By Susan J. Matthees –

FDA recently denied a 2006 citizen petition submitted by Wyeth Consumer Healthcare (“Wyeth”) requesting that FDA withdraw a 2005 Notice of Proposed Rulemaking (“NPRM”) that would reclassify phenylpropanolamine (“PPA”) from Category I (generally recognized as safe and effective) to Category II (not generally recognized as safe and effective).  Wyeth alleged that FDA’s proposal to reclassify PPA was based on one flawed study of PPA and that the NPRM incorrectly described the safety status of PPA.  FDA disagreed, stating that the weight of evidence indicates that PPA’s safety has not been demonstrated. 

PPA has a relatively long history of use in the United States.  The ingredient was synthesized in the early 1900s and by the early 1940s was used in OTC nasal decongestant products.  Beginning in the 1970s, PPA was marketed as an appetite suppressant in OTC weight control drug products.  According to FDA, a 1991 review of adverse event reports from 1977 to 1991 and published studies on PPA suggested that PPA might be associated with an increased risk for hemorrhagic stroke.  In 2000, FDA’s Nonprescription Drugs Advisory Committee evaluated data on PPA and concluded that PPA should not be generally recognized as safe.  That same year, FDA conducted its own analysis of PPA data and requested that manufacturers voluntarily discontinue marketing products containing PPA.  In 2005, FDA proposed the reclassification of the ingredient from Category I to Category II. 

Wyeth objected to the proposed reclassification, alleging that FDA based its proposal to reclassify PPA on the findings of one flawed study, the Yale Hemorrhagic Stroke Project (“HSP”).  According to Wyeth, the HSP study is not a reliable study because the findings were based on a small number of cases and that there were a number of errors in the study, including errors in determining subject eligibility and classification and confounding factors that could undermine the validity of the results. 

FDA disagreed that the HSP study was fatally flawed, saying that Wyeth failed “to present convincing evidence that the HSP study is irreparably compromised.”  FDA also explained that the Agency’s proposal to reclassify PPA was based on all available data for the drug and the totality of the evidence suggested that the drug’s safety has not been demonstrated.  FDA reviewed 20 years of adverse event reports for PPA and the published results of a Korean study that was similar to the HSP.  Although Wyeth had criticized the Korean study, FDA concluded that the study provides “additional supportive evidence.”  FDA also stated that the adverse event reports for PPA are consistent with known biological effects of PPA on blood pressure. 

On July 26, 2011, Hyman, Phelps & McNamara, P.C. filed a request for a one-year comment period to allow affected businesses adequate time to respond to a lengthy and controversial draft guidance on New Dietary Ingredient ("NDI") notifications that FDA issued earlier this month.  Our previous post on the draft NDI guidance is available here. 

By Jennifer D. Newberger –

On July 27, 2011, the Center for Devices and Radiological Health ("CDRH") announced the issuance of a Draft Guidance titled “510(k) Device Modifications: Deciding When to Submit a 510(k) for a Change to an Existing Device.”  When finalized, this guidance document will replace that of the same name issued in January 1997. 

At first glance, the 2011 Draft Guidance does not appear to be too different from its 1997 predecessor.  For instance, both claim to focus on the meaning of whether a modification may “significantly affect” the safety or effectiveness of the device; both pose questions, categorized by modification category, that are to be analyzed for each change individually as well as collectively since the last 510(k) clearance; and both emphasize that, when determining whether the modifications may significantly affect safety or effectiveness, the modified device may only be compared to the most recently cleared device, not to another device made by the manufacturer or another manufacturer. 

But don’t get too comfortable too soon.  While much of the Draft Guidance is not too drastically different from the 1997 version, some of the changes that the Draft Guidance does include make fairly substantive changes to existing policy and practice.  Most importantly, these changes all flow in one direction:  more 510(k)s.  Changes that, in the past, may have been addressed via a letter to file may now require a new 510(k).  There do not appear to be any situations in which a change that previously required a 510(k) may now be addressed via a letter to file.

Labeling Changes.  Let’s start with labeling.  In the 1997 guidance, the labeling section notes that the threshold for whether a new 510(k) will be required is whether the modification affects the indications for use.  The 2011 Draft Guidance, however, does not appear to be so limiting.  Of particular interest is that the Draft Guidance notes that “it is important to keep in mind that the term ‘labeling’ includes more than just the instructions for use,” and may include things such as promotional materials.  Presumably, this means that when a manufacturer changes its promotional materials, it will need to go through the labeling analysis in the Draft Guidance and determine whether that change necessitates a new 510(k).  If a manufacturer determines no new 510(k) is needed, it will need to document that decision.

In addition to including promotional materials in the types of labeling covered by the Draft Guidance, the labeling section states that CDRH will now require a new 510(k) for changes that were specifically called out as not requiring a new submission in 1997.  For instance, the 1997 guidance notes generally that if a device is cleared for three indications and the manufacturer decides to market the device only for two of those indications, no new 510(k) is needed.  The Draft Guidance, however, modifies this condition in a manner sure to create confusion, stating that no new 510(k) would be needed in that situation only if the indication was removed “due strictly to marketing reasons” (emphasis in original).  In other words, if the market demand changed, resulting in a decision by the manufacturer to pull one of the indications, no new 510(k) would be needed.  However, “if a firm decides to market the devices for only two of those [three] indications due to other reasons, for example, changes that have been made to the device that affect the removed indication or because of complaints or corrective actions, FDA would generally consider the removal of the indications for use to be a ‘major change’ that requires a new 510(k).”  Yes, you read that right.  If the manufacturer makes a modification to a device that affects a use no longer claimed in the labeling, it may still need to submit a 510(k) for that modification unless the deletion was for marketing reasons.

The Draft Guidance also changes CDRH’s position regarding clinical versus home use.  CDRH has become increasingly focused on home-use products recently, so this change may not be a complete surprise.  Nevertheless, it does revise the 1997 position.  In 1997, the guidance stated:  “Many prescription devices are used in the home with increasing frequency and the Agency believes that 510(k)s are not necessary to add home-use labeling.”  This belief is no more.  The 2011 Draft Guidance states:  “[C]hanges from prescription use in a clinical setting to prescription use in a home setting” require a 510(k).

Manufacturing Process Changes.  One other area of particular import is that the Draft Guidance discusses manufacturing changes, a section not contained in the 1997 guidance.  Some of the questions asked in the manufacturing section (related to packing or expiration dating and changes to sterilization) were present in the 1997 guidance in a different section.  The primary difference is that the Draft Guidance now asks the manufacturer to consider whether manufacturing processes were part of the original 510(k).  If not, you’re in luck—the Draft Guidance says if manufacturing process changes were not part of the original 510(k), chances are any changes to the manufacturing process won’t necessitate a 510(k).  But if they were part of the original 510(k), “changes to manufacturing processes that could affect device specifications will likely require submission of a new 510(k).”

Technology, Engineering, and Performance Changes.  As expected (or, perhaps, hoped), the Draft Guidance also addresses more types of technology used by medical devices than does the 1997 version.  With regard to nanotechnology, the Draft Guidance notes that FDA has not adopted nanotechnology-specific criteria to assist manufacturers in determining when changes require a new 510(k), so instead CDRH asks manufacturers to consult it regarding any nanotechnology-related changes.

Many of the technology-related updates in the Draft Guidance conclude that a new 510(k) would be required for most technology-related changes.  For instance, the Draft Guidance concludes that “all changes in fundamental scientific technology could significantly affect safety or effectiveness,” and therefore all such changes require the submission of a new 510(k).  The Draft Guidance also more specifically addresses whether the change has the potential to alter performance characteristics or specifications, and concludes that such changes directly impact the performance, and potentially the safety and effectiveness, of the device, “and a new 510(k) with comparative testing should be provided for such modifications, whether the performance characteristics are improved or worsened.”  Another area with a sweeping requirement for a new 510(k) is changes that affect how the device receives, transmits, or displays electrical signals or data.  The Draft Guidance does not contain much discussion of this topic, but nevertheless concludes that most changes of this nature have the potential to significantly impact safety or effectiveness by altering data communication quality, and therefore require a new 510(k).  An example provided includes a case of diagnostic software that typically displays images on a monitor in a clinical setting that is being modified to output the image to a portable hand-held device that can be used to view the images from any location.  The Draft Guidance states that this change “could result in new risks, such as the inability to discern certain data due to a smaller hand-held screen, lower picture resolution, or loss of data during transmission, that could significantly affect the safety and effectiveness of the software.” 

Finally, the Draft Guidance includes an area into which FDA generally at least attempts to tread lightly:  the practice of medicine.  One of the questions posed in the Draft Guidance is whether the change will affect how the device is likely to be used in practice.  What is particularly interesting about this question is that it cites a little-used statutory provision related to FDA’s ability to consider potential off-label uses of products under review.  According to this provision, if FDA concludes there is a “reasonable likelihood that the device will be used for an intended use not identified in the proposed labeling” and that “such use could cause harm,” FDA may require the submitter to include a statement in the labeling providing “appropriate information regarding” the off-label use of the product.  According to the Draft Guidance, if a manufacturer makes a change to the product that may result in off-label use that could cause harm, even if the manufacturer does not intend to change the labeling, a 510(k) may be needed “to enable FDA to evaluate whether ‘appropriate information’ in the labeling about a use not currently identified in the labeling is necessary.”

It’s hard to say whether industry will find the Draft Guidance provides the clarity missing from the 1997 guidance, or whether the proposal only increases the areas of ambiguity.  The only thing that appears certain is that CDRH believes many more modifications necessitate a new 510(k) than had been the case.  There are no changes where 510(k)s that were needed are no longer required, but there are many changes for which companies would have used a letter to file that would now need a 510(k).

By Kurt R. Karst –

Late last week, the U.S. District Court for the Eastern District of Virginia granted the U.S. Patent and Trademark Office’s (“PTO’s”) Motion for Summary Judgment in a challenge mounted by the Genetics & IVF Institute (“GIVF”) to the PTO’s August 2010 denial of a Patent Term Extension (“PTE”) for U.S. Patent No. 5,135,759 (“the ‘759 patent”), which covers a method to preselect the sex of offspring and is owned by the U.S. Department of Agriculture (“USDA”).  As we previously reported, GIVF, as the exclusive licensee of the (now-expired) ‘759 patent, sued the PTO under the Administrative Procedure Act, and asked the court to, among other things, vacate and set aside the PTO’s August 2010 decision and to declare that the PTO has the discretion to extend the term of the ‘759 patent for the full period required under 35 U.S.C. § 156.

The case involves the interim PTE provisions at 35 U.S.C. § 156(d)(5), under which the PTO may grant an interim patent extension while a Premarket Approval application (“PMA”) is undergoing FDA review if the patent owner (or his agent) “reasonably expects that the applicable regulatory review period . . . that began for a product that is the subject of such patent may extend beyond the expiration of the patent term in effect.”  To request an initial interim PTE, the owner (or his agent) submits an application to the PTO “during the period beginning 6 months, and ending 15 days before such term is due to expire.”  The statute provides that a total of 5 interim PTEs may be granted.  After the initial interim PTE is granted, 35 U.S.C. § 156(d)(5)(C) provides that “[e]ach such subsequent application shall be made during the period beginning 60 days before, and ending 30 days before, the expiration of the preceding interim extension” (emphasis added).

The ‘759 patent was set to expire on August 4, 2009; however, the USDA requested and the PTO granted an interim PTE for a period of one year, through August 4, 2010.  Just days before the interim PTE was going to expire, the USDA, on July 27, 2010 petitioned the PTO for an extension of time to file a second interim PTE and also a request for a second subsequent interim PTE.  On August 2, 2010,  the PTO denied both the USDA’s petition and request for a second subsequent interim PTE, saying that “[b]ecause the relief that petitioner seeks is from a statute, the USPTO, without any statutory authority to grant such relief, cannot excuse failure to comply with the statutory timing requirement of § 156(d)(5)(C) . . . .”  Unsatisfied with this decision, GIVF decided to take the matter to court.

GIVF argued in its Motion for Summary Judgment that the PTO’s decision that the Office lacked discretion to consider the USDA’s untimely application, because § 156(d)(5)(C) uses “shall,” fails because “shall” is sometimes discretionary,  the PTO’s decision is “inconsistent with how the USPTO views Section 156 and how the law views the other timing provisions in federal patent law,” and because  “allowing the USPTO’s decision to stand will result in a harsh, absurd, and
unfair result.”

In a 31-page opinion, Judge James C. Cacheris granted the PTO’s Motion for Summary Judgment.  Noting that although in the proper context “shall” may be permissive, in 35 U.S.C. § 156(d)(5)(C), the court said, “shall”  is mandatory:

The relevant language provides that “[e]ach such subsequent application shall be made during the period beginning 60 days before, and ending 30 days before, the expiration of the preceding interim extension.”  35 U.S.C. § 156(d)(5)(C).  This language is unqualified.  The application “shall be made” in the relevant period, full stop.  Without any qualifying language, “[n]othing in the language of the statute states or suggests that the word ‘shall’ does not mean exactly what it says.”  Thus, “shall” has its ordinary meaning denoting a mandatory requirement or obligation.  [(Citation omitted)]

This was not the end of the inquiry for the court, however: 

That “shall” in § 156(d)(5)(C) has its ordinary meaning does not end the inquiry.  That mandatory requirement or obligation applies to the applicant for the Extension, and not the USPTO.  That is, § 156(d)(5)(C) speaks to when a patent holder must file an application for an Extension, and does not, by its terms, address anything the USPTO must do.  Put simply, saying that Plaintiff had a mandatory requirement or obligation to file its application within a certain period does not, in and of itself, address whether the USPTO had discretion to consider a tardy application. [(Italics in original)]

Turning to whether § 156(d)(5)(C) speaks to the PTO’s discretion, independent of imposing a mandatory obligation on GIVF, the court said that “[n]othing in that statute, or in § 156 generally, answers the question of whether the USPTO has discretion to consider a tardy application under § 156(d)(5)(C).”  There are several other provisions in the patent laws that expressly grant the PTO  with discretion when administering time periods or deadlines; however, Judge Cacheris, relying on the canon of statutory construction against superfluity, wrote that if the PTO  “has discretion regardless of the mandatory requirement placed on the patent holder . . .  and without the statute’s granting discretion, then Congress would not have needed to provide for that discretion in the other provisions . . . .  Thus, all of that discretionary language would be unneeded and superfluous.”

Finally, addressing the remedial nature of the PTE statute and the allegedly “harsh” result it produced here, Judge Cacheris stated that even “[a] liberal reading of ‘shall’ in § 156(d)(5)(C) is not enough to get to where Plaintiff would have this Court go.  The Court would also need to add language to the statute to add discretion where Congress stated none.  The Court will not do so.”  GIVF had sought to rely on the district court’s so-called “liberal-reading-of-a-remedial-statute rule” in Medicines Co. v. Kappos, 731 F. Supp. 2d 470 (E.D. Va. 2010), to support its position.   But Judge Cacheris was not convinced, saying that in Medicines Co. Judge Hilton “reasonably applied one of two alternative common definitions for a term,” but that GIVF, in contrast, “is effectively asking the Court to rewrite, or at least add, whole-cloth, language to § 156(d)(5)(C).”

By Carmelina G. Allis –

The FDA’s “Draft Guidance on Mobile Medical Applications” is applicable to software products (or “mobile apps”) intended for use on mobile platforms that are handheld in nature, such as, for example, the iPhone® and Android® phones.  “Mobile medical apps” are defined as software applications that meet the statutory definition of a “device” under Section 201(h) of the Federal Food, Drug, and Cosmetic Act, and are either used as an accessory to a regulated medical device, or transform a mobile platform into a regulated medical device.

The FDA plans to exercise regulatory oversight over those mobile medical apps that are associated with current device classifications.  Thus, the guidance document focuses on mobile apps that perform functions that either have been traditionally considered medical devices, or that affect the performance or functionality of a currently regulated medical device.  Examples include mobile apps that are an extension of one or more medical devices by connecting to such device for storing or displaying patient-specific medical data (e.g., an app that displays medical images directly from a PACS server), or mobile apps that allow the user to input patient-specific information and uses algorithms to obtain a patient-specific results or diagnosis (e.g., apps that collect patient-specific data and compute the prognosis of a particular disease).

FDA also identifies the categories of mobile medical apps for which it will apply regulatory oversight.  Those categories are:

• displaying, storing or transmitting patient-specific medical device data in its original format;
• controlling the intended use, function, modes, or energy source of the connected medical device;
• transforming or making the mobile platform into a regulated medical device; and
• creating alarms, recommendations or creating new information (data) by analyzing or interpreting medical device data.

The guidance document clarifies that mobile apps that are electronic copies of textbooks, reference materials or teaching aids; that are used to make decisions regarding general health and wellness; or that only automate general office operations, such as billing, are not considered mobile medical apps.

This document also clarifies that a mobile platform is not a “device” simply because it can be used to run a mobile medical app.  However, if the platform is being marketed with a medical device intended use, then it would meet the definition of a “device.”

Although this guidance document provides much needed clarification on how the agency intends to regulate mobile medical apps, it still leaves uncertainty in some areas.  For example, FDA intends to exercise “enforcement discretion” against those mobile apps that do not meet the definition of a “mobile medical app” but may meet the statutory definition of a “device.”  This approach will create uncertainty for industry.  Moreover, there are other mobile apps that FDA will “monitor” and “determine whether additional or different actions are necessary to protect the public health.”  Examples of mobile apps that FDA will “monitor” are products that may meet the definition of a “device” and also automate common clinician’s diagnostic and treatment tasks, or allow individuals to self-manage their disease.  Because the agency has not defined its regulatory position on those apps that it will “monitor,” FDA seems to suggest that manufacturers should consider complying with device regulatory requirements for these types of apps.  This position will generate further uncertainty and unnecessary expense.

FDA is seeking comments on this draft guidance document.

By Kurt R. Karst –      

FDA has been asked for a fourth time to provide an advisory opinion on compliance with the Hatch-Waxman Orange Book patent listing requirements for a patent that claims a drug delivery device integral to the administration of the active ingredient, but where the patent does not recite the active ingredient.  The latest Advisory Opinion Request (Docket No. FDA-2011-A-0363), submitted on behalf of Forest Laboratories, Inc. (“Forest”) (and with respect to a drug product under an NDA – NDA No. 202-450 – that apparently has not yet been approved), follows almost identical Advisory Opinion Requests filed in January 2005 by GlaxoSmithKline (Docket No. 2005A-0015), in August  2006 by AstraZeneca (Docket No. 2006A-0318), and in June 2007 by AstraZeneca (Docket No. 2007A-0261).  Forest’s Advisory Opinion Request raises the issue of whether a patent with certain characteristics should be submitted to FDA for Orange Book listing; specifically, where:

a)  the patent claims a drug delivery device: (i) whose use is integral to the administration of the active ingredient subject of the NDA, (ii) whose approval, therefore, is part of the approval of the active ingredient subject of the NDA, and (iii) that is recited in the “Indications and Usage” section of the Prescribing Information for the active ingredient subject of the NDA (“label”); and

b)  the claims in the patent do not recite the active ingredient subject of the NDA.

As we previously reported, the advisory opinion requests previously submitted to FDA were apparently prompted by FDA’s response to comments stated in the preamble to the Agency’s June 2003 final rule implementing the FDC Act’s patent listing provisions.  Those comments sought clarification as to whether patents claiming delivery devices or containers “integral” to a drug product should be submitted to FDA for Orange Book listing.  FDA did not directly address the issue, but rather stated that the key factor in determining whether a drug product patent must be submitted for Orange Book listing is “whether the patent being submitted claims the finished dosage form of the approved drug product.” 

FDA’s failure to provide clear statements on the issue has led some companies to interpret the law and FDA’s patent listing regulations at 21 C.F.R. § 314.53 to require patent submission and Orange Book listing if such patents claim an integral part of an approved drug product rather than merely packaging (patents claiming packaging may not be submitted for Orange Book listing).  Indeed, GlaxoSmithKline, apparently tired of waiting for a response from FDA to its Advisory Opinion request, informed FDA in February 2009 that “in the absence of further guidance from the FDA, [the company] has modified its Orange Book listing practice to list those patents whose claims read on the drug product subject to FDA approval, including those patents that claim all or a portion of integrated drug-device products, regardless of whether the approved drug substance is specifically mentioned in the claims of such patents.” (See our previous post here.)  Other companies have apparently followed suit, as there are now several patents listed in the Orange Book that could be characterized as drug delivery device patents. 

Forest says in its Advisory Opinion Request that the FDC Act “imposes a duty on an NDA applicant to submit a patent for listing when the patent claims a drug product that can be asserted against a generic manufacturer in an infringement action,” and that:

In Forest’s view, that duty exists when the patent claims a drug delivery device that is an integral part of the administration of the active ingredient to a patient, especially when the approval of the drug product NDA is conditioned on the concurrent approval of the drug delivery device.  This duty should exists irrespective of whether the patent recites the active ingredient in the claims.  This is because the patent would be, in either case, a patent with respect to which a claim of patent infringement could reasonably be asserted under the conditions recited in the statute.

Moreover, says Forest, there are two reasons that “strongly suggest that the FDA accepts the practice of submitting drug delivery device patents that do not recite the drug substance in the claims for listing in the Orange Book.”  First, “the FDA has not condemned the practice publicly, even after given the explicit opportunity to do so via the three requests for an advisory opinion cited above.”  Second, “the FDA accepts the submissions of such patents and later lists them in the Orange Book.”

The Orange Book listing of one patent alleged to be a drug delivery device patent has already led one company to assert in court the patent delisting counterclaim provisions at FDC Act §505(c)(3)(D)(ii)(I) added to the statute by the Medicare Modernization Act (“MMA”) available to 505(b)(2) NDA sponsors.  (The MMA also added a parallel counterclaim provisions at FDC Act §505(j)(5)(C)(ii)(I) applicable to ANDA sponsors.)  As we previously reported, Intelliject, Inc. alleges in a court filing from earlier this year that U.S. Patent No. 7,794,432 (‘the ‘432 Patent”), which is listed in the Orange Book for EpiPen and EpiPen Jr Auto-Injectors (epinephrine injection) solution, 0.3mg/ml and 0.415/0.3 ml (NDA No. 19-430), must be delisted from the Orange Book, because “the ‘432 patent does not claim either the drug for which Meridian’s NDA was approved or an approved method of using the drug.”

By Kurt R. Karst –      

Suppose FDA approves a New Drug Application (“NDA”) – NDA No. 1 – and grants a period of 5-year New Chemical Entity (“NCE”) exclusivity, but there are no patents listed in FDA’s Orange Book for the NDA, and therefore, there is no opportunity for a generic drug sponsor to submit to FDA an ANDA containing a Paragraph IV certification on the so-called “NCE-1 date.”  Suppose further that a couple of years after the approval the NDA No. 1, FDA approves a second NDA from the same sponsor – NDA No. 2 – for a drug product containing the same active moiety as in NDA No. 1, but perhaps in a different dosage form, but the NDA sponsor does submit to FDA for listing in the Orange Book a patent for NDA No. 2.  While the remainder of the period of NCE exclusivity granted for the approval of NDA No. 1 would apply under FDA’s “umbrella policy” to NDA No. 2, does the fact that NDA No. 1 is not listed in the Orange Book with a patent preclude an NCE-1 Paragraph IV ANDA submission for the drug product covered under NDA No. 2?  It’s an interesting scenario – and probably quite rare – but one we thought should be tackled. 

The statutory 5-year NCE exclusivity provision at FDC Act § 505(j)(5)(F)(ii) applicable to ANDAs (there is a slightly different parallel provision at FDC Act § 505(c)(3)(E)(ii) applicable to 505(b)(2) applications) governing the scope of NCE exclusivity states in relevant part:

If an application submitted under subsection (b) for a drug, no active ingredient (including any ester or salt of the active ingredient) of which has been approved in any other application under subsection (b), is approved after the date of the enactment of this subsection, no application may be submitted under this subsection which refers to the drug for which the subsection (b) application was submitted before the expiration of five years from the date of the approval of the application under subsection (b), except that such an application may be submitted under this subsection after the expiration of four years from the date of the approval of the subsection (b) application if it contains a [Paragraph IV certification]. [(Emphasis added)]

Is the emphasis in this statutory provision on the phrase “the drug” (subsequently clarified by FDA to mean “active moiety”), which would argue in favor of an NCE-1 Paragraph IV ANDA submission for NDA No. 2, or on “the subsection (b) application,” which would seem to argue otherwise?

FDA’s regulation at 21 C.F.R. § 314.108(b)(2) implementing FDC Act § 505(j)(5)(F)(ii) sheds some light on this statutory provision and states, in relevant part, that:

If a drug product that contains a [NCE] was approved after September 24, 1984, in an application submitted under section 505(b) of the act, no person may submit a 505(b)(2) application or [ANDA] under section 505(j) of the act for a drug product that contains the same active moiety as in the [NCE] for a period of 5 years from the date of approval of the first approved [NDA], except that the 505(b)(2) application or abbreviated application may be submitted after 4 years if it contains a [Paragraph IV] certification . . . .[(Emphasis added)]

This regulations seems to say that the decisive factor in determining the scope of NCE exclusivity is the active moiety.  Indeed, if FDA intended the reference to “the subsection (b) application” in FDC Act § 505(j)(5)(F)(ii) to be the decisive factor in determining the scope of NCE exclusivity, then 21 C.F.R. § 314.108(b)(2) presumably would not emphasize the active moiety as it does.  Thus, if FDA were presented with the scenario above, it seems that the Agency would determine that NCE exclusivity prevents the submission of an ANDA for a proposed drug product containing the protected active moiety for 5 years – whether that protected active moiety is in a drug product approved under NDA No. 1 or under NDA No. 2 – unless an ANDA for a generic version of the drug product covered under NDA No. 2 protected by the umbrella NCE exclusivity stemming from the approval of NDA No. 1 contains a Paragraph IV certification to an Orange Book-listed patent.  In other words, an ANDA for a generic version of the drug product covered by NDA No. 2 could be submitted on the NCE-1 date if it contains a Paragraph IV certification.

Such an interpretation of FDC Act § 505(j)(5)(F)(ii) seems to be consistent with FDA’s NCE exclusivity “umbrella policy.”  Under that policy:

[W]hen exclusivity attaches to an active moiety or to an innovative change in an already approved drug, the submission or effective date of approval of ANDA’s and 505(b)(2) applications for a drug with that active moiety or innovative change will be delayed until the innovator’s exclusivity has expired, whether or not FDA has approved subsequent versions of the drugs entitled to exclusivity, and regardless of the specific listed drug product to which the ANDA or 505(b)(2) application refers.

FDA, Proposed Rule, ANDA Regulations, 54 Fed. Reg. 28,872, 28,897 (July 10, 1989) (emphasis added). 

Thus, NCE exclusivity protects the active moiety in subsequent NDA approvals made within the 5-year NCE exclusivity period; however, that exclusivity would seem to apply separately with respect to each approved drug product, particularly when there is a patent listed in the Orange Book covering NDA No. 2 in our scenario but not for the original NDA No. 1 approval from which the NCE exclusivity flows. 

By Kurt R. Karst –

On July 19th, President Obama announced his intent to nominate Maureen K. Ohlhausen as a Commissioner of the Federal Trade Commission (“FTC”).  Ms. Ohlhausen is currently a partner at Wilkinson Barker Knauer LLP, where she specializes in privacy, data protection, and cybersecurity.  Ms. Ohlhausen previously worked at the FTC from 1997 to 2008.  From 2004 to 2008, she served as Director of the Office of Policy Planning, where she supervised the development of reports, amicus briefs, and advocacy filings on competition and consumer protection topics, principally focusing on e-commerce, advertising, and technology issues.  Additional background information is available here.

If confirmed by the Senate, Ms. Ohlhausen would serve a 7-year term on the 5-member board, which currently includes Commissioners Jon Leibowitz, J. Thomas Rosch, William E. Kovacic, Edith Ramirez, and  Julie Brill.  Ms. Ohlhausen would be replacing William E. Kovacic, whose term expires in September.

By Ricardo Carvajal –

The integration of federal and state food safety systems is one of the goals of the Food Safety Modernization Act.  To that end, FDA recently announced the availability of grant funding to help with the “design, development, delivery, and maintenance of a national food/feed training program” to ensure “a competent workforce doing comparable work at all levels of the integrated food system.”

Budgetary realities suggest that the effort might not go smoothly.  Minnesota, generally regarded to be in the vanguard of states that prioritize food safety, was recently forced to designate critical services that would continue to be provided during that state government’s shutdown. Food safety and disease outbreak investigation and response made the cut, albeit “with limited staff.”  Conditions could be similarly grim in other states, particularly given that the playing field was not level even before the economic downturn.

Doubtless FDA will push forward.  An Agenda for Strengthening State and Local Roles in the Nation’s Food Safety System was laid out by Deputy Commissioner for Foods Michael Taylor before he assumed that mantle at FDA – and when the FSMA was just a gleam in the eyes of its sponsors.

By Kurt R. Karst –      

Last week, Judge Ellen S. Huvelle of the U.S. District Court for the District of Columbia dismissed without prejudice for lack of subject matter jurisdiction a Complaint filed by Cephalon, Inc. (“Cephalon”) on March 15, 2011 challenging FDA’s January 7, 2011 approval of Watson Laboratories, Inc.’s (“Watson’s”) ANDA No. 079075 for a generic version of FENTORA (fentanyl) buccal tablets (approved under NDA No. 021947).  Watson, represented by Hyman, Phelps & McNamara, P.C. and Crowell & Moring, intervened in the case as an Intervenor-Defendant.  

Cephalon’s lawsuit is related to two citizen petitions – Docket Nos. FDA-2010-P-0383 and FDA-2010-P-0396 – Cephalon submitted to FDA in July 2010.  One petition requests that FDA withdraw its acceptance of Watson’s ANDA and require Watson to submit a 505(b)(2) on the basis that Watson’s generic FENTORA drug product contains two active ingredients – i.e., fentanyl citrate and an additional salt form, fentanyl starch glycolate – whereas FENTORA contains only fentanyl citrate.  The second petition requests that FDA establish certain bioequivalence requirements for the approval of any generic version of FENTORA.  FDA denied both petitions on January 7, 2011 (the same date FDA approved ANDA No. 079075) saying that Cephalon had “not submitted sufficient evidence establishing that the Watson product contains an additional salt form of fentanyl, fentanyl starch glycolate,” and that the additional parameters proposed by Cephalon are not necessary to determine bioequivalence.  Cephalon alleges in its Complaint that FDA’s rejection of the citizen petitions and approval of Watson’s ANDA were unlawful and in violation of the FDC Act and the Administrative Procedure Act. 

Watson’s ANDA contains Paragraph IV certifications to two Orange Book-listed patents – U.S. Patent Nos. 6,200,604 (the ‘604 Patent) and 6,974,590 (the ‘590 Patent) – both of which are scheduled to expire on March 26, 2019.  Cephalon filed a patent infringement lawsuit against Watson in the U.S. District Court for the District of Delaware with respect to both patents, thereby triggering a 30-month stay of ANDA approval.  Cephalon also asserted a third, non-Orange Book-listed patent – U.S. Patent No. 6,264,981 (“the ‘981 Patent”).  FDA approved ANDA No. 079075 once the 30-month stay naturally expired. 

Cephalon filed is Complaint against FDA just four days after the Delaware district court ruled in Watson’s favor on the ‘604 and ‘590 Patents.  Shortly thereafter, however, the court ruled in Cephalon’s favor on the non-Orange Book-listed ‘981 Patent and issued an injunction barring Watson from infringing the patent, which expires in 2019.  Watson filed a notice of appeal with the U.S. Court of Appeals for the Federal Circuit, but the Court has not yet scheduled the case for argument. 

Given the ruling on the ‘981 Patent, FDA filed a Motion to Dismiss Cephalon’s Complaint on the basis that Cephalon lacks standing and that the company’s claims are not ripe.  According to FDA:

Cephalon does not have standing because the injury it cites is not “actual or imminent,” nor is it redressable by the Court.  In its complaint, Cephalon alleges harms purportedly caused by FDA’s approval of Watson’s generic drug: (1) harm to the public because the FDA “will usher into the marketplace a generic drug of untested safety and efficacy,” (2) “rapid and significant erosion of sales [of Fentora] that cannot be recouped,” and (3) harm to Cephalon’s reputation if Watson’s generic fentanyl citrate product is less effective than Fentora because Fentora “will thus be wrongly associated with bad outcomes.”  These purported injuries can exist only if and when Watson’s generic drug enters the market; as noted, Watson is currently enjoined from making, using, or selling its generic product until 2019. [(Internal citations omitted)]

With respect to ripeness, FDA argued that:

although FDA denied Cephalon’s citizen petitions, those agency decisions have had no impact on Cephalon’s day-to-day operations because, despite receiving FDA approval, Watson is nonetheless barred from marketing its generic fentanyl citrate product until the ‘981 patent expires.  Therefore, Cephalon is asking this Court to render a decision that may have no effect on the parties until 2019, or until a speculative appellate decision.  It is a waste of this Court’s resources to undertake review now, especially when Cephalon suffers no hardship. 

FDA further argued that the U.S. Court of Appeals for the District of Columbia Circuit’s decision in Pfizer Inc. v. Shalala, 182 F.3d 975 (D.C. Cir. 1999), is applicable to the instant case.  In Pfizer, the D.C. Circuit considered FDA’s denial of a citizen petition to be final agency action, even though FDA had not finally ruled on the ANDA at issue.  The Court found that Pfizer’s claims were not ripe because the citizen petition denial did not cause any of the economic harm alleged by Pfizer.  Similarly, says FDA in its Motion to Dismiss, “Cephalon’s claims relate to no imminent, certain harm.”

Judge Huvelle agreed with FDA and dismissed the case based on ripeness grounds in a 15-page decision issued on July 14, 2011.  Applying the two-part ripeness analysis – i.e., (1) “the fitness of the issues for judicial decision” and (2) “the hardship to the parties of withholding court consideration” – Judge Huvelle ruled that Cephalon did not meet either prong. 

With respect to fitness, Judge Huvelle wrote that “the fact that the agency has issued final approval of the ANDA submitted by a generic applicant does not establish ripeness,” and noted the D.C. Circuit’s decision in Pfizer “does not undercut this conclusion,” because “[a]lthough the Court reasoned that an eventual FDA approval of a generic ANDA could make the case ripe, it did not establish a per se rule that automatically makes ripe a case involving final agency action.  On the contrary, the Court acknowledged that ‘a final agency action nonetheless can be unripe for judicial review.’”

With respect to hardship, Judge Huvelle wrote that this prong of the ripeness analysis “requires the Court to consider not whether the parties have suffered any direct hardship, but rather whether postponing judicial review would impose an undue burden on them or would benefit the court” (internal quotations and citations omitted).  Judge Huvelle noted that the D.C. Circuit’s March 2, 2010 decision in Teva Pharmaceuticals USA, Inc. v. Sebelius, 595 F.3d 1303 (D.C. Cir. 2010), concerning 180-day exclusivity for generic versions of COZAAR/HYZAAR, and in which the Court reasoned that “where there are no institutional interests favoring postponement of review, a petitioner need not satisfy the hardship prong,” has not changed the hardship test for ripeness.   

According to Judge Huvelle, Cephalon’s assertions that the case is ripe “because postponing review will cause immediate, direct, and significant harm” are “too speculative to establish an undue burden on plaintiff.”  Moreover, “the Court would benefit from postponement of the case,” says Judge Huvelle, “because a number of events could occur that could either make adjudication unnecessary or materially alter the complexion of the case.”

By Wes Siegner, Ricardo Carvajal & Riëtte van Laack –

Since at least the early 1960s, FDA has attempted to exercise control over the dietary supplement market, sometimes in ways that the public, industry and Congress have found unacceptable.  In the 60s, FDA proposed a regulation that would have required FDA review and approval of vitamin products that exceeded 150% of the U.S. RDA and to require the following disclaimer on vitamin supplements: "Vitamins and minerals are supplied in abundant amounts by commonly available foods.  Except for persons with special medical needs, there is no scientific basis for recommending routine use of dietary supplements."  The proposed disclaimer was withdrawn after hearings, but the regulation setting limits on potency was finalized in 1973.  That regulation was invalidated as arbitrary and capricious by a federal appellate court, and the regulation prompted Congress to add section 411 to the Federal Food, Drug, and Cosmetic Act ("FDC Act") through the Proxmire Amendments in 1976.  Among other things, section 411 restricts FDA’s authority to set maximum limits on the potency of synthetic or natural vitamins or minerals in dietary supplements.  

In the 1980s, FDA pursued the theory that novel dietary supplements were in fact unapproved and therefore illegal “food additives,” bringing multiple seizure actions against a variety of products including evening primrose and black currant oil.  FDA’s arguments that even pure black currant oil in a gelcap or a glass bottle was a “food additive” led to unusually strong rebukes in two appellate courts, one of which found that FDA’s argument “perverts the statutory text, undermines legislative intent, and defenestrates common sense,” while the other described FDA’s theory as an “Alice-in-Wonderland approach,” and “an end-run around the statutory scheme.”  Then Congress stepped in again, 18 years after the Proxmire Amendments, and passed the Dietary Supplement Health and Education Act ("DSHEA"), clarifying that FDA has no authority to regulate dietary supplements as “food additives.”

Now, 17 years after DSHEA, FDA has published the long-awaited draft guidance on new dietary ingredients ("NDIs"), providing regulated industry with a comprehensive view of FDA’s thinking on all things NDI.  If FDA translates that thinking into regulatory action, there will be multiple negative effects on the dietary supplement industry, including:

• The “grandfather” status of many dietary ingredients marketed prior to October 15, 1994 would be eliminated through (1) unachievable documentation requirements to prove prior marketing, and/or (2) the requirement that there be no change in the manufacturing method.  Most ingredients that have been accepted as having “grandfather” status would instead be regulated as NDIs.
• DSHEA’s exemption from the notification requirement for NDIs “present in the food supply as an article used for food in a form in which the food has not been chemically altered” would be gutted by FDA’s view that (1) the “food supply” includes only conventional foods, not dietary supplements, and (2)  “chemically altered” means virtually any process applied to any dietary ingredient other than treatment with water or ethanol, even if no change in chemical structure or properties occurs.  The result is that the vast majority of NDIs would have to be the subject of a notification, unnecessarily burdening industry and swamping the agency with pointless work.
• Innovation in the supplement market, an important purpose of DSHEA, would be strangled by FDA’s view that (1) new dietary ingredient notifications ("NDINs") are applicable only to the specific manufacturer that submitted the NDIN, and (2) even minor changes in use or the manufacturing process for an NDI would require submission of a new NDIN.
• Many NDINs would be rejected as a result of FDA’s view that synthetic equivalents of certain naturally occurring NDIs do not qualify as dietary ingredients, a position that is lacking in scientific and legal merit.

In sum, if the guidance were to be finalized and implemented in anything resembling its current form, it would drastically restrict the marketing of grandfathered dietary ingredients, and stifle the development of new dietary ingredients and more efficient manufacturing methods.

The draft guidance strikes us as a missed opportunity for FDA.  Rather than craft a viable path forward for the implementation of the new dietary ingredient provisions of the FDC Act, the draft guidance both ignores the purpose of DSHEA and exceeds the statutory authority granted by that legislation.  The draft guidance shows that the agency has again declined to heed the corrective message delivered by Congress through the Proxmire Amendments and DSHEA.  Perhaps, 18 years after DSHEA, it will be time for Congress to deliver that message again.

By Kurt R. Karst –      

A recent article published in Roll Call, titled “Hatch-Waxman Act’s Interpretations Threaten Lives, Jobs,” caught our attention.  The article was penned by Delegate Donna Christensen (D-VI) (who is chairwoman of the Congressional Black Caucus Health Braintrust) and expresses the strong support of members of the Congressional Black Caucus for Section 37 of the House-passed version of the America Invents Act (H.R. 1249).  As we recently reported, Section 37 was sponsored by Representative John Conyers (D-MI) and would amend the Patent Term Extension (“PTE”) law at 35 U.S.C. § 156(d)(1) to effectively codify Judge Claude M. Hilton’s August 3, 2010 decision in The Medicines Company v. Kappos, 731 F. Supp. 2d 470 (E.D. Va. 2010), in which Judge Hilton ordered the Patent and Trademark Office (“PTO”) to consider timely filed The Medicines Company’s (“MDCO’s”) PTE application for U.S. Patent No. 5,196,404 covering ANGIOMAX (bivalirudin) under a next business day interpretation of the PTE statute.  Although H.R. 1249 includes the PTE provision, the Senate version of the bill (S. 23) does not.  (According to IPO Daily News, some Senators are objecting to a few provisions in the House bill, including Section 37.) 

Section 37 (also dubbed the “MedCo amendment” or the “Dog Ate My Homework Act”) has been controversial, but we will not get into that here.  What is of particular interest to us is a statement in Del. Christensen’s article that Judge Hilton’s “decision benefited not only the Angiomax innovator but also another company with a lifesaving drug that this month applied for patent term restoration based on Hilton’s decision.” 

We did some digging and there appear to be two candidates out there that fit Del. Christensen’s description. 

The first is the PTE application for U.S. Patent No. 6,441,168 (“the ‘168 Patent”) (currently set to expire on April 17, 2020) covering BEYAZ (drospirenone/ethinyl estradiol/levomefolate calcium and levomefolate calcium) Tablets.  FDA approved BEYAZ under NDA No. 022532 on September 24, 2011, and a PTE application was submitted to the PTO on November 23, 2010 – or 61 days after NDA approval, including the date of NDA approval.  Under 35 U.S.C. § 156(d)(1), the submission of a PTE application must occur “within the sixty-day period beginning on the date the product received permission under the provision of law under which the applicable regulatory review period occurred for commercial marketing or use.”  But does the next business day rule from The Medicines Company decision apply to the PTE application for the ‘168 Patent?  That is, was notice of the approval letter for NDA No. 022532 received after business hours (i.e., after 4:30 P.M., Eastern Time), thereby making November 23, 2011 day 60 instead of day 61?  (The BEYAZ approval letter does not include a time stamp.)

In March 2011, the PTO issued an Order to Show Cause with respect to the PTE application for the ‘168 Patent citing The Medicines Company decision and saying:

Here, no evidence has been made of record indicating that Applicant received notice of its NDA approval from FDA after FDA’s close of business, i.e., after 4:30 PM EST.  Therefore, without any such evidence, the USPTO presumes that the notice of NDA approval was transmitted to Applicant on September 24, 2010 during FDA’s normal business hours.  Thus, Applicant filed its PTE application one day late, and the eligibility requirement set forth in section 156(d)(1) does not appear to be satisfied and the ‘168 patent appears ineligible for patent term extension for this reason.

The applicant recently responded to the Order to Show Cause providing the requested evidence to the PTO, stating:

[T]he facts are the same as described in The Medicines Company v. Kappos.  Applicant received notice of their NDA Approval from FDA after the close of FDA's business, i.e., after 4:30 PM EST, on September 24, 2010.  Thus, the time period set forth in 35 USC §156(d)(1) started on the next business day, i.e., September 25, 2010.  Thus, the sixty day period set forth in 35 USC §156(d)(1) ended on November 23, 2010, the date that applicant fIled the instant PTE application. Therefore, the application was filed "within" the sixty day period set forth in 35 USC § 156(d)(1).

In this case, the FDA provided notice of the approval in an email received at 4:45 PM on September 24, 2010.

The second candidate is the PTE application for U.S. Patent No. 5,674,860 (“the ‘860 Patent”) covering SYMBICORT (budesonide; formoterol fumarate dihydrate) Inhalation Aerosol, which we have previously reported on (here and here).  FDA approved SYMBICORT under NDA No. 021929 on Friday, July 21, 2006, and a PTE application for the '860 Patent was submitted to the PTO on September 19, 2006 – or 61 days after NDA approval, including the date of NDA approval.  According to a recent submission to the PTO, however, FDA approved NDA No. 021929 at 4:36 PM (Eastern) on July 21, 2006.  Therefore, says the applicant, "in accordance with The Medicines Company, Applicant's period to file the PTE application did not begin to run until the first business day following the FDA's after-hours transmission," or Monday, July 24, 2006, "thus rendering the submission of the PTE application on September 19, 2006, timely within the meaning of § 156(d)(1)." 

By Jamie K. Wolszon –

FDA announced earlier this week the publication of a much-anticipated draft guidance on in vitro companion diagnostic devices.  In the draft guidance, FDA stakes out a policy position that if safe and effective use of a therapeutic depends on a diagnostic, then FDA generally will require approval or clearance of the diagnostic at the same time that FDA approves the therapeutic.  Companion diagnostics are key to the advancement of personalized medicine.  Some well-known companion diagnostics are the tests used to identify patients who will benefit from cancer therapy Herceptin.

FDA outlines two exceptions to this general rule: For new therapeutics, FDA may approve the therapeutic even though the companion diagnostic has not been approved or cleared if the therapeutic product is “intended to treat a serious or life-threatening condition for which no satisfactory alternative treatment exists and the benefits from the use of the therapeutic product with an unapproved or uncleared IVD companion diagnostic device are so pronounced as to outweigh the risks from the lack of an approved or cleared IVD companion diagnostic device.”

As for the second exception to the general rule, for therapeutic products that are currently on the market, FDA would be willing to approve a supplement for new labeling even without a cleared or approved companion diagnostic under the following limited circumstances: (1) The “labeling for an already approved therapeutic product must be revised to address a serious safety issue”; (2) the change made to address this issue requires use of a diagnostic test that is not yet approved or cleared; and (3) “the benefits from the use of the therapeutic product with an unapproved or uncleared IVD companion diagnostic device are so pronounced as to outweigh the risks from the lack of an approved or cleared IVD companion diagnostic device.”

The guidance did not provide examples of types of therapeutics or diagnostics that would qualify for these exceptions from the general rule.

The guidance defines IVD companion diagnostic as “an in vitro diagnostic device that provides information that is essential for the safe and effective use of a corresponding therapeutic product.” 

FDA provides as an example of an IVD companion diagnostic tests that “identify patients who are most likely to benefit from a particular therapeutic product.”  Companion diagnostics also include tests that “identify patients likely to be at increased risk for serious adverse reactions as a result of treatment with a particular therapeutic product” and “monitor response to treatment for the purpose of adjusting treatment (e.g., schedule, dose, discontinuation) to achieve improved safety or effectiveness.”

Companion diagnostics do not include tests intended to provide “information that is useful to the physician regarding the use of a therapeutic product, but that are not a determining factor in the safe and effective use of the product.”  For instance, biochemical assays (e.g., serum creatinine tests) used to monitor organ function are not companion diagnostics.

Ideally, according to FDA, a “therapeutic product and its corresponding IVD companion diagnostic device would be developed contemporaneously, with the clinical performance and clinical significance of the IVD companion diagnostic device established using data from the clinical development program of the corresponding therapeutic product.”  However, FDA states that it recognizes that this will not always be possible.  This expectation that the therapeutic and the companion diagnostic would be developed contemporaneously may be viewed as unrealistic.

The guidance also notes that studies of companion diagnostics generally will be significant risk devices that will require an IDE.  Most studies of other IVDs are non-significant risk.

FDA will use a risk-based approach to regulate companion diagnostics.  FDA says that in its experience to date, companion diagnostics generally will be Class III devices requiring a PMA, but there could be instances where 510(k) would be sufficient.

The guidance recommends that sponsors consult with both the device center, for a pre-IDE meeting, and the center in charge of regulating the therapeutic component.  FDA notes that it is “developing appropriate internal policies and procedures to ensure effective communication among the relevant centers and to promote consistent and efficient product review.”  FDA also states that there could be instances where viewed as combination product and thus only one application but did not state what such instances would be. 

The guidance also discusses FDA’s view of the need for cross-labeling between the therapeutic and the companion diagnostic.

The guidance has been long-awaited by industry, which has sought guidance in this area – an area that has been marked by ambiguity.  Years ago, FDA issued a draft guidance on the topic, which received criticism from industry.  FDA stated last year that it would promulgate two guidances to provide clarity that would address issues including when FDA would require simultaneous approval and what data requirements the agency would require. 

The comment period for the draft guidance will close within 60 days of issuance, which occurred July 14.

By Nisha P. Shah –

Under a bill titled, “An Act to Make Certain Prescription Drug Disclosure Laws Consistent with Federal Law,” the State of Maine repealed three laws related to the reporting of marketing costs, price reporting, and the disclosure of clinical trials by manufacturers and labelers of prescription drugs dispensed in Maine. 

One repealed law, Me. Rev. Stat. Ann. tit. 22, § 2698-A, required manufacturers and labelers that employed or used marketing representatives in Maine to submit an annual report of certain marketing costs, including, but not limited to, (1) expenses associated with food, entertainment, gifts valued at more than $25, trips, and travel in connection with all licensed health care professionals and entities, and (2) costs associated with advertising, marketing, and promotion of prescription drugs as they pertained to Maine residents (unless the costs were for a regional or the national market).  The Maine legislature also repealed the $1,000 annual fee that was associated with the marketing report.  Note that the repeal does not affect the annual report and fee for CY 2010 that were due July 1, 2011.  The Maine reporting requirement was similar to marketing reporting laws in the District of Columbia and West Virginia.  Massachusetts and Vermont also have reporting requirements for marketing practices, though these laws extend to both pharmaceutical and medical device manufacturers.  Another rescinded law, Me. Rev. Stat. Ann. tit. 22, § 2698-B, required disclosure, on a quarterly basis, of the average manufacturer price and best price for all drugs subject to the Medicaid Drug Rebate Program. 

Finally, Me. Rev. Stat. Ann. tit. 22, § 2700-A was amended to revoke the requirement that manufacturers and labelers of prescription drugs post information on clinical trials that they conducted or sponsored on a publicly accessible website.  Such information included a summary of the purpose of the clinical trial, the dates during which the trial has taken place, and the results of the clinical trial (including potential or actual adverse effects of the drug).  Manufacturers of prescription drugs that are provided through MaineCare (Maine’s Medicaid program) were required to pay an annual fee of $1,000, in part, for the posting of clinical trial results and the monitoring of adverse event reports.  Because this fee also was used to fund the state’s academic detailing program, the Maine legislature amended the bill to cut the annual fee to $500 beginning April 1, 2012. 

The repeal provisions are effective September 28, 2011, 90 days after the Maine legislature adjourned on June 29, 2011. 

By Larry K. Houck –

The Drug Enforcement Administration (“DEA”) published a Notice of Proposed Rulemaking (“NPRM”) on July 6, 2011 seeking to raise initial registration and renewal fees for all registrants.  76 Fed. Reg. 39,318 (July 6, 2011).  Citing increased diversion control activities, DEA justified increasing fees for the second time in five years.  DEA also explained the different fee-setting methodologies it considered, including the one selected, that would increase fees for each category of registrants.  The proposed fees for all registrants would increase by 33%.

The Controlled Substances Act authorizes DEA “to charge reasonable fees relating to the registration and control of the manufacture, distribution, and dispensing of controlled substances and to listed chemicals.”  21 U.S.C. § 821.  DEA is required to set registration fees “at a level that ensures the recovery of the full costs of operating the various aspects of” the Diversion Control Program.  21 U.S.C. § 886a(1)(C).  Thus, registration fees must be “reasonable” but must cover all costs of the Diversion Control Program.

DEA listed its historical diversion control activities in the NPRM in addition to salary and other costs related to the Diversion Control Program’s expanded mission since the last fee adjustment in 2006.  DEA cited a number of factors justifying the fee increase including:

• Expansion and use of Tactical Diversion Squads comprised of DEA diversion investigators and special agents, state and local law enforcement and regulatory officers conducting criminal investigations.  (There were 37 operational Tactical Diversion Squads as of March 2011, and since 2006, DEA added 161 special agent positions, the majority assigned to Tactical Diversion Squads.  76 Fed. Reg. 39,324);
• Increased frequency of scheduled cyclic regulatory investigations of registrants;
• Increased drug and chemical scheduling initiatives;
• Improved information technology capabilities for the Controlled Substances Ordering System (“CSOS”), Automated Reports and Consolidated Orders System (“ARCOS”) and the Drug Theft/Loss database; and
• Implementation of the Combat Methamphetamine Epidemic Act of 2005, the Methamphetamine Production Prevention Act of 2008 and the Combat Methamphetamine Enhancement Act of 2010 requirements.

DEA asserts in the NPRM that it “will be unable to continue current operations” without increasing fees, and will violate the requirement that it set fees at a level that ensures the recovery of the full costs of operating the Diversion Control Program.  To that end, DEA considered four different fee-setting methodologies, explaining the benefits and disadvantages of each.  DEA selected a weighted-ratio methodology to determine the reasonable fee for each category of registrant that would increase future registration fees for all registrants by 33%.

Current and Proposed Fees for Three-Year Cycle Registrants

Current and Proposed Fees for Annual Cycle Registrants

The deadline for submitting comments is September 6, 2011.