In a May 6, 2011, letter to Dr. Margaret Hamburg, Commissioner of the U.S. Food and Drug Administration (“FDA” or “the Agency”), 10 congressional leaders requested the Agency to “take immediate action” against Brazilian Blowout Solution, Acai Professional Smoothing Solution, and other hair smoothing/straightening products “that have high levels of formaldehyde based on testing information already available.” This letter follows Representative Earl Blumenauer’s October 5, 2010, letter to Dr. Hamburg, in which Rep. Blumenauer explained that testing by the Oregon Occupational Safety and Health Administration (“Oregon OSHA”) found “significant levels of formaldehyde in bottles of Brazilian Blowout Solution labeled ‘formaldehyde-free’” and requested FDA to investigate the issue.
The most recent letter to FDA states that Oregon OSHA and the Oregon Health and Science University’s Center for Research on Occupational and Environmental Toxicology “confirmed” that both Brazilian Blowout Solution and Acai Professional Smoothing Solution “contained between 4.85% and 10.6% formaldehyde,” levels well above the 0.2% limit recommended by the Cosmetic Ingredient Review, which is an “industry-funded body tasked with reviewing the safety of ingredients in cosmetics.” The letter also stated: “Subsequent air monitoring of salons by federal Occupational Safety and Health Administration (OSHA) led the agency to issue a Hazard Alert warning salons not to use formaldehyde-based hair straighteners, and outlined strict requirements salons must follow if they want to continue their use.” According to federal OSHA, formaldehyde may be listed on labels as methylene glycol, formalin, methylene oxide, paraform, formic aldehyde, methanal, oxomethane, oxymethylene, or CAS Number 50-00-0.
In addition to requesting that FDA issue a “voluntary recall” of products containing high levels of formaldehyde, the congressional leaders asked that FDA continue to test hair straighteners for formaldehyde, require warnings on labels for such products that contain formaldehyde, investigate the labeling practices of companies marketing their products as formaldehyde-free, and review whether to ban formaldehyde and formaldehyde-releasing chemicals from hair products, “given the significant health hazard they pose.”
Other than color additives, FDA does not pre-approve cosmetics or cosmetic ingredients. Although FDA does not have the authority to order a mandatory recall of cosmetics, the Agency can request companies to voluntarily recall products, and if the companies refuse, FDA can issue its own public notice describing the risk and recommending that recipients return the products. In addition, FDA can take enforcement action, such as a seizure or injunction, if the Agency has evidence that the products are adulterated or misbranded.
Hyman, Phelps & McNamara, P.C., Director Josephine M. Torrente will be moderating a session at the Food and Drug Law Institute’s (“FDLI’s”) upcoming 1-day conference on Risk Evaluation and Mitigation Strategies (“REMS”), which were created under the 2007 FDA Amendments Act. The FDLI conference, for which Ms. Torrente also served on the planning committee, is titled “Issues and Answers: Advancing Risk Evaluation and Mitigation Strategies and Benefit-Risk Management to the Next Level,” and will feature cutting-edge presentations by FDA and industry experts followed by panel discussions to further explore the implications of the presentations. The conference will take place on May 19, 2011 at the Westin City Center in Washington, DC.
Ms. Torrente’s panel session, titled “From Qualitative to Quantitative-Benefit Risk Models and Patient Perspectives,” will consider the pros and cons of the existing qualitative methods and the evolving quantitative models in REMS considerations. Other panel sessions include “Advances in REMS Risk Communications,” “The State of REMS and Benefit Risk Management,” and “Measuring the Effectives of REMS Tools and Programs to Date.”
Additional information on the FDLI conference, including registration information, is available on FDLI’s website here.
In a stunning ruling on May 10, 2011, United States District Court Judge Roger W. Titus ruled from the bench in Greenbelt, Maryland, granting a Motion for a Judgment of Acquittal filed by the defendant, Lauren Stevens. Ms. Stevens was formerly an in-house lawyer for GlaxoSmithKline (“GSK”).
The Judge stated that this was the first case in his seven and a half years as a jurist when he has granted such a motion. Because jeopardy had already attached, this ruling is not appealable by the government and ends this criminal case against her.
The Court’s oral remarks are a broadside attack on the government’s case. First, the Court criticized an earlier ruling by a judge in Massachusetts. That ruling had given the government access to otherwise privileged GSK documents under the “crime-fraud” exception to the attorney-client privilege. Judge Titus described that ruling as “unfortunate”, saying that the government never should have been given access to GSK’s privileged records. He also ruled that the records themselves showed that Ms. Stevens “was not engaged to assist a client to perpetrate a crime or fraud.”
Second, the Court stated that Ms. Stevens’ former employer, GSK, “did not come to Ms. Stevens and say, assist us in committing a crime or fraud.” Judge Titus then concluded that Ms. Stevens “sought and obtained the advice of counsel of numerous lawyers. She made full disclosure to them. Every decision that she made and every letter she wrote was done by a consensus.”
Third, the Judge stated that “only with a jaundiced eye and with an inference of guilt that’s inconsistent with the presumption of innocence could a reasonable jury ever convict this defendant.”
Fourth, he stated that “there are serious implications for the practice of law generated by this prosecution.”
Fifth, Judge Titus concluded “that the defendant in this case should never have been prosecuted and she should be permitted to resume her career.”
This ruling is hardly the end of the tale of woes for the government that this case has produced. As we previously reported, in March, Judge Titus dismissed an earlier Indictment that had been returned against Ms. Stevens. The Court ruled that the government had mischarged the grand jury which had indicted her. That ruling was noteworthy because the Court took the highly unusual step of granting defense counsel access to the grand jury minutes. The government could have appealed that ruling. Instead, the government reindicted Ms. Stevens on the charges that were dismissed on May 10th. Because the government reindicted her, it cannot appeal Judge Titus’ March 23rd ruling. As a result, that ruling stands as precedent for the proposition that defense counsel can request and perhaps obtain the transcripts of highly secretive grand jury proceedings.
The government has initiated many criminal and civil cases against companies and individuals who are alleged to have engaged in unlawful off-label marketing. Indeed, the government has increasingly regulated these practices by criminal prosecution, settlement agreements and corporate integrity agreements that lay out the government’s view as to what is and is not illegal off-label practices, rather than publishing regulations to spell out exactly what companies can and cannot do. Few defendants have gone to trial in off-label cases, and there is very little judicial guidance on the subject.
In the Stevens case, Judge Titus disagreed with the government’s theory regarding what is illegal off-label activity. According to a pleading filed by the government on May 9, 2011, the Court was prepared to instruct the jury on off-label use, which, according to the government, adopted the defense theory and disagreed with the government’s theory regarding what is unlawful activity. A judicial rejection of the government’s legal theory on this subject is both stunning and significant. It will be interesting to see if Judge Titus’ views on off-label use will cause the government to reassess its views regarding what is legal and illegal conduct in this area.
Our firm has done a series of blog entries and other presentations regarding the government’s publicly-stated intention to bring the so-called Park Doctrine back to life (see, e.g., here and here). This case was not a Park prosecution. Thus, we do not know if this ruling will impact the government’s future use of the Park Doctrine. However, the ruling is a severe blow to the government’s highly touted efforts to threaten individuals with aggressive prosecution.
As aficionados of all things social media (see our prior postings here, here, here, and here) (other than kitten videos, enough with those already!) we couldn’t help but notice a recent Untitled Letter to Warner Chilcott, LLC, relating to a YouTube video. A product of DDMAC’s Bad Ad campaign, the letter describes a video created and posted by a sales representative at the direction of a district manager, in which the sales representative describes attributes of the drug Atelvia (risedronate sodium) to a staff member in a physician’s office. The staff member apparently reacted enthusiastically to the description of the dosing (presumably, more enthusiastically than David After the Dentist). We’ll never know how enthusiastic the response was, since the video has long since been pulled off of YouTube.
FDA complained that notwithstanding the existence of promotional claims for Atelvia in the video, the video omitted any reference to risks associated with its use as well as the indication. The video also made misleading claims regarding dosing. And, to top it all off, as one would expect with a homemade video, it had not been submitted to DDMAC at the time of initial dissemination.
The tweak at FDA in the blogpost title is admittedly gratuitous in this case. Companies should know by now that videos on YouTube have to comply with the same promotional requirements as any other piece of promotional labeling or advertising. The use of new media does not excuse compliance with existing promotional rules.
On May 10th, the U.S. District Court for the District of Columbia ruled in FDA’s favor in a case filed last July by Graceway Pharmaceuticals, LLC (“Graceway”) stemming from the Agency’s January 2010 denial of a Graceway citizen petition and approval of a generic version of Graceway’s ALDARA (imiquimod) Cream, 5%. In granting FDA’s Motion for Summary Judgment and denying Graceway’s Motion for Summary Judgment, Judge Reggie B. Walton’s 21-page decision gave FDA another feather for its cap insofar as court challenges to FDA generic drug bioequivalence and ANDA approval decisions are concerned.
As we previously reported (here and here), the primary issue raised in the Graceway petition and lawsuit was whether a generic applicant can demonstrate bioequivalence for a multi-indication Reference Listed Drug (“RLD”) with a comparative clinical trial in just one indication, and whether FDA’s approval of a generic version based on a trial in one indication violated the FDC Act and the Administrative Procedure Act (“APA”). Graceway requested in its petition that FDA refuse to approve ANDAs for generic versions of ALDARA Cream unless such applications contain, among other things, data from bioequivalence studies conducted in patients with each of ALDARA’s three approved indications – actinic keratoses (“AK”), primary superficial basal cell carcinoma (“sBCC”), and external genital and perianal warts/condyloma acuminata (“EWG”). FDA denied the petition (concluding that a well-designed study in AK will suffice to show bioequivalence of a generic version of ALDARA for all indications), approved an ANDA, and the lawsuit followed.
FDA has long held – see e.g., Docket No. FDA-1995-P-0044 – that a clinical endpoint bioequivalence study in one indication for a multi-indication RLD can suffice as proof of bioequivalence in another indication when the indications are “related” and involve the “same site of action.” Indeed, in 2009, the U.S. District Court for the Central District of California ruled that FDA’s April 2008 denial of a citizen petition and decision to approve a generic version of EFUDEX (fluorouracil) Topical Cream, 5%, under somewhat similar circumstances to generic ALDARA Cream did not violate the APA – see our previous post here.
Graceway alleged in its July 2010 Complaint that:
FDA’s decision not to require bioequivalence studies in patients with [EWG] was based on its unsupportable conclusion that genital warts are “related” to and share the same “site of action” as the other two conditions treated by Aldara, both of which result from sun exposure. This determination was unsupported by – and in fact, contrary to – basic science, common sense, and the agency’s previous actions in similar situations. While Graceway is not contesting for the purposes of this lawsuit that AK and [sBCC] may be “related” in the sense that both result from sun exposure, neither has anything in common with genital warts, which appear in the pubic area and are caused by an infectious disease – a sexually-transmitted virus. [(internal citation omitted)]
FDA shot back that its conclusions “were based upon reasoned scientific analysis, and were therefore not arbitrary, capricious, or otherwise contrary to law.” Graceway also made much hay out of an apparent disagreement between FDA’s CDER Dermatology Division and the Office of Generic Drugs (“OGD”) concerning study requirements. That conflict was ultimately resolved in favor of OGD’s position, which was relayed in the citizen petition response.
Quickly dispensing with any issues raised by Graceway about the internal disagreement at FDA, but nevertheless noting that “the internal disagreement between the different divisions of the FDA is certainly not irrelevant, but neither is it the dispositive proof of arbitrary and capricious action that the plaintiff seems to believe it is,” Judge Walton examined the extent to which FDA’s petition response contained well-reasoned explanations. On both of Graceway’s “site of action” and “relatedness” arguments, Judge Walton ruled in FDA’s favor, concluding that “because the FDA addressed each argument raised in the plaintiff's Citizen Petition, explained its conclusion with respect to each argument, and cited the scientific literature on which it relied, the FDA's Response denying the plaintiff's Citizen Petition was not arbitrary, capricious, or otherwise contrary to law, and therefore does not violate the APA.”
On May 9th, FDA announced the May 10th publication of a Federal Registernotice proposing and requesting comment on the structure of a user fee program for applications for biosimilar and interchangeable biological products submitted under section 351(k) of the Public Health Service Act (“PHS Act”), which was created with the March 23, 2010 enactment of the Biologics Price Competition and Innovation Act of 2009 (“BPCIA”) (under Title VII of the Affordable Care Act). Section 7001(f)(1) of the Affordable Care Act directs FDA to meet with a range of groups, to develop recommendations for a user fee program for 351(k) applications for Fiscal Years 2013 through 2017, and to submit recommendations to Congress by January 15, 2012.
Before getting into the meat of FDA’s proposal, the Agency sets the stage by noting that “[d]eveloping a user fee program for 351(k) applications presents unique challenges as compared to other medical product user fee programs.” After all, FDA says, when PDUFA “was first implemented in FY 1993, the biopharmaceutical industry was relatively mature.” In contrast, “given that the biosimilar and interchangeable biological product approval pathway did not exist prior to March 2010, the biosimilar and interchangeable biological product market is just forming.” Thus, while “the PDUFA program is a useful model, FDA believes that a user fee program for 351(k) applications will need to include different elements to ensure an equitable program that generates adequate revenue.”
FDA also describes a set of four “key principles to support the development of a fair and adequate initial user fee program,” which are based on stakeholder comments to FDA and the Agency’s “prior experience with elements that foster strong and successful user fee programs.” Those four “key principles” are:
(1) “FDA needs sufficient review capacity to prevent unnecessary delays in the development and approval of [biosimilar and interchangeable biological] products;”
(2) “At least for the initial 5-year authorization of the 351(k) user fee program, 351(k) user fees should remain comparable to 351(a) user fees [under PDUFA];”
(3) “The 351(k) user fee program should provide funding to support activities that occur early in the biosimilar and interchangeable product development cycle;” and
(4) “The 351(k) user fee program should ensure adequate resources for the review of 351(k) applications, so that critical resources for 351(a) review are not redirected from innovator drug review to biosimilar products.”
With that background in place, FDA launches into the Agency’s proposed user fees and performance goals for Fiscal Years 2013 through 2017.
FDA proposes four different types of fees – two in the pre-351(k) market approval phase and two in the marketed 351(k) phase. The two proposed pre-351(k) market approval phase user fees are:
(1) A “Biosimilar Product Development Fee” of $150,000 that would “support the ongoing scientific, technical, and other regulatory activities associated with 351(k) biosimilar development, including milestone meetings and the application data reviews required to provide advice for the next steps in development.” This fee would be paid upon the submission of an IND and annually thereafter “for a biosimilar or interchangeable product (molecule) under active development that is intended for submission in a single 351(k) marketing application.” Failure to pay the fee “would result in the IND being placed on Full Clinical Hold;” and
(2) A “351(k) Marketing Application Fee” that would be paid for each submitted 351(k) marketing application, and that “would be set equal to a 351(a) marketing application fee [under PDUFA], less the sum of all of the previously paid annual Biosimilar Product Development fees associated with the biosimilar product that is the subject of the 351(k) application.
The two proposed marketed 351(k) phase user fees are the annual Establishment and Product Fees the drug industry is familiar with under PDUFA and that would be set equal to those PDUFA fees established annually by FDA. The table below from FDA’s Federal Register notice captures each of the four proposed fees.
With respect to performance goals for Fiscal Years 2013 through 2017, FDA proposes that 351(k) applications be categorized into two types as a result of the exclusivity provisions at PHS Act § 351(k)(7). Under PHS Act § 351(k)(7), a 351(k) application cannot be submitted to FDA until 4 years after the reference product was first licensed under section 351(a) and cannot be approved until 12 years after the reference product was first licensed (or 4.5 years and 12.5 years with pediatric exclusivity).
In Category 1 are “applications that are submitted 10 or more years after the date of first licensure of the reference product” and that “would be eligible for approval in 2 years or less, depending on the relevant filing dates.” For this category, FDA proposes phased-in performance goals akin to those hammered out for PDUFA I. Specifically, FDA proposes that beginning in Fiscal Year 2013, 50% of both original biosimilar and interchangeable 351(k) applications be reviewed and acted on within 10 months of the 60-day filing date, and 50% of biosimilar and interchangeable 351(k) application resubmissions in response to a complete response action be acted on within 6 months of receipt. In Fiscal Years 2014-2017, the 50% figures from 2013 would go up to 60%, 70%, 80%, and 90%, respectively, while the 10-month (original) and 6-month (resubmission) review timeframes would remain static.
In Category 2 are “applications submitted between 4 and 10 years after the date of first licensure of the reference product” and that “would not be eligible for approval for more than 2 years and perhaps for as long as 8 years.” For this category, FDA says that the Agency “is concerned about committing resources to meet performance goals that might ready an application for approval years before it could be approved, necessitating updating of the application, new reviews, and new inspections of facilities shortly before the application becomes eligible for approval,” and therefore, instead of proposing performance goals, FDA is soliciting public comment on establishing performance goals for 351(k) applications in this category of applications, and specifically on three questions:
(1) “What factors should the Agency consider in determining appropriate performance goals for 351(k) applications that are filed earlier than 2 years prior to the date on which a 351(k) application would be eligible for approval (i.e., 12 years after the date of first licensure of the reference product)?”
(2) “How should the performance goals take into account readiness for inspection?”
(3) “What other factors relating to the unique characteristics of the 351(k) approval pathway should the Agency consider when setting performance goals for 351(k) applications?”
Not knowing exactly which companies comprise the regulated industry and acknowledging that not all public stakeholders have necessarily notified FDA of their interests, FDA implores interested parties to notify the Agency of their interest so that they can be included in the user fee recommmendation process. Information on contacting FDA is included in the Agency’s Federal Register notice.
ReGen Biologics, Inc. (“ReGen”) has petitioned the U.S. Court of Appeals for the District of Columbia Circuit (“D.C. Circuit”) to review the Center for Devices and Radiological Health (“CDRH”)’s March 30, 2011 order that rescinded the company’s 510(k) clearance of a collagen scaffold device, marketed as Menaflex. The petition for review is the most recent development in ongoing controversy surrounding FDA rescission of 510(k)s. For many years industry has questioned FDA's statutory authority to rescind a 510(k) clearance. One cannot determine from the petition for review if that argument will be a basis for the company's lawsuit.
The debate surrounding FDA’s 510(k) clearance for ReGen’s Menaflex (K082079) appears to have been an important catalyst for FDA’s recent review of the overall 510(k) process. In light of criticisms from lawmakers and the trade press about the Menaflex clearance process, in April 2009 FDA Principal Deputy Commissioner Joshua Sharfstein tasked three high-ranking FDA officials, including then-Associate Commissioner for Policy and Planning Jeff Shuren (now CDRH director), with leading an internal review to investigate the clearance. The agency indicated that the review of the Menaflex clearance should “determine whether changes should be made to the agency’s policies, processes, procedures, or practices to better protect the integrity of FDA’s decisionmaking.”
The September 2009 preliminary report, “Review of the ReGen Menaflex: Departures from Processes, Procedures and Practices Leave the Basis for a Review Decision in Question,” identified alleged procedural irregularities in the clearance process for that particular device. The report recommended an independent scientific re-evaluation of the Menaflex substantial equivalence determination. The report also recommended that the agency launch an independent review of the 510(k) program at CDRH.
Beginning in the fall of 2009, FDA undertook the recommended scientific re-evaluation of the determination of the device’s substantial equivalence. An advisory committee considered the device in May 2010. As a result of the re-evaluation of the device, FDA announced in October 2010 its intention to rescind the clearance for the device.
As for the recommendation for a review of the overall 510(k) program, we previously reported that since September 2009, CDRH has been reviewing the operation of the 510(k) program. In August 2010, the 510(k) working group issued a preliminary report that included a recommendation that CDRH consider issuing a regulation to define the “scope, grounds, and appropriate procedures, including notice and an opportunity for a hearing, for the exercise of its authority to fully or partially rescind a 510(k) clearance.”
This process, according to the report, would include consideration of whether FDA needs additional rescission authority. Although the FDC Act does not state that the agency has 510(k) rescission authority, FDA believes that this authority is implicit in the statute. FDA claims in the report that the agency has issued a limited number of partial and full rescissions. It is not clear if any of the rescissions were issued over the objection of the 510(k) holder, as has happened in the ReGen case.
We previously reported (here and here) that several lawmakers from both the House and the Senate wrote FDA urging the Agency to delay implementation of the rescission proposal until the IOM issued its report on the evaluation of the 510(k) process, which is expected to be completed in the summer of 2011.
FDA granted this request: As we previously reported, FDA’s report in January 2011 included certain items that it would implement immediately and others for which it would wait until it IOM concluded its review. The rescission proposal was one of the items that FDA postponed to allow for IOM input.
While we were at the American Conference Institute’s conference on Paragraph IV Disputes last week, the Federal Trade Commission (“FTC”) announced the publication of its annual summary of agreements filed with the Commission during Fiscal Year 2010 – “Agreements Filed with the Federal Trade Commission under the Medicare Prescription Drug, Improvement, and Modernization Act of 2003.” According to the FTC, “[p]harmaceutical companies struck an unprecedented number of deals in Fiscal Year (FY) 2010 in which the manufacturers of branded products paid potential generic rivals and generic companies agreed to defer the introduction of lower-cost medicines for American consumers.” The 2003 MMA requires pharmaceutical applicants – both brand and generic – to file with the FTC and the Assistant Attorney General certain agreements executed on or after January 7, 2004. Since the enactment of the MMA, the FTC has published summaries of these agreements. Copies of previous summaries are available here.
The FTC’s report says that in FY 2010 the Commission received 113 final resolutions of patent disputes between a brand and a generic, which is almost double the amount received in any previous fiscal year. Of these 113 final resolutions, the number of potential pay-for-delay settlements (31 in FY 2010) and the number of potential pay-for-delay settlements involving first filers (26 in FY 2010) substantially increased over any previous year, as shown in the table below from the FTC’s report.
Notwithstanding the identification of “potential pay-for-delay” agreements, the FTC’s announcement of the annual summary, titled “FTC Staff Report Finds 60 Percent Increase in Pharmaceutical Industry Deals That Delay Consumers' Access to Lower-Cost Generic Drugs,” seems less tentative.
The FY 2010 summary report will certainly show up again – probably sooner rather than later – as the FTC continues its crusade – both in the courts and in Congress – against patent settlement agreements. (The FTC even has a website dedicated to the issue.)
In March, the U.S. Supreme Court denied a Petition for Writ of Certiorari in Louisiana Wholesale Drug Co., Inc., et al. v. Bayer AG, et al. (Docket No. 10-762) concerning whether a patent settlement agreement involving manufacturers of Ciprofloxacin HCl (CIPRO) is per se lawful under the Sherman Act – see our previous post here.
The FTC’s report could also add steam to Senator Herb Kohl’s (D-WI) efforts to push through Congress the Preserve Access to Affordable Generics Act, which, as we previously reported, was introduced once again earlier this year. That bill would amend the Federal Trade Commission Act to permit the FTC to “initiate a proceeding to enforce the provisions of [new Sec. 28] against the parties to any agreement resolving or settling, on a final or interim basis, a patent infringement claim, in connection with the sale of a drug product.” Such agreements, if challenged, would be presumptively anticompetitive and unlawful unless it can be demonstrated “by clear and convincing evidence that the procompetitive benefits of the agreement outweigh the anticompetitive effects of the agreement.” In addition, “[e]ach person, partnership or corporation that violates or assists in the violation of [new Sec. 28] shall forfeit and pay to the United States a civil penalty of not more than 3 times the gross revenue of the NDA holder from sales of the drug product that is the subject of the patent infringement claim for the period of the violation, starting with the date of the agreement.”
Reaction to the FTC’s FY 2010 annual summary from the Generic Pharmaceutical Association (“GPhA”) was swift. In a press release, GPhA said that “[t]he FTC is continuing to perpetuate the myth that pro-competitive, pro-consumer patent settlements are harmful to consumers — an unsubstantiated position that has repeatedly failed to receive support in both Congress and the Courts.” GPhA cites two analyses – from the Royal Bank of Canada and Jonathan Orszag, former Director of the Office of Policy and Strategic Planning and member of President Clinton’s National Economic Council – supporting the proposition that patent settlement agreements are pro-competitive and increases opportunities for consumer savings. The FTC’s analysis of such agreements (see our previous post here) estimates that patent settlement agreements “cost American consumers $3.5 billion per year – $35 billion over the next 10 years.”
On April 6, only 2 weeks behind schedule, FDA issued proposed rules (here and here) implementing section 4205 of the Patient Protection and Affordable Care Act of 2010 (“PPACA”), which requires certain restaurants and vending machines to disclose nutrition information. Last summer, FDA requested public comments on PPACA § 4205 implementation and two draft guidance documents related to PPACA § 4205 (see our previous posts here and here). FDA reports that it received about 875 comments on how to implement PPACA § 4205 and 80 comments on the draft guidance, and considered all those comments when drafting the proposed rules.
FDA estimates that the initial mean cost of complying with the proposed regulations is $315.1 million, with an estimated mean ongoing cost of $44.2 million. FDA did not estimate the benefits of the proposed regulations. As we blogged in March, there is still uncertainty as to whether menu labeling will provide any benefits for consumers. Nonetheless, FDA is set to impose significant added costs on food retailers, many of whom are small business franchisees, which will potentially drive up food costs and make these businesses less profitable.
Under proposed 21 C.F.R. § 101.11, a covered establishment would be required to disclose the number of calories in standard menu items by listing calories adjacent to the name and price of the menu item and under a heading “Calories” or “Cal.” As currently drafted, a covered establishment would include chain restaurants, certain grocery stores, certain convenience stores, and coffee shops, but would exclude movie theaters, airplanes, trains, and amusement parks. Calorie information for variable menu items, defined as standard menu items that are available “in different flavors, varieties, or combinations, and . . . listed as a single menu item,” would be required to be declared in a range from lowest to highest (e.g., soft drink, 0-400 calories). Menus would also be required to bear the statement, “A 2,000 calorie daily diet is used as the basis for general nutrition advice; however, individual calorie needs may vary.” The regulations would also require establishments to provide more detailed nutrition information upon customer request, including information on fat, saturated fat, trans fat, cholesterol, sodium, total carbohydrate, dietary fiber, sugars, and protein.
Under proposed 21 C.F.R. § 101.8, certain vending machines would be required to disclose the total calorie information for all food options in the machine, unless the Nutrition Facts box can be examined prior to purchase. Calorie information could be displayed in or on the vending machine.
The proposed rules show that FDA remains uncertain on how to implement PPACA § 4205. For example, FDA proposed that calories for variable menu items be disclosed as a range, but also described 5 different options it considered and asks for further comments. Similarly, FDA tentatively concluded that the definition of a retail food establishment would be limited to establishments “whose primary business activity is the sale of food to consumers,” but asks for comments on how to determine whether “sale of food” is an establishment’s primary business activity.
This firm submitted comments to FDA on behalf of Domino’s Pizza encouraging the Agency to recognize the difficulties in menu labeling for highly variable and customizable foods like pizza, particularly those that are primarily ordered for delivery over the phone, internet, or mobile device. There are two unique ordering factors for delivery pizza that make in-store menu labeling a costly and ineffective requirement: due to the variety in the sauce, toppings, and crust choices, there are millions of ways that a customer can order a pizza, so menu labeling every option on a menu board is impossible; and most people ordering a pizza for delivery or pick-up do so over the phone, internet, or mobile device. Our comments asked that FDA consider the inherent difficulties in menu labeling customized and variable food items like pizza when drafting the proposed rules, and recognize that for delivery food like pizza, online menus are the only way to provide complete and accurate calorie information and are often the only menu a consumer consults.
The Agency rejected the use of online sources as the sole means for communicating nutrition information, even in cases where most orders are placed over the phone or internet. Instead, FDA concluded that “menu” means “any writing of the covered establishment” (emphasis added). FDA explained that this means that under the proposed rule, a restaurant would be required to label a printed menu, menu board, and even a take-out menu mailed as a flyer to a consumer’s home.
FDA appears to have concluded that calories in multi-serving foods should be listed by the entire food (e.g., the calories in an entire extra large pizza rather than per slice), although the Agency did ask for comments on the issue of multiple-serving foods. From the standpoint of the consumer and the retailer, labeling calories for the entire multi-serving food is meaningless. Multi-serving foods are generally meant to be shared; few people consume an entire extra-large pizza, 10-piece bucket of chicken, or full rack of ribs in one meal. Forcing consumers to do their own math on how many calories they have consumed defeats the purpose of menu labeling.
FDA determined that all pizza would be categorized as a variable menu item. Alternatively, FDA could have determined that variations of standard pizza builds were customized item (e.g., pepperoni pizza is a standard pizza, pepperoni pizza with pineapple is a customized item), which would have been exempt those customized orders from menu labeling requirements. FDA also tentatively concluded that calories for such foods should be listed by ranges. For many foods, including pizza, the range of calories can be significant. For highly variable foods like pizza, a more informative way to disclose calories is by one serving of commonly ordered pre-set builds of pizza (e.g., a slice of a large cheese or pepperoni pizza).
For food items such as pizza, should FDA impose a final rule requiring menu labeling for in-store and take-out menus, the result will be costly to small business franchisees while providing no real useful information to consumers. Comments to the proposed rule on menu labeling are due June 6.
Comments to the proposed rule on vending machine labeling are due July 5.
As directed by the Food Safety Modernization Act (“FSMA”), FDA published interim final rules amending its administrative detention and prior notice regulations. Both rules (here and here) take effect July 3, 2011.
Under the administrative detention regulations as amended, an FDA officer or qualified employee will have authority to administratively detain food that the officer or qualified employee has “reason to believe” is adulterated or misbranded – a standard that is much easier for FDA to meet than the current standard of “credible evidence or information indicating that the article of food presents a threat of serious adverse health consequences or death to humans or animals.” The relative difficulty of meeting the current standard, coupled with the fact that foods meeting this standard are typically the subject of Class I voluntary recalls or are embargoed by the states, helps explain why FDA has never used its administrative detention authority.
Not surprisingly, FDA declined to provide an interpretation of the “reason to believe” standard: “Decisions regarding whether FDA has a ‘reason to believe’ a food is adulterated or misbranded would be made on a case by case basis because such decisions are fact specific.” However, FDA indicated that the exercise of administrative detention is more likely under the new standard, particularly in Class II recall situations (i.e., those in which “use of, or exposure to, a violative product may cause temporary or medically reversible adverse health consequences or where the probability of serious adverse health consequences is remote”).
Under the prior notice regulations as amended, submitters of prior notice of imported food (whether for humans or animals) will be required to report any country to which the food has been refused entry. FDA expects submitters to “gather and verify” information about whether a food was previously refused entry.
Senior FDA officials have signaled that implementation of the new and enhanced enforcement authorities granted by the FSMA is a high priority. Their first use can’t be far behind.
Hyman, Phelps & McNamara's Ricardo Carvajal will speak on the legal aspects of food allergen labeling and control at the Institute of Food Technologists’ 2011 Annual Meeting and Food Expo, taking place in New Orleans from June 11-14. He will also serve as co-instructor for the pre-meeting short course Labeling Requirements and Implications for Foods Marketed in the U.S., taking place from June 9-10. For more information on the meeting and the short course, click here and here. Early bird registration rates expire this Friday, May 6.
The Interagency Working Group charged with drafting standards for marketing food to children has released draft nutrition principles, available here. The proposed principles are intended to help food companies determine which foods should be marketed to children as a way to encourage a healthful diet and which foods should not be marketed to children.
The proposal requests industry to reformulate and develop new products for those foods that are most heavily marketed to children aged 2-17, which include breakfast cereals; snack foods; candy; dairy products; baked goods; carbonated beverages; fruit juice and non-carbonated beverages; prepared foods and meals; frozen and chilled desserts; and restaurant foods. Because most foods currently marketed to children would not meet the draft nutrition principles, the Working Group has proposed 2016 as the year for industry to fully implement them.
The draft principles are similar to those that the Working Group announced in December 2009 (see our previous post here) in that they set forth criteria to determine whether a food makes a meaningful contribution to a healthful diet (Nutrition Principle A) and provide limits on certain nutrients that can have a negative impact on health and weight (Nutrition Principle B). The Working Group requests comments on the draft principles, including whether the principles “create incentives for manufacturers to reformulate a food product in a manner that would diminish the nutritional quality” of the food and what the impact of reformulation challenges will be on “manufacturers’ incentive and ability to improve the nutritional quality of the foods they market to children.”
The Working Group’s proposal also addresses the definitions of marketing to children, ages 2-11, and adolescents, ages 12-17. The tentative definitions include 20 categories of advertising and promotional activities, including television, radio, and print advertising; ads on third-party Internet sites and other digital advertising, such as email and text messaging; cross promotions, including character licensing and toy co-branding; word-of-mouth and viral marketing; celebrity endorsements; and in-school marketing, among others. The Working Group is proposing that for each of these categories, the Federal Trade Commission’s (“FTC’s”) definitions of when a promotional activity is targeted to children and adolescents will be used. Because restrictions on marketing targeted to adolescents would likely also limit food marketing in media that reaches adults, the proposal requests “comment on whether it would be appropriate to more narrowly define the scope of marketing to which the nutrition principles would apply for adolescents.”
Comments on the Working Group’s proposal must be submitted to the FTC by June 13, 2011.
In 2004, the Federal Trade Commission (“FTC”) brought a civil action against the marketers of products sold as “Coral Calcium Daily” and “Supreme Greens with MSM.” The FTC challenged a number of claims, including that the products allegedly made express or implied claims that they were an effective treatment for cancer and would cause significant weight loss. In 2008, the United States District Court for the District of Massachusetts granted in part the FTC’s motion for summary judgment. Judge O’Toole ruled that certain claims were not adequately substantiated, finding that the infomercials were misleading as a matter of law. After a subsequent bench trial, the District Court entered judgments enjoining the defendants from running deceptive infomercials, and ordered them to pay in excess of $48 million. In 2010, the United States Court of Appeals for the First Circuit affirmed those rulings (see our previous post here). FTC v. Direct Marketing Concepts, 624 F.3d 1 (1st Cir. 2010).
One of the defendants in that action was Donald Barrett, who owned half of Direct Marketing Concepts. On April 26, 2011, the United States Attorney’s Office in Massachusetts filed a criminal Information against Mr. Barrett in connection with his companies’ sales of these same products. The government alleged that he unlawfully introduced Supreme Greens into interstate commerce. The government alleged the products were drug products, and that sales of these products was unlawful because the products were misbranded in that they did not have adequate directions for use. On May 2, 2011, the United States Attorney’s office issued a press release announcing that Mr. Barrett had agreed to plead guilty to an FDC Act misdemeanor charge, along with tax charges. According to the government, Mr. Barrett faces a possible three year jail sentence and a fine.
These cases are noteworthy on a number of grounds. First, the FTC action shows that the Commission is seeking and will surely continue to seek large monetary payments from dietary supplement companies and their executives when the FTC believes that certain defendants have made large sums of money from sales of their products. Second, it shows that company executives can face criminal charges for the same type of activity.
However, what is most striking about these cases is that the government will use both civil and criminal remedies against company executives for FTC Act and FDC Act violations. Indeed, it is quite clear that the FTC and the FDA are working closely these days to coordinate their enforcement activities. Nevertheless, this coordination poses severe landmines for companies, their executives and the lawyers who represent them. Absent some type of global resolution of all potential criminal and civil charges, the end of either a criminal or civil case may not mean the end of a company executive’s legal problems.
Earlier this month, FDA updated the 1998 guidance document regarding changes to a PMA device that may or may not qualify for a 30-Day Notice. This updated document provides new examples of manufacturing changes that may be submitted under a 30-Day Notice and reflects the current review process for those submissions. In addition, information regarding user fees for 30-Day Notices has been included.
The updated guidance recommends that a 30-Day Notice be submitted for changes in manufacturing procedures or methods of manufacture that affect the safety or effectiveness of PMA devices, or that are critical to the performance of the device. If the changes do not affect safety or effectiveness, or are not critical to the performance of the device, then they may be submitted in a PMA annual report.
Some examples of changes that FDA says may be appropriate for a 30-Day Notice include:
sterilization process parameter changes (e.g., dose auditing or aeration time);
changes from manual to automated processes;
changes in manufacturing materials, such as machining lubricants; or
a change in sterilization test site.
Other changes appropriate for a 30-Day Notice include changes to quality control testing used on incoming or raw materials or a finished device, as well as changes in manufacturing processes, such as a change from machining to injection molding of a part. The new guidance also suggests that a change in raw material supplier qualifies for a 30-Day Notice as long as the change does not result in a modification to device component specifications.
The new guidance also addresses those changes that are not appropriate for a 30-Day Notice, such as changes in the manufacturing procedure or method of manufacture that alter the performance, design, physical, material, or chemical specifications of the device. In addition, changes in the manufacturing/sterilization site or device operating software are not appropriate for 30-Day Notices. Most importantly, labeling changes do not qualify for a 30-Day Notice. If a change does not qualify for a 30-Day Notice, FDA recommends that the manufacturer submit a 180-day PMA supplement or another alternate submission.
After submission of a 30-Day Notice, the manufacturer can distribute the product 30 days after the date on which FDA received the notice, unless FDA notifies the manufacturer within those 30 days that the notice is inadequate. If the information is deemed inadequate, FDA will notify the manufacturer in writing that a 135-Day PMA supplement is required, in which case the letter will also indicate the additional information required to evaluate the change.
The new guidance, “Guidance for Industry and FDA Staff; 30-Day Notices, 135-Day Premarket Approval (PMA) Supplements and 75-Day Humanitarian Device Exemption (HDE) Supplements for Manufacturing Method or Process Changes,” was issued on April 13, 2001, and is available here.
FDA’s recent move to remove from the market hundreds of unapproved cough, cold, and allergy drug products has spawned two new lawsuits that might very well be one of the last hurrahs for court challenges to FDA Drug Efficacy Study Implementation-related decisions. Last Friday, Petitions for Review were filed with the U.S. Court of Appeals for the District of Columbia Circuit on behalf of ECR Pharmaceuticals (“ECR”) and Laser Pharmaceuticals, LLC (“Laser”) requesting that the Court review and set aside FDA’s March 3, 2011 decisions (here and here) that certain marketed unapproved drug products are not Generally Recognized as Safe and Effective (“GRASE”). (Both FDC Act § 505(h) and FDA’s regulations at 21 C.F.R. § 514.235(b) permit a direct appeal to an appellate court within 60 days after the entry of a relevant FDA order.)
In ECR Pharmaceuticals v. Margaret Hamburg (Case No. 11-1120), which concerns extended-release LODRANE containing brompheniramine maleate alone or in combination with pseudoephedrine HCl, ECR contends that its products are Identical, Related, or Similar (“IRS”) to the antihistamine/decongestant reformulation of controlled-release DIMETAPP Extentabs containing 12 mg of brompheniramine maleate and 75 mg of phenylpropanolamine HCL. “In its final order, [FDA] concluded that all extended-release drug products subject to the notice (e.g., Dimetapp Extentabs), and any IRS drug products (e.g., Lodrane products) to such extended-release drug products require approved new drug applications or abbreviated new drug applications prior to marketing, and are not [GRASE],” says the ECR Petition.
Adding more color to the 2-page Petition for Review is an April 1st Petition for Reconsideration/Petition for Stay of Action submitted to FDA on behalf of ECR requesting that the Agency “review and reverse its determination that ECR's Lodrane® products are not [GRASE] drug products. According to the ECR petition to FDA, “FDA's determination in this matter has not appropriately considered all of the evidence regarding these products. In addition, the Agency's actions fail to provide [ECR] the procedural protections in accordance with due process of law.” The ECR petition to FDA also asks the Agency to stay for 6 months the effective dates for action set forth in FDA’s March 3rd notice “[i]f upon reconsideration FDA maintains its position that the Lodrane products are not GRAS/E and may not obtain a hearing. . . .”
The second case, Laser Pharmaceuticals, LLC v. Margaret Hamburg (Case No. 11-1121), is similar to the ECR action, but concerns methscopolamine nitrate. According to the 2-page Petition for Review, FDA concluded in the Agency’s March 3rd final order:
that methscopolamine nitrate is not [GRASE]. In addition, [FDA] determined that products containing the active moiety in methscopolamine nitrate that are marketed for the relief of cold, cough, or allergy symptoms are new drugs within the meaning of [FDC Act § 201(p)], and therefore require approved new drug applications or abbreviated new drug applications prior to marketing. [FDA] further states that it intends to take immediate enforcement action against persons who market methscopolamine nitrate, as well as against those who manufacture the product or cause it to be manufactured or shipped in interstate commerce.
As with the ECR case, the Laser case was preceded by an April 1st Petition for Reconsideration/Petition for Stay of Action. That petition requests that FDA “delay any enforcement action against [Laser] for the manufacture of drug products containing methscopolamine nitrate until January 1, 2012, and delay any enforcement action for the shipment of such products until February 28, 2012.” Among other things, Laser alleges that FDA failed to consider important facts and ignored its own legal requirements in announcing its March 3rd action with respect to methscopolamine nitrate.
FDA has not substantively responded to either of the April 1st Petitions for Reconsideration/Petitions for Stay of Action. Both the ECR and Laser Petitions for Review were filed with the D.C. Circuit within the statutory 60-day period and appear to have been filed to protect the companies’ procedural rights.
