success rate, Carrier and Wander looked at the number of petitions decision FDA granted and denied between 2001 and 2010 (161 of them, which does not include 16 mixed decisions and 81 petitions for which a response was not located) and found, as depicted in Figure 1 below, that FDA granted 19% (31 petitions) and denied 81% (130 petitions).  (FDA is currently in the process of clearing the backlog of old petitions that may no longer be timely – see here.)  The success rate for petitions submitted by or on behalf of brand companies (which submit 68% of petitions) is 19%, compared to a success rate of 28% for petitions submitted by or on behalf of generic companies. 

Among other things, Carrier and Wander conclude that FDC Act § 505(q) “has not been successful in reducing the number of citizen petitions.”  This conclusion seems to jibe with a concern that FDA expressed in the Agency’s third annual report on 505(q) petitions that the provision “may not be discouraging the submission of petitions that do not raise valid scientific issues and are intended primarily to delay the approval of competitive drug products.” 

By our count, FDA has already received 17 petitions in Fiscal Year 2012 containing a 505(q) certification – several in recent months.  But it is too early to tell whether or not the Fiscal Year 2012 numbers will be on par with the numbers from previous years.  FDA may ultimately determine that not all of the petitions meet the criteria for consideration as a 505(q) petition.  For petitions submitted to FDA in Fiscal Year 2012, the Agency has issued three responses (two denials and one mixed decision).  A couple of the petitions are “duplicates” insofar as the petitions were withdrawn and resubmitted (and assigned a different docket number). 

Hyman, Phelps & McNamara P.C. invites you to register for our webinar, “Garbage Runs, Fake Identities, and Surprise Home Visits: Strategies to Deal With FDA's Nontraditional Investigative Tools,” which is scheduled to take place on Wednesday, June 20, 2012 from 12:30 – 2:00 p.m. ET. 

From routine on-site inspection to rummaging through trash bins outside your facility, FDA and other government agents have shown increasing willingness to obtain information outside of just conducting regulatory inspections of company facilities.  This webinar will provide an overview of popular, and not so well-known, tactics that the government uses, followed by a discussion of strategies to help your company to prepare for, and if necessary, respond to them.  Participants will gain an understanding of how to deal with the government's demands for information, directed to the company, its current employees, and even former employees, while protecting the company's interests.

The webinar will feature HP&M attorneys Doug Farquhar, John Fleder, and Anne Walsh, who bring the full perspective of experience in government enforcement, including a former Assistant U.S. Attorney, the former Director of DOJ's Office of Consumer Litigation, and a former Associate Chief Counsel at FDA.  They will:

• Share insights from their experiences in the government; 
• Describe trends on government enforcement efforts using these investigative techniques; 
• Analyze publicly disclosed cases; 
• Provide strategies for preparing your company before the government even begins its scrutiny, and responding when the government arrives;
• Explain how government investigative methods have been used against large as well as small corporations; and
• Answer participants' questions during the webinar

You can register for this free webinar here.  Please contact Lisa Harrington (lharrington@hpm.com) with any questions.

By Anne Marie Murphy & Benjamin K. Wolf* –

On June 12, 2012, FDA announced the availability of a draft guidance, titled “Considerations When Transferring Clinical Investigation Oversight to Another IRB” (“FDA Draft Guidance”).  This is the first time FDA has provided through guidance specific direction to the entities (including the original and receiving institutional review boards, or IRBs, the sponsor of the clinical investigation, and the clinical investigator) involved in the transfer of a study from one IRB to another.  Generally, the same IRB (a group formally designated by an institution to review, approve the initiation of, and to conduct periodic review of biomedical research of human subjects) maintains continued oversight of clinical trials at a research site.  However, an IRB or study sponsor may need to transfer a clinical trial for reasons including institutional reassessment or reorganization, natural disaster, or disqualification of the IRB. 

The Office for Human Research Protections (“OHRP”) made available its own draft guidance, titled “Considerations in Transferring a Previously Approved Research Project to a New IRB or Research Institution” (“OHRP Draft Guidance”), which, despite some minor variations from the FDA Draft Guidance, is meant to harmonize with the FDA Draft Guidance.  The Federal Register notice announcing the OHRP Draft Guidance can be found here.

The Agency suggests a non-exhaustive list of eight steps that should be addressed, as appropriate, prior to IRB transfer.  They are:

1. Identifying those studies for which IRB oversight is being transferred; 
2. Ensuring the availability and retention of pertinent records; 
3. Establishing an effective date for transfer of oversight, including records, for the clinical investigation(s); 
4. Conducting a review of the study(ies) by the receiving IRB, where appropriate, before it accepts responsibility for the study(ies);
5. Confirming or establishing the date for the next continuing review; 
6. Determining whether the consent form needs to be revised; 
7. Notifying the key parties; and
8. Updating IRB registration information.

Each of these steps is designed to ensure a smooth transition between IRBs and the continued observance of all regulations pertaining to IRB oversight—including continuous oversight by an IRB, document retention, and providing contact information for the IRB to FDA.

FDA is accepting comments on the Draft Guidance until August 13, 2012.

*  Summer Associate

REMINDER:  HP&M is hosting a webinar, Garbage Runs, Fake Identities, and Surprise Home Visits; Strategies to Deal With FDA's Nontraditional Investigative Tools, on Wednesday, June 20, 2012 from 12:30 – 2:00 p.m. ET.  Click here to register.

By Riëtte van Laack –

As we previously reported, the United States District Court for the Southern District of Florida denied the Federal Trade Commission’s (“FTC’s”) motion to hold Garden of Life and its founder, Jordan S. Rubin (collectively “GOL”) in contempt for allegedly violating a court-issued Consent Decree.  The Court held that a disagreement between FTC’s and GOL’s experts did not constitute evidence that GOL violated the Consent Decree which requires that GOL possess “competent and reliable scientific evidence” to support its claims. 

In an effort to tighten the screws regarding what GOL will contend in the future constitutes competent and reliable scientific evidence supporting GOL’s claims, the FTC moved to modify the Consent Decree.  The proposed modifications sought to redefine competent and reliable scientific evidence to mean two adequate and well-controlled human clinical studies for claims regarding bone and cognitive health benefits of GOL’s products and FDA approval for disease treatment and cure claims for GOL’s products. 

The Court rejected the FTC’s position, concluding that the FTC did not establish that any significant change in facts or law had occurred that warranted revision of the Consent Decree.  A difference in opinion between experts was not sufficient reason to modify the Consent Decree.  Moreover, there was no evidence to support the FTC’s contention that the original objective of the 2006 order had not been met.  The Court stressed that a Consent Decree is a negotiated document between parties in which each party gives up its right to prove its position.  Except under special circumstances, a Consent Decree must be enforced as written.  In 2006, FTC and GOL agreed to use the more vague definition of “competent and reliable scientific evidence” and the Court found that the FTC could have anticipated that experts might disagree.  The Court ruled that the FTC cannot now 5 years later, merely because it is no longer satisfied with the negotiated definition, have the Court modify this definition to suit the FTC’s purpose.