Effective May 11, 2022, the Drug Enforcement Administration (“DEA”) will require all applications and renewals for registration to be submitted electronically.  DEA issued a final rule on April 11, 2022, eliminating the “mail-in” option, believing that initial and renewal applications submitted online will be more effective for the agency and registrants.  Requiring Online Submission of Applications for and Renewals of DEA Registration, 87 Fed. Reg. 21,019, 21,020 (Apr. 11, 2022).  Applicants will be required to submit all applications through DEA’s secure online portal.  The agency has determined that “[r]egulatory changes are needed to modernize DEA’s approach to registration and renewal applications” and requiring online submission will eliminate “inefficient paper applications” whose typographical errors and incomplete information have “routinely resulted in delayed or rejected applications.”  Id.

DEA had proposed this change in its January 7, 2021, notice of proposed rulemaking. Amending Regulations To Require Online Submission of Applications for and Renewals of DEA Registration, 86 Fed. Reg. 1,030 (Jan. 7, 2021).  DEA noted that the National Association of Chain Drug Stores (“NACDS”) and three other individuals commented on the proposed rule.  NACDS observed that DEA did not propose to modify nor address “batch” renewals for multiple locations holding multiple registrations, and expressed its desire for the agency to continue allowing registrants to submit batch renewals.  Id. at 21,020- 21,021.  DEA confirmed that the batch renewal process would not be affected, opining that batch renewals streamline the process for both registrants and the agency, and that the online portal would continue to accept batch applications and single payments.  Id. at 21,020- 21,021.

NACDS also commented that the proposed rule was unclear on whether DEA’s rejection of a single, deficient application within a batch would cause rejection of the entire batch.  DEA countered that the existing process already ensures that only completed applications are processed while incomplete applications are rejected, thereby precluding the possibility of rejecting an entire batch due to a defective application.  Id. at 21,021.

Lastly, DEA addressed NACDS’ final observation that the proposed rule listed credit cards as the only payment option, noting that some batch renewal payments exceed $1,000,000, and payment by credit card would run afoul of corporate policies requiring large transaction payment via certified bank check.  Id.  In response, DEA amended the proposed rule to allow online payment by Automated Clearing House (“ACH”) fund transfer, credit card or other means that may be available at submission using the secure application portal.  DEA will not accept bank checks for the foreseeable future.  Id.

It is worth noting that in June 2020, DEA had stopped mailing renewal notifications to registrants and instead stated that it would send out electronic reminders to renew at 60, 45, 30, 15, and 5 days prior to the expiration date of the registration to the associated email address.  Renewal Applications are available here.  DEA’s policy has been to allow a registrant to continue operations if a renewal has been submitted in a timely manner.  However, registrants will now need to be very careful to meet the online deadline and will no longer be able to argue that “it’s in the mail.”

There is no doubt that this change will significantly reduce the administrative burden on DEA in processing the applications and renewals.  We would hope that this will also mean that registrants will receive their renewal or new registration certificates on a more-timely basis.  Delays in issuing these certificates have caused issues for registrants when asked to verify their renewals to suppliers or customers.

On April 13, 2022, FDA released its long-anticipated final Guidance for Industry # 256 – Compounding Animal Drugs from Bulk Drug Substances (GFI).  As readers of this blog likely remember, the animal drug compounding GFI has had a relatively long and tortured history, blogged about here, and here and here.

In its communication released with the GFI, FDA stated that it received many comments on its previous 2019 draft guidance.  A review of the docket reveals that FDA received in fact well over 2,000 comments on its last attempt.  FDA noted that it made “significant changes” to the final GFI to provide “recommendations for veterinarians seeking to access  animal drugs compounded from bulk drug substances for those animals that need them.”  (FDA Press Release at 4).  But, FDA recommends that compounds from bulk substances only be used after the prescribing veterinarian considers whether the FDA-approved treatment options can be used. FDA is clear in its communications accompanying the GFI’s release that compounding  from bulk substances for animals is not permissible federally unless compounding pursuant to the limited conditions set forth in the Guidance.  Thus, for FDA to deem compounding appropriate, there must be a circumstance where no FDA-approved or indexed drug (including the extralabel use of an FDA-approved animal or human drug) can be used to treat the animal’s particular medical condition.

FDA’s GFI addresses in particular:

• The types of drugs compounded from bulk substances that present the greatest risk, in FDA’s determination, and thus are prioritized for enforcement action
• The circumstances under which FDA does not intend to take enforcement action (i.e., it will exercise enforcement discretion), for violation of the FDCA’s approval, adequate directions for use and cGMP requirements – separately considering non-food producing; office stock for non-food producing; and food producing animals.

FDA also strongly urges reporting of adverse events by veterinarians, pharmacists and owners on FDA’s Form 1932a.  Later in the GFI, FDA makes such reporting within 15 days a requirement of  compounding (from non-food producing animals) as a condition of FDA’s enforcement discretion.

The Guidance contains a fair amount of detail about what FDA will consider concerning documentation of reasons necessitating compounding in lieu of an FDA- approved product. To compound for individually identified non-food producing animals, pages 10-15 of the GFI list the necessary conditions, and accompanying documentation (and note that documentation of reasons seems critically important for FDA’s exercise of enforcement discretion).  Concerning controversial animal drug office use compounding (pages 15-16, and Appendix at 19-22), FDA retains (from the earlier draft) its nomination and “list” concept (adopted from FDA’s “bulks list” approach for human drugs).  The Appendix sets forth what nominators must include in their nominations.  Importantly,

• There is no marketed FDA-approved, conditionally approved, or indexed animal drug(s) that can be used to treat the condition, and demonstrates;
• There is no marketed FDA approved, conditionally approved, or indexed animal or human drug(s) with the same active ingredient(s) that could be used in an extralabel manner to treat the condition; and
• FDA has not identified a significant safety concerning specific to use of the drug substance in animals;

AND in addition,

• Urgent treatment with the compounded drug is necessary to avoid animal suffering or death, or to protect public safety.

The Appendix provides docket information and a description of the information that should be submitted with the bulk substance nomination.  We have seen these “bulks lists” before.  Importantly, unlike this animal compounding GFI, FDA’s “bulks list” for human drugs is dictated by the statutory command for FDA to create the lists, set forth in Section 503A (individually identified patients) and Section 503B (outsourcing facility/office use).  This blogger wonders where FDA’s authority derives to regulate through a guidance document animal drug compounding in the first instance.  This has been debated for decades and blogged about over a decade ago, right here, and here, where the Agency lost that argument at the federal district court in Florida.  Given the FDA’s recent and widely publicized troubles in its implementation of the human drug compounding MOU, blogged about here,  it is surprising FDA would again take the GFI “leap” when it may lack statutory authority to do so.

On March 22, FDA announced that it reached agreement with representatives from the medical device industry on proposed recommendations to Congress for the fifth reauthorization of the Medical Device User Fee Amendments (MDUFA V).  MDUFA authorizes FDA to collect fees from certain medical device applicants to fund FDA’s process for review of device applications.  MDUFA V would be applicable to fiscal years 2023 through 2027.

FDA published in the Federal Register a draft version of its MDUFA V commitment letter, which outlines FDA’s updated performance goals in reviewing device applications and planned process improvements.  The most important takeaways from the draft commitment letter are as follows:

Pre-Submissions:  The process and timing for requesting a pre-submission meeting, scheduling the meeting, and receiving feedback from FDA is remaining the same.  However, FDA is significantly increasing (more than double) the number of pre-submission sponsors that will receive feedback within the review goal of 70 calendar days from receipt date or 5 calendar days before the date of the scheduled meeting, whichever is sooner.  Many companies have experienced delays in receiving pre-submission feedback due to FDA’s resource constraints during COVID-19, so this increased goal will be welcome news to companies with devices in development.  As those who have had pre-submission meetings with CDRH understand, preparing for the pre-submission meeting cannot, practically, begin until the written feedback is received.  Having greater certainty as to when written feedback will arrive will allow sponsors consistent time to prepare for the meeting, thereby making the best use of its and FDA’s time.

De Novo Requests:  In the MDUFA IV commitment letter, FDA’s performance goal for review of de novo requests started with review of 50% of requests received in FY 2018 within 150 days of receipt, and increased 10% per fiscal year, ending with 70% within 150 days in FY 2022.  The draft MDUFA V commitment letter starts with a 70% goal in FY 2023, but if the de novo decision goal is met in FY 2023 and the fee revenue amount provided for FY 2026 and 2027 is adequate to support performance improvements, FDA plans to increase the goal to 80% in FY 2026.  Similarly, if the 70% goal is met in FY 2024 and adequate fee revenue is provided, the goal will be adjusted to 90% in FY 2027.

Premarket Approval (PMA) Applications, 510(k) Premarket Notifications, CLIA Waivers by Application, and Biologics License Applications (BLAs):  FDA has not recommended any changes to the timeframe and performance goals for original or supplement PMAs, 510(k) premarket notifications, CLIA waivers by application, or BLAs.

Deficiency Letters:  By January 1, 2023, FDA plans to update the 2017 guidance document on “Developing and Responding to Deficiencies in Accordance with Least Burdensome Provisions” to clarify what constitutes a statement of the basis for the deficiency.  FDA has set performance goals related to providing a statement of the basis for a deficiency in at least 75% of deficiencies in FY 2023, and that goal will increase each fiscal year.

Enhanced Use of Consensus Standards:  Pursuant to MDUFA IV, FDA established a voluntary pilot program called the Accreditation Scheme for Conformity Assessment (ASCA), which grants ASCA accreditation to qualified accreditation bodies to accredit testing laboratories that perform premarket testing for medical device companies.  During the pilot, over 85 testing laboratories have become ASCA accredited (see list here).  The draft MDUFA V commitment letter states that FDA plans to transition the pilot program to a “sustainable and expanded program” by the end of FY 2023, incorporating lessons learned from the pilot program.  While many laboratories have received ASCA accreditation during the pilot, in our experience, FDA does not inquire about the ASCA status of testing laboratories during premarket reviews.  It is possible that with transition to a more established program, FDA will become more interested in whether testing laboratories have ASCA accreditation when reviewing a device premarket application.

Patient Engagement:  The draft commitment letter notes the following plans to increase patient engagement in device premarket reviews: issue a draft guidance to provide best practices on incorporating  clinical outcome assessments (i.e., an assessment that reflects how a person feels, functions, or survives) into premarket studies; support use of innovative technologies to reduce barriers to patient participation in studies; and hold a public meeting by the end of FY 2024 to explore ways to use patient-generated health data to advance remote clinical trial data collection and support clinical outcome assessments.  The feedback received during the planned public meeting on remote data collection could potentially impact FDA’s draft guidance document on “Digital Health Technologies for Remote Data Acquisition in Clinical Investigations.”

Real-World Evidence:  FDA plans to update the 2017 guidance document on “Use of Real-World Evidence to Support Regulatory Decision-Making for Medical Devices” to provide clarity on acceptable real-world evidence methodologies and best practices.  We are, certainly, supportive of this effort.  It is relatively rare for FDA to be accepting of real-world evidence to support safety and effectiveness.  It would be beneficial for industry to have a better understanding of how real-world evidence can be used in device premarket submissions.

Digital Health:  The draft commitment letter states that FDA will finalize the draft guidance document on “Content of Premarket Submissions for Device Software Functions” by 18 months from the close of the comment period.  FDA will also publish a draft guidance document describing a process to evaluate a predetermined change control plan for digital health devices.

International Harmonization:  FDA plans to “support regulatory convergence” by developing a mechanism for FDA to communicate confidentially with regulatory partners to align international regulatory strategy (e.g., regarding scientific, clinical, or technical information).  By the end of FY 2023, FDA plans to issue for public comment a draft strategic plan with details and timelines on achieving international harmonization objectives.  Starting in FY 2024, FDA will publish an annual assessment of international harmonization activities described in the strategic plan.  Notably, this section of the draft commitment letter did not make any mention of FDA’s proposed rule to harmonize the Quality System Regulation (21 C.F.R. Part 820) with ISO 13485 (see our blog post here), which is one of CDRH’s most significant steps to-date to harmonize its requirements with international regulatory requirements.

Total Product Life Cycle (TPLC) Advisory Program (TAP):  FDA will establish the TAP pilot during the course of MDUFA V.  The goal of this program is to provide for more timely premarket interactions, enhance the experience of all participants in device development and review processes, facilitate improved strategic decision-making by identifying and mitigating product development risks earlier, facilitate regular engagement with FDA review teams, and collaborate to better align expectations regarding generation of evidence and submission quality.  Each fiscal year, FDA will enroll increasing numbers of products in the TAP pilot, starting with 15 in FY 2023, and ending with at least 325 through FY 2027.

A virtual public meeting will be held on April 19th to allow the public to comment on the proposed recommendations in the draft MDUFA V commitment letter (see meeting information and instructions for submitting comments to the docket here).  FDA plans to deliver the final recommendations to Congress by the end of the month.

The American Conference Institute (“ACI”) is hosting its 17th Annual Paragraph IV Disputes Conference in New York (and livestream) from April 26-27, 2022 (Eastern Daylight Time).  Over the course of two days, this event will provide impactful and practical programming all geared towards assessing the implications and imprimaturs of court cases, legislation, and industry behaviors which affect the patent endgame and the pursuit of related profits.

2022 agenda highlights include:

• The Viability of Written Description as a Compelling Invalidity Defense
• Clarity On What Satisfies Section 1400(b)’s Venue Requirements in the Hatch-Waxman Context
• Whether a Skinny Label Alone Is Enough to Preclude Induced Infringement Allegations
• The Latest FDA Initiatives Impacting Pharmaceutical Patents -Restrictions on Reverse-Payment Settlements

Hyman, Phelps & McNamara, P.C.’s Kurt R. Karst will be speaking at a session titled “Brand and Generic Perspectives on the Latest FDA Initiatives Impacting Pharmaceutical Patents.”

FDA Law Blog is a conference media partner. As such, we can offer our readers a special 10% discount. The discount code is: D10-896-896EX04. You can access the conference brochure and sign up for the event here. We look forward to “seeing you at the conference.”

On March 28, 2022, FDA transmitted its justification to Congress for its Fiscal Year 2023 budget.  This document contains a number of legislative proposals, including three proposed amendments to the accelerated approval statutory provisions in section 506(c) of the Federal Food, Drug, and Cosmetic Act.  The proposal to “revise 506(c)(3) so that FDA can follow its dispute resolution [(FDR)] procedures for drug applications when withdrawing a drug product’s accelerated approval” caught our attention in light of our extensive experience with the FDR process.

Consistent with due process considerations, the administrative hearing process that is currently used for the withdrawal of a drug approved via accelerated approval requires the Agency to provide the administrative record to the applicant.  In contrast, FDA’s custom in an FDR is not to disclose the administrative record or even a review division’s underlying reviews to the applicant.  As previously noted, this lack of transparency significantly hampers an applicant’s ability to present a winning case.  Certainly FDA’s application of this unwarranted lack of transparency shouldn’t be extended to now also affect the withdrawal procedures for an accelerated approval.

We would instead hope to see the Agency begin to provide the administrative record and/or the medical/statistical reviews (depending on the context) for all FDRs, such as those appealing complete response actions (CRs).  The importance to sponsors and applicants of obtaining the division’s reviews of their applications is underscored by the recent lawsuit filed by Vanda Pharmaceuticals, Inc. (Vanda) to obtain the medical and scientific reviews underlying a CR letter it received for a supplement to an approved NDA.  See Vanda Pharmaceuticals, Inc. v. Food and Drug Administration, No. 1:22-cv-0938 (D.D.C. Apr. 6, 2022).  As Vanda noted in its complaint, without those underlying reviews, it cannot know the detailed basis for FDA’s decision not to approve its supplement and whether FDA’s decision was the result of a factual error or whether or how Vanda should adapt its development program.

A key to efficient drug development is transparency.  When FDA decides to take an action – be it to withdraw a drug approved via accelerated approval or to issue a CR letter – disclosure to the affected party of the detailed reasons for the decision is crucial.  If Congress were to give FDA the authority to follow its FDR procedures for the withdrawal of an accelerated approval, it is imperative that the FDR procedures specifically require that FDA provide the administrative record to the applicant.  Otherwise, the applicant will be deprived of the process it is due, the FDA deciding official will not have the benefit of a fulsome debate, and patients with serious conditions may unnecessarily lose access to a safe and effective drug when no other therapy is available.

One of the more complex areas of device regulation is the management of risks associated with malfunctions reported from the field.  A critical task in this situation is for a firm to estimate the risk posed by the issue as accurately as possible.  This estimation of risk is important because it drives both decision making and regulatory compliance.

A December 2021 warning letter to Medtronic, Inc. (Medtronic Warning Letter) provides an important reminder from FDA as to the correct estimation of risk associated with malfunctions.  The warning letter is long and covers many issues associated with the management of risks associated with malfunctions and complying with the complex web of regulations potentially applicable when malfunctions occur.

Our focus, however, is on FDA’s criticism of Medtronic’s calculation of risk.  As background, Medtronic manufactures the MiniMed 600 series insulin infusion pumps.   During an inspection, FDA learned that Medtronic had opened a CAPA to address complaints of damaged retainer rings in these pumps (more than 74,000 between June 2016 and November 2019, with more than 57,000 reported to FDA as MDRs).  An internal investigation apparently had determined the device failures were caused by a malfunction involving the retainer ring.  According to FDA, a “damaged retainer ring may result in the over or under-delivery of insulin, which may lead to hypoglycemia or hyperglycemia.”

In Medtronic’s quality system, as FDA notes:  “Your CAPA System procedure (SOP114-01DOC, Effective Date 5/19/2015, Version L) requires your firm to determine whether distributed product is potentially affected by a nonconformance and to conduct additional risk assessment activities per the Product Risk Management Process (SOP104- 08, Version W).”  FDA acknowledged that Medtronic followed the procedures but disagreed with the assessment of risk.

Specifically, FDA criticized the risk calculation formula because it used the total shipment of affected product, which “underestimates the probability of occurrence because the number of products shipped includes devices not in use by patients (e.g., devices shipped to distributors that have not yet been distributed to customers).”

Is FDA’s criticism valid?  After all, it is fairly common for firms to use shipment (or sales) as a denominator in a risk estimate.  It would seem, though, that FDA is right that total shipments of affected product could potentially overstate the number in actual use by patients, thereby underestimating the risk.  Of course, it would not always be true that there is a significant gap between the number of medical devices shipped and the number in actual use.  Some products may move with high velocity to patient use.  Nonetheless, firms would be wise to at least consider the issue when calculating risk.

One last nuance:  As FDA noted toward the end of the warning letter, there was such a large gap between the number shipped versus the number in use (according to Medtronic’s own calculation) that the number held by distributors might not account for the entire gap.  Whether true or not in that case, the lesson here is that an estimate of the delay in reaching the patient should consider all possibly contributing factors and not simply time in possession of distributors.  For instance, some products could remain in boxes in hospital inventory for an extended period.

In a nutshell, when estimating risk of harm from a malfunction, be sure to consider whether the total shipments of affected product is an adequate proxy for the total number in use!  Firms should update their procedures to include this consideration.

With great sadness, we announce that our firm’s co-founder, leader, colleague and friend, Jim Phelps passed away on April 2, 2022, at the age of 83. Jim is survived by Sophia, his wife of 57 years, his three sons and their wives, Evan and Nicola, Morgan and Mijiko, Michael and Kimberley, and 9 grandchildren.

Jim established the firm with Paul Hyman and Bob Dormer on March 17, 1980. He maintained an active practice until our 30th Anniversary on March 17, 2010, when he took senior counsel status. Although he then split his time between Great Falls, VA and Fort Myers, FL, and spent as much time as he could on the golf course, he was always available to help when needed.

Jim was an acknowledged leader of the food and drug bar, admired by his colleagues, clients, fellow practitioners and even his opponents (despite his tendency sometimes to intimidate them). Jim was an exceptional litigator, a great teacher and an inspiration to all of us in the firm. He had a great ability to identify key issues and to develop creative and effective solutions to them. He was always polite, civil and correct in his demeanor and actions no matter how tense or serious the matter. Jim was so respected as a food and drug lawyer that, for many years after he retired, he routinely was listed among the best lawyers in the field.

A graduate of the University of Cincinnati and its law school, after service in the U.S. Army, Jim began his legal career in 1965 as a Trial Attorney with the Office of General Counsel, Food and Drug Division, of the U.S. Department of Health, Education and Welfare (now the FDA’s Office of Chief Counsel). In 1967, Jim became an Assistant U.S. Attorney for the District of Columbia. He left that office in 1969 to join Burditt, Calkins & Wiley, a leading food & drug law firm in Chicago, where he remained until 1977, when he became vice president and general counsel of the pharmaceutical company G.D. Searle, which had a particular need for Jim’s litigation and broad FDA regulatory experience. He left Searle to join the other founders of our firm.

Jim’s practice extended to all areas of the food and drug bar. Jim also advised clients on matters involving controlled substances domestically and internationally, handling matters before the World Health Organization, the International Narcotics Control Board and the U.N. Commission on Narcotic Drugs.

Jim was a member of the U.S. National Commission for the United Nations Educational, Scientific and Cultural Organization from 1983-1985. He also was General Counsel of the Regulatory Affairs Professionals Society from 1982 to 2002.

Jim was a great companion and friend. He was proud of his roots in East Bernstadt, Kentucky, and liked to tease the mostly East Coast “johnnies” he worked with about their limited horizons. Jim was a great competitor in all aspects of life, from the courtroom to the squash court, the golf course and even the card table. His ability and intelligence supported his success in all these fields. He also had extraordinary eyesight, which he used to produce fantastic photographs of birds and other wildlife during his retirement. Some of these photos are proudly hung on the walls of our firm.

It is no exaggeration to say that Jim was the soul of the firm. Those of us who were privileged to know Jim are pledged to carry forward his commitment to the law and to the firm he helped start.

We extend our heartfelt sympathy to his wonderful wife, Sophia, and to his entire family. Jim will be greatly missed.

Effective April 1, 2022, California Board of Pharmacy (“BOP”) regulations no longer require reporting every single missing tablet or dosage form.  Instead, the amended loss regulations establish thresholds which will reduce the number of reports received by the California BOP, and in our opinion, creates a more meaningful and substantive reporting system.  The joke appeared to be on the BOP because reporting every loss has created “an administrative burden for both the licensee and the Board to prepare, review, and document the reported loss.”  Reporting Drug Loss, Cal. Regulatory Notice Register, June 4, 2021, 727.  The Board is not joking now, for several reasons, including reducing the estimated number of an estimated 10,000 loss reports per year to 6,667 per year, and more closely aligning with federal requirements, has fine-tuned its loss reporting requirements.  Id.

The prior BOP regulations became effective April 1, 2018, requiring owners to report the loss of any controlled substance, even single doses, to the Board.  Id. § 1715.6(a)(1).  The new regulations, require reporting a loss in part if it hits one of several triggers including if it meets or exceeds established aggregate quantity thresholds within the prior year.

1. Owners must report the following dosage units meeting or exceeding these thresholds:

• Tablets, capsules or other medication-99 dosage units;
• Single-dose injectables, lozenges, films such as oral, buccal and sublingual,
  suppositories or patches-10 dosage units; and
• Injectable multidose injectables, infusion medications or unidentified other multi-dose unit-two or more multi-dose vials, infusion bags or other containers. Cal. Code Regs. § 1715.6(a)(1).

2. Owners must also report all losses caused by employee theft, diversion or self-use within 14 days of discovery. Id. at § 1715.6(a)(2); Cal. Business and Professions Code, 4104(c).  (Federal regulations enforced by the Drug Enforcement Administration (“DEA”) require reporting all thefts, not just those by employees.  21 C.F.R. § 1301.76(b)).  Board inspectors must investigate all employee thefts “to ensure that no additional controlled substances have been diverted and that appropriate action can be taken against the subject employee’s license to restrict their access to controlled substance in the future.”  Initial Statement of Reasons, Reporting Drug Loss, California Board of Pharmacy, March 24, 2021, 3.
3. Also similar to federal requirements, owners must report any “significant loss” determined by the Pharmacist-In-Charge (“PIC”), including though not limited to losses “deemed significant relative to the dispensing volume of the pharmacy.” Id. at § 1715.6(a)(3).
4. Loss reports must specify loss details including controlled substance name, quantity and strength, and date of discovery. Id. at § 1715.6(b).

No one should be surprised that requiring any controlled substance loss, including a single tablet, to be reported, has resulted in thousands of meaningless reports of de minimis losses.  The new regulations seek  “to eliminate this excessive reporting and more closely align the Board’s regulation with the federal regulation by providing increased clarity with respect to the quantities of controlled substance losses that must be reported.”  Initial Statement of Reasons, Reporting Drug Loss, California Board of Pharmacy, March 24, 2021, 1.

That the Board has established a minimum aggregate reporting threshold quantities to resolve ambiguity is laudable.  We note that DEA has provided the following factors as to what it considers may be a significant loss:

1. The actual quantity lost relative to the business type;
2. The controlled substances lost;
3. Whether the loss can be associated with access by specific individuals, or if the loss can be attributed to unique activities that take place involving the controlled substances;
4. A pattern of losses over a specific time period, whether the losses appear to be random, and the results of efforts taken to resolve the losses; and, if known,
5. Whether the controlled substances are likely candidates for diversion and
6. Local trends and other indicators of the diversion potential of the controlled substances.  Id.

Also, DEA regulations require pharmacies and other registrants to report all thefts, but only losses that are significant, in writing within one business day of discovery, and to complete and submit a DEA Form 106.  21 C.F.R. § 1301.76(b).

One difficulty with the new Board requirements involves how pharmacies maintain a running total of losses over a year in order to report if the aggregate total hits or exceeds the quantity threshold.  In addition, the new regulation does not totally eliminate ambiguity about “significant loss” because a PIC, using their professional judgment, must report if they determine it “significant” relative to how much the pharmacy dispenses.  So even if losses do not hit a threshold, a pharmacy must report a loss deemed significant.  We wonder how often the Board is going to second-guess a PIC regarding failure to report what it considers a significant loss.

It is noteworthy in reading the administrative record for the new regulations that the Board considered the loss of one tablet falling on the floor requiring disposal to be a reportable.  The Board presumably requires dosage units meeting the reporting threshold that fall on the floor or spilled requiring disposal to be reportable losses.  This is another area where Board requirements diverge from DEA requirements.  Unlike the Board, DEA does not require witnessed damaged, spilled or damaged controlled substances reportable because the registrant can account for them.  Reports by Registrants of Theft or Significant Loss of Controlled Substances, 68 Fed. Reg. 40,576, 40,578 (July 8, 2003).  DEA registrants, however, must maintain records if the lost controlled substances are not recoverable.

Unlike the April 1, 1957, BBC broadcast report that a Swiss region near the Italian border was experiencing “an exceptionally heavy spaghetti crop” and showing film footage of people harvesting spaghetti off trees, the amended California controlled substance loss reporting requirement is no joke.

In January 2021, we reported on a CMS rule that, among other things, revised the Medicaid rebate best price regulation to remove impediments to value-based purchasing (VBP) arrangements in Medicaid. The rule, which will go into effect on July 1, 2022, defined a VBP is “an arrangement or agreement intended to align pricing and/or payments to an observed or expected therapeutic or clinical value in a select population . . . .”   VBP pricing may be determined by outcomes-based measures, which substantially link a drug’s cost to its actual performance or a reduction in medical expenses, or by evidence-based measures, which substantially link cost to existing evidence of effectiveness and value for a specific use.  See 42 C.F.R. 447.505(a), 85 Fed. Reg. 87000, 87102 (Dec. 31, 2020).

Last week, CMS issued Manufacturer Release 116 to put flesh on the bones of the new multiple best price option, including details about the structure of VBP arrangements and the respective responsibilities of manufacturers, states, and CMS.  The arrangements are to be structured as a series of outcome-based tiers, each tier associated with a guaranteed net unit price (GNUP).  Each GNUP will be the ultimate cost to the state net of the Medicaid rebate and an additional VBP rebate.  CMS gives the following illustration for a drug whose list price is $2,000:

• If a beneficiary is undergoing treatment with the drug and is hospitalized in year one, the GNUP will be $500.
• If a beneficiary is undergoing treatment with the drug and hospitalized in year two, the GNUP will be $750.
• If the beneficiary is undergoing treatment with the drug and is hospitalized in year three, the GNUP will be $1,000.

The manufacturer will report a best price corresponding to each GNUP.  Since best price is determined by prices to commercial customers who will not receive the Medicaid rebate portion of the GNUP but may receive the VBP discount, the reported best price corresponding to each GNUP presumably is the GNUP plus the Medicaid unit rebate amount (URA), assuming that the commercial customer receives no other discounts.  The manufacturer will also report a non-VBP best price, which CMS will use to calculate the traditional URA, but CMS will not calculate the VBP rebates.  That will be left to the states, which will invoice the manufacturer separately for ordinary Medicaid rebates and the VBP rebates that the state has earned.

In order to avail itself of multiple best price reporting, a manufacturer must offer the VBP arrangement to all states.  The manufacturer will upload a description of the VBP into the Medicaid Drug Programs (MDP) reporting system, which is currently used for Medicaid price reporting.  The MDP will notify states about manufacturer VBP offers along with a summary and contact information, and it is up to an interested state to contact the manufacturer.  The manufacturer will report in MDP when it has entered into a VBP arrangement with a state.  CMS will not be involved in the review of VBP programs; the various outcomes measures, the intervals and methods for measuring them, data content and format of state invoices, frequency of invoicing, and other terms and conditions will be negotiated between the manufacturer and the state.

Ceiling prices under the 340B Drug Discount program will not be affected by VBP best prices, but instead will continue to be based on the non-VBP best price as well as average manufacturer price.  However, Medicare Part B average sales price (ASP) will include VBP discounts paid to ASP-eligible customers.

A manufacturer who wishes to offer a VBP arrangement only to commercial customers will not be able to report multiple best prices, because that  option requires that the VBP be offered to every state Medicaid program.  As discussed in our summary of  the December 2020 CMS rule (at p. 3), a manufacturer that offers a VBP arrangement only in the commercial market may instead use a bundled sale methodology whereby a discount (or full refund) on one unit of drug that failed to achieve the outcome measure, instead of setting the best price, may be allocated among all the units sold under the VBP arrangement during the quarter, reducing the cost of each one by a small amount.  However, the bundled sale methodology does not offer much best price relief when the total number of units sold during a quarter is small, such as for an orphan drug.  For such drugs, multiple best price reporting could be an attractive option, as long as the manufacturer is willing to offer the VBP to Medicaid.

It was some time ago that we posted on what we though was “the Good” in an avalanche of FDA-related legislation that we sorted into three categories: the Good, the Bad, and the Ugly.  Our prior post took a look at a couple of bills that we thought fit Clint Eastwood’s role as “the Good” in the 1966 Italian epic spaghetti Western film, “The Good, the Bad and the Ugly”: the “Modernizing Therapeutic Equivalence Rating Determination Act” (S. 1463) and the “Simplifying the Generic Drug Application Process Act” (S. 1462).

We intended to quickly follow up that post with another post addressing a couple of bills that we thought fit the role of Lee Van Cleef as “the Bad,” and Eli Wallach as “the Ugly”: the “Prompt Approval of Safe Generic Drugs Act” (H.R. 2831) and the “Bringing Low-cost Options and Competition while Keeping Incentives for New Generics Act of 2021” (H.R. 2853), which is better known as the “BLOCKING Act of 2021.”  The BLOCKING Act in particular has drawn this blogger’s ire in prior blog posts (here, here, and here) and in Congressional testimony as antithetical to a primary goal of the Hatch-Waxman Amendments: getting high quality, low-cost generic drugs into the hands of consumers—fast.

Well, things got away from us due to other intervening priorities at the time and we never quite got to finishing up that post.  But Good things—and in this case Bad and Ugly (and we mean really Bad and really Ugly!) things too—come to those who wait!  But before we get back to “the Good” again, let’s take a look at “the Bad” and “the Ugly” . . . .

Earlier this week, FDA issued its Fiscal Year 2023 Budget Justification and related documents.  Among the various documents, a document titled “Executive Summary of FY 2023 Legislative Proposals” caught our attention.  It’s a list of 14 legislative proposals that FDA says would “better support Agency efforts to protect American consumers and patients, particularly during public health emergencies like the COVID-19 pandemic.”  The first of such legislative proposals targets 180-day generic drug exclusivity.  It says:

Amend the 180-Day Exclusivity Provisions to Encourage Timely Marketing of First Generics

In practice, 180-day patent challenge exclusivity is not operating as expected to encourage early generic entry, because this exclusivity is often “parked” by first applicants who either receive approval but do not begin marketing for extended periods of time following approval, or by first applicants who delay receiving final approval of their ANDAs for extended periods of time.  This proposal would substantially increase the likelihood that generic versions of patent-protected drugs will come into the market in a timely fashion, and that multiple versions of generic products will be approved quickly (leading to significant cost savings).  FDA is proposing to amend sections 505(j)(5)(B)(iv) and (D)(i)-(iii) of the FD&C Act, which govern the 180-day patent challenge exclusivity provisions, to specify that FDA can approve subsequent applications unless a first applicant begins commercial marketing of the drug, at which point approval of subsequent applications would be blocked by 180 days, ensuring that the exclusivity actually lasts 180 days (i.e., from the date of first commercial marketing by a first applicant until 180 days later) rather than for multiple years, as can occur under current law.

If the scent of this proposal smells vaguely familiar, it is.  It’s regime change!  It’s an effort to rework the current and longstanding ANDA Paragraph IV 180-day exclusivity incentive regime by replacing it with a new 180-day exclusivity regime modeled after the Competitive Generic Therapy (“CGT”) 180-day exclusivity regime created with the passage of the FDA Reauthorization Act of 2017 for drugs for which there is inadequate generic competition and for which there are no unexpired patents or exclusivities listed in the Orange Book at the time of original submission of an ANDA.

But before we delve into how a CGT-like exclusivity model would be misplaced and disastrous for a generic drug approval system based on patent challenges, it’s worth taking a quick look at the (false) premise of the proposal: “180-day patent challenge exclusivity is not operating as expected to encourage early generic entry, because this exclusivity is often ‘parked’ by first applicants who either receive approval but do not begin marketing for extended periods of time following approval, or by first applicants who delay receiving final approval of their ANDAs for extended periods of time.”  This sounds a bit dramatic . . . and it is.  It’s overly dramatic.

This blogger would expect FDA to point to the Agency’s findings in a November 2021 research report, titled “Marketing of First Generic Drugs Approved by U.S. FDA from January 2010 to June 2017” as evidence to support the premise above.  But that report—a not-too-thinly-veiled promotion piece for the BLOCKING Act and other legislation—is flawed.  In addition to stale data, data sets that may count the same product multiple times across different first applicants, and some selective data omissions, the report looks at the incorrect endpoint for its analysis: the time from ANDA approval to product launch.  However, the more accurate, reasonable, and meaningful endpoint for an analysis of the success of the current Paragraph IV 180-day exclusivity regime is the time between product launch and patent expiry.  That is, how much sooner does a generic drug come to market than it otherwise would without a patent challenge.  In other words, FDA’s analysis looks at the wrong end of the equation.  It’s not the time from ANDA approval to launch that is meaningful, but the time taken off of patent life allowing for an early launch that is meaningful.

Turning back to the legislative proposal, it says that FDA is proposing to amend FDC Act §§ 505(j)(5)(B)(iv) and (D)(i)-(iii)—the statutory provisions currently governing the qualification for and forfeiture of 180-day patent challenge exclusivity eligibility—“to specify that FDA can approve subsequent applications unless a first applicant begins commercial marketing of the drug, at which point approval of subsequent applications would be blocked by 180 days, ensuring that the exclusivity actually lasts 180 days (i.e., from the date of first commercial marketing by a first applicant until 180 days later) rather than for multiple years, as can occur under current law.”

That’s exactly how CGT 180-day exclusivity operates.  Indeed, here’s how FDA explains that exclusivity in guidance:

The 180-day CGT exclusivity period described under section 505(j)(5)(B)(v) of the FD&C Act is triggered by the “first commercial marketing of the competitive generic therapy (including the commercial marketing of the listed drug) by any first approved applicant.”  After this exclusivity is triggered, the 180-day period runs without interruption.

The FD&C Act also specifies that only an ANDA “for a drug that is the same as a competitive generic therapy for which any first approved applicant has commenced commercial marketing” can have its approval blocked until the 180-day CGT exclusivity period has been extinguished.  As such, once the first approved applicant has commenced commercial marketing, FDA is restricted from approving ANDAs for a drug that is the same as a CGT approved in the first approved applicant’s ANDA.  Therefore, FDA would not be restricted from approving other ANDAs covering a drug that is the same as the CGT prior to or after the approval of a first approved applicant’s ANDA for the CGT unless and until the first approved applicant has commenced commercial marketing and triggered the exclusivity period.  Likewise, the triggering of the CGT exclusivity period by the first approved applicant would not restrict other ANDA applicants that were approved prior to the trigger of such exclusivity from commercially marketing their products.

While the CGT 180-day exclusivity regime has operated quite well for drugs with inadequate generic competition and for which there are no unexpired patents or exclusivities listed in the Orange Book (as evidenced by the 130 CGT approvals thus far), using it as a blueprint for the approval of generic versions of brand-name drugs with dense patent thickets makes no sense.  What generic drug companies would be willing to invest millions of dollars in generic drug development and patent challenges for the potential of a hollow exclusivity incentive?  That is, because patent challenges often result in patent settlements that allow for generic competition (i.e., launch) prior to patent expiration, a CGT-like exclusivity regime that triggers the exclusivity only upon launch—which may occur years after ANDA approval—means that by the time launch occurs and exclusivity is triggered there will be no further approvals to which the exclusivity would apply.

Perhaps this is FDA’s way of trying to limit patent settlements.  But if you limit a generic drug manufacturer’s ability to settle cases, that manufacturer does not settle fewer cases, it submits fewer Paragraph IV ANDAs.  And fewer ANDAs means less, not more, generic drug competition.

The problem here, as with FDA’s November 2021 research report, is that the Agency is focused on the wrong endpoint.  FDA focuses on ANDA approvals instead of launches.  But more approvals does not necessarily translate into more launches.  Indeed, over time, a CGT-like exclusivity regime for Paragraph IV ANDAs may mean fewer ANDA approvals and launches.  And that ultimately means fewer choices for consumers and higher costs to the U.S. healthcare system.

If FDA and Congress were to focus on addressing the launch issue and not approvals alone, then a simple proposal that addresses this issue may be something along the lines of the following, which we call the “First Applicant Prime” exclusivity approach:

• If a “first applicant,” as currently defined under the statute, receives final approval within 45 months of ANDA submission or commercially markets more than 5 years before the expiration of the latest exclusivity-qualifying Paragraph IV Orange Book-listed patent, then that applicant would be eligible for 270 days of exclusivity rather than the current 180 days of exclusivity.
• If there is a group of first applicants and only a single first applicant meets the 45-month/5-year criteria above, then that applicant would be eligible for the first 90 days of exclusivity alone and other first applicants would get approval on day 91 of the 270-day exclusivity period.

This “First Applicant Prime” approach has several advantages, and is Clint Eastwood’s “the Good” in this post.  It incentivizes the submission of high-quality applications, which is what FDA wants.  There would be a competition to see who the “true” first applicant would be, meaning the first applicant who can both submit first and get approved first.  It could also address FDA’s concern about companies submitting ANDAs with non-compliant manufacturing facilities identified.  Separately, such a proposal could address the “25-tied ANDA first applicant situation” that is a problem with all New Chemical Entities.  That is, it would restore true generic drug exclusivity (to a one ANDA applicant for 90 days).  This approach could also help play a role in patent settlement agreements by potentially allowing companies to negotiate better agreements that fit into the 5-year criterion above.

Legislation has been proposed in Congress that would require FDA to regulate all contrast agents as drugs even though two courts determined that doing so clearly contradicts the plain language of the Federal Food Drug and Cosmetic Act (“FDC Act”).  Unless amended, the proposed legislation would reverse a Court determination that FDA had erroneously classified a frequently used contrast agent, barium sulfate, as a drug.  Our client Genus Medical Technologies, plaintiff in the cases decided by the courts and one of two distributors of barium sulfate in the United States, is seeking a revision to the proposed legislation.

By way of background, barium sulfate is ingested before some radiographic procedures studying the gastrointestinal tract. In 2017, FDA issued a warning letter to our client, Genus Medical Technologies, for distributing barium sulfate, which FDA characterized as an unapproved drug. After years of regulatory procedures and litigation in two federal courts (the District Court for the District of Columbia and the U.S. Court of Appeals for the D.C. Circuit), Genus’s position was vindicated: barium sulfate must be regulated as a medical device, not a drug, because the product achieves its primary intended purposes through its physical characteristics rather than through biological or metabolic action. The court decisions were subjects of prior blogposts (link here and here). After the government decided not to challenge the appellate court decision, FDA acceded to the decision and issued a Federal Register Notice discussing about how products would be transitioned if they had been classified as drugs inconsistent with the court decision (the Federal Register Notice was the subject of a blogpost linked here).

Congress is currently considering legislation that would revise statutes governing User Fees for drugs and medical devices, and a rider to that legislation has been proposed that would lump all contrast agents into the drug classification, resulting in huge expenses for Genus and other companies to market barium sulfate, which has been used safely and effectively for more than 120 years. The regulatory fees associated with introducing a drug, even a generic drug, to market, are around $400,000 in the first year (and $150,000 annually thereafter). By contrast, applications for marketing authorization for medical devices cost tens of thousands of dollars, followed by much more limited costs once the device is marketed.

Unless amended, the proposed legislation would isolate all contrast agents – including barium sulfate – from the well‐settled statutory and regulatory scheme that has, as the courts decided, dictated that products meeting the statutory definition of medical devices be classified and regulated as medical devices. Specifically, the FDC Act defines medical products by excluding from the definition of devices any products that achieve their primary intended purposes through chemical action in or on the body or through metabolic action, and has done so for about 50 years.

In initially trying to shoehorn barium sulfate into the drug category, FDA insisted that it needed to regulate all contrast agents as drugs based on a prior District Court decision (an argument the Courts rejected), and claimed that the change would be administratively convenient. Citing a case that says that FDA cannot regulate similar products differently, FDA decided to regulate all contrast agents as drugs while ignoring the fact that not all contrast agents are similar. Yet FDA insisted that all contrast agents needed to be regulated as drugs with no credible explanation for treating products that work differently as if they are the same. FDA appeared to be saying that its administrative convenience trumps the disparate safety and effectiveness concerns that arise in the context of drugs and devices.

While Genus would raise no objection to regulating the other products addressed by the legislation – radioactive drugs and OTC monograph drugs – as drugs, a simple amendment to the proposed legislation (linked to here) would limit the legislation’s effect on contrast agents to injectable contrast agents (this would cover, for example, iodine‐based solutions that are injected for computer tomography scans). Other contrast agents, like barium sulfate, which may have an oral, rectal, or dermal route of administration, would be classified and regulated as drugs or devices depending on the long‐standing statutory distinction: as drugs, if they achieve their primary intended purposes through chemical action in or on the body or through metabolic action.

While FDA argued in court that all contrast agents should be classified and regulated as drugs, there are important distinctions between those that achieve their primary intended effects through chemical or metabolic action, and those that do not. Radioactive drugs, and intravenously administered contrast agents, are capable of perfusing through or transforming tissues or cells. Consistent with an FDA Guidance, linked here, that elaborates on what chemical action means, these types of products are much more likely to be systemically distributed through the body, and could have results that are like those of pharmaceutical products. But, as FDA conceded, barium sulfate is not one of those products: the compound does not pass through tissue or transform cells. Instead, it absorbs X‐rays during radiographic procedures, resulting in contrast enhancement, which improves visualization of tissues.

Indeed, studies show that, under physiological conditions, barium sulfate passes through the gastrointestinal tract in an unchanged form.

We will keep you posted on the progress of Genus’s proposed amendment, and this legislation.

It’s not often that FDA issues an “Immediately in Effect Guidance,” but it’s not often that a case like Genus v. FDA comes along and upends twenty years of FDA practice.  Almost a year after the D.C. Circuit held that products that simultaneously meet both the FD&C Act’s general “drug” definition and its more-restrictive “device” definition must be classified and regulated as “devices,” FDA issued an “Immediately in Effect Guidance” to implement the decision as applied to ophthalmic products.  In the Guidance, entitled Certain Ophthalmic Products: Policy Regarding Compliance With 21 CFR Part 4, FDA explains that it can no longer regulate eye cups, eye droppers, and other dispensers intended for ophthalmic use as drugs when packaged with the ophthalmic drug with which they are intended to be used as a result of the Genus decision.  This is because the Genus decision no longer allows FDA to regulate devices as drugs, and, if the dispensers provided with the drug are devices, then the entire product as supplied must be considered a combination product.  Consequently, the Guidance announces that FDA will now “regulate these products as drug-led combination products composed of a drug constituent part that provides the primary mode of action and a device constituent part (an ophthalmic dispenser).

With the drug as the primary mode of action, the product will stay in the Center for Drug Evaluation and Research, but as a combination product, different requirements apply.  Manufacturing practices for combination drug-device products, as the relevant ophthalmic products will now be regulated, must consider both the cGMP requirements and QSRs, which may require additional steps or documentation.  Manufacturers may continue to use a cGMP-based operating system, but it must integrate each applicable provision of the device QSRs.

For the next 12 months, FDA will exercise enforcement discretion while impacted sponsors develop a Quality System that complies with 21 C.F.R. § 820.  Products subject to pending applications will be required to submit additional documentation for the combination product, including all facilities involved in the manufacturing of the device element.  Depending on the risk profile of the product, FDA may decide to evaluate new QS regulation requirements only during inspection following approval, may require a Pre-Approval Inspection, or may review quality information as part of the quality assessment of the combination product application.  However, “FDA anticipates that pre-approval assessment of [sponsor] compliance with any applicable QS regulation requirements generally will not need to include facility inspection against these requirements.”

As FDA attempts to implement Genus, industry should expect to see more products transitioning from drug to device and more guidances like this one to facilitate those transitions.  If you’re the sponsor of one of the products that Genus likely affects, be on the lookout for your own Immediately in Effect Guidance.

All companies dread the logistics, cost, and reputational harm associated with conducting a recall when necessary to remove or correct products in the field.  But the more prepared a company is for a potential recall, the less pressure it will feel when a situation necessitates taking action.  To clarify what preparations companies should take to more seamlessly manage a recall, on March 2, 2022, FDA published its Final Guidance Document on Initiation of Voluntary Recalls Under 21 CFR Part 7, Subpart C.

The Guidance provides detail on a recalling firm’s responsibilities, preparations, and communications and how the Agency can assist a firm with carrying out its recall responsibilities.  The Guidance applies to voluntary recalls of any food, drug intended for human and animal use, any cosmetic, biological, and tobacco product intended for human use, and any item subject to a quarantine regulation under 21 CFR part 1240.

What is a recall?  The guidance defines a recall as a firm’s removal or correction of a marketed product that the FDA considers to be in violation of the laws it administers and against which the Agency would initiate legal action, e.g., seizure.  But FDA notes that the same principles could apply to a company’s action even if it does not rise to the level of a recall, e.g., market withdrawals.  Almost all recalls are conducted on a voluntary basis by the manufacturer.  FDA maintains a database for recalls of FDA-regulated products based on information gathered from press releases and other public notices.

“It is critical for firms in a product distribution chain to be “recall ready.””

The Guidance emphasizes that firms need to be “recall ready.”  The Guidance provides practical guidelines for both firms and direct accounts.  For example, firms should identify and train appropriate personnel with recall-related responsibilities and establish a recall communications plan.  In recognition that hard copy communications are slower and more cumbersome, FDA recommends that firms use electronic communications, as they lay out the details of the electronic means here, to notify the public about recalls.  The Guidance highlights that the firm should identify specific points of contact for internal communications, communications with FDA, and communications to direct accounts or the public ahead of time and maintain draft templates for prompt communication.  FDA has model recall communication templates available here that firms can utilize.

Firms should identify any reporting requirements for distributed products and know in advance whether their product is associated with any legal or regulatory requirements to make a report to FDA.  Firms also need to maintain distribution records to facilitate identifying the direct accounts that received the recalled product by name, physical address where the product was delivered, and contact information.  Whether required or not, distribution records should be maintained by the recalling firm to locate the products being recalled.  Distribution records should be retained for a time period that exceeds the shelf life or expected life of the product and at least the length of time specified in applicable record retention regulations.  Product coding (e.g., unique device identifier for devices, product identifier for drug products) is helpful for the identification of the recalled products, but it may also help a recalling firm accurately limit the scope of recall.

The Guidance also provides recommended procedures for initiating a recall and performing actions related to initiating a recall.  For instance, the Agency recommends that firms prepare, maintain, and document written procedures for initiating a recall and performing actions related to initiating a recall.  This effort could help minimize delays created by uncertainty about what actions to take when a firm decides to initiate a recall, thereby reducing the amount of time a violative product is on the market.  An effective written procedure should carefully delineate (i) the plans of ceasing distribution, shipment, and/or sales of the affected product, (ii) a recall strategy, (iii) communication strategies to notify direct accounts about the product being recalled, including what should be done with respect to the recalled product, and (iv) a communication plan to notify the public about a product that presents a health hazard, when appropriate.

If there is an indication of a problem with a distributed product, FDA recommends that all firms should implement procedures to (i) identify indicators that there may be a problem with a distributed product, (ii) investigate the problem, (iii) make decisions and take action, and (iv) consult with FDA about the problem.  Of note, FDA emphasizes that the recalling firm does not need to wait for the completion of an investigation before it initiates a voluntary recall.  In addition, if a firm identifies any problem with a distributed product, it should not delay initiation of a voluntary recall pending FDA’s review of its recall strategy or recall communications.  The recalling firm should promptly issue a press release or other public notice.  The details of the procedural guidance regarding press releases and written recall notification letters can be found here.

Finally, the Guidance notes that FDA’s recall coordinators can work cooperatively with a recalling firm to facilitate the orderly and prompt removal of, or correction to, a violative product in the marketplace.  If a recalling firm is located in the United States, it can contact a Division Recall Coordinator within the FDA Office of Regulatory Affairs (ORA).  Note that for recalls of CBER-regulated products, firms should contact the CBER’s Direct Recall Classification (DRC) Program.  If a recalling firm is located outside of the United States and is recalling a product exported to the United States, then the recalling firm should contact ORA Headquarters.

Most FDA-regulated entities have an established SOP that governs the evaluation, decision, notification, and process for conducting a recall.  Although the guidance does not impose new requirements, it provides detail on what these SOPs should address and encourages companies to begin the recall process even if FDA has not agreed with the recall plan:

“A recalling firm need not delay initiation of a voluntary recall pending FDA’s review of its recall strategy or recall communications.”

We recommend companies take another look at their existing SOPs to ensure they would satisfy FDA’s expectations set forth in this guidance.

The saying “Hope for the best, prepare for the worst” applies to recalls.  Manufacturers hope for the best that their products are going to be used safely and effectively for patients and consumers.  At the same time, they should prepare for the worst by being “recall ready.”

The Centers for Disease Control and Prevention (“CDC”) issued a voluntary practice guideline on opioid prescribing for clinicians treating chronic pain five years ago.  (We blogged on the final 2016 guideline here on March 17, 2016).  On February 10th, the agency published a comprehensive proposal to update the guideline.  Proposed 2022 CDC Clinical Practice Guideline for Prescribing Opioids, 87 Fed. Reg. 7,838 (Feb. 10, 2022); Dowell, Deborah, MD., et al, CDC Clinical Practice Guideline for Prescribing Opioids-United States, 2022, CDC.  As explained more fully below, CDC concedes that states, insurers, pharmacies and pharmacy benefit managers have implemented laws, regulations and policies that have misapplied the 2016 guideline.  Some have interpreted the 2016 guideline as requiring a hard, daily opioid dosage of 50-90 morphine milligram equivalent (“MMEs”) and opioid treatment duration of three to seven days.  CDC’s proposed 2022 practice guideline takes a more flexible, patient-specific approach relying on clinicians’ judgment rather than applying “inflexible standards of care across patient populations.”  Proposed 2022 CDC Practice Guideline, 7,839.

We believe the proposed 2022 guideline provides much needed clarification of CDC’s recommendations for both practitioners and regulators.  We remain concerned, however, that the “misapplication” of the 2016 guideline and the same risk for the 2022 proposed guideline, may continue to adversely affect patient care.

Purpose of the Proposed Guideline

CDC intends the proposed guideline to improve communication between clinicians and patients about the risks and benefits of pain treatment that includes opioid therapy; improve the safety and effectiveness of pain treatment with an eye towards improved function and patient quality of life; and reduce opioid use disorder, overdose and death associated with long-term opioid therapy.  Id.

2016 Guideline

As CDC notes in the 2022 proposed guideline, the 2016 guideline provided twelve recommendations for primary care clinicians who prescribe opioids for chronic pain in outpatient settings.  CDC Clinical Practice Guideline, 10.  The 2016 guideline recommendations were based on systematic review of the best available evidence with input from experts, the public and an advisory committee, noting that the goals were to ensure clinicians and patients consider safer, more effective pain treatment, improve patient outcomes with reduced pain and improved function and reduce opioid use disorder, overdose, or other adverse events.  Id. at 11.  The guideline impacted the continuing decline of total numbers of opioid prescriptions issued in the U.S., and although not an intention, also impacted laws, regulations and policies.  Id.  Over half the states enacted legislation limiting initial opioid prescriptions for acute pain to seven days or less while insurers, pharmacy benefit managers and pharmacies enacted similar policies.  Id.  CDC emphasizes that while some of the initiatives had positive results for some patients, guideline “recommendations are voluntary and intended to be flexible in support, not supplant, individualized, patient-centered care.”  Id. at 12.  CDC notes with “particular concern” that some policies purportedly from the 2016 guideline “have, in fact, been notably inconsistent” with the guideline “and have gone well beyond its clinical recommendations.”  Id.  CDC notes that misapplication of recommendations have even extended to cancer and palliative patients, opioid tapering and abrupt discontinuation without patient collaboration, rigid application of opioid dosage thresholds, duration limits, and patient dismissals.  Id.  Misapplication of the guideline has “contributed to patient harm, including untreated and undertreatment of pain, serious withdrawal symptoms, worsening pain outcomes, psychological distress, overdose, and suicidal ideation and behavior.”  Id.

The Proposed Guideline

From our perspective, given misapplication of the 2016 guideline, we begin with what the proposed guideline is not rather than what it is.  The proposed guideline is not “[a] replacement for clinical judgment or individualized, person-centered care” and its recommendations are not inflexible standards of patient care.  Id. at 2.  The guideline is neither law, regulation nor policy.  The guideline is not applicable to the treatment of pain related to sickle cell disease, or palliative or end-of-life care.  Id.

According to the CDC, the proposed guideline is a clinical tool meant “to improve communication between clinicians and patients, empowering them to make more informed, person-centered decisions related to pain care together.”  Id.  It is intended for clinicians (primary care, physicians, nurse practitioners, physician assistants, and oral health practitioners) who provide pain care to outpatients aged 18 years or older with acute pain (lasting less than a month), subacute pain (lasting 1-3 months) or chronic pain (lasting more than 3 months) in outpatient settings.  Recommendations do not apply to inpatient care during hospitalization, emergency department or other observed settings, but do apply to prescribing for pain management upon discharge.  Id. at 3.

Methodology

CDC developed the proposed practice guideline using Grading of Recommendations Assessment, Development, and Evaluation (“GRADE”) framework.  Id.  Recommendations are based on a review of available scientific evidence; benefits and harms; patients’, caregivers’, and clinicians’ values and preferences; and resource allocation (such as costs to patients or health systems, including clinician time).  CDC also obtained input from conversations with patients, caregivers, and clinicians, through Federal Register notices and comments from the public, peer reviewers, and an advisory committee.  Id.

Recommendations

The proposed guideline generally follows the organization of the 2016 guideline, listing recommendations within four general areas: (1) determining whether to initiate opioids for pain; (2) opioid selection and dosage; (3) opioid duration and follow-up; and (4) assessing risk and addressing potential harms of opioid use. Id. at 31.

Note:  Given nuances in language, we quote each recommendation verbatim in bold text below and include certain implementation considerations for each recommendation though not verbatim.  To fully understand and benefit from the proposed rationale and explanation of the guideline, clinicians and others should read the proposed recommendations and implementation considerations in their entirety.

 (a)  Determining Whether to Initiate Opioids for Pain

Recommendation 1.

Nonopioid therapies are effective for many common types of acute pain.  Clinicians should only consider opioid therapy for acute pain if benefits are anticipated to outweigh risks to the patient.  Id. at 64.

• Opioid therapy plays an important role in treating acute pain related to severe traumatic injuries such as crush injuries and burns, invasive surgeries with moderate to severe postoperative pain, and other severe acute pain when non-steroidal anti-inflammatory drugs (“NSAIDs”) and other therapies are contraindicated or ineffective. Opioids should not be first-line therapy for acute pain conditions, like low back and neck pain, pain related to musculoskeletal injuries including sprains, strains, tendonitis and bursitis, pain related to minor surgeries associated with minimal tissue injury and mild postoperative pain (for example, dental extraction), dental pain, kidney stones, and headaches including episodic migraines.
• Clinicians should maximize use of nonopioid pharmacologic therapies such as NSAIDs or acetaminophen and nonpharmacologic therapies that include ice, heat, elevation, rest, immobilization and exercise for specific conditions. They should continue such therapies as needed after opioid therapy is discontinued.
• Clinicians should prescribe opioids on an “as needed” basis rather than on a scheduled basis (e.g., “one tablet every 4 hours”) and encourage tapering if opioids are to be taken around the clock for more than a few days.

Recommendation 2.  

Nonopioid therapies are preferred for subacute and chronic pain.  Clinicians should only consider initiating opioid therapy if expected benefits for pain and function are anticipated to outweigh risks to the patient.  Before starting opioid therapy for subacute or chronic pain, clinicians should discuss with patients the known risks and realistic benefits of opioid therapy, should work with patients to establish treatment goals for pain and function, and should consider how opioid therapy will be discontinued if benefits do not outweigh risks.  Id. at 75.

• Clinicians should use noninvasive, nonpharmacologic approaches to help manage chronic pain.

(b)  Opioid Selection and Dosage

Recommendation 3.  

When starting opioid therapy for acute, subacute, or chronic pain, clinicians should prescribe immediate-release opioids instead of extended-release/long-acting (“ER/LA”) opioids.  Id. at 91.

• ER/LA opioids should be “reserved for severe, continuous pain.”

Recommendation 4.  

When opioids are initiated for opioid-naïve patients with acute, subacute, or chronic pain, clinicians should prescribe the lowest dosage to achieve expected effects.  If opioids are continued for subacute or chronic pain, clinicians should use caution when prescribing opioids at any dosage, should carefully evaluate individual benefits and risks when considering increasing dosage, and should avoid increasing dosage above levels likely to yield diminishing returns in benefits relative to risks to patients.  Id. at 95-96.

• “[B]efore increasing total opioid dosage to ≥ 50 MME/day, clinicians should pause and carefully reassess evidence of individual benefits and risks. If a decision is made to increase dosage, clinicians should use caution and increase dosage by the smallest practical amount.”
• “The recommendations related to opioid dosages are not intended to be used as an inflexible, rigid standard of care; rather, they are intended to be guideposts to help inform clinician-patient decision making. Further, these recommendations apply specifically to starting opioids or to increasing opioid dosages, and a different set of benefits and risks applies to reducing opioid dosages.”

Recommendation 5.

For patients already receiving higher opioid dosages, clinicians should carefully weigh benefits and risks and exercise care when reducing or continuing opioid dosage.  If risks outweigh benefits of continued opioid therapy, clinicians should optimize other therapies and work closely with patients to gradually taper to lower dosages or, if warranted based on the individual clinical circumstances of the patient, to appropriately taper and discontinue opioids.  Unless there are indications of a life-threatening issue, such as warning signs of impending overdose, e.g., confusion, sedation, or slurred speech, opioid therapy should not be discontinued abruptly, and clinicians should not abruptly or rapidly reduce opioid dosages from higher dosages.  Id. at 101. 

• When risks outweigh benefits of continued opioid therapy, clinicians should consider reducing opioid dosage, or tapering and discontinuing opioid therapy, collaborate with patients prior to initiating changes, how quickly tapering will occur and when tapering pauses may be warranted.
• Clinicians should follow up at least monthly with patients engaged in opioid tapering.
• Payers, health systems, and state medical boards should not set rigid standards related to opioid dose or opioid therapy duration, and should ensure that policies not result in rapid tapers or abrupt discontinuation of opioids and do not penalize clinicians for accepting chronic pain patients using prescribed opioids, including high doses. Id. at 103.

(c)  Opioid Duration and Follow-Up

Recommendation 6.

When opioids are needed for acute pain, clinicians should prescribe no greater quantity than needed for the expected duration of pain severe enough to require opioids.  Id. at 115.

• Clinicians can often manage nontraumatic, nonsurgical acute pain without opioids.
• A few days or less are often sufficient when opioids are needed for nontraumatic, nonsurgical pain. “However, durations should be individualized based on the clinical circumstances of the specific patient.”
• Clinicians should evaluate patients continuing to receive opioids for acute pain at least every 2 weeks.
• Clinicians should refer to recommendations on subacute and chronic pain for follow-up (Recommendation 7) and tapering (Recommendation 5) for treating patients receiving opioids for a month or longer.

Recommendation 7.  

Clinicians should evaluate benefits and risks with patients within 1 to 4 weeks of starting opioid therapy for subacute or chronic pain or of dose escalation.  Clinicians should evaluate benefits and risks of continued therapy with patients every 3 months or more frequently.  Id. at 120.

(d)  Assessing Risk and Addressing Potential Harms of Opioid Use

Recommendation 8.  

Before starting and periodically during continuation of opioid therapy, clinicians should evaluate risk for opioid-related harms and discuss with patients.  Clinicians should work with patients to incorporate into the management plan strategies to mitigate risk, including offering naloxone when factors that increase risk for opioid overdose are present.  Id. at 125.

• Clinicians should offer naloxone when prescribing opioids to patients at increased risk for overdose including patients with a history of overdose, substance use disorder or sleep-disordered breathing. It also includes patients who take higher dosages of opioids, for example 50 MME/day or more, patients taking benzodiazepines with opioids and patients at risk for returning to a high dose who have lost tolerance.

Recommendation 9.  

When prescribing initial opioid therapy for acute, subacute, or chronic pain, and periodically during opioid therapy for chronic pain, clinicians should review the patient’s history of controlled substance prescriptions using state prescription drug monitoring program (PDMP) data to determine whether the patient is receiving opioid dosages or combinations that put the patient at high risk for overdose.  Id. at 135.

• Clinicians ideally should review PDMP data before every opioid prescription for acute, subacute, or chronic pain in all jurisdictions where available and practicable.
• For long-term opioid therapy, clinicians should review PDMP data before an initial opioid prescription and at least every 3 months thereafter.
• Clinicians should not dismiss patients on the basis of PDMP information.

Recommendation 10.

When prescribing opioids for subacute or chronic pain, clinicians should consider toxicology testing to assess for prescribed medications as well as other prescribed and non-prescribed controlled substances.  Id. at 139.

• Clinicians should not dismiss patients based on toxicology test results.

Recommendation 11.

Clinicians should use extreme caution when prescribing opioid pain medication and benzodiazepines concurrently and consider whether benefits outweigh risks of concurrent prescribing of opioids and other central nervous system depressants.  Id. at 145.

• There are circumstances when it is appropriate to prescribe opioids to a patient who is prescribed benzodiazepines, for example a patient in acute pain who is taking long-term, low-dose benzodiazepines. Clinicians should consider whether benefits outweigh risks of concurrent use of opioids with other central nervous system depressants such as muscle relaxants, non-benzodiazepine sedative hypnotics and potentially sedating anticonvulsant medications like gabapentin and pregabalin.

Recommendation 12.

Clinicians should offer or arrange treatment with medication for patients with opioid use disorder.  Id. at 149. 

• Clinicians should not dismiss patients due to opioid use disorder.

CDC’s Conclusion

CDC observes that “[a] central tenet of the clinical practice guideline is that acute, subacute, and chronic pain needs to be appropriately and effectively treated independent of whether opioids are part of a treatment regimen.”  Id. at 162.  CDC notes that this is achieved by nonpharmacologic or pharmacologic treatments that “maximize patient safety and optimize outcomes in pain, function, and quality of life.”  Id.  CDC emphasizes the need for care “to be individualized and person-centered.”  Id.  CDC warns that the guideline not be misapplied beyond its intended use, and policies derived from it not result in unintended consequences for patients, warning that inflexibility on opioid dose and duration, discontinuing or dismissing patients, rapidly tapering patients who may be stable on higher doses without collaboration, and applying to cancer, sickle cell, or end receiving end-of-life patients.  Id. at 164.

HPM Comment

Clinicians face difficult decisions in deciding whether to prescribe opioids, the dosage to prescribe and duration of treatment for acute, subacute and chronic pain patients.  As we stated at the time, we found the 2016 guideline to be reasonable.  Its recommendations constituted sound medical practice applicable to prescribing opioids, and non-opioid controlled and non-controlled medication.  However, while the 2016 guideline helped clarify legitimate medical purpose standards for prescribing and dispensing controlled substances for clinicians, pharmacies and regulators, we cautioned that legitimate medical treatment may conflict with strict adherence opioid therapy of more than seven days or in excess of 50-90 MMEs daily.  We remain concerned.

CDC stressed that the 2016 guideline was “voluntary, rather than prescriptive” and advised clinicians to “consider the circumstances and unique needs of each patient when providing care.”  CDC Guideline for Prescribing Opioids for Chronic Pain-United States, 2016, 2.  CDC now  acknowledges that states, insurers, pharmacies and pharmacy benefit managers implemented laws, regulations and policies that have misapplied the 2016 guideline.  They misapplied the recommendations as inflexible CDC mandates to the chronic pain patient population and inappropriately applied them to cancer, palliative and end-of-life patients.

We questioned then as we question now whether the Drug Enforcement Administration and state regulators will similarly “misapply” the proposed guideline and pursue enforcement action against practitioners who do not strictly comply with the proposed guideline.  Clinicians and regulators must strive to apply the 2016 and proposed guideline in the manner in which CDC intended so that patients receive the appropriate opioid treatment their legitimate condition requires.  So both the regulators and the regulated industry must recognize the intent of the 2022 proposed  guideline and apply the recommendations appropriately.  Otherwise, legitimate patients will remain at risk for nontreatment or undertreatment of acute, subacute or chronic pain.

Public Comments

The public can comment on the proposed guideline and recommendations until April 11, 2022.  We urge all interested parties to weigh in.

Hyman, Phelps & McNamara, P.C. is pleased to announce that Sophia Gaulkin will be presenting and speaking on an expert panel at Informa Connect’s Drug Pricing Transparency Congress, which is being held virtually and in-person in Philadelphia on March 28-29, 2022.

Ms. Gaulkin’s presentation on Changes for 2022 Drug Price Transparency Reporting will outline new state drug pricing transparency reporting requirements that have taken effect in 2022, examine updated laws in Maine, Nevada, and Texas, and consider trends and what to expect in state-level legislative efforts regarding drug pricing going forward.

In a later session, she will join a panel of experts to answer questions about developments in drug pricing transparency requirements and provide practical advice to implementing the state requirements.

This hybrid event brings together experts working in or with the pharmaceutical and biotechnology industries to share best practices and discuss how current and future drug pricing transparency regulations will impact commercialization, reimbursement, pricing, and compliance practices.

FDA Law Blog readers are offered a discount of 10% off the registration price.  The discount code is 22HYMAN10.  You can access conference information and register for the event here.