On July 18, 2008, in a rare “win” (depending on which side you are on) on a motion for reconsideration, the U.S. District Court for the Southern District of Indiana (Indianapolis Division), vacated the court’s September 2007 decision in Tucker v. SmithKline Beecham Corp., in which Chief Judge David F. Hamilton had earlier dismissed, on federal preemption grounds, a wrongful death/failure-to-warn lawsuit brought under Indiana state law against GlaxoSmithKline (“GSK”) concerning the company’s antidepressant drug PAXIL (paroxetine HCl).  The recent decision, in which the court found no implied conflict preemption and declined to rely on FDA’s “preemption preamble” (see pages 3933-36) changes the Drug Preemption Scorecard kept by the folks at Drug and Device Law Blog.  The case is now reopened for adjudication on the merits, which the court promised to address in the “near future.”

The case concerns the death of Father Rick Tucker, a Roman Catholic priest who allegedly committed suicide in September 2002 after being prescribed PAXIL in August 2002.  Plaintiff Debra Tucker, Father Tucker’s younger sister, brought a wrongful death suit under Indiana state law against GSK claiming that her brother committed suicide as a result of taking PAXIL. Ms. Tucker contends that GSK breached its duty to warn of an increased suicide risk in adults taking PAXIL. GSK argued that the company could not be held liable for the alleged inadequacy of the PAXIL labeling because the United States Constitution’s Supremacy Clause mandates that the Federal Food, Drug, and Cosmetic Act (“FDC Act”) and FDA labeling requirements preempt Ms. Tucker’s state law claims.  In September 2007, the district court granted GSK’s motion for summary judgment because Ms. Tucker’s “state law claims stand in direct conflict with the FDA’s labeling requirements for Paxil issued pursuant to federal law. . . .” (i.e., conflict preemption).

Fast-forward 10 months and the district court has reversed course.  After the September  2007 decision, Ms. Tucker filed a Rule 59 motion asking the court to reconsider its decision.  Ms. Tucker argued that no conflict exists between Indiana state law and federal law because “FDA has not, in fact, precluded GSK from including in its current label Paxil-specific warning language,” and that even if there is a conflict as a result of class-wide antidepressant labeling changes implemented in 2007 concerning suicide, “no conflict existed in 2002 when GSK could have warned Father Tucker or his physician about Paxil’s alleged association with suicidality.”

GSK countered that although FDA’s labeling regulations give the company the right to adopt proper labeling, and that the company had the ability to change PAXIL’s labeling if there was a “reasonable association” between a serious adverse event and the drug, FDA retains exclusive regulatory authority over prescription drug labeling.  GSK also argued that the conflict between state and federal law that favors preemption is the risk that “drug manufacturers will be forced to walk a tightrope between being sanctioned by the FDA for ‘overwarning’ and sanctioned by the courts for ‘underwarning.’”  That is, there is a Catch-22 – a company could misbrand a drug by adding warnings against non-existent risks to avoid tort liability, or adhere to FDA labeling requirements and risk failure-to-warn tort liability.

In his latest ruling, Judge Hamilton was unconvinced by GSK’s arguments.  “In [earlier] finding conflict preemption, the court failed to appreciate the significance of the fact that the FDA regulations allow a manufacturer to modify pharmaceutical labels unilaterally and immediately, without prior FDA approval, when the manufacturer has reasonable evidence of a serious hazard.”  With respect to GSK’s argument that FDA retains exclusive authority over prescription drug labeling, the court stated that:

This argument fails to appreciate, as the court failed to appreciate, the fact that the ongoing ability, authority, and responsibility to strengthen a label still rest squarely with the drug manufacturer.  Although the FDA might later disapprove of a label strengthened pursuant to 21 C.F.R. § 314.70(c) and § 201.80, the FDA’s power to disapprove does not make the manufacturer’s voluntarily strengthened label a violation of federal law, which is what it would take to establish an actual conflict between state tort law and federal law. 

With respect to GSK’s Catch-22 argument, the court found this position flawed in one key respect:

[I]n spite of the FDA’s direction regarding Paxil’s label in May 2007, GSK still had (and has) the obligation to revise its label to strengthen a warning upon reasonable evidence of an association of a serious hazard, particularly with respect to this individual drug. If GSK were to receive such evidence, it would be obligated to revise its label in spite of the FDA’s directive in May 2007. In fact, when it issued its instruction that GSK revise Paxil’s label, the FDA advised GSK that if GSK disagreed with the FDA’s belief that Paxil-specific analysis should be included in the SSRI labeling revisions, GSK could request a meeting with the FDA. The FDA’s offer, upon which GSK did not act, is consistent with GSK’s ongoing obligations under the regulations. In other words, the FDA’s revisions were not necessarily the final word on Paxil’s label and did not put GSK into a position where it was impossible for GSK to comply with both state and federal law.

Judge Hamilton also took the opportunity to take issue with FDA’s “preemption preamble” in the Agency’s January 2006 final rule on prescription drug labeling.  There, FDA asserted that “FDA approval of labeling under the [FDC Act] . . . preempts conflicting or contrary State law,” that the Agency’s labeling requirements are not minimum standards but establish both a “floor and a ceiling,” that this preemption position was “long standing,” and that state failure-to-warn lawsuits have “directly threatened the agency’s ability to regulate manufacturer dissemination of risk information for prescription drugs.” 

Citing a recent essay authored by former FDA Commissioner Dr. David Kessler and Georgetown University Law Professor David Vladeck, Judge Hamilton states that “FDA’s current position on preemption is not ‘long standing’ but is in fact a ‘180-degree reversal’ from its earlier stance.”  Thus, “[t]he court, on reconsideration, gives relatively little weight to the FDA’s opinion on the preemptive effects of its regulations.” Moreover, Judge Hamilton opined that “failure to warn litigation can serve to reinforce the FDA’s regulations, which already place the obligation to strengthen the warnings on a drug’s label squarely on the shoulders of the drug’s manufacturer.”

By Kurt R. Karst 

As widely reported earlier this month, FDA and the Department of Justice (“DOJ”) intensified their investigation of Indian drug company Ranbaxy, Inc.  On July 3, 2008, the government moved to enforce administrative subpoenas directed at Ranbaxy and the company’s consultant, PAREXEL Consulting concerning information about drugs and drug products manufactured at Ranbaxy’s Paonta Sahib, India manufacturing facility.  The motion, filed in the U.S. District Court for the District of Maryland (Southern Division), alleges that Ranbaxy, among other things, falsified documents “that have resulted and continue to result in the introduction of adulterated and misbranded products into interstate commerce with the intent to defraud or mislead.”  Ranbaxy is in the midst of selling a majority stake in the company to Japan-based drug company Daiichi Sankyo for $4.6 billion.  Ranbaxy’s stock took a hit after news of the FDA/DOJ investigation surfaced.

Last week, Ranbaxy responded to the government’s motion and “unconfirmed allegations.”  In a clear attempt to bolster public confidence in the company, Ranbaxy made several commitments “to the Court, the FDA, the DOJ,” and to the company’s “employees, customers, and business partners.”  Among other things, Ranbaxy committed to cooperating with FDA and DOJ in their investigation and states that the company “is in the process of producing requested supporting documentation for its ANDA applications to DOJ.”  Ranbaxy also states that the company “is committed to develop and market high quality generic drug products.  Ranbaxy makes that commitment to its customers, business partners, and employees every day.” 

In addition, U.S. Representatives John Dingell (D-MI), Chairman of the Energy and Commerce Committee, and Bart Stupak (D-MI), Chairman of the Energy and Commerce Committee Subcommittee on Oversight and Investigations, announced late last week that the Energy and Commerce Committee “will soon commence a formal investigation into the Ranbaxy drug approvals and potential violations of GMP regulations.”  Representatives Dingell and Stupak question whether FDA “knowingly allowed drugs suspected of being fraudulently approved and manufactured in gross violation of Good Manufacturing Practices (GMP) to continue being sold by Ranbaxy, Inc., in the United States.” 

By Kurt R. Karst  

In previous postings (here and here), we have observed that § 912 of the 2007 FDA Amendments Act (“FDAAA”), which added the new § 301(ll) prohibition to the FDC Act, could represent a fundamental shift in the dividing line between foods and drugs, and has the potential to deter innovation in the research and development of new food ingredients.  That potential is slowly starting to be realized.  To understand why, a brief recap of the Generally Recognized as Safe (“GRAS”) concept is necessary. 

Research and development of new food ingredients and of new uses of existing ingredients is typically oriented toward attempting to establish that the proposed use of the ingredient is GRAS.  Under FDC Act § 201(s), the use of an ingredient is GRAS if it is generally recognized, among experts qualified by scientific training and experience to evaluate its safety, as having been adequately shown through scientific procedures to be safe under the conditions of its intended use.  A determination that the use of an ingredient is GRAS can be made independent of FDA, and does not require FDA approval.  However, because the marketplace generally demands it, ingredient developers seek FDA’s review of their GRAS determinations by submitting a GRAS notice to FDA.  If FDA has no questions about the notifier’s GRAS determination, FDA issues a letter saying so (a so-called “no questions” letter).  In its most recent “no questions” letter, issued to Mead Johnson & Co., FDA included the following paragraph on the new FDC Act § 301(ll) prohibition:

The Food and Drug Administration Amendments Act of 2007 that was signed into law on September 27, 2007, amends the FFDCA to, among other things, add section 301(ll). Section 301(ll) of the FFDCA prohibits the introduction or delivery for introduction into interstate commerce of any food that contains a drug approved under section 505 of the FFDCA, a biological product licensed under section 351 of the Public Health Service Act, or a drug or a biological product for which substantial clinical investigations have been instituted and their existence made public, unless one of the exemptions in section 301(ll)(1)-(4) applies. In its review of Mead Johnson’s notice that [its ingredient] is GRAS for use in infant formula powder, FDA did not consider whether section 301(ll) or any of its exemptions apply to foods containing [the ingredient]. Accordingly, this response should not be construed to be a statement that foods that contain [the ingredient], if introduced or delivered for introduction into interstate commerce, would not violate section 301(ll).

The inclusion of this paragraph is notable because “no questions” letters already contain a statement advising that it is the notifier’s continuing responsibility to ensure that food ingredients marketed by the notifier “are safe, and are otherwise in compliance with all applicable legal and regulatory requirements.”  Evidently, FDA feels it necessary to specifically put all parties on notice that a “no questions” letter offers no safe harbor from FDC Act § 301(ll).

Beyond the inclusion of a § 301(ll) disclaimer in its “no questions” letters, FDA has begun raising potential  issues as it becomes aware of them during its review of GRAS notices and in pre-submission meetings.  In effect, FDA has begun implementing FDAAA § 912.  During a symposium moderated by Diane McColl at the recent Institute of Food Technologists annual conference and trade show in New Orleans, an FDA representative recommended that § 912 be “part of the product development calculus.”  Sound familiar?

By Diane B. McColl & Ricardo Carvajal

Under the terms of a 1987 Memorandum of Understanding, the Alcohol and Tobacco Tax and Trade Bureau (“TTB”) exercises jurisdiction over labeling of distilled spirits, wines, and malt beverages subject to the Federal Alcohol Administration Act (“FAA Act”), and FDA exercises jurisdiction over other alcohol beverages.  Last week, TTB issued a ruling clarifying that certain beverages that meet the definition of a “beer” under the Internal Revenue Code are not “malt beverages” subject to regulation under the FAA Act if they are produced from substitutes for malted barley, such as rice or corn, and are made without hops.  The ruling makes clear that such beverages are subject to FDA’s ingredient and other labeling requirements.  However, the ruling leaves open the possibility that beverages with relatively small amounts of malted barley or hops might conform to the definition of a “malt beverage,” and thereby escape FDA’s labeling requirements.  As an example, the ruling cites a recent TTB determination that “a neutral malt beer containing malted barley at one percent of the total dry weight of all ingredients contributing fermentable extract to the product” is a “malt beverage.” The ruling does not affect sake and other beverages that fall within the definition of “wine” under the FAA Act.  Those beverages continue to be subject to the requirements of the FAA Act as long as they contain at least seven percent alcohol by volume.

By Ricardo Carvajal

An interesting issue is percolating at the U.S. Patent and Trademark Office (“PTO”) concerning Patent Term Extensions (“PTEs”).  We hinted at this issue in our recent post concerning the PTO’s decision to deny a PTE with respect to U.S. Patent #5,674,860 (“the ‘860 patent”), which covers AstraZeneca’s SYMBICORT (budesonide; formoterol fumarate dihydrate) Inhalation Aerosol.  In that case, the PTO determined that the ‘860 patent is ineligible for a PTE because the SYMBICORT New Drug Application (“NDA”) was not the first permitted commercial marketing or use of either of the active ingredients, and because the PTE application was submitted on the 61st day after the date of NDA approval.  In a similar action, the PTO has determined that U.S. Patent #5,817,338 (“the ‘338 patent”), which covers AstraZeneca’s PRILOSEC OTC (omeprazole magnesium) Delayed-Release Tablets, is not eligible for a PTE on the same two statutory bases.  In both cases, AstraZeneca has challenged the PTO’s determination that the PTE applications were untimely because they were submitted to the PTO 61 days after NDA approval (including the date of NDA approval).

Under the PTE statute at 35 U.S.C. § 156, the term of a patent claiming a drug shall be extended from the original expiration date of the patent if, among other things, the PTE application is submitted to the PTO by the owner of record within 60 days of NDA approval.  Specifically, § 156(d)(1) states that a PTE application “may only be submitted within the sixty-day period beginning on the date the product received permission under the provision of law under which the applicable regulatory review period occurred for commercial marketing or use” (emphasis added).  The 60-day filing period is a hard and fast rule.  (At least unless Congress passes the latest iteration of the “Dog Ate My Homework Act,” which would amend the PTE statute to permit a late filing if there is an inadvertent delay in PTE application submission.)  Indeed, in Unimed, Inc. v. Quigg, 888 F2d 826; 12 USPQ2d 1644 (Fed. Cir. 1989), the U.S. Court of Appeals for the Federal Circuit addressed PTE application submission timeliness and observed that “section 156(d)(1) admits of no other meaning than that the sixty-day period begins on the FDA approval date.” Notwithstanding the specific language in 35 U.S.C. § 156(d)(1) and the Federal Circuit’s commentary in the Unimed decision, AstraZeneca asserts with respect to the company’s PTE applications for the ‘860 and ‘338 patents that the PTO recently changed the Office’s method for determining the 60-day filing period, and that both PTE applications should considered timely filed according to the PTO’s original method used for calculating the 60-day period. 

In 2004, the PTO and FDA determined that the PTE application for the ‘338 patent covering PRILOSEC OTC was “timely within the meaning of 35 U.S.C. 5 156(d)(l).”  Despite this initial determination, an April 1, 2008 letter from the PTO to FDA reverses course and states that “it is the position of the [PTO] that the subject [PTE] was not timely filed based on a plain reading of the statutory language of 35 U.S.C. § 156(d)(1) and the [PTO’s] implementing regulations at 37 C.F.R. § 1.720(f).”  Clearly unhappy with this turn of events, AstraZeneca petitioned the PTO to have the April 1, 2008 letter withdrawn and to prevent the PTO from retroactively applying “an apparently new method of determining timeliness that has not yet even been announced to the public.”  (In January 2008, AstraZeneca filed similar documentation with respect to the ‘860 patent covering SYMBICORT.  The PTO denied a PTE for that patent in June 2008.) 

According to AstraZeneca, “[f]rom at least 1986 until relatively recently, the PTO had consistently applied to numerous other PTE applications the Original Method for determining timeliness,” under which the 60-day statutory filing deadline was calculated beginning on the date after product approval.  AstraZeneca cites several examples of PTEs allegedly granted since 1986 in which the PTE application for the subject patent was submitted to the PTO based on a 60-day period calculated using the date after product approval as day 1.  AstraZeneca also cites: (1) a 1987 PTO-FDA interagency memorandum of understanding stating that in response to a request for assistance in making a PTE determination FDA will provide a written reply to the PTO “informing the [PTO] whether the [PTE] application was submitted within 60 days after the product was approved” (emphasis added); and (2) FDA’s “Frequently Asked Questions on the Patent Term Restoration Program,” which states, in relevant part, that an “[a]pplication for patent extension must be filed within 60 days of FDA approval of the drug product . . . .” (emphasis added).  AstraZeneca asserts that these publications, “which have not been superseded or withdrawn,” show that “the PTO and FDA interpret the timeliness provision of 35 U.S.C. § 156(d)(1) to mean that a PTE application must be filed within 60 days after FDA approval . . . .” (emphasis in original).

Notwithstanding the alleged inconsistencies in the PTO’s 60-day calculation method, AstraZeneca’s petition does not explain how to square the fact that the PTE statute states that the 60-day period begins “on the date the product” was approved for commercial marketing with the fact that the PTE applications for the ‘860 and ‘338 patents were submitted on day 61 according to such a calculation.  Perhaps more concerning, however, is the possibility that the PTO might have incorrectly granted PTEs based on an application submitted on day 61 according to the statutory calculation.   

By Kurt R. Karst    

On June 10, 2008, the Pharmaceutical Research and Manufacturers of America (“PhRMA”) announced the release of a newly revised version of the “Code on Interactions with Healthcare Professionals,” which is a voluntary code focusing on the industry’s interactions with healthcare professionals as they relate to the marketing of products.  The revised Code will take effect in January 2009.  According to PhRMA, the revised Code “reaffirms that interactions between company representatives and healthcare professionals should be focused on informing the healthcare professionals about products, providing scientific and educational information, and supporting medical research and education.”

The revised Code, which is substantially more restrictive than the July 2002 version, includes several changes, including a prohibition on the distribution of non-educational items (e.g., pens adorned with a company or product logo), a complete prohibition on entertainment and recreational activities, and a prohibition on company sales representatives from providing restaurant meals to healthcare professionals.  Hyman, Phelps & McNamara, P.C. has prepared a memorandum summarizing the most significant changes to the revised Code.

In June, the U.S. Patent and Trademark Office (“PTO”) determined that AstraZeneca’s U.S. Patent No. 5,674,860 (“the ‘860 patent”), which covers the drug product SYMBICORT (budesonide; formoterol fumarate dihydrate) Inhalation Aerosol, is ineligible for a Patent Term Extension (“PTE”).  The PTO’s decision is important in that it clarifies the Office’s position that a PTE is not available for a drug product containing two previously approved active ingredients that purportedly act synergistically to create a new product.

Under the PTE statute at 35 U.S.C. § 156, the term of a patent claiming a drug shall be extended from the original expiration date of the patent if: (1) the term of the patent has not expired; (2) the patent has not been previously extended; (3) the PTE application is submitted to the PTO by the owner of record within 60 days of New Drug Application (“NDA”) approval; (4) the product, use, or method of manufacturing claimed has been subject to a “regulatory review period” before it is commercially marketed; and (5) the NDA is the first permitted commercial use of the drug product.  In this case, the PTO denied AstraZeneca’s PTE request because the SYMBICORT NDA was not the first permitted commercial use of budesonide or formoterol fumarate dihydrate, and also because the PTE application was not submitted within the 60-day statutory period.  (Spoiler Alert: While this post deals solely with the first basis for the PTO’s denial, the second basis – i.e., not meeting the 60-day period criterion – is another issue simmering at the PTO that we will post on in the near future.)

FDA approved SYMBICORT on July 21, 2006 for the long-term maintenance treatment of asthma in patients 12 years of age and older.  SYMBICORT contains two previously approved active ingredients.  On September 19, 2006, AstraZeneca submitted a PTE application to the PTO.  AstraZeneca takes the position in its application that the ‘860 patent is eligible for a PTE because “the combination of budesonide and formoterol fumarate dihydrate as a new active ingredient required full scientific review by the FDA.”  AstraZeneca apparently relies on the PTO’s Manual of Patent Examining Procedure (“MPEP”), which states, in relevant part, that “an approved product having two active ingredients, which are not shown to have a synergistic effect or have pharmacological interaction, will not be considered to have a single active ingredient made of the two active ingredients.”  This statement seems to raise the possibility that two previously approved active ingredients could synergistically interact to yield a new product eligible for a PTE. 

The PTO first addressed (to our knowledge) the issue of PTEs for combination drug products containing previously approved active ingredients in a 1994 decision concerning EMLA (lidocaine; prilocaine) Topical Cream.  In that case, the PTO determined that, consistent with the legislative history of 35 U.S.C. § 156, a patent claiming a combination of two previously and separately approved active ingredients is not eligible for a PTE, “notwithstanding any enhanced effect of the combination.”  More recently, in 2004, the U.S. Court of Appeals for the Federal Circuit stated in Arnold Partnership v. Dudas that “this court doubts that synergistic effects are an appropriate distinction for [PTE] policies, particularly where the statutory language does not distinguish between synergistic and nonsynergistic combinations.”  Notwithstanding these decisions, patent owners have continued to raise the possibility of a PTE for a patent covering a combination drug product containing two previously approved active ingredients, presumably because of the ambiguity of the MPEP passage quoted above.

In June 2007, the PTO issued a preliminary analysis in which the Office determined that SYMBICORT “is nothing more than a combination of previously approved active ingredients” and therefore fails to meet the statutory PTE criterion that the NDA approval represents the first permitted commercial use of the drug product.  “Whether the product is a synergistic or nonsynergistic combination of active ingredients is of no consequence to a determination of compliance with [this statutory criterion],” states the PTO in reliance on the dicta in Arnold Partnership.  In a December 2007 letter to the PTO, FDA agreed that the ‘860 patent is ineligible for a PTE because the SYMBICORT NDA “does not represent the first permitted commercial marketing or use of either of the active ingredients in this ‘product.’”  FDA also states that the SYMBICORT NDA “was approved on July 21, 2006, which makes the submission of the [PTE] application on September 19, 2006, NOT timely . . . .” (i.e., the PTE application was submitted on the 61st day after the date of NDA approval).

On June 13, 2008, the PTO issued a final decision that the ‘860 patent is ineligible for a PTE.  The decision goes to great lengths to clarify the MPEP statement on synergistic effect:

The synersistic effect of the active ingredients formoterol fumarate dehydrate and budesonide has no relevance in determining “first permitted commercial marketing or use of the product” . . . .  Applicant’s reliance on MPEP § 2751 is misplaced.  The statement in the MPEP does not require that the USPTO treat an alleged synergistic combination drug product with two active ingredients as a single active ingredient made up of the two active ingredients for [PTE] purposes.  Rather, MPEP § 2751 merely explains that a product having two active ingredients, without synergy, will not be treated as a single active ingredient.  This does not imply that a showing of synergy in a product having two active ingredients, each of which was previously approved for commercial marketing or use, must be considered to be a single active ingredient for [PTE] purposes.

It is unclear whether AstraZeneca will submit a request for reconsideration of the PTO’s June 2008 decision.  The company has until later this summer to do so. 

By Kurt R. Karst    

On June 26, 2008, ranking Republican of the U.S. House of Representatives Energy and Commerce Committee, Representative Joe Barton (R-TX), along with several co-sponsors, introduced the “Strengthening of FDA Integrity Act of 2008” (H.R. 6378).  According to an Energy and Commerce Committee Republicans press release, the bill:

• Gives FDA the authority to debar any company or individual who is convicted of crimes relating to any drug or device.

• Gives FDA the authority to debar companies for any misconduct relating to the drug or device, not just over misconduct that takes place during a drug or device’s development or approval.

• Provides great accountability by requiring the FDA to bring debarment actions within one year of the date of conviction.

• Requires the FDA to report to Congress on the number of debarment proceedings initiated and imposed each year.

H.R. 6378 follows a February 2008 report prepared for Rep. Barton by the Energy and Commerce Committee Minority Staff highlighting what is characterized as a “record of weaknesses in FDA’s ability and authority to carry out its duties and to protect its own integrity.”  According to Rep. Barton, H.R. 6378 “fixes the problem by giving FDA the authority it currently lacks.”

The Federal Food, Drug, and Cosmetic Act (“FDC Act”) was amended in 1992 by the Generic Drug Enforcement Act (“GDEA”).  Specifically, the GDEA, which was enacted in response to the discovery in 1989 of widespread corruption in the generic drug approval process, amended the FDC Act to authorize debarment and other penalties for illegal acts involving the approval of Abbreviated New Drug Applications.  According to the Energy and Commerce Committee Minority Staff report, however:

Since the passage of the [GDEA], FDA has not debarred a single corporation. After more than 15 years with the Act, FDA has debarred 71 individuals (five of the permanent debarments were later terminated and one was withdrawn), but almost half of these debarments (32) occurred in about the first 2 years of the Act and involved convicted felons who figured in the generic drug scandal of the late 1980s. . . .

FDA’s ad hoc approach to carrying out its debarment authority is partly to blame for its paltry enforcement record. At FDA, responsibility for handling debarments is not centralized; rather the manner in which it is handled is left to each FDA center. Although it was signed into law over 15 years ago, FDA has never issued regulations implementing the debarment provisions in the [GDEA].

The report notes that although “Congress granted debarment authority to FDA to serve a remedial purpose, ” the Agency’s ability to carry out this intent has been hampered in two ways:

First, FDA lacks adequate authority.  Under the statute, the agency cannot debar companies other than those that submit generic drug applications. The FDA also lacks authority to debar companies for post-approval criminal conduct. Second, FDA lacks focus in its debarment actions. A review of some cases involving debarred and non-debarred individuals convicted of FDA-related crimes demonstrates FDA’s uneven application of its debarment authority.

To address these issues, the report recommends that Congress consider, among other things, extending the GDEA’s debarment provisions to innovator drug and medical device companies, as well as whether a company’s misconduct post-approval should be a basis for debarment.  (Interestingly, during debate of GDEA legislation in 1990, the limitation to generic drugs was critized as too narrow by Rep. Henry Waxman and by Acting FDA Commissioner James Benson.)

H.R. 6378 incorporates many of the changes recommended in the report.  The bill was referred to the Energy and Commerce Committee for further consideration.  A companion bill has not yet been introduced in the U.S. Senate. 

By Kurt R. Karst 

ADDITIONAL READING: 

• John R. Fleder, The History, Provisions, and Implementation of the Generic Drug Enforcement Act of 1992, 49 Food & Drug LJ 89 (1994) – available here.

On June 27, 2008, the U.S. Drug Enforcement Administration (“DEA”) published a much anticipated Notice of Proposed Rulemaking Regarding Electronic Prescriptions for Controlled Substances.  The proposed regulations are in addition to existing prescribing requirements for controlled substances and are expected to work in tandem with standards developed by the U.S. Department of Health and Human Services on transmitting electronic prescriptions.

The proposed regulations are voluntary and provide practitioners with the option of issuing prescriptions for controlled substances electronically.  However, the practitioner must follow strict controls to deter the diversion of controlled substances.  Such controls include implementing a physically secure information management system and monthly review by the practitioner of a system-generated controlled substance prescription log.  There is a corresponding duty to notify DEA of anything found to be “unusual” within a certain time period.  There are also strict guidelines imposed upon a practitioner on transmitting electronic prescriptions, such as authenticating the system just before signing and not printing or faxing an electronically transmitted prescription.  The burden in on the practitioner to ensure compliance with the proposed regulations and to prevent the diversion of controlled substances.  Among other things, practitioners will be held liable for knowingly permitting another individual to issue electronic prescriptions in the practitioner’s name and for failing to maintain adequate security measures in the handling of electronically transmitted prescriptions.

The proposed regulations also permit pharmacies to receive, dispense, and archive electronic prescriptions.  Again, this is voluntary.  Upon receipt of an electronic prescription, a pharmacy must check the validity of the prescriber’s DEA registration.  “A pharmacy that fails to check the validity of a controlled substance prescription before dispensing is legally responsible if the prescription is invalid.”  The proposal also places strict controls on the participating pharmacy to guard against diversion, such as an enhanced pharmacy information management system, internal audits and back-up systems.  For example, the pharmacy must establish and implement a list of auditable events, and the pharmacy’s system must analyze the audit logs at least once every 24 hours and generate an incident report that identifies each auditable event.  The pharmacy must then decide whether any auditable event poses a security incident that would have to be reported to DEA.

The DEA’s proposal has been long awaited to complement existing initiatives  to promote electronic prescribing, such as those under Medicare and the Health Insurance Portability and Accountability Act.  However, the cumbersome and strict framework proposed by DEA could be an obstacle to widespread adoption of electronic prescribing.  The ability to integrate these requirements into existing technology could be important to how extensively electronic prescribing is used, particularly by doctors.  The fear of DEA enforcement actions for failure to comply with these requirements will also play a role in whether a practitioner decides to adopt these procedures.  DEA should consider these issues in refining the proposed rule before issuing final regulations.  Comments on the proposed regulations must be submitted by September 25, 2008.

By John A. Gilbert & Serafina E. Lobsenz

On June 11, 2008, the Accreditation Council for Continuing Medical Education (“ACCME”) issued for comment a proposal “that the commercial support of continuing medical education end.”  The proposal is intended to provoke debate on whether unbiased CME is possible when funded by individual pharmaceutical or device companies.  The ACCME notice cautioned that comments on the proposal should discuss alternatives, “as nothing would be worse than the deconstruction of a system without the identification of alternatives.” 

As an alternative to a complete ban on commercial funding, the ACCME outlined a restrictive new paradigm under which commercial support would be permissible if all of the following conditions were met:

• Needs assessments are performed by organizations that do not receive commercial support and are free from financial relationships with industry (e.g. government agencies);
• The CME addresses a practice gap of a particular group of learners that is corroborated by bona fide performance measurements (e.g. National Quality Forum) of the learners’ own practice;
• CME content comes from a continuing education curriculum specified by a bona fide organization (e.g. American Medical Association, Agency for Healthcare Research and Quality, American Board of Medical Specialties); and
• The CME is verified as free of commercial bias.

The ACCME is requesting that members of the profession, public and CME community submit comments on the new proposal by August 11, 2008. 

This proposal responds to increasing scrutiny of commercially supported CME on the part of Congress and the medical community.  In April 2007, Senate Finance Committee Chair Max Baucus and ranking member Charles Grassley publically criticized the ACCME for not doing enough to prevent industry influence over commercially supported CME.  The American Medical Association ("AMA") recently considered a report by its Council on Ethical and Judicial Affairs ("CEJA") recommending that individual physicians, medical institutions, and professional organizations cease accepting industry funding to support professional education activities, with the exception of technical training when new diagnostic or therapeutic devices and techniques are introduced.  After hearing testimony largely opposing the CEJA recommendation at AMA’s annual House of Delegates Meeting on June 15, the AMA’s Reference Committee declined to adopt CEJA’s recommendation, concluding that broader discussion was needed before adopting an ethics policy on commercial support of CME. 

Concern over the appearance of bias in commercially supported CME led one drug company, Pfizer Inc., to announce today that it will discontinue all direct funding for CME provided by medical education and communication companies.  Pfizer will continue to fund CME provided by medical institutions, medical societies and associations.

By Noelle C. Sitthikul & Alan M. Kirschenbaum

On June 27, 2008, the District of Columbia Department of Health proposed regulations to implement Title 1 of the SafeRx Amendment Act of 2008 (“SafeRx Act”), which FDA Law Blog previously reported on in January 2008.  Under the proposed regulations, pharmaceutical detailers in the District would need to be licensed by the Board of Pharmacy by April 1, 2009.  The Board would begin accepting applications for licensure on October 1, 2008.

The proposed regulations outline:

• A pharmaceutical detailer code of ethics, including mandatory compliance with the PhRMA Code on Interactions with Healthcare Professionals to the extent that the PhRMA Code does not conflict with the SafeRx Act or its implementing regulations;
• The license application process and fees;
• Education requirements for licensure and the educational requirement waiver process;
• Continuing education requirements and approval of continuing education programs;
• The authority of the Board of Pharmacy to collect information from licensed detailers; and
• Detailer record retention requirements.

Comments on the Proposed Rule are due by July 27, 2008.

An article that appeared in the June 2008 issue of RAPS Focus describes the relevant provisions of the SafeRx Act.

By Bryon F. Powell

Are state law personal injury suits against drug and device manufacturers preempted by federal regulation of these products?

This question has been the subject of much litigation since the early 1990s.  The U.S. Supreme Court has issued a string of decisions in this area, with one case pending.  But the preemption waters are likely to remain roiled for some time to come.  A new twist involves combination device-drug or device-biologic products.

For the complete post, including an overview of preemption law as applied to drugs and medical devices, click here.

By Jeffrey K. Shapiro

On June 5, 2008, a citizen petition was submitted to FDA requesting that the Agency “initiate rulemaking proceedings addressing the authoritative statement nutrient content claim provisions” of the Federal Food, Drug, and Cosmetic Act (“FDC Act”).  The petition takes issue with FDA’s November 27, 2007 proposal to prohibit nutrient content claims for Eicosapentaenoic acid (“EPA”) and Docosahexaenoic acid (“DHA”).

A nutrient content claim characterizes the level of a nutrient in a food, e.g., “high,” “more,” or “good source.”  Until the FDA Modernization Act of 1997 (“FDAMA”), foods could carry only nutrient content claims that were authorized by FDA.  Moreover, only nutrients of the type required to be in nutrition labeling were eligible for nutrient content claims.  FDAMA amended the FDC Act to authorize nutrient content claims based on an “authoritative statement” published by “a scientific body of the United States with responsibility for public health protection or research directly relating to human nutrition,” or by the National Academy of Sciences (“NAS”) which “identifies the nutrient level to which the claim refers.”  Notice of the claim must be submitted at least 120 days before its use.  The notified nutrient content claim may be made until FDA issues a regulation prohibiting the claim. 

Between 2004 and 2006, FDA received three nutrient content claim notifications for the omega-3-fatty acids Alpha-linolenic acid, EPA, and DHA.  All three notifications stated that the claims were based on authoritative statements in a prepublication copy of a report by the NAS Institute of Medicine (“IOM”).   In November 2007, FDA proposed to prohibit the notified nutrient content claims for EPA and DHA.  The Agency concluded that the IOM publication did not identify a “nutrient level” for EPA and DHA within the meaning of the FDCA, and thus the statements cited as authoritative in the notifications did not meet the statutory requirements.

The newly filed petition challenges FDA’s view that a notified nutrient content claim must be based on an established reference value such as a Dietary Reference Intake or Daily Value.  According to Petitioners, Congress “intended the phrase ‘nutrient level’ to apply in situations when a Daily Value had not been established and to be broad enough to include any appropriate references to nutrient levels.” 

The petition also argues that FDA’s narrow interpretation of “nutrient level” conflicts with the First Amendment, and that before prohibiting a notified nutrient content claim, FDA must consider the use of disclaimers “to appropriately qualify authoritative statement nutrient content claims.” 

Considering its limited resources and the fact that notified nutrient content claims have not been a high priority for FDA, a prompt response to this petition does not appear likely.  However, FDA faces a number of the same issues in comments submitted in response to its proposed prohibition of EPA and DHA nutrient content claims.

By Riëtte van Laack & Ricardo Carvajal

On June 23, 2008, Representative William Delahunt (D-MA) introduced, and the U.S. House of Representatives quickly passed by voice vote, H.R. 6344 – the Responsive Government Act of 2008.  The 12-page bill includes several provisions, including the latest iteration of the so-called “Dog Ate My Homework Act,” which is legislation that would permit the U.S. Patent and Trademark Office (“PTO”) to exercise discretion to accept untimely filed Patent Term Extension (“PTE”) applications.  As we previously reported, a similar provision was added to the Patent Reform Act of 2007 (S.1145) by Senator Edward Kennedy (D-MA) in July 2007; however, efforts to get that bill passed have stalled.

The impetus for the “Dog Ate My Homework Act” is the PTO’s decision to deny an application submitted by Massachusetts-based The Medicines Company for a PTE for U.S. Patent #5,196,404 (“the ‘404 patent”) covering ANGIOMAX (bivalirudin), an anticoagulant drug product FDA first approved on December 15, 2000 for use in conjunction with aspirin in patients with unstable angina undergoing percutaneous transluminal coronary angioplasty.  The Medicines Company submitted a PTE application to the PTO 62 days after FDA approved the company’s ANGIOMAX New Drug Application (“NDA”).  The patent term extension law at 35 U.S.C. § 156(d)(1), requires the submission of a PTE application “within the sixty-day period beginning on the date the product received permission under the provision of law under which the applicable regulatory review period occurred for commercial marketing or use” (i.e., within 60-days of the date of NDA approval). 

Section 4 of the Responsive Government Act of 2008 would amend 35 U.S.C. § 156 to add new subsection (i), which states that the PTO Director “may accept an application under this section that is filed not later than three business days after the expiration of the 60-day period provided in subsection (d)(1) if the applicant files a petition, not later than five business days after the expiration of that 60-day period, showing, to the satisfaction of the Director, that the delay in filing the application was unintentional.”  (The 5-day petition period for a PTE application pending before the PTO would begin on the date of enactment of the Responsive Government Act.)  However, there is a cost for unintentional delay.  “In order to effect a [PTE] under section 156(i) of title 35, United States Code, the patent holder shall pay a fee to the United States Treasury . . . .” 

The fee for The Medicines Company is $65,000,000.  For other patent owners, the fee is determined based on a complex calculation.  Specifically, the bill states that a patent holder shall pay a fee equal to “(i) $65,000,000 with respect to any original application for a [PTE], filed with the [PTO] before the date of the enactment of this Act, for a drug intended for use in humans that is in the anticoagulant class of drugs” (i.e., ANGIOMAX), or “(ii) the amount estimated under subparagraph (B) with respect to any other original application for a [PTE].”  Under proposed subparagraph (B), the PTO and the Under Secretary of Commerce for Intellectual Property must consider a host of factors to calculate a late-filing fee, including “any net increase in direct spending arising from the extension of the patent term,” “any net decrease in revenues arising from such [PTE],” and “any indirect reduction in revenues associated with payment of the fee under this subsection.”  If enacted, proposed § 156(i) would apply to any application – (A) that is made on or after the date of the enactment of this Act; or (B) that, on such date of enactment, is pending before the Director or as to which a decision of the Director is eligible for judicial review.”

According to the sponsor and co-sponsors of H.R. 6344 (and as evidenced by its quick passage in the House by voice vote), the PTE provisions in the bill have bi-partisan support and are intended to correct “an anomaly in the patent law.”  In discussing the PTE provisions in H.R. 6344, co-sponsor Rep. Donna Christensen (D-VI) stated that the provisions “will make a minor but important amendment to the landmark Hatch-Waxman Act patent act of 1984.  The act of 1984 has done much to make medicine available and more affordable for countless people in this country.  Inadvertently though, in patent term restoration, there is an inflexible deadline provision which has the potential to limit the good that the act can do.”  A copy of the House floor discussion of H.R. 6344 is available here.

After passage in the House, H.R. 6344 was referred to the Senate Judiciary Committee for consideration. 

By Kurt R. Karst    

On June 2, 2008, First DataBank, a private publisher of prescription drug prices in the United States, announced a new proposed settlement in a class action suit alleging that the company conspired with a wholesaler to inflate the Average Wholesale Price (“AWP”) for certain prescription drugs. Among other prices, First Data Bank publishes Blue Book AWPs, which are widely used by Medicaid and private health insurers as a benchmark for reimbursement of prescription drugs. Under the terms of the new agreement, First DataBank will be required to adjust its reporting of Blue Book AWP for approximately 1400 National Drug Codes (“NDCs”) to 1.20 times the Wholesale Acquisition Cost (“WAC”) or Direct Price for those NDCs that are on a mark-up basis, and establish a centralized data repository to facilitate reasonable access to First DataBank material describing its drug price reporting practices. In addition, First DataBank agrees to pay $1 million and certain settlement-related expenses and fees.

On January 23, 2008, the Court issued an order denying approval of a previous proposed settlement, which would have required that First Databank cease publishing AWP data within two years after the Court’s approval of the settlement, as long as no competitor continues publishing similar AWP data. Because AWP is widely used by third-party payers as a drug reimbursement benchmark, the court was concerned that the original settlement had the potential to affect many providers that were not parties in the lawsuit.

Although the requirement that First DataBank cease publishing AWP was dropped in the new proposed settlement, First DataBank has announced, independent of the litigation, that it will discontinue publishing the Blue Book AWP data field for all drugs no later than two years after the changes noted above are implemented. First Databank also announced that it will apply the same 1.20 mark-up factor to all other NDCs whose Blue Book AWP is set based upon a markup to WAC or Direct Price in excess of 1.20. First DataBank will continue to publish other drug pricing information including WAC, Direct Price, Suggested Wholesale Price, Federal Upper Limits, as well as other clinical drug information.

The changes to the Blue Book AWP will become effective on or about 90 days after final court approval of the proposed settlement agreement. The proposed settlement agreement will require preliminary approval by the court, notification to the class members, and final approval by the court. Although the settlement does not require the termination of AWP, First DataBank’s decision to do so could result in significant changes in current reimbursement methodologies.

By Noelle C. Sitthikul