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On June 12, 2012, FDA announced the availability of a draft guidance, titled “Considerations When Transferring Clinical Investigation Oversight to Another IRB” (“FDA Draft Guidance”).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.

By Kurt R. Karst –      

In a move that brings to mind Scene 2 of Monty Python and the Holy Grail, in which a mortician roams the streets ringing a bell and calling out “Bring out your dead!” (a close second being the Monty Python “Dead Parrot” sketch), FDA is announcing, in a notice to be published in the Federal Register on June 14th, that 364 inactive ANDAs will be deemed voluntarily withdrawn unless the Agency is informed otherwise.  The announcement likely kicks off a broader FDA initiative to get a handle on pending ANDAs as the Agency prepares for implementation of the Generic Drug User Fee Amendments of 2012 (“GDUFA”) (here and here).  GDUFA is pending in Congress as part of broader FDA legislation.

Under GDUFA, there is, among other fees, a one-time (Fiscal Year 2013) ANDA backlog user fee that will be calculated by dividing $50 million by the number of ANDAs in the backlog as of October 1, 2012.  Under the proposed GDUFA text, “[e]ach person that owns an [ANDA] that is pending on October 1, 2012, and that has not received a tentative approval prior to that date, shall be subject to a fee for each such application.”  Provided GDUFA becomes law this year, FDA must publish a notice in the Federal Register by October 31, 2012 announcing the amount of the ANDA backlog fee.  That fee must be paid no later than 30 calendar days from FDA’s publication of the Federal Register notice.

As a result of how a backlog ANDA is defined in GDUFA, the true ANDA backlog consists of more than just those applications pending in the Office of Generic Drugs (“OGD”) on October 1, 2012 that have not been acted on (i.e., awaiting an approval, tentative approval, or not approvable/complete response action).  (Today, that number stands at almost 2,900 applications – see the table below).  Instead, the true ANDA backlog consists of all ANDAs not yet acted on, as well as all ANDAs submitted to OGD over the past few decades that are the subject of a not approvable or complete response letter and that have not been withdrawn. 

FDA’s June 14th notice addresses a portion of those ANDAs that will be part of the backlog for GDUFA user fee purposes.  Specifically, the notice addresses so-called “Inactive ANDAs,” which are applications “that have been determined to be incomplete and as to which the ANDA applicant has not communicated with FDA since July 8, 1991.”  Why July 8, 1991?  We understand that the 364 ANDAs listed by FDA are identified in DARRTS (FDA’s Document Archiving, Reporting, and Regulatory Tracking System) as “incomplete” and that the last date on which FDA received correspondence on any of those 364 ANDAs was July 8, 1991.  The date also seems to correspond to a timeframe in which FDA issued a couple of industry letters – in June 1990 and November 1991 – concerning the completeness of applications. 

The Inactive ANDAs predate and are, therefore, not subject to FDA’s regulation at 21 C.F.R. § 314.110(c).  That regulation, which became effective on June 29, 1992, was last amended in July 2008 (73 Fed. Reg. 39,588), and states:

(c) Failure to take action. (1) An applicant agrees to extend the review period under section 505(c)(1) or (j)(5)(A) of the act until it takes any of the actions listed in paragraph (b) of this section [(i.e., resubmission, withdrawal, or request opportunity for hearing)].   For an application or abbreviated application, FDA may consider an applicant’s failure to take any of such actions within 1 year after issuance of a complete response letter to be a request by the applicant to withdraw the application, unless the applicant has requested an extension of time in which to resubmit the application.  FDA will grant any reasonable request for such an extension.  FDA may consider an applicant’s failure to resubmit the application within the extended time period or to request an additional extension to be a request by the applicant to withdraw the application.

(2) If FDA considers an applicant’s failure to take action in accordance with paragraph (c)(1) of this section to be a request to withdraw the application, the agency will notify the applicant in writing.  The applicant will have 30 days from the date of the notification to explain why the application should not be withdrawn and to request an extension of time in which to resubmit the application.  FDA will grant any reasonable request for an extension.  If the applicant does not respond to the notification within 30 days, the application will be deemed to be withdrawn.

For the 364 Inactive ANDAs identified by FDA in the June 2012 notice, the Agency will deem them to have been voluntarily withdrawn unless the the sponsor (which includes any successor in interest, because many of the companies identified no longer exist) timely notifies FDA in writing of its intent to actively pursue approval.  To protect confidentiality, FDA delinks the sponsor names and ANDA information.

FDA’s notice on Inactive ANDAs appears to be Phase 1 in the Agency’s efforts to do some house cleaning in anticipation of the enactment and implementation of GDUFA and to develop a master list of backlog ANDAs.  We suspect that Phase 2 will concern pending ANDAs that are the subject of a not approvable/complete response action and that have not been withdrawn.  That cohort of ANDAs is likely to be much larger larger than the 364 Inactive ANDAs.  Phase 3 will likely concern what is typically considered the ANDA backlog (i.e., those ANDAs pending and not yet acted on by FDA) and may not be implemented until GDUFA is enacted. 

By Jeffrey K. Shapiro –

A provision in the House FDA Reform Act of 2012 (H.R. 5651) would require FDA to “regularly publish detailed decision summaries for each clearance of a device requiring clinical data” (Section 704).  The requirement would be applied only on a going forward basis to new clearances.  This provision is not in the companion Senate Food and Drug Administration Safety and Innovation Act (S. 3187).  An earlier Senate proposal (S. 2292) did have this provision, and would have applied it to all clearances, not just those requiring clinical data.  That bill, however, did not move forward to Senate passage.

The House Report for H.R. 5651 says that Section 704 “would add predictability, consistency, and transparency to the medical device premarket review process.”  House Report 112-495 at 26.  Specifically, the Report states:  “Only by creating transparency in decision making can we ensure the review process functions as intended.”  Id. at 27.  The House Report does not elaborate on why this reform would improve the 510(k) system, but it is worth considering this point in more detail.

In each 510(k) review, FDA compares a proposed device to an accepted baseline, which is a “predicate” device generally already cleared to market via a previous 510(k) decision.  The proposed device and the predicate must have the same intended use, but they need not have the same technological characteristics.  The technological differences can be bridged if FDA finds that, based upon the data and information presented, the proposed device implicates the same type of safety and effectiveness questions as the predicate device, and is at least as safe and effective.  This finding is known as “substantial equivalence.”

The 510(k) system, then, consists of a series of case by case adjudications of individual device safety and effectiveness, each one based upon the substantial equivalence comparison just described.  Once a new technology (or technological feature) has received clearance, it then becomes a platform for further incremental improvements.  The system has proven to be adaptable to an almost infinite variety of device technologies, allowing FDA to conduct a meaningful premarket review of safety and effectiveness while still allowing continuous technological innovation.

A persistent criticism of FDA’s implementation of the 510(k) system, however, is a lack of predictability, particularly as to the data that will be required to bridge the gap between proposed and predicate devices.  The lack of predictability leads to delays and friction in the review process. 

A possible root cause of this problem actually may be a lack of transparency.  Specifically, in order for the 510(k) system to operate predictably, the public must have access to the essential information in prior 510(k) decisions, such as the intended use and technological characteristics of the proposed and predicate devices, and the data required to show substantial equivalence.  This information is necessary to allow a sponsor seeking clearance of a proposed device to hunt for predicate devices, learn FDA’s existing data requirements, and/or extrapolate likely additional data requirements that might apply. 

Unfortunately, the essential information is not easily available.  The database of 510(k) summaries is the primary searchable database, and these summaries are wholly inadequate.  They are prepared by the submitter, not FDA, and they are (i) not standardized very well and (ii) tend to be vague and lacking in detail (sometimes intentionally so, to avoid providing potential competitors with useful information about how to achieve clearance).  FDA has forced improvements in the quality of the 510(k) summaries in the past couple of years, but not enough has been done.  It is also impractical for the public to obtain a complete 510(k) file; a Freedom of Information Act request is required and the fulfillment time is typically a year or more.  (An article describing the various techniques for trying to gather this information can be found here.)

The bottom line is that the public is operating from a different and degraded database as compared to FDA reviewers, who have access to complete 510(k) files and also have institutional knowledge of their prior decisions.  The current lack of access to important decision data creates a cloudy picture that leads to unpleasant surprises when FDA reviewers impose data requirements that were not discernible from the public 510(k) summaries.

Section 704 would provide at least a partial remedy to this problem.  As the House and Senate conferees reconcile their companion bills, they should certainly include section 704 of the House bill.  However, section 704 is really too timid.  It should be extended to require decision summaries for all new 510(k) clearances, as was proposed in S. 2292, not just the approximately 10%requiring clinical data.  Indeed, the use of decision summaries is not new.  It was implemented almost ten years ago by the Office of In Vitro Diagnostics (“OIVD”).  As stated in OIVD’s FY 2005 Annual Report (P. 28):

In an effort to provide stakeholders with the scientific / regulatory basis for FDA’s decisions . . . OIVD . . . implemented the use of a standardized Premarket Decision Summary Template across all the OIVD divisions. 

The Premarket Decision Summary Template summarizes the basis on which an in vitro diagnostic device was cleared under a 510(k) submission. OIVD implemented the use of this standardized premarket Decision Summary Template in August 1, 2003. The decision summaries have been continuously posted on the OIVD webpage and the public has full access to them through the 510(k) database.

OIVD has continued posting decision summaries to this day.  Congress should simply require FDA to extend this useful practice to the Office of Device Evaluation (“ODE”).  If ODE lacks sufficient resources, then Congress should provide the necessary funding.  However, it is not obvious that such funding is needed.  The ODE reviewers undoubtedly document their review decisions now.  It should not require significant additional resources to create a standard template, complete it for each 510(k) review, and post it to the 510(k) database.  The experience of OIVD should be a guide as to what level of resources will be required.

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 Jennifer D. Newberger –

On June 5, 2012, the Department of Health and Human Services Office of Inspector General (“OIG”) released a report titled “Scientific Disagreements Regarding Medical Device Regulatory Decisions.”  A number of scientific disputes at the Center for Devices and Radiological Health (“CDRH”) received media attention between 2008-2010.  Perhaps in an effort to address the management of scientific disputes, in October 2009, CDRH issued new policies and procedures addressing their resolution.  The OIG report was intended to:  1) describe the types of disputes that arose between 2008-2010; 2) determine whether CDRH followed the requisite procedures and regulations when addressing such disputes; 3) assess the implementation of the new policies and procedures; and 4) identify challenges in addressing scientific disputes.

The October 2009 guidance formalized the process to resolve internal scientific disagreements.  The first step in the process is an informal discussion between the reviewer and the manager.  If that discussion is unsuccessful, the manager may submit an “initiation memorandum” to the Ombudsman, who reviews the memorandum to determine “whether it is complete and eligible for the new process.”  To be eligible, “the disagreement must be scientific and related to a regulatory decision.”  The Ombudsman then assigns a manager not involved in the initial disagreement to review the memorandum, discuss the disagreement with involved parties, and attempt to resolve the issue.  If resolved, the reviewer and manager submit a “joint memorandum” to the administrative file documenting the resolution and its basis.

If the dispute is not resolved, the manager “must make a decision on each disputed issue on the basis of a review of evidence in the administrative file and any other relevant resources” and must document that decision in a decision memorandum that will be included in the administrative file.  The manager must then send the memorandum to the Ombudsman and all involved parties.  If any party is not satisfied, he or she may appeal for review by a higher supervisory level, up to and including the Center Director, after which the appeal may be taken to the FDA Commissioner. 

In reviewing use of the scientific resolution procedures and applicable regulations, OIG used the following sources:  “CDRH administrative files; an online survey of CDRH reviewers and managers; interviews with CDRH officials and other stakeholders; and CDRH's current and former policies, procedures, and guidance documents.”  OIG ultimately identified 36 administrative files to review, 33 of which used the pre-October 2009 procedures, and three of which used the new, more formal procedures.  OIG acknowledges that the actual numbers of agreements could have been much higher, since CDRH did not begin tracking scientific agreements until 2010. 

The scientific disagreements reviewed by OIG involved a variety of issues, and were not often directly related to clearance or approval of a medical device.  Rather, only 1/3 of the resolutions led to the clearance or approval of a device.  The other 2/3 dealt with processes prior to clearance or approval.  This may serve as some comfort to individuals who believed, based on publicly available information, that many of the disagreements between reviewers and managers led to managers making decisions to clear or approve devices when the reviewers expressed concern about the safety or effectiveness of the device.  The OIG report indicates that many of the issues for 510(k) devices were related to whether a device was eligible for review through the 510(k) process, appropriate device labeling, and identification of an appropriate predicate device.  For PMAs, disagreements related to clinical trial design, the need for additional data, and appropriateness of labeling.

OIG also looked at the type of documentation included in the administrative files, and found that five of the 36 lacked any documentation related to the disagreement, and 22 contained formal memoranda.  Nine files contained emails or other documentation referencing the scientific disagreements, rather than formal memoranda.  OIG found that CDRH has not specified who is responsible for upkeep of the administrative file and documenting decisions related to the disagreement.  Additionally, OIG found that not all CDRH managers and reviewers were trained on the new scientific disagreement procedures released in October 2009, and CDRH did not track who received the training.  Many reviewers stated that they do not even know how to initiate the new procedures.

Perhaps one of the most interesting findings is that approximately 20% of survey respondents indicated they were concerned that expressing a scientific disagreement to management could adversely affect their careers.  OIG also found a small numbers of reviewers who “reported incidents in which they felt some pressure to change elements of their written reviews or to not document a scientific disagreement.”  The majority of respondents, however, indicated they felt comfortable discussing scientific disagreements with their peers and managers.

Based on its findings, OIG recommended FDA do the following:  1) define more clearly its requirements for documenting and resolving scientific disagreements; 2)  train all reviewers and managers on the new policies and procedures for resolving scientific disagreements; and 3) more clearly assign accountability for the contents of the administrative files of all submissions.  The OIG report states that FDA concurs with the recommendations and has outlined plans to implement them.  Hopefully, reviewers will feel comfortable taking advantage of the procedures available to them to express disagreements without fearing an adverse impact on their careers.  Because this report included a review of only three disagreements undertaken in accordance with the new procedures, it will be interesting to see, in a few years, what impact the new procedures have on the resolution of scientific disagreements.

By Diane B. McColl - 

The days of having to deal with those pesky adhesive labels on citrus fruit may be over.  FDA has announced a final rule approving the use of a carbon dioxide laser for etching information, such as product code, on the surface of citrus fruit.  The surface etching is intended to replace the adhesive label.

More than five years ago, Durand-Wayland, Inc. (later joined by Sunkist Growers Inc.), represented by Hyman, Phelps & McNamara, P.C., filed a food additive petition (Docket No. FDA-2007-F-0390) for the use of a carbon dioxide laser for etching information on the surface of certain foods.  The Petition was subsequently amended to focus on the etching of citrus fruit. 

FDA evaluated both the potential chemical effects and the potential microbiological risk from etching the surface of citrus fruit.  The Agency concluded that use of the carbon dioxide laser to etch information on foods does not generate any new chemical substances that are not also typically generated by conventional cooking.  The agency evaluated a study conducted by the University of Florida Citrus Research and Education Center and concluded that “Salmonella bacteria present on orange surfaces prior to etching by the carbon dioxide laser, and that contaminate orange surfaces after laser etching, do not infiltrate, survive, or grow during subsequent storage to a level that presents a potential public health hazard significantly greater than the survival or growth of Salmonella bacteria on oranges that are not etched by the carbon dioxide laser.”  No Salmonella was found in the juice portion of any sound, decay-free etched oranges.   In other words, there is no material difference between etched and unetched citrus fruit.  FDA concluded that the laser etching of citrus fruit is safe and the food additive regulations are amended accordingly.  Public comments may be submitted within 30 days of publication of the final rule.

REMINDER:  You can follow us on Twitter @fdalawblog

By Kurt R. Karst –      

In a late-day vote, the U.S. House of Representatives passed H.R. 436, the Health Care Cost Reduction Act of 2012 (formerly titled the Protect Medical Innovation Act of 2012), by a 270-146 vote.  Among other things, the bill repeals the medical device excise tax created by the Affordable Care Act (“ACA”).  Under the ACA, beginning in 2013, an excise tax of 2.3% will be imposed on the sale of any medical device (as defined in the FDC Act) by the manufacturer or importer.  Exemptions are provided for eyeglasses, contact lenses, hearing aids, and other devices determined by Treasury to be of a type that is generally purchased by the general public at retail for individual use.  According to a House report, the excise tax, if it goes into effect, “will adversely impact the industry . . . , increase the cost of healthcare, slow medical innovation, and lead to loss of jobs in the industry.” 

The vote was taken after the House passed a resolution (H. RES. 679) paving the way for consideration of a substitute version of the bill consisting of the text of Rules Committee Print 112-23.  That version includes three items in addition to the original text of H.R. 436:

(1) H.R. 1004, the Health Flexible Spending Arrangements Improvements Act of 2012, which would increase participation in medical flexible spending arrangements;

(2) H.R. 5842, the Restoring Access to Medications Act of 2012, which would repeal the amendments made by the ACA that disqualify expenses for OTC drugs under health savings accounts and health flexible spending arrangements; and

(3) the Reconciliation Recommendation Related to the Recapture of Overpayments Resulting from Certain Federally Subsidized Health Insurance (see here). 

While repeal of the medical device excise tax and the provisions in H.R. 1004 and H.R. 5842 were tagged by the Congressional Budget Office (see here) and the Joint Committee on Taxation (see here) as measures that would increase the deficit ($29 billion alone for repeal of the excise tax), the Reconciliation Recommendation included in the as-passed version of H.R. 436 provided the needed off-set to make the bill pay-as-you-go compliant. 

The Advanced Medical Technology Association (“AdvaMed”) quickly issued a statement after the passage of H.R. 436 commending the House for voting to repeal the device tax.  AdvaMed conducted a study estimating the potential effect of the device excise tax on employment in the medical device industry, and issued a report last year saying that the excise tax “could reduce employment in the industry by cutting back on the demand for medical devices and by encouraging American firms to shift production overseas.”

It is unclear when the U.S. Senate might take up medical device excise tax legislation.  The White House has already signaled its opposition to repeal of the excise tax.  A June 6th Statement of Administration Policy from the Office of Management and Budget says that “[i]f the President were presented with H.R. 436, his senior advisors would recommend that he veto the bill.”

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 Kurt R. Karst –      

Magistrate Judge Theodore H. Katz of the U.S. District Court for the Southern District of New York has dealt FDA another loss in litigation over the withdrawal of approval of certain uses of certain classes of antibiotics in food-producing animals.  In a June 1st decision on cross-motions for summary judgment, Magistrate Judge Katz denied FDA’s Motion for Summary Judgment and granted a Motion for Summary Judgment filed by the National Resources Defense Council (“NRDC”) and three other member groups of “Keep Antibiotics Working” – the Center for Science in the Public Interest, the Food Animal Concerns Trust, and the Union of Concerned Scientists – and found that FDA violated the Administrative Procedure Act (“APA”) and the FDC Act (§ 512(e)) when the Agency denied two Citizen Petitions requesting that FDA withdraw approval of subtherapeutic uses of penicillin and tetracyclines in animal feed because of a threat to human health. 

The June 1st decision follows a March 22, 2012 decision in which Magistrate Judge Katz granted Plaintiffs’ Motion for Summary Judgment on their first claim for relief – that FDA withheld agency action in violation of both the APA and the FDC Act (§ 512(e)) by failing to implement withdrawal proceedings (see our previous posts here and here).  FDA recently appealed that decision to U.S. Court of Appeals for the Second Circuit (Case No. 12-2106).  Representative Louise Slaughter (D-NY), who is the author of legislation (the Preservation of Antibiotics for Medical Treatment Act) that would, among other things, phase out the non-therapeutic use in livestock of medically important antibiotics, promptly criticized FDA’s decision to appeal the March 22nd ruling as “a dereliction of duty.”  FDA will presumably appeal Magistrate Judge Katz’s June 1st decision as well. 

Magistrate Judge Katz’s June 1st decision stems from a Supplemental Complaint the Plaintiffs in the case filed after FDA denied (here and here) two Citizen Petitions submitted to the Agency – one on March 9, 1999 (Docket No. FDA-1999-P-1286) and another on April 7, 2005 (Docket No. FDA-2005-P-0007) – relating to Notices of an Opportunity for Hearing FDA issued in 1977 on proposals to withdraw approval of all subtherapeutic uses of penicillin in animal feed and nearly all subtherapeutic uses of tetracyclines (oxytetracycline and chlortetracycline) in animal feed.  In both petition denials, FDA commented that formal withdrawal proceedings “can consume extensive periods of time and Agency resources,” and that instead of instituting formal withdrawal proceedings, the Agency is instead “currently pursuing other alternatives to address the issue of antimicrobial resistance related to the production use of antimicrobials in animal agriculture.”  Those “other alternatives” include a final guidance FDA issued in April 2012, titled “Guidance for Industry No. 209: The Judicious Use of Medically Important Antimicrobial Drugs in Food-Producing Animals,” and a a draft guidance issued at the same time, titled “New Animal Drugs and New Animal Drug Combination Products Administered in or on Medicated Feed or Drinking Water of Food-Producing Animals: Recommendations for Drug Sponsors for Voluntarily Aligning Product Use Conditions with [Guidance for Industry No. 209].” 

FDA argued that the court lacks subject matter jurisdiction over the Agency’s denial of the 1999 and 2005 petitions, because FDA’s petition denials are actions outside the scope of judicial review pursuant to APA in that they are enforcement actions “committed to agency discretion by law.”  Magistrate Judge Katz disagreed, and wrote that “initiating the withdrawal of approval of a new animal drug is not an enforcement action.”  And even if such withdrawal is an enforcement action, the FDC Act “provides sufficient guidelines for the agency to follow in exercising its enforcement powers to rebut the presumption of unreviewability” (internal quote omitted), wrote Magistrate Judge Katz.

Finding that the petition denials are subject to judicial review, the court moved on to the Plaintiffs’ APA claim and found that FDA’s petition denials were both arbitrary and capricious.  In doing so, Magistrate Judge Katz harshly criticized FDA:

For over thirty years, the Agency has been confronted with evidence of the human health risks associated with the widespread subtherapeutic use of antibiotics in food-producing animals, and, despite a statutory mandate to ensure the safety of animal drugs, the Agency has done shockingly little to address these risks.  Now, in responding to this litigation and two Petitions that have been pending for years, requesting that the Agency comply with its statutory mandate, the Agency has refused to make any findings and instead intends to adopt a voluntary program that is outside the statutory regulatory scheme.  The adoption of voluntary measures does not excuse the Agency from its duty to review the Citizen Petitions on their merits.  The Agency must evaluate the safety risks of the petitioned drugs and either make a finding that the drugs are not shown to be safe or provide a reasoned explanation as to why the Agency is refusing to make such a finding.

The FDA failed to offer a reasoned explanation, grounded in the statute, for its refusal to initiate withdrawal proceedings, and, therefore, its action was arbitrary and capricious and otherwise not in accordance with law.

The June 1st decision is the latest in a string of losses for FDA in court in non-Hatch-Waxman cases.  Earlier this year, the U.S. District Court for the Northern District of Connecticut ruled that FDA’s qualified health claim regarding the relationship between green tea and the risk of breast and prostate cancer violates the First Amendment (see our previous post here).  FDA also lost cases in the U.S. District Court for the District of Columbia involving death row inmates and unapproved thiopental sodium, and the Agency’s regulation requiring the display on cigarette packages of graphic warnings (see our previous posts here and here).  FDA has appealed both of those decisions to the U.S. Court of Appeals for the District of Columbia Circuit. 

By Kurt R. Karst –      

As the U.S. Senate and U.S. House of Representatives geared up last month to consider bills in their respective chambers to, among other things, reauthorize and amend old and establish new user fee statutes, one FTC Commissioner – Commissioner J. Thomas Rosch – penned a letter to Senate Majority Leader Harry Reid (D-NV) and Senate Republican Leader Mitch McConnell (R-KY) expressing opposition to the inclusion of two provisions in S. 3187, the FDA Safety and Innovation Act, concerning patent settlement agreements (referred to in the letter as Pay-For-Delay (“PFD”) agreements) and Risk Evaluation Mitigation Strategies (“REMS”).

“[T]he effort to tack PFD legislation onto ‘Must Have’ legislation may not be in the public interest,” said Commissioner Rosch referring to the Fair and Immediate Release of Generic Drugs Act.  That bill was introduced as an amendment to S. 3187 by Sen. Jeff Bingaman (D-NM) during Senate Floor debate on the FDA bill and proposed to amend the FDC Act’s provisions with respect to “first applicant” status and 180-day marketing exclusivity for certain ANDA sponsors to address patent settlement agreements.  As we previously reported, the amendment failed by a 28-67 vote.  (The House version of the FDA bill, H.R. 5651, the FDA Reform Act of 2012, was passed last week – see our previous post here – and does not include a provision conerning such agreements.) 

“My primary concern is that the bill would impede pioneer and generic pharmaceutical firms from settling patent disputes to a greater extent than the burden shifting approach would do so.  There is not a consensus among antitrust scholars or economists that impeding such settlements would be in the public interest. . . .  Before any legislation on this subject is adopted, legislators should carefully consider the viewpoints of all stakeholders.  It should not simply be tacked onto ‘Must Have’ legislation on the Senate floor,” said Commissioner Rosch.  Commissioner Rosch has previously expressed a similar view.  For example, during a November 2010 speech, he commented that patent settlement legislation “should rise or fall on its own merit” and should not be tacked on to other legislation (at that time, a war funding bill). 

Commissioner Rosch also objects to the inclusion of provisions in S. 3187 concerning REMS and generic competition.  Those provisions, which are included in Section 1131 of the bill as passed by the Senate, would amend FDC Act § 505-1 and state, among other things, that:

Notwithstanding any other provision of law, if a drug is a covered drug, no elements to ensure safe use shall prohibit, or be construed or applied to prohibit, supply of such drug to any eligible drug developer for the purpose of conducting testing necessary to support an application under [FDC Act § (b)(2) or § 505(j) or PHS Act § 351(k)] if the Secretary has issued a written notice described in paragraph (2), and the eligible drug developer has agreed to comply with the terms of the notice.

“[T]he effort to tack substantive REMS legislation onto ‘Must Have’ legislation will not do consumers any favors,” wrote Commissioner Rosch.  Referring to both REMS legislation advocated by FTC staff that would “give the FTC jurisdiction to challenge the refusal of a pioneer drug company to provide product samples to generic manufacturers if the FDA determined that the generic company’s protocols were safe,” and the REMS provisions in the then-Health Education Labor & Pensions Committee-passed version of S. 3187, Commissioner Rosch commented that “[n]either proposal should be tacked on to other legislation on the Senate floor and should instead be considered by the Help Committee on their own merits.”

Although the Senate voted against Sen. Bingaman’s patent settlement amendment, it is possible that the issue will be raised again as the Senate and House hash out differences and work to produce a conference version of the FDA bill.  Folks will also be closely watching how Section 1131 of the Senate bill is handled, as the House version does not contain a similar provision. 

Hyman, Phelps & McNamara, P.C. Director Jeffrey N. Gibbs is a featured speaker at the Food and Drug Law Institute’s upcoming Medical Device Regulation and Litigation Conference.  The conference is schedule to take place on July 18, 2012 at The Madison Hotel in Washington, DC.  A copy of the conference agenda is available here.  

Top officials from FDA’s Center for Devices and Radiological Health will join Mr. Gibbs at the conference to discuss in-depth the most significant recent and upcoming medical device compliance, regulatory, and enforcement priorities.  Participants will respond to the Center presentations and attendees will have a unique opportunity to directly ask questions of these Center officials.  The conference will also focus on three hot topics: the 510(k) clearance process; risk management strategies for manufacturers; and the use of social media to communicate with end-users.

A diverse group of expert stakeholders will conclude the meeting with a roundtable discussion evaluating compliance, regulatory, enforcement, technological, and policy issues in the medical device field.

FDA Law Blog readers can receive a 15% discount off the conference registration price.  To receive the discount, use the following promotional code: DEV2012.  To register for the event click here. 

By John R. Fleder –

It is often said that a grand jury would indict a ham sandwich if asked to do so by a prosecutor.  Some lawyers also say that the government cannot lose an FDA misdemeanor prosecution against current and former company officials because the intent bar is so low, namely the prosecutor does not need to prove that a defendant had any mens rea.  A recent FDA criminal case does nothing to refute the first saying, but it calls into question the accuracy of the second.

On December 29, 2009, the Justice Department announced that Spectranetics Corporation had agreed to pay $5 million in civil damages and forfeiture to resolve claims arising from the company’s alleged involvement in importing unapproved medical devices, namely medical lasers and peripheral devices for those lasers.  In addition, Spectranetics agreed to enter into an HHS corporate integrity agreement.  In return, the federal government agreed that it would not criminally prosecute the company.  However, the government did not agree that it would forgo criminally prosecuting Spectranetics’ former executives.

On August 26, 2010, a grand jury in Denver, Colorado returned a felony indictment against former Spectranetics’ officials, including its former president.  The charges stemmed from complaints that company employees had made to the United States Attorney’s Office.  Before the charges were filed, an agent from FDA’s Office of Criminal Investigations and a Special Agent from Immigration and Customs Enforcement executed a search warrant.  During execution of the warrant, the former president agreed to a voluntary interview.  Statements made during that interview formed the basis for one of the criminal charges filed in the case.

The case went to trial against two of the individual defendants, including the former president.  The trial involved twelve counts: one count of a conspiracy to defraud the United States (18 U.S.C. 371), one count of making false statements (18 U.S.C. 1001(a)(2)),  three counts of illegally bringing merchandise into the United States (18 U.S.C. 545), three counts of introducing adulterated and misbranded devices into interstate commerce (21 U.S.C. 331(a) and 333(a)(2)), and four counts of receiving adulterated and misbranded devices in interstate commerce (21 U.S.C. 331(c) and 333(a)(2)).

Of the two defendants who went to trial, one was acquitted on all of the counts.  The former president was acquitted on eleven of the counts, but was convicted on the twelfth count involving making a false statement to the government when the search warrant was executed.

Particularly noteworthy in assessing the jury’s rejection of the government’s case is that the jurors were presented with two opportunities to convict the defendant who was acquitted on all counts.  The jury was allowed to find the defendant guilty of felony violations of the FDC Act, but was also given the alternative of finding that defendant guilty of a lesser included offense for those alleged violations, namely that the defendant was guilty of misdemeanor charges for the same acts.  In other words, the jury was allowed to convict that defendant without any showing of mens rea.  Nevertheless, the jurors acquitted that defendant on all FDC Act counts, including the three lesser included offenses counts.

After conviction of the former president on that one count, the government sought an “upward departure” for his sentence, meaning that it sought a sentence that was harsher than what would otherwise be provided for under the U.S. Sentencing Guidelines.  The government recommended a sentence of two years imprisonment.  However, on May 31, 2012, the Court squarely rejected the government’s recommended sentence.  The former president was put on probation for one year, was prohibited during that period from engaging in the sale of medical devices not approved by FDA, and also was ordered to complete 100 hours of community service.

The threat of any criminal charge under the FDC Act can be a life changing event for any person.  Going to trial carries the reward of having a jury acquit a person on all counts.  However, going to trial runs the risk that a person will be convicted, and almost certainly face a harsher sentence than the person would have faced had he pleaded guilty before trial.  This case demonstrates that sometimes that risk is worth the reward.  It also demonstrates that even if the government charges a responsible corporate officer with a misdemeanor for FDC Act violations, the government’s case is not always open and shut. It does serve as a reminder that there are risks for prosecutors at trial as well, even when the charge is an FDC Act misdemeanor.

The other lesson from the outcome of this case is that it is almost never a good idea to voluntarily speak with government criminal investigators without legal counsel.  As noted above, a voluntary interview formed the basis of the sole charge on which the jury convicted.  We’ll have more to say about this topic in our June 20, 2012  webinar, “Garbage Runs, Fake Identities, and Surprise Home Visits Strategies to Deal With FDA’s Nontradition Investigative Tools.”

Hyman, Phelps & McNamara, P.C. Director Jeffrey K. Shapiro is the featured presenter in a 90-minute webinar hosted by Elsevier Business Intelligence, titled “Discover the Impact of the FDA’s Eagerly Awaited Final Risk-Benefit Guidance.”  The webinar is scheduled for June 19, 2012 at 1:00 PM (Eastern).

During the webinar, Mr. Shapiro will delve into FDA’s recently issued final guidance document, “Factors to Consider When Making Benefit-Risk Determination in Medical Device Premarket Approval and De Novo Classifications” (see our previous post here).  This first-of-its-kind guidance document outlines the systematic approach FDA device reviewers will take when making risk-benefit determinations.  According to FDA Center for Devices and Radiological Health Director Jeffrey Shuren, the final guidance “clarifies this process for industry, which will provide manufacturers with greater predictability, consistency and transparency in FDA decision-making while allowing manufacturers and the FDA to use a common framework for benefit-risk determinations.”

During the webinar, Mr. Shapiro will take a critical look at the new final risk-benefit guidance, explain which aspects of this guidance are actually old news and which ones may move FDA decision making in a new direction, and discuss how the guidance has affected research and development programs as well as clinical data requirements.  To register for the webinar click here. 

By Jennifer M. Thomas –

Last week, the Federal Trade Commission (“FTC”) hosted a workshop entitled “In Short: Advertising and Privacy Disclosures in a Digital World.” The workshop was intended to explore whether the FTC needs to revise its online advertising disclosure guidelines (“Dot Com Disclosures”), which were published in 2000.  The FTC has been seeking input on revisions to the Dot Com Disclosures since May 2011.  According to Mary Engle (Associate Director, FTC Division of Advertising Practices), the FTC is accepting written comments on the issue through July 11, 2012, and aims to publish “something” in response to the workshop and comments by Fall 2012.  The FTC’s ongoing effort to guide advertisers on mobile and social media casts into sharp relief the dearth of meaningful FDA guidance in this area.

The FTC workshop was limited to discussing best practices for making disclosures in digital media.  It did not address how to decide whether a disclosure is necessary in the first place—although several panel members did express opposing views about the need for disclosures, consumer expectations for digital media, etc.   There were a few presentations that included research and data on how consumers read disclosures online, and the innovative techniques that some companies are creating to effectively communicate disclosures (including privacy policies).  For the most part, the workshop consisted of industry and public-interest stakeholder panels evaluating examples of online and mobile advertisements and debating whether a particular disclosure technique adequately protects consumers.  The examples included blog posts, tweets, traditional online ads, as well as ads and offers viewed on a mobile device.

At the close of the workshop, Ms. Engle summarized the FTC’s take-aways:

• Context matters.  It is not possible to devise a universal rule for disclosures, but the FTC will try to eke out as many black and white areas as it can from among the shades of gray.
• Media platforms must adapt to the law, and not vice versa.  If it is not possible to run a compliant ad on a particular platform, then the ad simply should not run on that platform.
• Using hyperlinks for disclosures may be acceptable in some circumstances, but the label of the link itself needs to be attention-getting and accurately descriptive.   I.e., “Disclosures,” “Details,” or “More Information” generally will not suffice as a link title.
• The timing of disclosures — i.e., placement of a hyperlink on the page, proximity to the claim being clarified, placement in relation to the flow of purchase—is important to consumer attention and comprehension.
• Icons (for privacy disclosures in particular) or hashtags (for Twitter) may be useful, but they depend on consumer understanding.  The lingering question is ‘who should be responsible for educating consumers?’
• The solution for some digital media may be to revise claims so that no disclosure is necessary.

The FTC has not yet made the presentation slides used during the workshop available for download.  However, you can watch a webcast of the workshop and flip through the presentation slides here.  

By Ricardo Carvajal - 

FDA denied a citizen petition submitted by the Corn Refiners Association ("CRA") which asked FDA to authorize the use of “corn sugar” as a common or usual name for high fructose corn syrup ("HFCS"), and to amend certain regulations that reference “corn sugar” so as to eliminate those references or replace them with the term “dextrose.”  FDA based its denial on the following factors:

• “FDA’s regulatory approach for the nomenclature of sugar and syrups is that sugar is a solid, dried, and crystallized food; whereas syrup is an aqueous solution or liquid food.” 

• In a regulatory context, “[t]he term ‘corn sugar’ has been used to describe dextrose for over 30 years.”  Further, “corn sugar” is often used to describe dextrose in the scientific literature and on the internet. 

• Using “corn sugar” as a name for HFCS could pose a risk to consumers with hereditary fructose intolerance or fructose malabsorption, who have come to understand that “corn sugar” (i.e., dextrose) is safe to eat, whereas HFCS is not.

The CRA promptly issued a press release stating that HFCS “is a form of sugar and is nutritionally the same as other sugars,” and that FDA’s denial did not challenge the fact “that the vast majority of consumers are confused about HFCS.”  The Sugar Association issued its own press release calling “[t]he FDA’s ruling a victory for American consumers,” and demanding that CRA end its “multi-million dollar advertising and marketing campaign that argued that sugar and HFCS were identical.”  As we noted in a prior posting, that campaign prompted a Lanham Act lawsuit by the Sugar Association that is still pending.