By William T. Koustas –

FDA recently released a draft of it class-wide opioid REMS in preparation for an advisory committee meeting on the issue.  The Joint Meeting of the Anesthetic and Life Support Drugs Advisory Committee and the Drug Safety and Risk Management Advisory Committee is scheduled to meet July 22 and 23, 2010 to examine FDA’s most recent proposed REMS for extended-release opioids. 

This draft of FDA’s opioid REMS is substantially less onerous than previously discussed versions which would have required both patient and physician registries.  The draft REMS includes a medication guide, elements to assure safe use (“ETASU”) and a timetable of assessment.  The medication guide would be required to include class language as well as product specific information.  The ETASU would consist of both prescriber and patient education, but no restrictions on distribution.  The prescriber education is to be developed by the drug sponsors and would educate prescribers on patient selection and monitoring as well as counseling patients on the safe use/storage/disposal of their opioids.  FDA would encourage (though not mandate) sponsors to use a third party to develop the prescriber education and FDA would have to approve any training materials beforehand.  Sponsors would have to demonstrate that prescribers have been educated through prescriber surveys.  Patients would be educated via patient education sheets provided by sponsors to prescribers to use in their discussions with patients.  Sponsors would be required to encourage prescribers to use these materials, though FDA cannot actually mandate their use by physicians.  As with the prescriber education materials, these patient information sheets would also have to be approved by FDA. 

FDA openly considered requiring prescribers to enroll in a registration program and patients to enroll in a patient registry, but determined that the risk of prescribers and pharmacies opting out of the program, which may reduce patient access to these drugs, was outweighed by the benefits at this time.  While FDA left open the possibility of linking prescriber education with the DEA registration system, the agency acknowledged that this is outside its current authority and would require new legislation.  Further, FDA decided that enrolling the nearly 4 million patients currently using extended-release opioids on an annual basis would be too burdensome of an undertaking to make part of a class-wide REMS at this time.

The periodic assessments will likely include various metrics to measure the effectiveness of this new REMS, such as the means to measure patient and prescriber knowledge, the use of opioids for non-medical purposes, adverse events and access to care. 

Immediate release producst appear safe for now.  FDA explained that it does not think that it is wise to institute a REMS for immediate-release opioid products at the present time as data indicate a substantially higher rate of adverse outcomes associated with extended-release opioids compared to immediate-release versions.  However, in addition to these REMS, FDA noted that it intends to use its Safe Use Initiative to partner with other Federal agencies and the private sector to develop and implement non-REMS programs to reduce the abuse/misuse of opioids.

By John R. Fleder –

It is hardly a secret that FDA’s favorite regulated industry is certainly not the businesses that compound pharmaceutical products.  For years FDA has struggled to establish an enforcement mechanism that passes muster with Congress and the courts.  Two compounding pharmacies have recently fought back against government regulation.

Earlier this year, FDA (through the Department of Justice) filed an injunction suit against Franck’s Lab, Inc. and others (collectively “Franck’s”) in the Middle District of Florida.  Franck’s compounds veterinary drugs for non-food producing animals.  On July 1, 2010, the defendants filed a Motion to Dismiss that action, arguing among things, that the government’s Complaint is deficient.

Perhaps one of the main poster children of FDA’s fight against compounding pharmacies has been with regard to Signature Pharmacy, Inc. (Signature) which is also based in Florida.  Signature has been aggressively defending itself in federal and state court actions for several years.  Recent court rulings (here, here, and here), which are summarized below, have been quite sympathetic to Signature.  Although the proceedings began in Florida state court, a federal district court in the Middle District of Florida has now gotten involved in three actions concerning Signature.

In November 2005, authorities began investigating Signature and its principals for possible violations of various federal and state laws.  Signature is owned by Stan Loomis, his wife Naomi Loomis, and Mike Loomis.

On August 4, 2006, two Florida officials presented a 144 page application for a wiretap, and an affidavit to a Florida state court.  The court entered an order approving the wiretap that same day and Signature’s phone and fax lines were monitored for the next 60 days.

On February 27, 2007, state officials from New York and Florida, working in conjunction with FDA and other agencies, executed criminal search warrants at Signature’s Orlando and Winter Park Florida locations.  Government agents arrived at the premises with large U-haul trucks and proceeded to seize virtually everything within Signature’s stores.  The agents seized hundreds of thousands of patient prescriptions, all of Signature’s electronically stored information, and many of its drug inventories and financial records.  In short, according to the court, law enforcement seized everything essential to Signature’s business.  This led to four state indictments all of which were dismissed.  A fifth indictment was returned on June 16, 2010.

On the day of the raids, the Loomises and one other person were arrested and transported to New York.  The Florida federal court recently noted that the indicted defendants had never set foot in the State of New York prior to their arraignment, and Signature had no physical presence in New York.  New York simply appears to have been just one of the many states to which Signature shipped or filled prescriptions.

The federal court found that the media presence during the raids and arrests was intense.  The raids were even conducted in the presence of the media and were highly publicized.  In the months that followed, media from around the country implicated or mentioned numerous professional athletes and celebrities in connection with the investigation, including boxer Evander Holyfield, and former baseball player Jose Canseco.  Indeed, the Florida federal court found that state officials began a public relations campaign by attempting to connect Signature to professional athletes who were allegedly taking steroids, and the officials made deals with various media outlets to scoop the story.

During the two years after the raids, the Florida state court received over 2,600 objections from patients expressing privacy concerns about the seizure of their prescription records.  On November 24, 2009, that court entered an order establishing a procedure for holding individual hearings on the thousands of objections.

During a hearing on December 22, 2009, the Florida state court learned that the evidence seized during the raids had been transferred to the United States Attorneys’ Office in Florida, in violation of the state court’s order.  The United States Attorney’s office had issued a grand jury subpoena in an effort to keep the Florida state court from returning Signature’s property. In light of the State’s “Formal Notice of Intent Not to Prosecute,” the state court had ordered the evidence seized during the raids to be immediately returned to Signature.

The Florida federal court judge also was clearly troubled by many actions taken by the various governments.  For instance, the court noted that during the flight from Florida to New York after the arrests, one of the agents sat next to Mrs. Loomis and according to the Court, the agent lifted up the armrest between himself and Mrs. Loomis and rubbed up against her body while talking to others on the plane.

The federal court concluded that since the raids and arrests, Signature has been unable to conduct any pharmacy business, its reputation having been severely damaged and its inventory, business records and other items essential to its operations have been unlawfully retained by law enforcement for nearly three years. The court found that although Signature was never found guilty of any crime, Signature’s bank and merchant accounts were frozen, and its shipping accounts with Federal Express were suspended.

On April 12, 2010, the U.S. Attorneys’ Office issued yet another grand jury subpoena, this time to Signature.  On April 26, 2010, Signature moved to quash the grand jury’s subpoena.  On June 10, 2010, the federal court granted that Motion.  It found that grand juries are not licensed to engage in arbitrary fishing expeditions and cannot select targets of investigation out of malice or an intent to harass. It ruled that the grand jury subpoena must be quashed. First, the subpoena was deemed to be clearly overbroad, and compliance would, as a practical matter, be unreasonable.  Second, it ruled that the subpoena, without more, cannot substitute for a search warrant and alienate Signature from property that the Florida state court had earlier ordered should be immediately returned to Signature.  The federal court ruled that the grand jury’s continued and indefinite possession of all the property taken from Signature would certainly preclude Signature from reopening its doors.

The Court also raised serious concerns about the search warrants.  It found that there appeared to be at least colorable constitutional infirmities in the probable cause affidavits upon which the warrants used to originally seize the evidence were issued.  It ordered that the United States Attorneys’ Office and its agents immediately return to Signature any and all property, including copies of Signature’s electronically-stored information.

Unhappy with their treatment by the governments, Signature and its principals took an aggressive action by suing various state officials who the plaintiffs believed had wronged Signature.  They sued the District and Assistant District Attorney, respectively, for New York’s Albany County; a peace officer with the New York Bureau of Narcotics Enforcement; the City of Orlando; and a police officer with the Orlando Police Department.  One or more of the defendants in that action argued that they were exempt from being sued on “immunity” grounds.  The federal court generally rejected that argument and has ruled that the plaintiffs are entitled to go to trial on at least some their claims against the state officials.

Judges have sometimes referred to FDA as the “jail keeper” of firms that the agency regulates.  Government’s role becomes particularly troublesome when officials fall into the “bad guy” mindset.  When officials decide to investigate someone simply because the agents believe that the investigated person is one of the “bad guys”, they slip into the mode we often see on television, namely that the ends justify the means as a vehicle to “bring the bad guys to justice.” Companies do have many opportunities to defend themselves but they should not have to do so just because an investigation is designed to punish someone who the government believes is a “bad guy.”

By Jeffrey N. Wasserstein –

On July 8, 2010, the Office for Civil Rights of the U.S. Department of Health and Human Services announced the issuance of its long-awaited proposed rule (in prepublication form) relating to the modification to the HIPAA Privacy, Security and Enforcement Rules under the HITECH Act (see our previous post here).  While much of the proposed rule may not be of interest to our readers, several provisions are of great interest.

As we noted in our prior blogpost, prior to the HITECH Act, pharmaceutical companies could pay pharmacies to communicate with their patients for the purpose of either reminding patients to refill their prescription (“refill reminders”), or to recommend switching to alternative therapies (“switch communications”).  Such communications were considered “health care operations” and therefore did not require a written authorization from the patient.  The HITECH Act changed the definition of “health care operations” such that paid switch communications were no longer considered “health care operations” and thus required an authorization.

Surprisingly, the HITECH Act did not directly address whether paid switch communications might remain treatment communications which do not require an authorization, as per the FAQ referenced in our prior blogpost.  This omission created confusion – could Congress have left open an exception so big as to render the prohibition on paid switch communications a nullity?

Apparently so, according to HHS.  The preamble to the proposed rule notes that “it is unclear how Congress intended these provisions to apply to treatment communications between a health care provider and a patient.  Specifically, it is unclear whether Congress intended to restrict only those subsidized communications about products and services that are less essential to an individual’s health care (i.e., those classified as health care operations) or all subsidized communications about products or services, including treatment communications.”  Thus, while paid switch communications that used to be considered health care operations now require patient authorization prior to making the communications, paid switch communications that are to be considered treatment related require only that (1) the covered entity’s Notice of Privacy Practices includes a statement informing patients that the health care provider may send the paid switch communications and the individual has the right to opt out of receiving such communication, and (2) that the communication itself disclose the financial payment and the ability to opt out.  HHS has asked for comment on whether patients should be afforded the ability to opt out prospectively.

Sounds confusing?  Let’s soldier on.  HHS explains that the difference between a switch communication that is health care operations and one that is treatment depends on whether the communication is based on population (that is, made to all patients) which would be marketing if subsidized by the third party whose product or service is recommended or health care operations if unsubsidized, or whether it is based on the treatment needs of an individual, such as a letter to all pregnant patients recommending a particular birthing center (their example).  Similarly, payment to a pharmacy to recommend that all patients on a particular drug be switched to another drug would, apparently, be a treatment communication and would only require disclosure of the remuneration plus the opt out option (assuming the Notice of Privacy Practices has the required language).  While this is welcome news to pharmaceutical companies who often use these communications to get the word out about their products to patients, privacy activists are likely to argue for inclusion of such communications in the definition of marketing, which would require an authorization.  Indeed, HHS recognized the difficulty in their position, and has asked for comments on the proposal, including whether to permit all treatment communications without restriction on whether they are paid for, or whether to require an authorization for all paid switch communications, even if it is for treatment.

Interestingly, HHS asked for comment on whether to expand the HITECH Act exception that permits communications about the drug a patient is currently prescribed (e.g., refill reminders) to be deemed health care operations so that exception includes generic alternatives or new formulations of the drug.  This is puzzling, since under the proposed rule, such communications could in any event be considered treatment because they are for the treatment of an individual and are not population based.  We can expect that the marketing/treatment distinction will receive numerous comments.

Far less controversial, and very welcome to companies sponsoring clinical trials, is a provision that would permit compound authorizations; that is, an authorization permitting a covered entity to use protected health information for more than one purpose, if both (or all) purposes relate to the same research project.  Thus, a single authorization could be used for a clinical study as well as for specimen collection for a central repository.  Currently, compound authorizations are prohibited, which increases the burden on clinical trial sites when obtaining consent and authorization from subjects for the research project.  Moreover, HHS has also requested comment on whether (and how) an authorization could be used to permit future unspecified research studies using the subject’s protected health information.  This would greatly simplify the ability of sponsors and institutions to use collected information and data in future studies.

Last, but not least, HHS announced that it is providing a grace period of 180 days from the publication of the final rule for covered entities to come into compliance with the changes, notwithstanding that some of the HITECH Act provisions, including the marketing provision discussed above, went into effect on February 18, 2010.

Comments are due 60 days after date of publication in the Federal Register, which is expected to be on July 14.

By Kurt R. Karst –

With all of the hubbub over Patent Use Codes (“PUCs”) since the U.S. Court of Appeals for the Federal Circuit issued its April 2010 decision in Novo Nordisk A/S v. Caraco Pharmaceutical Laboratories, Ltd. addressing whether the patent delisting counterclaim provisions at FDC Act §505(j)(5)(C)(ii)(I), as added by the Medicare Modernization Act,  may be used to correct or delete an Orange Book-listed PUC, we thought it would be interesting to analyze the growth of PUCs. 

In Novo Nordisk, the Federal Circuit, in a 2-1 decision, reversed and vacated a 2009 judgment and order and injunction requiring Novo Nordisk to change an Orange Book-listed PUC for a patent on its drug product, PRANDIN (repaglinide) Tablets.  The Court ruled that “the Hatch-Waxman Act authorizes a counterclaim only if the listed patent does not claim any approved methods of using the listed drug,” and that “the terms of the counterclaim provision do not authorize an order compelling the patent holder to change its use code narrative.” (See our previous posts here and here)  Caraco has filed a petition for panel rehearing and rehearing en banc.  Several amicus briefs have been filed in the case in support of Caraco’s rehearing petition, including briefs from GPhA, Mylan, Teva, Apotex, and the Consumers Federation of America.  Meanwhile, others have alleged that the PRANDIN use code change is anticompetitive and violates § 2 of the Sherman Act because it stalls generic competition (here, here, and here).

By way of background, PUCs are listed in an Orange Book Addendum with a number and a descriptor.  Those PUCs correspond with various patents with method-of-use claims listed in the Orange Book for a particular approved drug product.  Although FDA created PUC descriptors prior to August 18, 2003, when the Agency’s June 2003 regulations went into effect revising the Orange Book patent submission and listing requirements, with the new regulations, NDA sponsors are now required under 21 C.F.R. § 314.53(c)(2)(ii)(P)(3) to supply the PUC descriptor language on Form FDA 3542.  (FDA still assigns the PUC number.)

The first PUCs appearing in an annual edition of the Orange Book are from 1988 (Orange Book 8th Ed.); however, FDA began adding them to its monthly cumulative supplements beginning in 1987.  In the 1988 annual edition of the Orange Book, 25 PUCs were listed.  Over 16.5 years – from 1988 to August 2003 – FDA created 530 PUCs.  Over the next 7.5 years – from August 2003 to today – 532 new PUCs have been designed by NDA holders (for a grand total of 1062 PUCs from 1988 to today).  The tables below show the year-by-year growth of PUCs.

So what general conclusions can be gleaned from the doubling of PUCs in just 7.5 years (since August 2003)?  First, NDA holders, although free to use “old” PUCs (whether those created by FDA pre-August 2003 or those created by NDA sponsors post August 2003), appear to be favoring the creation of new PUCs.  Second, new PUCs offer NDA holders a greater ability to tailor the use code descriptor to the approved drug product. 

PUCs will certainly continue to be an interesting area of Hatch-Waxman litigation.  We will be keeping one eye on the Federal Circuit as it considers Caraco’s rehearing petition, and another on Congress to see whether it will take interest in the issue and further amend the Hatch-Waxman Amendments.

By Kurt R. Karst –   

Earlier today, a 3-judge panel (Judges Tatel, Griffith, and Kavanaugh) of the U.S. Court of Appeals for the District of Columbia Circuit issued a 2-page per curiam judgment (without memorandum) affirming the U.S. District Court for the District of Columbia’s April 2, 2010 order denying motions for preliminary injunction filed by Roxane Laboratories, Inc. and Apotex, Inc. concerning 180-day exclusivity for generic versions of Merck’s COZAAR and HYZAAR (i.e., losartan).  The Roxane and Apotex motions challeged FDA’s March 26, 2010 letter decision in which the Agency reluctantly concluded  that Teva did not forfeit 180-day exclusivity eligibility under FDC Act § 505(j)(5)(D)(i)(VI).  That provision states that 180-day exclusivity eligibility is forfeited if “[a]ll of the patents as to which the applicant submitted a certification qualifying it for the 180-day exclusivity period have expired.”  FDA issued its response after soliciting public comment on whether Teva forfeited 180-day exclusivity eligibility because the only exclusivity-qualifying patent – U.S. Patent No. 5,608,075 – “expired” last year after Merck ceased paying certain patent maintenance fees.  FDA’s approved Teva’s ANDAs on April 6, 2010 with 180-day exclusivity.

According to the D.C. Circuit’s July 6, 2010 judgment:

The district court correctly concluded that appellants failed to show a substantial likelihood of success on the merits.  When the Hatch-Waxman Act’s forfeiture provisions are viewed in the context of the statute’s incentive structure, it becomes clear that Congress could not have intended a brand manufacturer’s unilateral decision to cause the premature expiration of a patent (in the face of a generic applicant’s challenge to the patent in a paragraph IV certification) to strip the first generic applicant of the 180-day period of marketing exclusivity granted by the statute.  See Teva Pharms. USA, Inc. v. Sebelius, 595 F.3d 1303, 1317–18 (D.C. Cir. 2010).  We will thus affirm the district court’s decision to deny appellants’ motions for a preliminary injunction.  See Apotex, Inc. v. FDA, 449 F.3d 1249, 1253–54 (D.C. Cir. 2006).

The July 6th judgment follows two orders (here and here) issued by the D.C. Circuit in May 2010, in which the Court denied FDA’s petition for panel rehearing and rehearing en banc of the D.C. Circuit’s March 2, 2010 decision in Teva Pharms USA, Inc. v. Sebelius.  In that case, a 3-judge panel of the D.C. Circuit (Judges Henderson, Griffith, and Williams) ruled in a 2-1 decision (Judge Henderson dissenting) also concerning Teva’s ANDAs for losartan drug products, that the patent delisting counterclaim provision at FDC Act § 505(j)(5)(C)(ii)(I) added by the 2003 Medicare Modernization Act must be read together with the patent delisting forfeiture provision at FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC), and that there is “no reason to conclude that the 2003 addition of forfeiture provisions meant to give the brand manufacturer a right to unilaterally vitiate a generic’s exclusivity.” 

Apotex and Roxane argued in their combined brief to the D.C. Circuit that the “Court should conclude that the plain language of the statute requires a finding that Teva forfeited its 180 days of exclusivity,” and that “FDA’s decision to the contrary was not based on the plain language, or any other tools of statutory interpretation, but on the ‘reasoning’ in . . . [Teva],” under which, according to Apotex and Roxane, FDA falsely believed it was required “to reach a result with which it disagreed.”  Although FDA, in its May 18th brief, agreed with Apotex and Roxane that, “based on the plain text of the statute, 21 U.S.C. § 355(j)(5)(D)(i)(VI), (ii), expiration of a patent for any reason should result in the forfeiture of 180-day exclusivity,” the Agency argued that it “must abide by [the Teva] decision and consider its inescapable effect on the closely related issue involved here” (i.e., forfeiture of 180-day exclusivity based on patent expiration for failure to pay maintenance fees).

Whether the D.C. Circuit’s July 6th judgment is the end of the matter remains to be seen.  Apotex and/or Roxane could petition the Court for rehearing or rehearing en banc; however, given the D.C. Circuit’s May 2010 denial of FDA’s petition for panel rehearing and rehearing en banc, it seems unlikely that the Court would grant such petitions. 

By Alexander J. Varond* & Kurt R. Karst –

Recently, the U.S. District Court for the District of Columbia dismissed a case brought by the Coalition for Mercury-Free Drugs (“Coalition”). Judge Reggie B. Walton ruled that the Coalition lacked standing to ask the court to ban vaccines containing the mercury-based preservative Thimerosal.

Background

Beginning on August 10, 2007, the Coalition pursued a Citizen Petition against the use of Thimerosal under the belief that it causes the onset of autism and other brain disorders in children.

Though the preservative has been used in vaccines in the United States since the 1930s and has been proven safe, FDA supports a policy to remove Thimerosal from vaccines that are commonly administered to children. Regardless, FDA denied the 2007 Citizen Petition citing its lack of a legal or scientific basis to support the Coalition’s proposition.

The Case: The Coalition for Mercury-Free Drugs v. Kathleen Sebelius

Following the denial of its Citizen Petition, the Coalition filed a petition for injunctive relief in the United States District Court for the District of Columbia. Specifically, the complaint sought to suspend all approval and licenses as well as recall the preservative unless manufacturers could positively prove that it did not cause neurological damage in susceptible populations.

The court first addressed whether the National Vaccine Injury Compensation Act (“Vaccine Act”) provided sufficient, independent standing. Judge Watson held that although the Vaccine Act contains a citizen petition clause which states that “[a]ny person may commence in a district court of the United States a civil action on such person’s own behalf against the Secretary where there is alleged a failure of the Secretary to perform any act or duty upon this part.” 42 U.S.C. § 300aa-31, “it does not dispense with the requirement that the plaintiffs must demonstrate that they have standing to bring such an action in federal court.” Opinion at 8.

Thus, to bring the action before the federal court, plaintiffs had to prove standing “which requires the presence [of]: (1) injury in fact, (2) causation, and (3) redressability.” Opinion at 6. The court noted that the group would have to prove that at least one individual in the group had “standing to sue in their own right,” as required under Hunt v. Wash. State Apple Advertising Comm’n, 432 U.S. 333 (1977).

First, Judge Walton ruled that fear of the effects of Thimerosal was an insufficient basis for standing since there was adequate availability of mercury-free vaccines. The court noted that these mercury-vaccines were ample alternatives for anyone fearing the potential harms of Thimerosal. Moreover, even if there was an increased burden for those people that preferred mercury-free vaccines, plaintiffs did not prove that the burden or delay caused sufficient harm.

The court also held that the potential for healthcare providers to become confused whether a vaccine contained Thimerosal was too abstract of a potential harm. This was particularly true because Thimerosal packaging clearly indicated the preservative’s presence. Moreover, the potential for mix-ups as a result of repackaging and  “blatant mislabeling and deception by a pharmacist cannot be deemed ‘fairly traceable’ to the actions of the named defendants . . . .” Opinion at 17 (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992)).

Finally, the court rejected the coalition’s claim that doctors and other medical professionals would suffer a loss of reputation from an alleged inability to guarantee the safety of vaccines. In these terms, the court held that this potential harm to doctors merely constituted an insufficient and generalized grievance, not the concrete and imminent injury.  Thus, the Coalition’s suit was dismissed for a lack of standing because the Coalition was unable to prove adequate harm.

* Law Student

By Kurt R. Karst –   

Late Thursday, the U.S. House of Representatives passed a package of amendments (beginning on page 74) to the War Funding Bill (H.R. 4899) that included the “Preserve Access to Affordable Generics Act,” which is intended to curb patent settlement agreements (what opponents call “pay-for-delay” agreements).  The amendment appears to be identical to an amendment Senators Herb Kohl (D-WI), Charles Grassley (R-IA), and Susan Collins (R-ME) introduced during the Senate’s consideration of the Tax Extenders Act (H.R. 4213) (see our previous post here).

The bill, which will have to be passed by the Senate, would amend the Federal Trade Commission (“FTC”) 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.”

The amendment was included in H.R. 4899 over the objection of some legislator who urged in a June 30, 2010 letter to House Appropriations Committee Chairman David Obey (D-WI) that the provision be eliminated.  According to those legislators:

From a substantive standpoint, the legislative language will achieve exactly the opposite of its intent. The two primary provisions of the legislative language will, in concert, remove current incentives for generic drug companies to challenge drug patents. Consequently, generic drug companies will wait until new drug patents expire before they bring a generic product to market. Consumers will then wait, on average, 5 to 9 years for access to cheaper generic medicines and consumer benefit will arguably be diminished.

According to a Dow Jones report, the measure was strongly backed by both House Speaker Nancy Pelosi (D-CA) and House Energy and Commerce Committee Chairman Henry Waxman (D-CA).

By Ricardo Carvajal –

The Supreme Court overturned a district court decision, affirmed by the 9th Circuit Court of Appeals, that enjoined the USDA Animal and Plant Health Inspection Service ("APHIS") from partially deregulating Roundup Ready Alfalfa ("RRA") and prohibited the planting of RRA until APHIIS completes an Environmental Impact Statement ("EIS") as required under the National Environmental Policy Act ("NEPA").  RRA is subject to regulation as a plant pest under the Plant Protection Act until APHIS decides that RRA does not present a plant pest risk and can be “deregulated.”  To do so, APHIS is required under NEPA to prepare an EIS unless a less burdensome environmental assessment ("EA") reveals that deregulation would have no significant environmental impact. 

APHIS’s decision to deregulate RRA on the basis of an EA was challenged by conventional alfalfa seed farms and some environmental groups on the ground that the EA did not adequately address the risks of gene transfer from RRA to conventional and organic alfalfa, or from RRA to weedy species, and that APHIS violated NEPA when it failed to conduct an EIS.  The district court agreed and the Court of Appeals agreed.  The Supreme Court did not address the merits of these issues, nor did it disturb the district court’s decision to vacate AHPIS’s deregulation of RRA.  Rather, the Supreme Court held that the district court abused its discretion in the remedies that it crafted for APHIS’s violation, and remanded the case to the district court for further proceedings which could yet result in a complete or partial deregulation of RRA.

Although the fate of RRA remains uncertain, the Supreme Court decision stirred action on the Hill, where several bills that address different aspects of the controversy over development, marketing, and labeling of bioengineered foods were immediately introduced (H.R. 5577, The Genetically Engineered Food Right to Know Act; H.R. 5578, the Genetically Engineered Safety Act; and H.R. 5579, the Genetically Engineered Technology Farmer Protection Act.

The legal jousting over bioengineered crops is certain to intensify as developers seek to market and perhaps deregulate varieties that are bioengineered to produce substances used in the chemical and pharmaceutical industries.  Those technological developments promise to accentuate the fault lines that have emerged between the biotechnology sector and those who seek to satisfy market demand for conventional and organic foods. 

As for the FDA, this case serves as a reminder that NEPA, although perhaps a paper tiger, is not entirely toothless.  Transgenic salmon, anyone?

By Kurt R. Karst –   

On the first day of FDA’s two-day public hearing (agenda here) regarding the Agency’s regulation of drugs, biological products, and devices for the treatment, diagnosis, and/or management of rare (i.e., orphan) diseases, the National Organization for Rare Disorders (“NORD”) called for FDA to issue a Statement of Policy expressing a more granular expression of the Agency’s historic commitment to exercise flexibility in its review of therapies for rare disorders and for an FDA expression of ways to reduce regulatory uncertainty in the development and review of orphan disorder therapies. 

NORD Board of Directors Chairman (and Hyman, Phelps & McNamara, P.C. Director) Frank J. Sasinowski stated during his testimony that FDA needs to “develop and issue a specific Statement of Policy on FDA’s role in regulating therapies for rare disorders, which includes an explanation and affirmation of the FDA’s historic position that FDA flexibly applies the standards of safety and effectiveness with respect to therapies for those with rare disorders.”  Although FDA’s rigorous safety and efficacy standards apply equally to orphan drugs, “the FDA interpretation and application of those same standards have historically been tailored by FDA to the unique facts of each particular medicine under FDA review,” according to Mr. Sasinowski.  Indeed, Mr. Sasinowski said that such a Statement of Poicy could stimulate orphan drug research: “the investment community and pharmaceutical industry may benefit from such a formal, explicit statement of policy that will encourage investment in, research of and development of medicines for those with rare disorders . . . for which there still is not a single FDA-approved therapy.”

NORD also commented on the need to increase regulatory certainty in the development of therapies for rare diseases/condition: 

It is axiomatic that the perfect is the enemy of the good.  In the world of rare disorders, there is much that is often not known or not known well, starting with the etiology and pathophysiology of the condition, including its natural history, and ranging to a lack of agreement among even a small handful of world experts on the most common clinical manifestations of some conditions.  Against this backdrop, it is entirely understandable that FDA on occasion will find it difficult to concur in advance with a development program, even the design of a registrational trial under a special protocol assessment.  However, researchers, industry and FDA, as well as most importantly, persons with the condition, may find that sometimes a study needs to proceed because patients are suffering and can not wait for the perfect trial design with the ideal primary endpoint to be eventually determined or developed and consensually accepted. . . .  [W]hen these trials are conducted, sometimes with designs with which all parties may not be in full concurrence, including the FDA, great deference should be afforded the design of these trials and flexibility applied in the interpretation of their results.

Other recommendations were included in a presentation given by NORD Vice President Diane Edquist Dorman. 

NORD’s stated need for greater certainty and predictability in the approval process was echoed in comments submitted to FDA by the Biotechnology Industry Organization, and will likely be stated again during the second day of FDA”s hearing.

The public hearing was held to assist FDA as the Agency implements § 740 of the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act of 2010 (Pub. L. No. 111-80), which, as we previously reported and as commented on by Office of Orphan Products Development (“OOPD”) Director Dr. Timothy Coté during his testimony at the hearing, requires FDA to convene a committee of expert Agency employees to consider the ways FDA reviews products to treat people with rare diseases, and consider policy improvements that might help people with rare diseases get better treatments faster.  The public hearing is FDA’s first hearing on rare diseases since the Orphan Drug Act (“ODA”) was enacted 27 years ago.  Since then, FDA has approved 350 products for rare diseases and has granted orphan drug designation for almost 2,200 products, according to OOPD’s database.  Although the ODA has been hailed as a resounding success, there remain approximately 5,800 rare diseases/conditions for which there are no FDA-approved therapies.

Earlier this year, FDA announced the newly-created position of Associate Director for Rare Diseases in the Agency’s Center for Drug Evaluation and Research’s (“CDER’s”) Office of New Drugs.  This orphan drug czar “will serve as CDER’s focal point to the rare disease drug development community and assist stakeholders and developers of drug and biologic products in navigating the complex regulatory requirements for bringing safe and effective treatments to patients in need.”  In addition, OOPD recently introduced the Rare Disease Repurposing Database (“RDRD”), which is a listing of products that have received orphan designation and that are already approved for the treatment of some other disease.  The RDRD is intended to push orphan drug research by providing sponsors with “a new tool for finding special opportunities to develop niche therapies that are already well-advanced through development.” 

Hyman, Phelps & McNamara, P.C. (“HP&M”) is pleased to announce that Frank J. Sasinowski has been elected by the the U.S. Pharmacopeial Convention (“USP”) as an At-Large Trustee of the USP Board of Trustees for the 2010-2015 cycle.  The Board of Trustees will guide the activities of the USP for the next five years and makes decisions that guide USP’s policies, finances, and strategic direction. 

By Susan J. Matthees –  

USDA and HHS have announced the availability of the final Report of the Dietary Guidelines Advisory Committee (“DGAC”).  The agencies are required by law to jointly update and publish the Dietary Guidelines for Americans at least every 5 years, and the final Report, along with public comments to the Report, will be used by the agencies to draft the 2010 Dietary Guidelines for Americans. 

A major focus of the Report is America’s “growing” problem with weight management and the great paradox of the American diet- we are eating more than enough food, yet are not getting adequate amounts of key nutrients, such as vitamin D, calcium, and dietary fiber.  The Report recommends that the Dietary Guidelines make reducing obesity a priority, explaining that the “DGAC considers the obesity epidemic to be the single greatest threat to public health in this century.”   

The Report reiterates what many nutrition experts and health advocates, including Mrs. Obama, have been suggesting: Americans should shift their diets to more plant-based foods, such as legumes, seeds, nuts, whole grains, vegetables and fruit,  reduce intake of foods that contain added sugar and solid fat, and increase their physical activity.  The 2010 DGAC opted to discontinue the term  “discretionary calorie allowance” to explain how much extra fat and sugar should be in the American diet.  The 2005 DGAC used this term, but the 2010 DGAC found that although it is still a scientifically valid concept, it is difficult to communicate to consumers.  Instead, the 2010 DGAC recommends using numerical limits, including a recommendation that added sugar be limited to 25% of total calorie consumption. 

Weight management was not the sole focus of the Report.  The Report also recommended a reduction in sodium intake to 1,500 mg per day or less, which is a decrease from the 2005 DGAC recommendation to limit sodium intake to less than 2,300 mg.  The Report acknowledged that this could be difficult and thus recommends a gradual reduction in intake with a nod towards the Institute of Medicine’s ("IOM’s") recent roadmap to reduce sodium intake. 

The Report also reviewed the consumption of alcohol, water, potassium, protein, and carbohydrates.  The Report concluded that there was no evidence that high protein, low carbohydrate diets are better for weight loss and weight maintenance than other diets.  Although there has been increased attention to the fact that many Americans are deficient in vitamin D, the DGAC opted not to conduct its own review because the IOM is currently reviewing the DRI for vitamin D.  Finally, although the Report notes that most Americans are deficient in some nutrients, it states that daily supplementation with a multivitamin/multimineral “does not offer health benefits to healthy Americans.”  
 
Interested parties are encouraged to submit written comments until July 15, 2010.  Written comments can viewed on the same website.  There will also be a public meeting on July 8, 2010, to solicit oral comments. 

By William T. Koustas –

Regenerative Sciences, Inc. (“Regenerative”) filed a complaint in the U.S. District Court for the District of Columbia against FDA on June 22nd in order to prevent FDA from essentially closing the business.  Regenerative owns a procedure by which physicians take bone marrow and blood samples from a patient, culture the stem cells, and place them back in the patient’s damaged joint in order to repair it (“Regenexx Procedure”).  Regenerative Sciences, Inc. v. FDA, United States District Court for the District of Columbia, June 22, 2010 (“Complaint”).  The Regenexx Procedure is exclusively licensed for use at the clinic where the inventors of the procedure practice.  Complaint at 2.  However, FDA appears to consider Regenerative a drug manufacturer and the stem cells it cultures in its Regenexx Procedure to be biological drugs, and thus claiming that Regenerative is manufacturing an unapproved drug.  Complaint at 8. 

FDA conduced an inspection of Regenerative’s facility in February and March of 2009, which culminated in FDA issuing a Form 483.  Complaint at 8.  Then, FDA returned to inspect Regenerative again earlier this month and again issued another Form 483.  According to the complaint, an FDA investigator threatened that FDA would issue a warning letter, cease and desist letter, civil penalties and seek an injunction if Regenerative did not correct the deficiencies found during the inspection.  Complaint at 7.  Regenerative claims that correcting the deficiencies found in the inspection would bankrupt it.  Complaint at 3. 

Regenerative argues that the Regenexx Procedure is the practice of medicine and is beyond the scope of FDA’s regulatory authority as provided in the U.S. Food, Drug & Cosmetic Act as well as the Public Health Service Act.  Complaint at 12.  Regenerative contends that the manipulation of stem cells occurs in the normal course of a medical practice which is regulated by Colorado.  Further, Regenerative stresses that the Regenexx Procedure occurs completely within the state of Colorado and is therefore not subject to FDA’s authority because it does not engage in the interstate sale of drugs.  Complaint at 14.  Regenerative also asserts a due process argument in that FDA’s actions violate the Due Process Clause of the Fifth Amendment as it will force Regenerative to go out of business.  Complaint at 17.  The complaint requests that the Court enjoin FDA from regulating the Regenexx Procedure, issuing a cease and desist letter and from ex-parte action by FDA to prevent the use of the Regenexx Procedure.  (A related case filed in the U.S. District Court for the District of Colorado was dismissed earlier this year and has been appealed to the U.S. Court of Appeals for the Tenth Circuit.)

By Carrie S. Martin –

The Office of Inspector General (“OIG”) recently issued a report detailing the inclusion of foreign clinical trial data in New Drug Applications (“NDAs”) and Biologics License Applications (“BLAs”) and FDA’s oversight of foreign clinical trial sites.  The OIG examined all NDAs and BLAs, and related documents, submitted in Fiscal Year (“FY”) 2008 with two questions in mind: (1) how much foreign data did sponsors submit in their marketing applications; and (2) to what extent did FDA monitor and inspect these foreign clinical trials.  The answers: (1) a lot; and (2) not enough.

OIG found that 80% of approved NDAs and BLAs in FY 2008 contained data from foreign clinical trials.  Although most subjects and sites were located in Western Europe, Central and South America accounted for the highest average number of subjects per site.  Usually, only one clinical investigator oversees a clinical trial site.  OIG also determined that FDA inspected only 0.7% of foreign clinical trial sites in FY 2008.  (That being said, FDA inspected only 1.9% of U.S. sites.)  Finally, the report noted that data limitations inhibited FDA’s ability to inspect foreign sites, including, for example, the failure of sponsors to submit complete information on site locations and subject enrollment.  Some of these data omissions may be understandable:  federal law does not require an Investigational New Drug (“IND”) application for clinical trials conducted exclusively outside the U.S.  INDs serve as FDA’s primary method of collecting information on clinical trials.

OIG acknowledged the perceived benefits of foreign trials – lower clinical trial costs, larger populations from which to collect patients, and the desire to obtain foreign marketing approvals.  The downside, according to critics, is the lack of patient protection due to inadequate monitoring and the ability to “generalize” foreign data to the U.S. population.

Based on its research, OIG made three recommendations to FDA: (1) require standardized electronic clinical trial data and create an internal database from which FDA can select sites for inspection; (2) monitor trends in foreign clinical trials not conducted under INDs and take steps as necessary to encourage sponsors to file INDs; and (3) explore additional ways to expand the Agency’s oversight of foreign clinical trials, including agreements with foreign regulatory bodies and inspections of clinical trial sites in countries not previously inspected. 

FDA generally agreed with OIG’s recommendations and is seeking to address each recommendation.  For FDA’s full response, see Appendix E of the report.  OIG predicts that the reliance on foreign data will grow in coming years; this will undoubtedly increase the pressure on FDA to adopt new ways to ensure patient protection and the integrity of foreign data.

By Kurt R. Karst –   

Earlier this week, FDA announced Pfizer’s voluntarily withdrawal (at least insofar as a voluntary withdrawal is truly voluntary when FDA requests it) of MYLOTARG (gemtuzumab ozogamicin for Injection) from the market after a required postmarketing study failed to demonstrate clinical benefit.  FDA approved MYLOTARG in May 2000 under the Agency’s Subpart H (“accelerated approval”) regulations as a single agent for patients with CD33 positive Acute Myeloid Leukemia (“AML”) in first relapse who are 60 years of age or older and who are not considered candidates for other cytotoxic chemotherapy.  Pfizer announced that the company will withdraw the MYLOTARG NDA effective October 15, 2010. 

In December 1992, FDA promulgated final regulations under which the Agency will accelerate the approval of certain new drugs and biologics for serious or life-threatening illnesses, and when such products provide a meaningful therapeutic benefit to patients over existing treatments.  These accelerated approval regulations are located in Subpart H (21 C.F.R. Part 314) of FDA’s drug regulations, and in Subpart E (21 C.F.R. Part 601) of the Agency’s biologics regulations.  If a product meets these criteria, then FDA may grant marketing approval based on a demonstrated effect on a surrogate endpoint reasonably likely to predict clinical benefit and a sponsor’s commitment to complete with due diligence the required postmarketing studies to confirm the product’s clinical benefits.  A surrogate endpoint is an alternative measurement of the symptoms of a disease or condition that is substituted for measurements of observable clinical symptoms.  Importantly, FDA may expedite the withdrawal of approval of an application approved under the accelerated approval regulations if “[a] postmarketing clinical study fails to verify clinical benefit” or if a sponsor “fails to perform the required postmarketing study with due diligence.”

FDA approved MYLOTARG based on the surrogate endpoint of response rate observed in 142 patients with AML across three clinical trials and required the applicant to conduct a postmarketing study designed to determine whether adding MYLOTARG to standard chemotherapy demonstrated an improvement in overall survival time (i.e., clinical benefit) of AML patients.  The required postmarketing study was initiated in 2004, but was stopped early when no clinical benefit was observed.  In addition, according to FDA, the study was also stopped “after a greater number of deaths occurred in the group of patients who received Mylotarg compared with those receiving chemotherapy alone.” 

The MYLOTARG withdrawal appears to be the first instance in which a product granted accelerated approval has been withdrawn from the market – either because a postmarketing study failed to verify clinical benefit or because of a sponsor’s failure to complete a required postmarketing study with due diligence.  Although FDA could have pursued withdrawing approval of IRESSA (gefitinib) when the sponsor’s postmarketing study failed to verify clinical benefit, FDA instead approved new labeling that limits IRESSA use to patients with cancer who are currently benefiting, or have previously benefited, from IRESSA treatment. 
 

By Kurt R. Karst –   

Earlier today, the U.S. Supreme Court declined to hear appeals in two separate cases of interest to the food and drug law bar involving the False Claims Act (“FCA”) – Hopper v. Solvay Pharms, Inc., 588 F.3d 1318 (11th Cir. 2009) and United States, ex rel. Mark Eugene Duxbury v. Ortho Biotech Products, L.P., 579 F.3d 13 (1st Cir. 2009).  The decision lets stand two circuit court rulings.

In Solvay, the U.S. Court of Appeals for the Eleventh Circuit ruled that a FCA action should be dismissed when, as in this case, the Relators are unable to present any evidence that the defendant company actually caused false claims to be submitted based on an alleged off-label marketing campaign.  As we previously noted (here and here), Solvay is an important ruling in the context of FCA litigation generally, but more specifically with regard to off-label use cases.  The Eleventh Circuit’s ruling is the first decision by a United States Court of Appeals concerning off-label use in which the court ruled that a complaint was deficient where there were no claims identified by the Relator.  Many off-label FCA actions have been initiated by company sales representatives who claim first-hand knowledge about an alleged off-label sales program, but do not have first-hand knowledge about the reimbursement practices of the company (usually because  those functions are handled by others in the company).

As we previously reported (here and here), the underlying case in Duxbury asserted qui tam claims under the FCA against Ortho Biotech that were based on certain of the company’s product promotion activities, alleging promotion of off-label use, marketing the “spread” and providing “kickbacks” to providers in the form, among others, of free product samples.  The District Court dismissed all of the claims, citing multiple grounds.  On appeal, the U.S. Court of Appeals for the First Circuit reversed in part, reviving only those claims attributable to Duxbury based on kickbacks.

The United States recommended in an amicus brief that the Supreme Court decline to hear the case, in part, on the basis that a recent amendment to the FCA’s definition of the term “original source” made one question posed in the Petition for a Writ of Certiorari “not of sufficient continuing importance to warrant this Court’s review.”