By Kurt R. Karst –      

We learned earlier today that Michael M. Landa, Esq. was named as FDA’s new Acting Chief Counsel.  Mr. Landa, who will assume his new role on April 13, 2009, has a long history with FDA.  Since July 2004, Mr. Landa has served as Deputy Director for Regulatory Affairs of FDA’s Center for Food Safety and Applied Nutrition.  Between January 2000 and July 2004, Mr. Landa served as FDA’s Deputy Chief Counsel, except that from March 2001 until August 2001, he was Acting Chief Counsel.  Mr. Landa also served in FDA’s Office of the Chief Counsel as the Associate Chief Counsel for Medical Devices, Enforcement and Veterinary Medicine during various periods between 1978 and 1993 before entering private practice.  There is some speculation that once a new Commissioner is installed at FDA, the “Acting” designation will likely be dropped from Mr. Landa’s title.

By Jennifer B. Davis –

The April 9, 2009 Federal Register will contain the official notice of an FDA order requiring manufacturers of 25 types of Class III “preamendments” devices to submit information on such devices, including adverse safety and effectiveness data not already submitted to the agency, by August 7, 2009.  The order also applies to manufacturers of devices marketed based on 510(k) determinations of “substantial equivalence” to the 25 identified preamendments devices.  FDA warns that failure to comply is a prohibited act, and will cause any affected device to be to be misbranded.  The agency also says it “does not anticipate extending the time for submitting the required information,” and “will use its enforcement powers to deter noncompliance.”  FDA intends to use the information submitted to decide the final classification for such devices.

A news release posted on April 8, 2009 on the agency’s website calls the order a “first step towards completing the review of Class III device types predating the 1976 law, as was recommended by the U.S. Government Accountability Office (GAO) in a January 2009 report to Congress.”  The FDA Amendments Act of 2007 ordered GAO to study FDA’s 510(k) process.  The GAO report found that the agency’s process for reclassifying or requiring PMAs for class III devices was incomplete, and recommended completion of that task to ensure the most stringent (PMA) review process for high-risk devices. 

Section 513 of the FDC Act (21 U.S.C. § 360c), added by the Medical Device Amendments of 1976 (“MDA”), requires FDA to classify all devices into one of three risk-based categories:  Class I, Class II, or Class III.  Devices assigned to Class III, representing the highest risk, must obtain premarket approval from the agency before they can be marketed.  21 U.S.C. § 360e(a).  However, under section 515(b)(1) of the Act (21 U.S.C. § 360e(b)(1)), devices initially assigned to Class III, which were marketed prior to the May 28, 1976 enactment of the MDA – so-called “preamendments” devices, do not require submission of a premarket approval application (“PMA”) until after FDA issues a final rule requiring a PMA for that device, or, FDA publishes a final classification placing the device in Class III.  In addition, the statute allows devices introduced to the market on or after May 28, 1976, which can be shown to be “substantially equivalent” to a Class III pramendments device, to be marketed through a 510(k) instead of a PMA unless and until FDA calls for a PMA, or finally classifies the preamendments device in Class III.

As of May 1994, there were approximately 149 preamendments devices  which FDA had initially classified or proposed to classify in Class III.  The agency has since reclassified (into Class I or II), or published a regulation requiring PMA submission for 122 of those devices, leaving 27.  The order to be published in the April 9, 2009 Federal Register addresses the following 25 devices.  (FDA has already initiated the process for the other two devices.)

1. 21 CFR 868.5610 Membrane lung for long-term pulmonary support.
2. 21 CFR 870.3535 Intra-aortic balloon and control system.
3. 21 CFR 870.3545 Ventricular bypass (assist) device.
4. 21 CFR 870.3600 External pacemaker pulse generator.
5. 21 CFR 870.3610 Implantable pacemaker pulse generator.
6. 21 CFR 870.3680(b) Cardiovascular permanent pacemaker electrode.
7. 21 CFR 870.3700 Pacemaker programmers.
8. 21 CFR 870.3710 Pacemaker repair or replacement material.
9. 21 CFR 870.4360 Nonroller-type cardiopulmonary bypass blood pump.
10. 21 CFR 870.5200 External cardiac compressor.
11. 21 CFR 870.5225 External counter-pulsating device.
12. 21 CFR 870.5310 Automated external defibrillator.
13. 21 CFR 872.3640(b)(2) Endosseous dental implant (blade form).
14. 21 CFR 872.3960 Mandibular condyle prosthesis (temporary implant).
15. 21 CFR 876.5540(b)(1) Implanted blood access device.
16. 21 CFR 876.5870 Sorbent hemoperfusion system.
17. 21 CFR 882.5800 Cranial electrotherapy stimulator.
18. 21 CFR 882.5940 Electroconvulsive therapy device.
19. 21 CFR 884.5330 Female condom.
20. 21 CFR 888.3070(b)(2) Pedicle screw spinal system (certain uses).
21. 21 CFR 888.3320 Hip joint metal/metal semi-constrained, with a cemented acetabular component, prosthesis.
22. 21 CFR 888.3330 Hip joint metal/metal semi-constrained, with an uncemented acetabular component, prosthesis.
23. 21 CFR 890.5290(b) Shortwave diathermy (certain uses).
24. 21 CFR 890.5525(b) Iontophoresis device (certain uses).
25. 892.1990 Transilluminator for breast evaluation.
  
Manufacturers of the above-listed devices must, by August 7, submit “a summary of, and citation to, any information known or otherwise available to them respecting the devices, including adverse safety and effectiveness data that has not been submitted under section 519 of the act” (e.g., medical device reports, reports of corrections and removals).  Additional details respecting the format and content for such submissions can be found in FDA’s order.

By Kurt R. Karst –      

Earlier today, FDA announced the approval of Novartis’ combination drug product COARTEM (artemether; lumefantrine) for the treatment of acute, uncomplicated malaria infections in adults and children weighing at least five kilograms.  Accompanying the approval is the first Priority Review Voucher (“PRV”) granted by FDA.  There has been significant debate about the value of a PRV, and any decision by Novartis to sell the PRV will be closely watched.

The FDA Amendments Act of 2007 (“FDAAA”), amended the FDC Act to add § 524 – “Priority Review to Encourage Treatments for Tropical Diseases.”  FDC Act § 524 provides for a transferable priority review program – the so-called “treat and trade” program – in which applicants for certain new drugs and biologics for “tropical diseases” that have received priority review may receive a PRV entitling the holder to a 6-month priority FDA review of another application that would otherwise be reviewed under FDA’s standard 10-month review clock.  The priority review voucher may be used or sold by the company granted the voucher for an application “submitted after the date of the approval of the tropical disease product application.”  FDA recently clarified in a draft guidance document that although FDC Act § 524 allows for only a single actual transfer of a PRV from the original recipient to another sponsor, “contractual arrangements such as the use of an option or transfer of the right to designate the voucher’s recipient could comply with the terms of the statute.” 

The tropical diseases that can qualify an applicant are enumerated in FDC Act § 524(a)(3) and include malaria.  Applicants that use a priority review voucher are required to pay FDA a priority review user fee in addition to other required user fees, and no such fee may be waived, reduced, or refunded.  FDA must establish the amount of the PRV user fee before the beginning of each fiscal year.  FDA may not collect user fees in connection with a PRV for a particular fiscal year until Congress has passed a law appropriating funds for such fees.  Congress has not yet done so for Fiscal Year 2009.

The idea to stimulate tropical disease drug development by offering a voucher system was first proposed in a 2006 Health Affairs article authored by three Duke University professors as an alternative to promoting tropical disease drug development through other incentive mechanisms, such as a patent term extension.  The PRV concept was adopted by Senator Sam Brownback (R-KS), who, along with Senators Sherrod Brown (D-OH) and Joseph Lieberman (I-CT), successfully amended a bill that would eventually become FDAAA. 

In order for a drug product to be eligible for a PRV, four requirements must be met:

(1) The application must be for a listed tropical disease;

(2) The application must be submitted either as a 505(b)(1) NDA or a 505(b)(2) application;

(3) The drug that is the subject of the application must not contain a previously-approved active moiety; and

(4) The application must qualify for a 6-month priority review under FDA’s policies.

FDA’s draft PRV guidance appears to limit PRV availability (and use) to a 505(b)(1) NDA.  According to the draft guidance, to be eligible for a PRV, “[t]he application must be submitted under section 505(b)(1) of the Act” (emphasis added).  However, FDC Act § 524(a)(4) refers more broadly to a “human drug application as defined in [FDC Act] section 735(1)” (emphasis added).  FDC Act § 735(1) identifies 505(b)(1) NDAs and 505(b)(2) applications as “human drug applications.”  Moreover, a 505(b)(2) application is an application submitted under FDC Act § 505(b)(1).  As such, a 505(b)(2) application that otherwise meets the requirements of FDC Act § 524 should also qualify for a PRV.  Indeed, during a December 2008 public hearing concerning additions to the list of tropical diseases identified at FDC Act § 524, FDA noted that 505(b)(2) applications are eligible for PRVs. 

Once an applicant receives a PRV, FDC Act § 524 places certain limitations on its use for another drug product submission, including: 

(1) The application using the PRV must be a 505(b)(1) NDA or a 505(b)(2) application, and is not limited to products for tropical diseases;

(2) At least one year in advance, the sponsor planning to use the PRV must notify FDA of its intent to use the voucher and the date on which the sponsor intends to submit the application;

(3) A sponsor using the PRV must pay an additional user fee to support the review of the application; and

(4) The PRV sponsor may make a one-time transfer of the voucher to another human drug application sponsor; however, “contractual arrangements such as the use of an option or transfer of the right to designate the voucher’s recipient could comply with the terms of the statute.” 

The value of a PRV is untested and unclear.  When the idea of a PRV was first introduced in Congress, it was thought that it “would be worth hundreds of millions of dollars.”  This estimate was presumably based on the 2006 Health Affairs article noted above in which the authors estimated that a PRV may be worth several million dollars.  More recently, BIO Ventures for Global Health, a non-profit organization that has created a website to track the PRV program and to help build a market for the vouchers, stated that “[e]stimates from different sources vary, but many experts place the value of a PRV somewhere between US$50 million and US$500 million.”   

Ultimately, the value of a PRV must be based on two considerations: (1) the prospect of saved approval time; and (2) the anticipated sales of a new drug.  It is difficult  to predict either with any certainty, although some have attempted to do so. 

By Kurt R. Karst –      

FDA’s September 1999 guidance document, “Qualifying for Pediatric Exclusivity Under Section 505A of the Federal Food, Drug, and Cosmetic Act,” includes a section addressing the following question: “If my study qualifies for pediatric exclusivity, to what will the period of pediatric exclusivity attach?”  FDA’s response (in relevant part):

Pediatric exclusivity will attach to exclusivity and patent protection listed in the Orange Book for any drug product containing the same active moiety as the drug studied and for which the party submitting the studies holds the approved new drug application (505A(a) and (c)).  For studies conducted on an unapproved drug, pediatric exclusivity will also attach to any exclusivity or patent protection that will be listed in the Orange Book upon approval of that unapproved drug.  FDA will attach pediatric exclusivity to protections listed at any time for a drug product as approved at the time pediatric exclusivity is obtained, as described further in section X.C.

Section X.C. of the guidance document, titled “Later-filed Applications Containing the Same Active Moiety,” states (again, in relevant part):

Previously earned pediatric exclusivity will not apply to new patents or exclusivity covering later-filed applications or supplements containing the same active moiety for which a sponsor previously earned pediatric exclusivity, unless the data that earned the prior pediatric exclusivity is essential to approval of the new application or supplement.

These statements reflect interpretations that appear simple enough to apply, but that in reality are a bit more complex. 

Consider, for example, FDA’s January 30, 2009 approval of NDA #22-287 for KAPIDEX (dexlansoprazole) Delayed Release Capsules.  Dexlansoprazole is the R-enantiomer of lansoprazole (a racemic mixture of the R- and S-enantiomers), which is approved and marketed under the proprietary name PREVACID.  FDA issued a Pediatric Written Request (“PWR”) for PREVACID in August 1999 (last amended in September 2005) and granted pediatric exclusivity on July 15, 2008, while the KAPIDEX NDA was under review at FDA.  Although FDA’s PWR does not mention dexlansoprazole, FDA nevertheless granted pediatric exclusivity with respect to all of the KAPIDEX Orange Book listings when the NDA was aproved in January 2009. 

FDA’s decision to grant pediatric exclusivity with respect to KAPIDEX clarifies two Agency interpretations: (1) when FDA issues a PWR for a drug product that is a racemic mixture, any pediatric exclusivity granted as a result of that PWR applies not only to the racemic mixture, but also to the sponsor’s other products containing either enantiomer, whether or not FDA’s PWR specifically identifies each enantiomer in the racemic mixture; and (2) FDA will apply previously earned exclusivity to later-approved applications that are under review at the time FDA grants pediatric exclusivity.

Another FDA interpretation stemming from FDA’s September 1999 guidance document that is not widely known is that previously earned pediatric exclusivity can apply to certain new Orange Book-listed patents if those patents relate back to the drug product when pediatric exclusivity was granted.  For example, if FDA granted pediatric exclusivity in 2000 for a drug product that was approved for indication A, and in 2007 two new patents are listed in the Orange Book covering the drug substance and newly approved indication B, then FDA could apply pediatric exclusivity to the newly listed drug substance patent, but not to the patent covering newly approved indication B, because the drug substance patent relates back to the drug product when pediatric exclusivity was granted, but the method-of-use patent does not.  FDA could take the same position on drug product patents and would grant pediatric exclusivity, provided the patent-protected formulation relates back to the drug product when pediatric exclusivity was granted.  FDA has applied this policy on a few occasions, including, for example, with respect to COMBIVIR (lamivudine; zidovudine). 

By Ricardo Carvajal –      

FDA has announced that it will hold a public meeting on “economically motivated adulteration” to foster discussion about ways that FDA-regulated industries can “better predict and prevent economically motivated adulteration with a focus on situations that pose the greatest public health risk.”  The agency is also requesting comment on the topic.

In recent years, economic adulteration has received little attention from FDA as the agency sought to focus its resources on violations of the FDC Act that presented a clear risk to public health.  The melamine episode made clear that economic adulteration can harm more than just the pocketbook.  Although FDA’s announcement of the meeting suggests that FDA will focus on instances of economic adulteration that pose a risk to health (e.g., those that give rise to a violation of FDC Act section 402(a)(1), under which a food is deemed adulterated if it contains an added poisonous or deleterious substance that may render the food injurious to health), we wonder if FDA will see fit to breathe new life into FDC Act section 402(b).  Under that section, a food is deemed adulterated:

(1) If any valuable constituent has been in whole or in part omitted or abstracted therefrom;

(2) if any substance has been substituted wholly or in part therefore;

(3) if damage or inferiority has been concealed in any manner; or

(4) if any substance has been added thereto or mixed or packed therewith so as to increase its bulk or weight, or reduce its quality or strength, or make it appear better or of greater value than it is.

Section 402(b) gives FDA clear authority to act in cases involving economic adulteration that poses no known risk to public health.  Stay tuned.

By JP Ellison –

In U.S. v. Palazzo, the Fifth Circuit recently reversed a trial court’s decision to dismiss criminal charges against a clinical investigator based upon violation of 21 C.F.R. § 312.62(b), which requires such investigators “to prepare and maintain adequate and accurate case histories that record all observations and other data pertinent to the investigation on each individual administered the investigational drug.”

As a result of the Fifth Circuit’s decision, the case was sent back to the trial court where the defendant will likely stand trial on fifteen counts of violations of this regulation with the intent to defraud and mislead, a felony, under the Federal Food, Drug, and Cosmetic Act ("FDC Act").

Importantly, nowhere in the Section 505(i) of FDC Act, which was the statutory basis for the charges, does it impose any obligation on clinical investigators.  Rather, Section 505(i) only imposes obligations on “the manufacturer or sponsor” of an IND, not on the clinical investigators.  In fact, Section 505 explicitly states that “[n]othing in this subsection shall be construed to require any clinical investigator to submit direct to the Secretary reports on the investigational use of drugs.”  § 505(i)(4).  Nevertheless, clinical investigators have been prosecuted based upon this statutory section.  These prosecutions have occurred because Section 505(i) mandates that the Secretary of HHS promulgate regulations governing clinical trials conducted under an IND, and in those regulations, including 21 C.F.R. § 312.62, FDA has imposed various obligations on clinical investigators, and in some instances alleged violations of those provisions have resulted in criminal charges. 

FDA’s regulations and the criminal prosecutions of clinical investigators under those regulations have raised a host of complicated constitutional, administrative, and criminal law issues that remain unresolved.

Palazzo is the third federal appellate court to consider the issue of whether criminal liability can be imposed on clinical investigators under the FDC Act.  Despite consideration by three Circuits in thoughtful opinions, the legal landscape remains unsettled and counsel can make non-frivolous challenges to criminal charges based on these and other regulations issued by the FDA under the FDC Act.

The first appellate court to consider the issue of clinical investigator criminal liability was the Ninth Circuit, in U.S. v. Smith, 740 F.2d 734 (9th Cir. 1984).  In Smith, the Ninth Circuit looked at Section 505(i) and concluded that it did not authorize FDA to promulgate regulations that gave rise to criminal liability for clinical investigators.  In reaching this conclusion, the Ninth Circuit relied, in part, upon the principle of the “Rule of Lenity” in interpreting an ambiguous criminal statute.  Id. at 738.  The Ninth Circuit also looked at FDA’s regulations governing clinical investigators at the time, and concluded that the regulations did not impose “a clear duty on investigators to maintain records.”  FDA’s regulations have been revised since Smith was decided, so that portion of the opinion has been superseded by subsequent events.

The second appellate court to consider the issue of clinical investigator criminal liability was the Eighth Circuit in U.S. v. Garfinkel, 29 F.3d 451 (8th Cir. 1994).  In Garfinkel, the Eighth Circuit disagreed with the Ninth Circuit and concluded that Section 505(i) could support criminal charges against clinical investigators.  In reaching this conclusion, the Eighth Circuit first conducted statutory analysis under Chevron U.S.A., Inc. v. Natural Resources Defense Council, 467 U.S. 837 (1984), and concluded that the statutory language of Section 505 was ambiguous.  Following Chevron, the Eighth Circuit then reasoned that deference was owed to FDA’s interpretation that the statute authorized it to promulgate regulations imposing obligations on clinical investigators.  Garfinkel, 29 F.3d at 457.

The Eighth Circuit then conducted constitutional analysis under the Nondelegation Doctrine, which arises out of Article 1, § 1 of the U.S. Constitution and reserves all legislative power to the Congress.  Under the Nondelegation Doctrine, the Executive Branch can promulgate regulations so long as the enabling legislation sets forth “an intelligible principle” to restrain the agency.  29 F.3d. at 458.  The Eighth Circuit concluded that Section 505(i) contained the requisite intelligible principle and thus found that the FDA’s regulations were not constitutionally invalid under the Nondelegation Doctrine.  Despite the Eighth Circuit’s thorough analysis and its discussion of the Ninth Circuit’s earlier Smith decision, Garfinkel did not address or discuss the Rule of Lenity, a point noted by the trial court in the Palazzo case.  See U.S. v. Palazzo, 2007 WL 3124697, *7 n.7 (E.D. La. 2007).  Based on this analysis, the Eighth Circuit concluded that criminal charges could be brought.

The most recent federal appellate court to address the criminal liability of clinical investigators was the Fifth Circuit in Palazzo.  Palazzo does little to clarify the split between the Eighth and Ninth Circuits, however because of what was conceded on appeal.  The Fifth Circuit’s opinion notes: 

If the parties questioned whether § 355(i) [Section 505(i)] provided sufficient guidance for the FDA to promulgate regulations requiring clinical investigators to adhere to certain record-keeping requirements, the non-delegation doctrine would be an issue in this case.  Similarly, if the parties disputed whether § 355(i) authorized the FDA regulation at issue, this Court would need to engage in a Chevron analysis to assess § 355(i)’s statutory construction.

The Fifth Circuit engaged in neither analytical exercise however, because of concessions on appeal.  Rather, the Fifth Circuit simply looked to Section 301(e) to conclude that that Section makes it a prohibited act to fail to maintain or establish any record required under, inter alia, Section 505(i), and that Section 503(a)(1) makes that prohibited act a criminal violation.  (Perhaps accidentally the court cited to the misdemeanor provisions of Section 503 despite the fact that the defendant was charged with felony violations.)  Given the defendant’s concession “that § 355(i) provides the FDA with unambiguous authority to promulgate regulations requiring clinical investigators to adhere to specific record-keeping and reporting requirements,” it is hard to see how the Fifth Circuit could have reached a contrary result.

Given Smith, Garfinkel, and Palazzo, what should a clinical investigator do?  First, one need not read or understand these cases to know that it is never prudent for an investigator to intentionally violate the FDC Act or FDA regulations in connection with a clinical trial.  Regardless of criminal liability based upon Section 505(i), there are a myriad of negative consequences, including but not limited to prosecution under other criminal statutes, that could arise from such conduct.  Second, should counsel for a clinical investigator face criminal charges based on Section 505(i) the nondelegation, Chevron, and lenity arguments, among others, should be made and preserved on appeal.  This legal question is far from decided and may end up in the Supreme Court before it is. 

By Kurt R. Karst –      

We previously reported on a lawsuit filed in July 2008 by PhotoCure ASA (“PhotoCure”) against the U.S. Patent and Trademark Office (“PTO”) after the PTO denied PhotoCure’s application for a Patent Term Extension (“PTE”) for U.S. Patent No. 6,034,267 (“the ‘267 patent”) covering the human drug product METVIXIA (methyl aminoevulinate hydrochloride), which FDA approved on July 27, 2004 under New Drug Application (“NDA”) No. 21-415.  In a decision issued earlier this week, the U.S. District Court for the Eastern District of Virginia granted PhotoCure’s Motion for Summary Judgment and denied the PTO’s Motion for Summary Judgment.  The decision, which struck down the PTO's interpretation of “product” in the PTE statute, could have significant implications on previous PTE decisions if the decision is appealed and affirmed by the Federal Circuit.

The PTO’s decision to deny a PTE for the ‘267 patent was based on an analysis of the “first permitted commercial marketing” criterion in the PTE statute.  Specifically, under 35 U.S.C. § 156(a)(5)(A), the term of a patent claiming a drug shall be extended from the original expiration date of the patent if, among other things, “the permission for the commercial marketing or use of the product . . . is the first permitted commercial marketing or use of the product under the provision of law under which such regulatory review period occurred” (emphasis added).  In recent PTE determinations, the PTO has heavily relied on decisions by the U.S. Court of Appeals for the Federal Circuit in Fisons v. Quigg, 8 U.S.P.Q.2d 1491 (D.D.C.1988), aff’d 876 F.2d 99 U.S.P.Q.2d 1869 (Fed.Cir.1989), and Pfizer Inc. v. Dr. Reddy’s Labs., 359 F.3d 1361 (Fed. Cir. 2004) (“Pfizer II”), to support the Office’s interpretation of the term “product” in 35 U.S.C. § 156(a)(5)(A) to mean “active moiety” (i.e., the molecule in a drug product responsible for pharmacological action, regardless of whether the active moiety is formulated as a salt, ester, or other non-covalent derivative) rather than “active ingredient” (i.e., the active ingredient physically found in the drug product, which would include any salt, ester, or other non-covalent derivative of the active ingredient physically found in the drug product).  In contrast, the Federal Circuit’s 1990 decision in Glaxo Operations UK Ltd. v. Quigg, 894 F.2d 392, 13 USPQ2d 1628 (Fed. Cir. 1990) (“Glaxo II”), construed the term “product” in 35 U.S.C. § 156(a)(5)(A) to mean “active ingredient.”

Applying the active moiety interpretation of the law, the PTO determined in May 2008 that METVIXIA does not represent the first permitted commercial marketing or use of the product because of FDA’s December 1999 approval of an NDA for Dusa Pharmaceuticals Inc.’s LEVULAN KERASTICK (aminolevulinic acid HCl) Topical Solution, which contains the active moiety aminolevulinic acid (“ALA”).  Thus, according to the PTO, METVIXIA does not represent the first permitted commercial marketing or use of ALA and the ‘267 patent is ineligible for a PTE. 

In reaching its decision that the PTO’s decision to deny a PTE with respect to ‘267 patent covering METVIXIA was “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law” under the Administrative Procedure Act, the court explained that it must determine whether it is required to follow the Federal Circuit’s ruling in Glaxo II or Pfizer II.  The court stated that “[i]mportantly, Pfizer II postdated Glaxo II and was a panel decision that the Federal Circuit declined to hear en banc.  ‘[The Federal Curcuit] has adopted the rule that prior decisions of a panel of the court are binding precedent on subsequent panels unless and until overturned in banc.  Where there is a direct conflict, the precedential decision is the first’” (internal citation omitted).   As a result, the court applied the “active ingredient” interpretation adopted in Glaxo II and determined that “the ‘267 patent covering Metvixia satisfies § 156(a)(5)(A), and that the USPTO’s decision to apply the active moiety interpretation and deny PhotoCute a [PTE] under this provision was contrary to the plain meaning of the statute and thus not in accordance with the law.”  The court also stated:

To adopt the active moiety approach would entail construing the term “active ingredient” in such a manner that permits compounds to qualify as ingredients of drugs even when those compounds are not actually present in the drug.  To adopt such a construction would be permissible, in this Court’s view, only if there was support in the legislative history.  But the Court could find no legitimate support for the active moiety approach in the § 156 legislative history.  Therefore, the Court will not construe the “active ingredient” term against its plain meaning by adopting a construction that permits compounds not present in the drug to qualify as the “active ingredient.”

Also worth emphasizing is that the term “active moiety” was indisputably well-known at the time Congress drafted the statute.  If Congress desired to infuse the “active moiety” concept into §§ 156(a) and (f), it could have done so easily by including the term somewhere in either of those two provisions.

The district court’s decision comes on the heels of several recent PTO decisions denying PTEs based on the “first permitted commercial marketing” criterion applying the active moiety interpretation of the statute – see our previous post here.  As such, it seems likely that the PTO will appeal the case to the Federal Circuit.  A Federal Circuit decision affirming the district court’s decision could call into question previous PTE denials using the active moiety interpretation of the statute.

By Ricardo Carvajal –      

Among the myriad proposals to overhaul the nation’s ailing food safety system, at least one calls for splitting off FDA’s food safety programs and incorporating them into a new Food Safety Administration ("FSA") within the U.S. Department of Health and Human Services.  That’s the tack taken in a report issued by the non-profit Trust for America’s Health titled “Keeping America’s Food Safe: A Blueprint for Fixing the Food Safety System at the U.S. Department of Health and Human Services.”  The report appears to have been strongly influenced by a paper included as an appendix titled “Restructuring Food Safety at HHS: Design and Implementation.”  That paper caught our eye because it was authored in part by Michael Taylor, formerly Deputy Commissioner for Policy at FDA, and now on faculty at the George Washington University School of Public Health.

Mr. Taylor’s paper raises the question of whether FDA’s dietary supplements and cosmetics programs should be housed in a new FSA or in the medical products agency that would remain once FDA’s food safety functions have been split off.  The paper acknowledges that dietary supplements “are categorized legally as foods and housed in CFSAN.”  However, the paper appears to suggest that perhaps the dietary supplement program should be housed in the medical products agency because:

the supplement category includes not only vitamins, minerals and other clearly nutritional substances but also herbal products and others that are marketed and sought after for their drug-like effects.  In fact, the issue of whether supplement claims cross the line to become, legally, drug claims is a recurring issue.

Similarly, with respect to cosmetics, that paper notes that “one of the recurring issues in cosmetic regulation is whether marketing claims and intended uses for some cosmetic products render them legally drugs.”

It strikes us as curious that the decision of where to house the dietary supplement and cosmetics programs would be based to any degree on the fact that unlawful marketing claims might be made for those products (a problem that needs to be addressed through enforcement), or that some consumers might seek those products out for their “drug-like” effects (what is to become of coffee?).  In any case, we thought that Congress had definitively settled the question as to how dietary supplements should be regulated – as food – and that nothing about the recent or current food safety crises suggests otherwise.  As for cosmetics, their regulatory paradigm has long resembled the one for foods much more strongly than the one for drugs.

It’s not difficult to imagine how the fate of the dietary supplement and cosmetics industries could depend on whether they’re housed in a new FSA or a medical products agency.  As the paper acknowledges in a masterful bit of understatement, “[t]he issue is of great interest to the regulated industries and other stakeholders and thus requires careful consideration.”

In the latest “Enforcement Corner” column for the Food and Drug Law Institute’s Update publication, Hyman, Phelps & McNamara, P.C. attorneys JP Ellison and John R. Fleder discuss the indictment, trial, conviction, and sentencing of Berkeley Nutraceuticals’ former in-house counsel Paul Kellogg.  Mr. Kellogg’s conviction arose out of two distinct series of events – one that the government alleged was designed to cover up an FDA violation, and another that the government alleged was designed to evade the Federal Trade Commission (“FTC”).  The article notes that “[i]f Kellogg’s conviction for conspiracy to obstruct the FDA seems like the work of a criminal mastermind, then Kellogg’s conspiracy conviction relating to the FTC may largely appear that of the unwitting dupe.”  The authors go on to discuss what lessons can be learned from Mr. Kellog’s case. 

By Jennifer B. Davis –

Earlier this week, the United States Court of Appeals for the Eleventh Circuit in Atlanta issued its opinion in United States v. Endotec, Inc., an appeal from the United States District Court for the Middle District of Florida.   We previously reported on the lower court decision here. 

The central issue on appeal was whether various ankle, knee, and jaw implants manufactured and distributed by Endotec qualified as “custom devices” exempt from the FDC Act's premarket approval requirements.  In the district court, FDA sought a permanent injunction against Endotec and its officers to preclude further manufacture and distribution of such devices without the necessary premarket approval.  Siding largely with the company, the District Court held that Endotec’s ankle and jaw implants, but not its knee implants, were exempt “custom devices.” 

On March 30, the Eleventh Circuit affirmed in part and reversed in part, concurring that the distributed jaw implant was a custom device, but not the knee or ankle implants.

The “custom device” exemption, codified at 21 U.S.C. § 360j(b), defines a custom device as one that:

necessarily deviates from an otherwise applicable performance standard or requirement prescribed by or under section 360e of this title if (1) the device is not generally available in finished form for purchase or for dispensing upon prescription and is not offered through labeling or advertising by the manufacturer, importer, or distributor thereof for commercial distribution, and (2) such device –

(A)(i) is intended for use by an individual patient named in such order of such physician or dentist (or other specially qualified person so designated) and is to be made in a specific form for such patient, or (ii) is intended to meet the special needs of such physician or dentist (or other specially qualified person so designated) in the course of the professional practice of such physician or dentist (or other specially qualified person so designated), and

(B) is not generally available to or generally used by other physicians or dentists (or other specially qualified persons so designated).

FDA’s regulation essentially mirrors, but restates the statutory criteria in list format:

Custom device means a device that:

(1) Necessarily deviates from devices generally available or from an applicable performance standard or premarket approval requirement in order to comply with the order of an individual physician or dentist;

(2) Is not generally available to, or generally used by, other physicians or dentists;

(3) Is not generally available in finished form for purchase or for dispensing upon prescription;

(4) Is not offered for commercial distribution through labeling or advertising; and

(5) Is intended for use by an individual patient named in the order of a physician or dentist, and is to be made in a specific form for that patient, or is intended to meet the special needs of the physician or dentist in the course of professional practice.

21 C.F.R. §812.3(b).

In applying the custom device criteria, the agency has historically taken a very restrictive view, characterized by the Endotec district court as “so narrow as to make the definition useless.”  As noted in the district court opinion, FDA officials claimed in their trial testimony that devices studied in clinical trials; devices used on more than one patient; devices available in different sizes; and devices having the same basic design as other available devices, cannot be custom devices.

Those who were hoping that the Endotec case might provide some conclusive analysis of the custom device provision won’t likely find it in the Eleventh Circuit opinion.  Although the opinion makes clear that the burden of proof lies with the party claiming the exemption, the court declined (as courts are wont to do) to address any broad based criteria-related question that was not necessary to resolve the specific issue in this case of whether Endotec’s devices were custom devices.  Finding that Endotec commercially advertised its “custom” ankle devices, the court concluded that “the district court erred with respect to one prong of the custom device definition and, because a device must meet all five prongs of the custom device definition, we decline to address the remainder.”  With regard to the knee implants, it found that the defendants failed to show an abuse of discretion by the district court, failed to address the “special need” requirement, and, like the ankle implants, advertised some of the knee implants in violation of the commercial distribution prong.  With respect to the jaw implant, the court found that the Government failed to demonstrate an abuse of discretion by the lower court in determining that device to be a custom device because it was not generally available to, or used by, other physicians.

Discussing issues that have broader applicability than just to custom devices,  the court of appeals rejected the lower court’s conclusion that for FDA to prevail in an injunction case, it had to “demonstrate dangerousness or actual harm with respect to a medical device.”   The court also ruled that the lower court erred when it relied on the conclusion that FDA's "strict interpretation of procedural requirements are resulting in technological innovation being stymied.”  Finally, it concluded that it “is not within the province of the district court (or, this Court, for that matter) to weigh the medical pros and cons of a certain medical device-that is best left to the FDA.”

Simply based on the reversal of the lower court’s decision regarding the status of Endotec’s ankle devices, the agency will surely view this decision as a victory.  The opinion also contains some agency-friendly language noting that it is “all-the-more necessary” to strictly and narrowly construe exemptions to a statutory scheme when the statute is one that addresses public health and safety.  Beyond that, however, we do not think the decision is likely to have a measurable impact on FDA’s current cramped construction of the custom device exemption.

By Kurt R. Karst –      

Earlier today, FDA announced that the Agency has taken enforcement action against several manufacturers of unapproved prescription narcotics.  The 9 Warning Letters issued by FDA concern 14 narcotic drug products, including morphine sulfate, hydromorphone, and oxycodone.  The Warning Letters direct the companies to stop manufacturing and distributing the specific narcotic drug products in certain dosage forms that lack FDA approval.  According to FDA, “[m]anufacturers have 60 days after the dates of the Warning Letters to cease manufacturing of new product, and distributors have 90 days after the dates of the Warning Letters to cease further shipment of existing products.”  (Of course, if the marketing of these products is illegal, that raises the question of why FDA would permit their continued manufacturing for 60 days.)

FDA’s action today is the first drug-based enforcement action the Agency has taken since September 2008, when FDA issued a Federal Register notice concerning unapproved ophthalmic drug products containing Balanced Salt Solution.  It is also the tenth drug-based enforcement action FDA has taken since June 2006 when the Agency announced its new unapproved drug initiative to remove unapproved drugs from the market and issued its final Compliance Policy Guide (“CPG”) on the topic.  FDA’s CPG articulates a risk-based enforcement approach under which the Agency gives higher priority to enforcement action against unapproved drugs in certain categories, including drugs with potential safety risks, drugs that lack evidence of effectiveness, drugs that present a health fraud, and drugs that present direct challenges to the “new drug” approval and over-the-counter drug monograph systems.  FDA’s decision to take enforcement action with respect to certain unapproved prescription narcotics aprears to be due, at least in part, to preserve the integrity of the drug approval process.

We recently reported on oxycodone shortages.  FDA also announced oxycodone shortages just a few days ago.  A couple of the firms noted on FDA’s oxycodone drug shortage list received Warning Letters.  It is unclear the extent to which FDA’s enforcement action might further concerns about drug product shortages.   

By Kurt R. Karst – 

Last week, the U.S. Government Accountability Office (“GAO”) issued a report, titled “Nonprescription Drugs: Considerations Regarding a Behind-the-Counter Drug Class.”  The report updates the Office’s 1995 report on the same topic (see our previous post here).  The updated report was requested by Representatives John Dingell (D-MI) and Bart Stupak (D-MI) in January 2008 after FDA held a public meeting in November 2007 on Behind-the-Counter (“BTC”) availability of certain drugs.  A copy of the 2007 FDA meeting transcript is available here.  FDA has previously considered and declined to create BTC drug status.  Specifically, in April 2004, FDA denied – without substantively discussing BTC status – a citizen petition requesting that the Agency “switch Nicotrol Inhaler (Nicotine Inhalation System) from prescription only to over-the-counter status TO BE SOLD ONLY UNDER A PHARMACIST’S SUPERVISION as a third class of drugs.” 

According to the GAO report, there are two general views on how a BTC drug class would be used in the U.S.  The first view is that BTC drugs would be a permanent drug class – similar to the current prescription and Over-the-Counter drug ("OTC") classes – insofar as there would be no expectation that BTC drugs would eventually switch to the prescription or OTC class.  The second view is that a BTC drug class would function as a transition class for some drugs and a permanent class for other drugs, such that “[a] drug being switched from prescription to nonprescription would spend time in the transition class, during which the suitability of the drug for OTC status could be assessed.”

The 1995 GAO report concluded that “[l]ittle evidence supports the establishment of a pharmacy or pharmacist class of drugs in the United States at this time, as either a fixed or a transition class, and that “[t]he evidence that is available tends to undermine the contention that major benefits are being obtained in the countries that have such a class.”  The bottom line in the 2009 report is less clear, presumably because the focus of the report was to describe arguments supporting and opposing the creation of a BTC drug category, evaluate BTC drug systems in five countries that have evaluated drug classification since 1995 (i.e., the U.S., Australia, Italy, the Netherlands, and the United Kingdom), and note issues important to establishing a BTC drug class in the U.S.  The GAO report concludes that:

Arguments supporting and opposing a BTC drug class in the United States have been based on public health and health care cost considerations, and reflect general disagreement on the likely consequences of establishing such a class.  Proponents of a BTC drug class suggest it would lead to improved public health through increased availability of nonprescription drugs and greater use of pharmacists’ expertise.  Opponents are concerned that a BTC drug class might become the default for drugs switching from prescription to nonprescription status, thus reducing consumers’ access to drugs that would otherwise have become available OTC, and argue that pharmacists might not be able to provide high quality BTC services.  Proponents of a BTC drug class point to potentially reduced costs through a decrease in the number of physician visits and a decline in drug prices that might result from switches of drugs from prescription to nonprescription status.  However, opponents argue that out-of-pocket costs for many consumers could rise if third-party payers elect not to cover BTC drugs. 

The GAO report also goes on to comment that “[a]ll five study countries have increased nonprescription drug availability since 1995; however, the impact of restricted nonprescription drug classes on drug availability is unclear.”  The report also identifies several issues that need to be addressed before a BTC drug class is established in the U.S.  In particular, the GAO report states that:

Pharmacist-, infrastructure-, and cost-related issues would have to be addressed before a BTC drug class could be established in the United States.  The roles and responsibilities of pharmacists in a BTC drug class that would need to be considered include defining pharmacist responsibilities for dispensing BTC drugs, ensuring that pharmacists provide the necessary BTC counseling, and determining whether additional training would be needed for pharmacists and pharmacy staff.  In addition, whether or not there is a sufficient pharmacist workforce to make such a class viable would need to be determined, and pharmacists’ new role would need to be communicated to the public. Ensuring that pharmacies have the data infrastructure necessary to provide pharmacists with patient information and the physical infrastructure to protect consumer privacy would also be important.

Whether the GAO’s report will lead to the introduction of legislation to create a BTC drug class remains to be seen.  Legislators are presumably reviewing the report in detail to gauge the need for and the potential impediments to the creation of a BTC drug class. 

By Ricardo Carvajal –      

The latest Morbidity and Mortality Weekly Report from the Centers for Disease Control and Prevention (CDC) gives credence to a possible link between higher intake of sodium and an increased risk of hypertension.  According to CDC, nearly 70% of U.S. adults should be limiting their intake of sodium to 1,500 mg/day (@ 2/3 teaspoon of salt), considerably lower than the estimated average daily intake of 3,436 mg/day for those age 2 and older. (Current dietary guidelines recommend a limit of 2,300 mg/day, but a lower limit of 1,500 mg/day is recommended for those in certain at-risk groups.)  CDC recommends that health-care providers “inform their patients of the evidence linking greater sodium intake to higher blood pressure.”

In an accompanying editorial note, CDC states that “[p]ublic health actions to reduce sodium intake likely will include 1) reducing the sodium content of processed foods; 2) encouraging consumption of more low-sodium foods, such as fruits and vegetables; and 3) providing more relevant information about sodium in food labeling.”  CDC further states that current percent daily value information in nutrition labeling of packaged foods “is likely to mislead the majority of consumers, for whom the 1,500 mg/day limit is applicable.”  As an example of a public health strategy to reduce sodium intake, CDC cites New York’s efforts to reduce sodium levels in processed and restaurant foods.

In 2005, the Center for Science in the Public Interest filed a citizen petition asking FDA to revoke the GRAS status of salt, require a reduction in the amount of salt in processed foods, and reduce the daily value for sodium to 1,500 mg/day, among other actions.  In response to the petition, FDA held a public hearing in November 2007.  The citizen petition is still pending.

By Susan J. Matthees –

FDA announced last week that it had added the first unapproved new animal drug to the Index of Legally Marketed Unapproved New Animal Drugs for Minor Species (i.e., the Index) since the Agency began accepting submissions last February.  The drug, Ovaprim, is indicated “[f]or use as a spawning aid in ornamental finfish broodstock.”  Placement on the Index allows the sponsor, Western Chemical, to sell Ovaprim without having the drug approved by FDA. 

The Index was created as part of the Minor Use Minor Species ("MUMS") Animal Health Act of 2004, which was passed with the intention of making more drugs available for treatment of minor species and uncommon diseases in major animal species.  Minor species are all animals other than the 7 major species (dogs, cats, cattle, horses, swine, chickens, and turkeys).  The Act was intended to increase drug availability by modifying the Federal Food, Drug, and Cosmetic Act in three ways. 

First, the Act allows a company to ask FDA’s Center for Veterinary Medicine to grant “conditional approval” of a drug.  Conditional approval permits a sponsor to sell a drug for up to 5 years before collecting all necessarily efficacy data.  However, the sponsor must demonstrate that the drug is safe.  Second, for drugs that have a very limited potential for marketing, FDA can add a drug to the Index, as it did yesterday for Ovaprim.  Finally, FDA can grant an animal drug a similar designation as human Orphan Drugs.  Sponsors who receive this designation can receive up to 7 years of marketing exclusivity.

FDA granted the first conditional approval in early 2007, but the Agency has not announced any other conditional approvals.  FDA granted the first designation in 2005 for the drug Florfenicol (Aquaflor®), and has been actively granting designation over the past 4 years. 

It is difficult to draw many conclusions from yesterday’s announcement since it was the first time that FDA has accepted a drug for the Index, and it remains to be seen whether the Index will increase the number of drugs available for minor uses and minor species.  However, the Index may soon prove to be very popular among the ornamental finfish of the country.

By Jennifer B. Davis & John R. Fleder –

In a March 17, 2009 opinion in United States ex rel Roop v. Hypoguard USA, Inc., the United States Court of Appeals for the Eighth Circuit held that the Relator’s qui tam allegations concerning Defendant’s alleged failure to submit FDA-required medical device reports (“MDRs”) for defective blood glucose monitors was insufficient to meet the Fed.R.Civ.P. 9(b) requirements for pleading fraud with specificity.  Affirming the lower court’s dismissal of Relator’s pre- and post-judgment motions to file a First Amended Complaint, the Eight Circuit determined that Relator’s proposed First Amended Complaint “failed to cure deficiencies in the initial Complaint” because it “did not plead with particularity the details of any false Medicare reimbursement claim presented to, or paid by, the United States or its agent.  Nor did it allege with particularity how any product defect or failure to submit MDR reports to the FDA was material to . . . the government’s decisions to pay countless unidentified Medicare reimbursement claims submitted by Hypoguard distributors.”

In a March 20, 2009 opinion in United States ex rel Poteet v. Lenke, the United States District Court for the District of Massachusetts held that Relator’s qui tam action against multiple spine surgeons and device distributors alleging receipt of kickbacks from Medtronic, Inc. and Medtronic Sofamor Danek U.S.A. in exchange for off-label promotion of INFUSE Bone Graft/LT-CAGE® was barred by the prior public disclosure of Relator’s allegations in previously filed lawsuits and the media, and by the Relator’s failure to meet the Fed.R.Civ.P. 9(b) requirements for pleading fraud with specificity.  In its application of the Rule 9(b) specificity requirement, the court found that Relator’s Amended Complaint was “devoid of specific allegations linking the distributor defendants to the general allegations of kickbacks and the filing of false claims with the government.”  It further observed that the Relator had failed to specify “which distributors were involved in the scheme, and how they were involved,” or “whether the recipients of the gifts ever purchased Medtronic products or filed a claim for medicare benefits,” “[ ]or . . . that these gifts caused a false filing with Medicare.”  Quoting a leading First Circuit FCA/Rule 9(b) opinion, United States ex rel. Rost v. Pfizer, Inc., 507 F.3d 720, 733 (1st Cir. 2007) (see our post about that case here), the court further found that the Relator’s Amended Complaint “contains ‘no factual or statistical evidence to strengthen the inference of fraud beyond possibility.’”

We have earlier reported on the case of Hopper and Hutto v. Solvay Pharmaceuticals, Inc., where the United States District Court for the Middle District of Florida dismissed a qui tam False Claims Act case involving allegations that the defendants had engaged in an alleged off-label marketing scheme with regard to the drug Marinol.  On March 13, 2009, the defendants filed their appellate brief with the United States Court of Appeals for the Eleventh Circuit.  On March 24, 2009, the Washington Legal Foundation filed an amicus curiae brief in that Court supporting the defendants’ position that the Eleventh Circuit should affirm the lower court’s dismissal.  Hyman, Phelps & McNamara P.C. is one of the counsel of record for the defendants in that case.