Operation Stork Speed is a go!

On March 18, 2025, the U.S. Department of Health and Human Services (HHS) and the Food and Drug Administration (FDA) launched a significant initiative called Operation Stork Speed to bolster the availability and safety of infant formula in the United States (see our previous blog post here).

The March announcement outlined six key actions underlying Operation Stork Speed, including the launch of the first comprehensive review of infant formula nutrients (see 21 C.F.R. § 107.100) since 1998.  HHS/FDA explained that such a review would help update the nutrient requirements for infant formulas, ensuring they meet the evolving needs of healthy, full-term infants.

Approximately two months later, HHS/FDA made good on their pledge.  On May 13, 2025, HHS/FDA published in the Federal Register, as well as via an FDA news release, a request for information and data to initiate the nutrient review process for infant formula.  The agency intends to use the collected information to determine what actions, if any, should be taken to update the nutrient requirements.  Purportedly, this review aims to ensure that infant formulas continue to meet the nutritional needs of infants and reflect the latest scientific research.

Specifically, FDA is requesting comments on the below six questions.

• What new scientific data or information since the 1998 comprehensive assessment should we consider regarding nutrient requirements for healthy, full-term infants that are associated with positive short- and/or long-term health outcomes?
• What scientific data or information have emerged since the 1998 comprehensive assessment regarding nutrient intakes for healthy, full-term infants that are associated with poor short- and/or long-term health outcomes?
• Which existing nutrients required in 21 C.F.R. § 107.100 should we review? Please explain your rationale.
• For the nutrients required in 21 C.F.R. § 107.100, what, if any, adjustments should be made to existing minimum or maximum levels? For the 20 nutrients with only a minimum level, which, if any, should have a maximum level added?  Please explain your rationale.  For example, describe how changes might positively impact health outcomes.
• What other nutrients (e.g., docosahexaenoic acid and arachidonic acid) or specifications for nutrients (e.g., ratio of linoleic acid to alpha-linolenic acid), if any, should we consider adding to 21 C.F.R. § 107.100? Please explain your rationale.
• Which nutrients, if any, should we remove from 21 C.F.R. § 107.100? Please explain your rationale.

Any interested parties should submit comments within 120 days of the Federal Register publication.

In his remarks at the Food Drug Law Institute’s Annual Conference last week, Commissioner Makary noted that FDA plans to convene an expert panel in June as part of Operation Stork Speed, but the Agency has not yet formally announced those plans.  Commissioner Makary also acknowledged some consumers’ desire for infant formulas free of certain ingredients such as seed oils.  It is not yet clear how FDA plans to address that issue.  We will continue to monitor Operation Stork Speed’s progress and report on any further developments.

Dr. Marty Makary took the stage on Thursday at the Food and Drug Law Institute’s Annual Conference, continuing the tradition of Commissioners speaking at this event, but with a tone and tempo distinctly his own.

Now firmly in the chair after the agency’s controversial RIFs—which he was quick to remind everyone he did not initiate—Commissioner Makary said that the FDA’s future depends on rebuilding its culture, empowering its staff, and applying his vision of the now oft-repeated “gold standard science and common sense.” The agency, he noted, isn’t a passive inbox for industry petitions. It’s a brand—the greatest in the world, he said—and he thinks that change is needed to live up to that lofty reputation.

Many of the Commissioner’s comments were familiar to those who have followed his podcasts and book rounds: he firmly believes the FDA’s regulatory model needs disruption. Dr. Makary noted that he doesn’t believe that the traditional playbook works for everything—particularly in the case of life-threatening diseases where randomized controlled trials are neither feasible nor humane. “Stage IV cancer should not be approved like a cosmetic,” he quipped, quickly calling to mind his days as an oncological surgeon and the many difficult conversations he had with patients and families with very limited options. Industry can, however, expect smarter tailoring of regulatory frameworks by condition, product type, and risk. He also specifically mentioned rare diseases here, in addition to his example of late-stage illnesses.

While Commissioner Makary reiterated the “no reorganization” refrain that has been consistent since he took the helm, he is interested in reducing internal redundancies and called for more consolidated operations and smarter tech.  He spoke with obvious enthusiasm about the recently announced pilot AI-assisted review and its potential to shave weeks off approval timelines, as he described hearing from one reviewer in the pilot project who said the pilot AI tool completed three days’ work in gleaning salient facts from medical literature in six minutes.

Beyond regulatory work, the Commissioner ventured into what he called “crossing into advocacy,” especially relating to food regulation. Citing the chronic health crisis among children, he challenged attendees to rethink society’s tolerance for environmental and dietary toxins, from petroleum-based food dyes to candy coated in talc. “Kids don’t have a willpower problem,” he said. “We’ve been poisoning them and drugging them at scale.” Expect new expert panels starting in June on infant formula, menopause, and peanut allergies, and a renewed focus on the upstream causes of America’s downstream health costs.

He delivered sharp words on tobacco and e-cigarette imports, warning that foreign manufacturers are gaming our “porous border” by importing products that would be illegal in their own countries. He also promised a clearer vaccine framework from CBER perhaps in a matter of days, a stronger commitment to “the letter and the spirit of Right to Try,” and major investment in post-market safety surveillance via big data.

Commissioner Makary made it clear that he isn’t here to maintain the status quo and he is here to shake loose entrenched assumptions, and remind industry of his view that common sense, in the right hands, can be a regulatory force multiplier. How he will impose common sense on policy will unfold over the next few months.  We’ll be back with updates.

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 annual Life Sciences Pricing & Contracting USA Summit, which is being held virtually and in-person in Philadelphia on May 19-21.

Ms. Gaulkin’s presentation, Product Price Increases: A SPTR Practical Walkthrough, will provide an interactive case study outlining the hypothetical enforcement, appeal, and settlement scenarios that may apply to qualifying drug price increases.  The presentation will also cover the legal, regulatory, and practical considerations involved throughout the reporting and enforcement process, including recent developments in state-level enforcement approaches and their impact on reporting and mitigation strategies.

Against the backdrop of increasing uncertainty and change in the drug pricing landscape, this hybrid event brings together experts working in or with the pharmaceutical and biotechnology industries to share best practices and discuss the cross-functional impacts of the ever-changing government and state drug pricing landscape on commercialization, pricing, contracting, reimbursement, market access, and compliance.

FDA Law Blog readers are offered a discount of 10% off the registration price.  The discount code is 25HYMAN10.  You can access conference information and register for the event here.

In early April, Cellares became the first company to announce receipt of an Advanced Manufacturing Technology (“AMT”) designation from FDA. The designation was granted by CBER to Cellares for its automated cell therapy platform, the Cell Shuttle. We were excited to see the news and look forward to seeing the full implementation of the AMT program and its potential benefits.

First, some background on the AMT program. Section 3213 of the Food and Drug Omnibus Reform Act of 2022 (“FDORA”), (21 U.S.C. § 356l), directed FDA to establish the AMT Designation Pilot Program. The program is intended for manufacturing methods that “incorporate[] a novel technology, or use[] an established technique or technology in a novel way, that will substantially improve the manufacturing process for a drug while maintaining equivalent, or providing superior, drug quality.” Such improvements could include reducing development time or increasing or maintaining the supply of a critically important drug or a drug on the drug shortage list.

An AMT designation is distinct from other FDA designation programs in that it is independent of any application submission. The designation could be used to support the development of a specific investigational drug, or a new method of manufacturing an approved drug, but it could also be granted to a technology separate from any specific application. A designation is instead granted for a particular “context of use,” which should be specific to a particular class of drugs, but does not have to be specific to a single product. However, the benefits of the designation are realized only in the context of an appropriate application within the designated context of use.

The law directed FDA to issue guidance regarding the implementation of the program, which was finalized in December 2024. As described in this guidance, AMT designation requests may be made at any point in time; however, the technology must be mature enough to consistently and reliably manufacture product in the context of use for which an AMT designation is sought. FDA recommends early engagement with CDER’s Emerging Technology Team (“ETT”) or CBER’s Advanced Technologies Team (“CATT”).

The types of supporting data and information to include with a request depend on the specific method of manufacturing and its proposed context of use. The robustness of these data and information should be commensurate with the level of risk.

As described in guidance, an AMT designation request should include the following:

• A description of the method of manufacturing and why it should be considered for designation, including an explanation of how the method incorporates a novel technology or uses an established technology in a novel way (novel here generally means a new technology FDA has not previously seen in a submission, or a technology with which FDA has experience but with a significantly different use);
• The context of use under which the proposed AMT will be used;
• A detailed description of how the method meets statutory eligibility criteria in a particular context of use, including quality-related data generated through process development studies, and information that describes and justifies the proposed AMT’s context of use;
• Perceived challenges to implementation;
• If the requestor is also an applicant or prospective applicant, an anticipated timeline for drug development activities incorporating the proposed AMT;
• If the requestor intends to use the proposed AMT for manufacturing an existing drug, a cross-reference to the existing application, information demonstrating that the proposed AMT will increase or maintain the supply of the drug, and evidence that equivalent or superior drug quality will be maintained.

The guidance states that requestors who are not applicants should include data generated using a model drug to provide FDA with a clear understanding of the AMT’s parameters, limitations, and context of use.

Within FDA, the center with jurisdiction over the type of drug that would incorporate the proposed AMT reviews the request, along with members of ETT or CATT, as applicable. The statute requires that a determination on the request be made within 180 days of receipt.

If granted, designated AMT holders should communicate updates or proposed changes that could affect the context of use or AMT eligibility. FDA will assess the proposed changes to confirm that the designated AMT continues to meet AMT criteria and maintains the same context of use for which the AMT was designated. Whether the context of use is the “same” should be discussed with FDA, and FDA may determine that a new designation request is necessary.

The benefits of designation include efforts by FDA to expedite the development and review of applications submitted for drugs that are manufactured using the AMT as well as allowing the holder of a designation, or another authorized party, to reference or rely upon data and information about the technology in subsequent applications for use in manufacturing drugs in the same context of use for which the designation was granted. FDA also intends to provide timely advice and to engage in additional communication (e.g., written correspondence, meetings) with applicants for a drug manufactured using a designated AMT. FDA expects to give higher priority where the technology is expected to significantly improve product quality, address known quality issues, or increase or maintain the supply of drugs that are life-supporting, life-sustaining, or of critical importance to providing health care, or are in shortage. The designated lead for the AMT request will coordinate with the FDA quality assessment team in the context of an application with the aim of making the assessment process more efficient than for applications using non-designated manufacturing methods.

Perhaps most importantly, FDA intends to support applicants while they are developing the CMC section of their applications such that the incorporation of a designated AMT will not increase the time or number of assessment cycles required to reach a quality-related decision, and thus will not increase the time required to make a decision regarding overall application approval. While it remains to be seen how advantageous this will be in practice, one of the most significant obstacles related to implementing a new manufacturing technology is the concern that FDA’s relative unfamiliarity with it will cause delays. The possibility that such delays could be avoided with the use of the AMT designation is definitely appealing.

As described in guidance, once FDA has gained significant experience with a specific designated AMT and it has been used in multiple approved applications, FDA may “graduate” the technology from AMT designation and transfer the review of future applications referencing that AMT to the standard quality assessment process rather than an expedited process. Such graduation would keep AMT designation aligned with the statutory requirement of “novelty” and facilitate further innovation to focus on new AMTs that meet the program’s goal of encouraging adoption of novel technologies. We can certainly foresee challenges related to such “graduation” determinations as there is currently a lack of clarity about when it would occur. Hopefully, this will become clearer in time.

Cellares does not appear to have any products in development on its own, and the company, in public statements, describes the likely use of the designation as supporting development and marketing applications of partners. As such, the specifics of how this AMT designation may ultimately impact FDA review of applications are not yet known. It would not be a surprise to us if this was the beginning of a pattern where many such manufacturing organizations seek the designation rather than the applicants themselves. However, this remains to be seen.

Now that we have an example of an AMT designation, we will hopefully be able to gain a better understanding of the benefits of such designations. We have seen quality issues delay otherwise approvable applications on numerous occasions, especially for products with more novel and complex manufacturing processes. It is an exciting thought that companies can get some level of comfort that such issues may be avoided through this proactive designation pilot program, especially for the novel technologies for which it is intended.

Under the law, FDA must post on its website by the end of 2025 a report describing the details of the program, including the types of manufacturing approaches supported. This report will also include numbers of designations granted and numbers related to applications that have included designated AMTs. We eagerly await its publication. As it currently stands, the program is scheduled to begin sunsetting October 1, 2032, with no further designations being considered beyond that date. Hopefully before then, we will see the benefits of designation realized through more efficient approvals with technologies that accomplish the goals of the program.

We are still parsing through the May 12 Executive Order (EO), “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients” and impacts this may have on the pharmaceutical industry.  We’ve blogged about Most-Favored-Nation (MFN) drug pricing and how the new EO goes well beyond the 2020 order and questions we have.  Of interest to these bloggers is the provision that deals with personal use importation.  (We note our departure from more light-hearted content and absence of musical references.  Please bear with us.)

Section 5 of the May 12 EO states that within 30 days, HHS will communicate MFN price targets to pharmaceutical manufacturers to bring prices for patients in line with “comparably developed nations.” If significant progress toward MFN is not made, the EO seeks to permit personal importation of less expensive drugs from foreign countries.  It provides that

the Secretary shall consider certification to the Congress that importation under section 804(j) of the Federal Food, Drug, and Cosmetic Act (FDCA) will pose no additional risk to the public’s health and safety and result in a significant reduction in the cost of prescription drugs to the American consumer; and if the Secretary so certifies, then the Commissioner of Food and Drugs shall take action under section 804(j)(2)(B) of the FDCA to describe circumstances under which waivers will be consistently granted to import prescription drugs on a case-by-case basis from developed nations with low-cost prescription drugs

We’ve seen this type of language in an EO before and to date, we still do not have a legal pathway for the personal importation of unapproved drugs.  Given that the provision in the May 12 EO may be a rehash of what occurred in 2020, we thought it would be helpful to provide a bit of history and background on personal importations.

As an initial matter, the Federal Food, Drug, and Cosmetic Act (FDC Act) precludes the importation of unapproved prescription drug products, including versions of FDA-approved drugs intended for distribution in foreign markets like the EU. As documented in a Congressional Research Service Report, FDA has taken the position that even a foreign-made drug that has the same active ingredient and is made by the same manufacturer of an FDA-approved drug is “highly unlikely” to “meet all of the requirements in the [FDC Act] for approval” such that it may be eligible for importation into the U.S.  Instead, FDA’s webpage on Personal Importation provides that “[i]f a drug is approved for use in another country but is an unapproved new drug in the U.S. it is illegal to import.”

Congress afforded FDA discretion to waive the prohibition on importation of unapproved prescription drugs where importation is for personal use and the drug does not appear to present an unreasonable risk to the individual.  FDC Act § 804(j)(1), (2).  FDA may issue such waivers by regulation or on a case-by-case basis.  Congress also directed FDA to issue guidance describing circumstances under which FDA consistently would grant such waivers.  This provision is effective only upon certification to Congress under FDC Act § 804(l) that the implementation of a waiver system would “pose no additional risk to the public’s health and safety” and would “result in a significant reduction in the cost of covered products to the American consumer.”   Absent such a certification, the provisions of FDC Act § 804 legally are not in effect.

Note – This is what the May 12 Executive Order is requiring – that HHS consider certifying to Congress that personal imports will pose no additional risk to the public’s health and safety.

The May 12 EO regarding personal importation is similar in this regard to the EO from 2020.  President Trump, at that time, directed HHS and FDA to facilitate “grants to individuals of waivers of the prohibition of importation of prescription drugs,” subject to the caveat that “such importation poses no additional risk to public safety and results in lower costs to American patients, pursuant to section 804(j)(2) of the Federal Food, Drug, and Cosmetic Act (FDCA), 21 U.S.C. 384(j)(2).”  Rather than obviate the need for a certification to that effect, the EO mandates that such waivers are granted only as “consistent with applicable law,” which, again, requires a certification under 804(l) for 804(j) to be in effect.  While then-Secretary of Health and Human Services, Alex Azar, made a certification to Congress about other provisions in §804 of the FDC Act (namely, importations from Canada as described in FDC Act §§ 804(b)-(h)) this certification expressly excluded § 804(j).  Letter from Alex Azar II to Hon. Kevin McCarthy (Sept. 23, 2020).  Specifically, the certification letter states that “[t]he personal importation provisions of section 804(j) of the FD&C Act are not being implemented . . . and thus section 804(j) is not currently in effect.”   Secretary Azar goes on to say “[a]ny implementation of section 804(j) . . . would occur through a separate certification.”  No such separate certification has been issued to date.

Due to the risks involved in personal importation, FDA specifically refused to implement a formal personal importation policy.  See Proposed Rule, Importation of Prescription Drugs, 84 Fed. Reg. 70,796, 70,800 (Dec. 23, 2019).  In a Proposed Rule implementing provisions relating to the importation of certain prescription drugs from Canada, FDA explained that it “is not proposing to implement the personal importation provisions in section 804(j)” because imported medications “pose significant challenges for FDA and its ability to adequately safeguard the quality and safety of drugs taken by U.S. consumers.”  FDA recognized that “there are pharmacy websites that operate legally and offer convenience, privacy, and safeguards for purchasing medicines,” but there are many that fail to adhere to safeguards followed by pharmacies licensed in the U.S.  Accordingly, FDA did “not implement personal importation provisions under section 804(j) of the FD&C Act” when it adopted rules implementing other provisions in section 804 of the FDC Act.  And while the Final Rule acknowledges that EO 13938 directs FDA and HHS to facilitate waivers under section 804(j) of the FDC Act, FDA maintained that it was “not implementing the personal importation provisions in section 804(j) of the FD&C Act through this rulemaking.”  Final Rule, Importation of Prescription Drugs, 85 Fed. Reg. 62,094, 62,097 (Oct. 1, 2020).

To date, neither FDA nor HHS has issued a guidance document describing circumstances in which the agencies will consistently grant waivers, as required under FDC Act § 804(j)(2).  FDA has, however, set forth on its website a policy for “personal importation.”  Under that policy, FDA would permit imports of Over-the-Counter treatment and limited imports of prescription drug products for personal use.   https://www.fda.gov/industry/import-basics/personal-importation.  With respect to prescription drug products, FDA will allow personal imports if the product is for a serious condition for which effective treatment may not be available domestically; there is no known commercialization or promotion of the product to persons in the U.S.; the product does not represent an unreasonable risk; the consumer affirms in writing that the product is for personal use; and the quantity is not more than a three-month supply.

It’s hard to read the tea leaves on the future of personal imports.  FDA has previously issued Warning Letters to entities facilitating the importation of foreign drugs and maintains an active import alert regarding these products, last updated on April 14, 2025.  That import alert notes the following:

FDA has observed foreign unapproved prescription drugs offered for sale in the United States by unsafe online pharmacies which poses a significant public health concern. Unapproved prescription drugs present serious safety and effectiveness concerns. Moreover, FDA-approved versions of these drugs are often available in the United States. Therefore, this import alert is intended to identify known distributors, including online pharmacies, of unapproved prescription drugs to U.S. consumers.

There are inherent risks to consumers who purchase unapproved new drugs and misbranded drugs. Unapproved new drugs do not carry the same assurances of safety and effectiveness as those drugs subject to FDA oversight. Drugs that have circumvented regulatory safeguards may be contaminated, contain varying amounts of active ingredients, or contain different ingredients altogether. In examining imported drugs sent through the mail, FDA has identified unapproved drugs, counterfeit drugs, improperly labeled drugs, drugs that failed to meet special storage conditions, and drugs that require supervision of a practitioner licensed by law to administer them.

It’s not clear whether the May 12 EO will lead to a certification to Congress that personal imports pose no additional risk to the public’s health and safety.  That position is at odds with FDA’s historical stance.  Given the unprecedented turnover within FDA and new leadership, however, FDA’s historical stance may not be relevant.

On September 15, 2020, I posted an article in this blog entitled “Trump Embraces International Reference Pricing in Executive Order,” which described an order in Trump’s first administration to use most-favored-nation (“MFN”) pricing as a limit on Medicare payment.  The article ended with the following prediction:  “Regardless of the fate of this Executive Order or the result of the upcoming election, this bipartisan concept will not go away soon.”  The MFN pricing concept did go away temporarily, but yesterday history repeated itself with a Trump Executive Order again embracing this concept – this time with a potentially broader scope.

Trump’s earlier Executive Order resulted in a November 27, 2020 interim final rule, which provided that Medicare Part B payment for 50 annually selected high-cost drugs would be based on prices in foreign countries instead of average sales price.  In the waning days of the first Trump administration, the implementation of the interim final rule was blocked by three different federal district courts, largely because of the lack of notice and comment rulemaking procedures.  The rule was finally rescinded by the Biden Administration in December 2021.  The concept of most favored nation pricing then mutated into a legislative proposal in the early versions of the Inflation Reduction Act’s Medicare drug price negotiation program, but Congress eventually opted to use non-Federal Average Manufacture Price reported to the Department of Veterans Affairs instead of prices in foreign countries to set a cap on negotiated prices.

MFN pricing reemerged in yesterday’s Executive Order, which goes well beyond the 2020 order.  Whereas the previous order called for CMS to establish payment models under which Medicare Part B and Part D would pay no more than an international reference price, the new order makes no mention of Medicare or Medicaid.  It sets forth the following three directives:

1. HHS shall “facilitate” direct-to-consumer purchasing programs for pharmaceutical manufacturers that sell their products to American patients at the most-favored-nation (“MFN”) price.
2. Within 30 days (i.e., by June 11), HHS will communicate MFN price targets to pharmaceutical manufacturers to bring prices for patients in line with “comparably developed nations.”
3. If “significant progress” toward MFN pricing is not made following the communications in (2), HHS must propose a regulation to impose it.

These directives raise a multitude of questions.  How will MFN targets be determined by HHS and for how many drugs?  What will constitute “significant progress” toward MFN pricing that will avoid a regulation and when will that determination be made?  What types of drugs are to be covered: brands, generics, biologics, biosimilars, or some combination?  Would the direct-to-consumer pricing and MFN pricing be limited to Medicare and Medicaid beneficiaries or extend to all consumers regardless of payor?  How many drugs would be subject to a direct-to-consumer pricing program and an MFN pricing rule?  All drugs?  Those with the greatest cost to Medicare and Medicaid?  To American consumers in general?  How would the drugs with highest cost be determined?  All of these are in addition to more practical questions about how the MFN price will be determined in the first place, which countries will be considered “comparably developed nations,” and how manufacturers would deliver MFN pricing to patients at the pharmacy counter under the direct-to-consumer program.

If significant progress toward MFN pricing is not delivered, the Executive Order also seeks to permit personal importation of less expensive drugs from foreign countries.  Under Section 804(b) through (h) of the Federal Food, Drug, and Cosmetic Act (“FDC Act”) and implementing FDA regulations at 21 C.F.R. Part 251, states and other entities are already permitted to develop a Section 804 Importation Program (“SIP”) to import certain prescription drugs from Canada into the United States. (So far, only Florida has obtained FDA authorization to operate a SIP.)

However, besides authorizing the importation of less expensive drugs from Canada, Section 804 also authorizes FDA to grant to individuals, by regulation or on a case-by-case basis, waivers permitting importation of drugs from foreign countries for personal use.  Section 804(j)(2)(B) requires FDA to publish guidance on when such personal use importation will be permitted.  However, current FDA policy permits importation for personal use only when the drug is not available in the U.S.  The new Executive Order directs FDA to “take action under section 804(j)(2)(B) . . . to describe circumstances under which personal use waivers will be consistently granted to import prescription drugs on a case-by-case basis from countries used to determine the most-favored-nation price,” as described above.  In other words, personal use importation would be expanded to situations where the drug is available domestically but is more expensive.

The Executive Order provides that, in order for FDA to take such action, HHS must first certify to Congress that expanded personal importation will pose no additional risk to public health and safety and will result in significant reduction in cost to American consumers.  HHS previously made this certification with regard to importation of drugs from Canada, but importation from other countries would pose additional safety risks.

It is difficult to predict the impact of this Executive Order with so many questions unanswered.  However, MFN pricing, whether offered in response to HHS’s price targets or imposed by regulation, has the potential to cause a major shift in global drug pricing, as international companies seek to equalize prices in the U.S. and other developed countries.  The size of this shift will depend on the scope of MFN pricing that emerges – the number of manufacturers affected, what types of drugs are covered, and how many drugs are covered – all of which are as yet unknown.  Also unknown is whether, if a regulation is triggered, mandated MFN pricing would survive the inevitable constitutional and statutory challenges.  We will keep readers posted on this important development as answers emerge.

Note to readers:  An earlier version of this article, which was posted yesterday (May 12), referred to a 180-day period following HHS’s communication of target prices to pharmaceutical manufacturers during which manufacturers must make “significant progress” toward MFN pricing in order to avoid a regulation.  The final Executive Order did not provide for a 180-day period, instead leaving indefinite the period during which “significant progress” must be made.  That correction has been made in the above article.

On May 6, 2025, FDA announced that it planned to conduct more surprise inspections at foreign manufacturing facilities that produce foods, essential medicines, and other medical products intended for U.S. consumers. The stated goals are to ensure that “foreign companies will receive the same level of regulatory oversight and scrutiny as domestic companies,” and “every product entering the U.S. is safe, legitimate, and honestly made.” This change builds on the pilot program conducted by FDA’s Office of Inspection and Investigations Foreign Unannounced Inspection, which focused on drug manufacturing facilities in India and China. FDA’s plan now expands the use of foreign surprise inspections to other countries as well as to other types of FDA-regulated facilities (foods and medical devices).

Most FDA inspections of domestic facilities are unannounced, with limited exceptions. Further, domestic facilities cannot dictate the day or time of the inspection. Foreign manufacturers, however, “often had weeks to prepare,” which FDA concludes, “undermin[es] the integrity of the oversight process.” Despite the advanced notice, FDA claims that it found “serious deficiencies more than twice as often” in its inspections of foreign facilities as compared to domestic facilities.

The discrepancy between the regulatory oversight over foreign firms is not a new concern, and the U.S. Government Accountability Office (GAO) reported in 2019, that “FDA’s practice of preannouncing foreign inspections up to 12 weeks in advance may give manufacturers the opportunity to fix problems.” GAO repeated this concern in its 2022 report and again in 2024. In 2024, Hyman, Phelps & McNamara, P.C. Counsel John Claud testified before the House Committee on Energy and Commerce Subcommittee on Oversight and Investigations about FDA’s foreign inspection program, in a hearing entitled Protecting American Health Security: Oversight of Shortcomings in the FDA’s Foreign Drug Inspection Program.”

Although FDA wants to increase the number and types of foreign inspections, the question remains how FDA will practically implement this expansion. In a recent Executive Order (E.O.) to promote domestic drug manufacturing, President Trump stated that the increase of “routine reviews of overseas manufacturing facilities involved in the supply of United States medicines” “shall be funded by increased fees on foreign manufacturing facilities to the extent consistent with applicable law.”  The E.O. is not entirely clear which fees the government intends to increase as there are, among other things, user fees for drug and device approvals, and program fees and facility fees that are paid annually.   Some fees already have a premium built-in for foreign manufacturing sites (for example, the annual facility fee for a domestic manufacturer for a finished dosage form generic drug is $231,952 for FY2025, but $246,952 for a similar foreign manufacturer). And even with increased fees attributable to foreign companies, the large number of RIFs that have affected the inspections office, among other key functions at FDA, will surely limit the number of inspections that physically can be conducted.  Further, the abrupt retirement of Michael Rogers, the FDA Assistant Commissioner for Inspections and Investigations, one day before FDA announced this plan to expand foreign inspections, is likely to disrupt or delay implementation.

We will continue to monitor the events as they unfold. In the meantime, be prepared! Although we advise foreign companies to always maintain inspection-readiness, in light of the new Administration’s announcement and priorities, we recommend taking some immediate-term actions:  assess your high-risk areas (such as those reviewed by FDA during previous inspections) through the internal audit program; conduct refresher training for all personnel who will be involved in an FDA inspection, particularly as the scope and tone may differ from other governmental authorities; and review your previous FDA inspections (and those from other regulatory bodies) to ensure completion of any open CAPAs or commitments.

There has been increased enforcement against medical device companies that engage in the pervasive practice of paying third party sales agents based on their volume of sales.  This scrutiny was enhanced after the Fourth Circuit’s ruling in United States v. Mallory, 988 F.3d 730 (4th Cir. 2021), reh’g denied, as well as in recent settlements (see, e.g., here), that all such arrangements violated the federal Anti-Kickback Statute (AKS). Two recent cases from the Fifth and Seventh Circuits, however, support the legality of these arrangements in the absence of the government proving certain circumstances.

On April 14, 2025, the Seventh Circuit overturned the criminal conviction of Mark Sorensen, the owner of a durable medical equipment (DME) distributor, who had been found guilty of violating the AKS.  The Seventh Circuit took a more lenient approach than the Fourth Circuit, focusing its rationale on whether an independent contractor had improper influence over a healthcare provider’s independent healthcare decisions.  Sorenson follows the Fifth Circuit’s decision last year in United States v. Marchetti, 96 F.4th 818, which likewise held that volume-based compensation is not a per se violation of the AKS, and must instead be based on an evaluation of whether the sales agents had undue or improper influence over healthcare providers.

Though Sorensen and Marchetti can provide support against allegations that such arrangements are per se violations of the AKS, companies should evaluate and, if necessary, take steps to de-risk their marketing organization, which could include limiting the use of independent contractors for such roles.

Regulatory Framework

The AKS makes it a criminal felony to knowingly and willfully offer or pay any remuneration, directly or indirectly, to induce a person to order or refer patients for medical care that is reimbursable under a federal healthcare program (e.g., Medicare or Medicaid).  Recognizing that this broad prohibition could encompass many common and non-abusive practices, the Office of the Inspector General of the U.S. Department of Health and Human Services (OIG) has promulgated a number of safe harbor regulations describing activities protected from prosecution.  Of relevance here is the “employees” safe harbor, which protects, inter alia, volume-based commissions paid by a pharmaceutical or device company to employee sales representatives, even though the commissions are intended to induce the representative to recommend the purchase of the company’s products.  However, commissions paid to sales representatives who are independent contractors, as opposed to bona fide employees, are not protected under the safe harbor.

Still, the failure of an arrangement to meet the conditions of a safe harbor does not mean that the arrangement is necessarily unlawful, only that it does not have guaranteed protection.  OIG reviews non-safe harbored arrangements on a case-by-case basis.  Regarding commissions-based compensation structures for marketing agents, OIG has issued several instructive advisory opinions: AO 98-1 (adverse); AO 98-10 (favorable); AO 99-3 (favorable); and AO 99-8 (favorable).  Although commissions-based compensation to marketing agents is not protected under any safe harbor, OIG’s multiple favorable opinions about such arrangements indicate that they are not per se violations of the AKS.

Per its advisory opinions on the subject, OIG evaluates the following factors to determine whether a sales agent arrangement is abusive:

1. compensation based on percentage of sales;
2. direct billing of a Federal health care program by the Seller for the item or service sold by the sales agent;
3. direct contact between the sales agent and physicians in a position to order items or services that are then paid for by a Federal health care program;
4. direct contact between the sales agent and Federal health care program beneficiaries;
5. use of sales agents who are health care professionals or persons in a similar position to exert undue influence on purchasers or patients; or
6. marketing of items or services that are separately reimbursable by a Federal health care program (e.g., items or services not bundled with other items or services covered by a DRG payment), whether on the basis of charges or costs.

The primary factor in the advisory opinions, apart from the commission-based payment, is whether the sales agents have undue influence over purchasers.  The case law on commission-based marketing agents—including the Sorensen decision—follow in a similar vein.

Seventh Circuit ruling in Sorensen

In Sorensen, the government alleged, and the District Court agreed, that Sorensen paid illegal kickbacks to marketing firms based on the number of leads generated and a DME manufacturer based on the percentage of funds collected from Medicare.  The Seventh Circuit unanimously reversed Sorensen’s criminal AKS conviction, finding there was insufficient evidence that any of the commissions-based marketing entities “leveraged any sort of informal power and influence over healthcare decisions.”  Rather, the sales agents Sorensen paid had received consent from patients before faxing unsigned prescriptions to their physicians for review; more often than not, those physicians declined to prescribe the device.

The Court explained that the unsigned prescriptions sent to physicians “are best understood as proposals for care, not as referrals.”  In contrast to its decision in United States v. Polin, 194 F.3d 863 (7th Cir. 1999), in which the sales agent was considered a decisionmaker because his referrals had never been overturned by a provider during the 14 years he worked in that role, here, even if the unsigned prescriptions are considered “recommendations” to providers, they were frequently overruled.  Physicians had “ultimate control” and exercised “independent judgment” over their patients’ healthcare decisions.  As such, neither Sorensen nor the entities he paid “had any authority to act on behalf of a physician” or “unduly influence[d] the doctors’ decisions.”

Distinguishing between “payments to individuals who take advantage of their existing relationships with patients or other health care providers” from mere “aggressive advertising efforts,” the Court found no evidence suggesting that Sorensen or anyone he paid “had any special relationship with or influence over patients’ physicians so as to subject them to improper influence.”   In the absence of such evidence, the Court held that Sorensen’s volume-based (i.e., percentage-based or per-lead) compensation structures did not violate the AKS.

Fifth Circuit Case Law

The Seventh Circuit favorably cited the Fifth Circuit’s recent decision in United States v. Marchetti, 96 F.4th 818 (5th Cir. 2024), which affirmed Marchetti’s conviction for receiving illegal kickbacks but determined that most of his actions did not violate the AKS.  In that decision, a medical laboratory paid Marchetti percentage-based compensation for successful referrals of Medicare patients to the laboratory.  The government asserted that Marchetti had “relationships with, access to, and influence over” doctors, but failed to show that Marchetti exercised any impermissible influence on them.  The Fifth Circuit ultimately affirmed Marchetti’s conviction based on his separate work for two competing laboratories, where he decided which laboratory received patient samples and received payments intended to induce his referrals.

It is worth noting that Marchetti follows a string of Fifth Circuit decisions on this topic, the holdings for which were based on similar grounds.  In U.S. v. Miles, 360 F.3d 472 (5th Cir. 2004), the court distinguished between violative arrangements in which the sales agent has authority to select a provider and thereby earn compensation, and permissible ones in which a sales agent (in that case, agents promoting a home health agency to physicians) had no authority to select the provider.  In a subsequent case, the Fifth Circuit describes Miles as standing for the proposition that where a purchasing choice is made by the health care provider and “there is no evidence that the advertiser ‘unduly influence[s]’ or ‘act[s] on behalf of’ the purchaser, the mere fact that the [seller] compensates the advertiser following each purchase is insufficient to support” a violation.  U.S. v. Shoemaker, 746 F.3d 614, 627-28 (5th Cir. 2014).

In Practice

Volume-based compensation arrangements for independent contractor sales agents and marketers have long been a concern for HHS OIG.  Sorensen and Marchetti provide additional support for defending against allegations that such arrangements are per se violations of the AKS, at least outside the Fourth Circuit.  In evaluating non-safe harbored, commission-based marketing agents (e.g., independent contractors), undue influence is a key determinant of whether an arrangement is violative under OIG advisory opinions and the case law from the Seventh and Fifth Circuits.

To that end, businesses should carefully review their marketing practices, including the nature of their relationships with, and the compensation structures for, physicians and others in a position to influence referrals. Even if the use of commission-based independent contractors may not be a per se violation of the AKS, it nevertheless provides an attractive target for the government, and we are aware of several companies that decided to de-risk their marketing practices by ending such arrangements or that considered the risk associated with these arrangements in their valuation of a merger or acquisition.

Drug Enforcement Administration (“DEA”) civil monetary settlements involving listed chemicals that do not include pseudoephedrine are rare.  Even more scarce are DEA civil settlements with non-registrants.  (By my count there have been only ten since 2000).  When one comes along, it is worthwhile to sit up and take notice.

On March 26th the U.S. Attorney’s Office for the Western District of Texas announced that IMC Pro International Inc. (“IMC Pro”), a shipping and logistics company based in North Carolina, agreed to pay $400,000, not a significant amount compared to some recent settlements, but not chump change either, to resolve allegations that it violated the Controlled Substances Act for transshipping precursor chemicals.

DEA seized five packages in Eagle Pass, Texas, identifying IMC Pro as the shipper containing 26.4 kgs. of 1-BOC-Piperidone and 138.66 kgs. of (2-Bromethyl) benzene.  Both chemicals are used in the illicit manufacturer of fentanyl.  1-BOC-Piperidone is a DEA-regulated List 1 chemical while (2-Bromethyl) benzene is on DEA’s longstanding, recently updated Special Surveillance List.

The government determined that the chemicals had been imported into the U.S. from China and transshipped to Eagle Pass for export to Mexico for manufacturing fentanyl.

The government alleged that IMC Pro entered into business agreements with companies operating in China.  IMC Pro agreed to provide the Chinese companies with access to the shipping company’s accounts for common carriers to generate domestic shipping labels for goods and products the Chinese companies sold or manufactured.  IMC Pro did not store or handle the packages nor maintain records about their contents.

IMC Pro took immediate steps to shut down the shipping accounts and terminate the business agreements with the Chinese companies when it learned its domestic accounts were being used to transship fentanyl precursors.  IMC Pro is also cooperating to identify other fentanyl precursor transshipments.  In addition to the civil penalty, IMC Pro affirmed that it would not engage in similar agreements with foreign-based entities.  Interestingly, the affirmation is also binding on IMC Pro’s successors in interest.

The IMC Pro civil settlement brings to mind two truths.  First, regulated chemicals are DEA’s other “controlled” substances and may require registration, recordkeeping and reporting.  Secondly, like the old Appalachian proverb says, “Know the one you’re dancing with.”

Thanks to everyone who joined us today.  We are excited that you were able to join us for our discussion of enforcement under the new FDA.  We hope you enjoyed a lively conversation.  We appreciated all of the questions we received from the audience.  If you were unable to join, you can still watch our recorded webinar here.

Stay tuned for news on future webinars this summer!

We have reached maximum capacity for this Thursday’s webinar!  We are excited by the large interest in this topic, and are eager to share our insights about the latest changes impacting the FDA-regulated industry.  Registration is closed, but if you would like to be put on a waitlist or receive a recording of the webinar, please contact Amy Vasvary (avasvary@hpm.com).  If your plans have changed and you can no longer attend, please contact Amy so we can open your space to the waitlist.

As a reminder, Hyman, Phelps & McNamara, P.C. is hosting a free webinar on recent and forward-looking enforcement under the Federal Food, Drug & Cosmetic Act on Thursday, May 1, 2025, from 12:00 p.m. to 1:30 p.m. (ET).  Registration is limited, so don’t forget to register here to join us this Thursday.

HPM’s Anne Walsh will moderate a panel discussion with three former DOJ attorneys who all litigated extensively under the FDC Act.  The panel will include J.P. Ellison, a former trial attorney at DOJ’s Consumer Protection Branch (CPB), John Claud, a recent Assistant Director at CPB, and Andrew Hull, a former Assistant U.S. Attorney.

Equipped with significant FDC Act prosecution experience from their years as federal prosecutors, the panelists will address questions about how an FDC Act case is prosecuted, recent FDC Act enforcement cases, and what to expect under the new administration.  The panelists will also share their predictions on the increased role of state agencies and other prosecutions in the FDA space.

We published a version of this post several years back (see here), but recent updates to the law and trends in DEA enforcement merit a refresher.  The stakes are high when a DEA-registered practitioner, pharmacy, distributor, manufacturer, or other registrant receives an Order to Show Cause (or OSC) from DEA.  OSCs often appear without warning and can throw a registrant into a flurry of uncertainty and risk of losing a registration necessary to conduct business.  Failing to respond in a timely or appropriate manner may also result in a waiver of your rights.

If you are in receipt of an Order to Show Cause from DEA and lost as to what it means or what to do, read this short primer to help guide you in making necessary and correct decisions in a prompt manner to protect your business and preserve your rights.

What Is an Order to Show Cause?

An Order to Show Cause is DEA’s official initiation of an administrative proceeding to revoke or suspend an existing DEA registration or deny an application for a DEA registration. By law, DEA must provide you with notice and an opportunity for a hearing before it can take away your registration (or deny your application), so DEA will issue an Order to Show Cause, which explains the legal grounds for revoking or denying a registration and informs you of your right to challenge DEA’s decision.

What Are Your Options When You Receive an Order to Show Cause?

You have several options. The first is to request a hearing before one of DEA’s administrative law judges (ALJs). To preserve your right to a hearing, you must file a request for a hearing with DEA’s Office of Administrative Law Judges within thirty (30) days of service of the Order to Show Cause. A second option is to waive your right to a hearing and simultaneously file a written position statement, again within thirty (30) days of service of the Order to Show Cause. A third option is to ignore the Order to Show Cause, in which case DEA will request a final order based only on DEA’s evidence. Which option is right for you is a decision that is best made after consulting with experienced counsel.

If you decide to request a hearing, DEA’s revised hearing regulations require that you simultaneously file an Answer to the Order to Show Cause.  The Answer must address each factual allegation in the OSC and specifically admit, deny, or state that the party does not have and is unable to obtain sufficient information to admit or deny the allegation.  It is not enough to file a timely request for a hearing; failure to simultaneously file an Answer may result in default, and DEA will deem each factual allegation not denied to be admitted against you.

Failure to file a request for hearing and answer in a timely manner (i.e., 30 days from service) may result in a waiver of the right to a hearing and a default, absent a timely request for an excuse demonstrating good cause.

What Happens If You Request a Hearing?

A timely request for a hearing places your case on the docket of one of the ALJs. The ALJ will issue an order for prehearing statements and schedule a prehearing conference. At the prehearing conference, the ALJ will set a date and location for the hearing.

The hearing closely resembles a trial, but the ALJ (rather than a jury) is the trier of fact. Both the government (represented by DEA counsel) and you will have an opportunity to present your case through witness testimony and record evidence. Hearings can range from half a day to several weeks, depending on the complexity of the case. After the hearing, both parties may submit post-hearing briefs, and the ALJ will issue a recommended decision. The parties may file exceptions to the decision if they believe the ALJ made a factual or legal error in the decision. The recommended decision is submitted to the DEA Administrator who reviews the decision, rules on the exceptions, and issues a final order regarding your registration, either adopting or rejecting the ALJ’s recommended decision.

Not all cases end up going to hearing, however, as DEA is sometimes willing to consider a settlement resolution.

What Happens If You Waive Your Right to a Hearing?

If you choose to forgo a hearing, the government will forward your case with its evidence (along with any timely submitted position statement) to the Administrator. The Administrator will then issue a final order based on the review of the evidence and written statements provided.  Remember that all factual allegations in the Order to Show Cause that have not been denied will be admitted against you.

What Is an Immediate Suspension Order?

An Immediate Suspension Order is the exception to the rule that DEA will not revoke or suspend an existing DEA registration prior to a hearing. An Immediate Suspension Order allows DEA to suspend your registration upon a determination that there is an “imminent danger to the public health and safety.” An Immediate Suspension Order is served along with an Order to Show Cause, allowing you to challenge DEA’s determination that your registration should be revoked, but it takes away your ability to handle controlled substances while your case is pending. As a result, an Immediate Suspension Order can significantly (and immediately) affect your ability to practice medicine or operate your business.

What Is a Corrective Action Plan?

Recipients of an Order to Show Cause (except those also receiving an Immediate Suspension Order) are permitted to submit a Corrective Action Plan. A Corrective Action Plan provides an opportunity for the registrant to demonstrate remedial actions contemplated or taken, and requests DEA to discontinue the Order to Show Cause proceedings. What should be discussed or admitted in a Corrective Action Plan is a decision that likely should be made after seeking advice from an experienced attorney.

Are You Allowed to Have an Attorney Represent You?

You are permitted to proceed on your own (i.e., pro se) or to have an attorney represent you. Because of the complex nature of these proceedings and the stakes involved, representation by a law firm experienced in handling DEA hearings may be a necessity.

What Resources Are Available?

DEA’s Office of Administrative Law Judges has a website containing forms and links to a variety of helpful legal resources, including instructions on filing documents.  We also regularly blog on DEA administrative cases and procedures (see here), and our HPM attorneys have authored articles (see here and here) on the DEA hearing process.  Our experienced HPM attorneys stand ready to defend you or company when you face an Order to Show Cause.

Recent reductions in force (RIFs) and leadership changes at FDA are already affecting key agency functions—and as the administration plans a broader reorganization, the impact will likely grow. One area drawing increasing attention is how these changes will affect the drug development and review process.

As reported by the Wall Street Journal last week, reviews of both innovative and follow-on drugs have been caught in a traffic jam, largely due to a leadership vacuum at the Center for Drug Evaluation and Research (CDER). Senior officials have left, others haven’t been replaced, and internal morale is reportedly “a work in progress”—a euphemism that, frankly, isn’t very euphemistic. That’s all bad news if your timeline depends on FDA sticking to theirs.

The Prescription Drug User Fee Act (PDUFA) sets specific deadlines for FDA to act on applications—typically ten months from the date FDA files the application for standard review and six months for priority review. These timelines are sacred to both R&D teams and Wall Street, and historically, FDA has a solid track record. According to the agency’s own performance reports, FDA has earned an “A” over the past five years, even reaching or exceeding 97% of its review goals for 11 of 12 submission types in 2023.

But, in recent weeks, concerns have mounted that deadlines may slip. While we haven’t seen much slow-down yet in our work at HPM, we are aware of some applications that appear to be idling. A recent Bloomberg Law report noted that staff cuts have left reviewers juggling multiple roles, including some filling in for departed senior leaders while still covering their own work, all without the help of RIFed support staff. One reviewer described the situation as “chaotic,” and another simply said, “We don’t have the bandwidth.”

If you were hoping for signs of stabilization, other recent headlines suggest more turbulence. Reuters reports that FDA recently dismissed most of its user fee negotiators—just as the next PDUFA and GDUFA reauthorization cycles begin. These are the professionals responsible for negotiating how the agency gets funded. Swapping out experienced negotiators at the start of high stakes talks raises legitimate concerns about whether FDA is prepared for the administrative heavy lifting ahead. While a fresh perspective can be valuable, in this case, the agency may be refreshing its roster right into a disadvantage.

Like the WSJ, we believe the impacts of such drastic staff cuts are a near certainty, but we are also cautious not to attribute every delay or unanswered email to the RIF and leadership changes. Some regulatory actions or inactions like the three cited in the WSJ article may not be attributable to anything other than the machinations of a large agency and are of the sort that have plagued clients for years. FDA’s failure to respond to a substantive question in two weeks’ time is hardly cause for concern, the proximity to the RIFs notwithstanding. Exercising a keen eye to discern which actions or inactions are actually being caused by the recent events may aid us in being more effective at combating them.

For companies with pending or planned NDAs or BLAs, this environment calls for both defensive and offensive strategies. First, it’s wise to build in more time for FDA review—even if your data look great and your application is buttoned-up. That’s especially true for applications involving advisory committees, REMS evaluations, or pre-approval inspections. Second, clarity and focus in your pre-submission meetings are more critical than ever. These interactions—already short and highly structured—may now be your best shot at aligning with a stretched agency. And finally, if your business strategy hinges on hitting a PDUFA date, consider engaging regulatory counsel early to spot red flags well in advance. In this climate, getting the first cycle right isn’t just about speed, it’s potentially about survival.

In recent interviews, FDA Commissioner Dr. Marty Makary emphasized that no scientists or reviewers were affected by the RIFs, stating that the layoffs targeted administrative and support roles. He’s also committed to ensuring that remaining scientific staff have the tools they need. But it’s fair to say the full impact on remaining reviewers—now operating without both senior leadership and support infrastructure—has yet to be fully realized.

We’ll be back with more on this.

There is much change happening at FDA. In the wake of the April 1^st reduction in force, there has been a great deal of uncertainty about what the impacts will be. This rings particularly true amongst the rare disease patient community, along with many small biotech companies (and their investors) that take on the risk of developing orphan drugs for exceedingly small patient populations.

For nearly a decade, we at HPM along with the rest of the rare disease community have been advocating for greater consistency in application of scientific judgment and regulatory flexibility in the review of applications for rare diseases (see our call to action here). We knew that expertise in the “science of small trials” comes with years of experience of conducting drug reviews, and that certain review teams within CDER and CBER have more experience overcoming the well-known challenges in rare diseases. Last year, FDA heard this message and established the Rare Disease Innovation Hub to create a greater teamwork approach to considering rare diseases scientific and regulatory issues. But was this new flagship “hub” retained by the new administration?

Patients and their families and caregivers have long fought to have a seat at the table with decision-makers. This has been a slow culture shift to see patients as having a voice, dating back to the HIV/AIDS crisis in the 1980’s, expanded to the cancer advocacy movement in the 1990’s, and now with rare disease patients stepping up to have their voices heard to fill the gaps in the medical literature that is so limited in rare disease. Their advocacy has led to long-standing, highly successful programs (i.e., Patient Listening Sessions and Patient-Focused Drug Development meetings) to more systematically involve patients, allowing them to educate all stakeholders about their lived experiences and treatment needs. But are these programs still operating?

And beyond the RIF, where does rare disease and patient engagement sit in the priorities of newly confirmed Commissioner Makary’s MAHA (Make American Healthy Again) priorities? In this post, we’ve summarized what we’ve learned in the weeks post-RIF, as well as share late-breaking insights from Dr. Makary’s first interview as Commissioner published late last night.

Does the MAHA platform have a plan for those suffering from rare diseases?

As for the Rare Disease Innovation Hub, while those who launched the Hub (previous CDER and CBER Directors, Patrizia Cavazzoni and Peter Marks, along with CBER Deputy Julie Tierney) have departed the Agency, the key person hired to operationalize the Hub, Amy Comstock Rick, the Director of Strategic Coalitions, remains. Other key rare disease functions like the CDER Rare Disease Team (led by Kerry Jo Lee) and the CBER Rare Disease Liaison, Julie Vaillancourt, are still boots on the ground too.

Recent remarks from Amy Comstock Rick signal continuity. Speaking to the Biopharma Congress, she shared that the Hub’s goals of efficiency, centralization and coordination fit with the Trump Administration’s current focus for the FDA (US FDA Rare Disease Innovation Hub’s Goals Align With Trump, Leader Says). Her comments should reassure patients and product developers that the progress made with the launch of the Hub is maintained.

When created in 2024, one of the goals of the Hub was collaboration between CDER and CBER. This goal now seems to align with reported plans to merge the various FDA Centers. Although details of the proposed plan to build a unified therapeutic product center are sparse, one could envision enhanced collaboration across orphan drug and biologic review in furtherance of that common goal.

More recently, in his first interview as Commissioner, Dr. Makary took the opportunity to address the need for therapies for those living with rare diseases, calling out ultra rare patient populations in particular. He shared his vision (the full interview is available here):

When you are talking about rare diseases, a genetic issue that affects 52 kids in the world and that’s a real thing…or 15 kids…, you can’t expect the companies to do a randomized controlled trial. You’ll kill innovation. You’ll kill investment in those innovative ideas. You’ve got to say, “Hey, this is a very difficult condition. It’s incurable. It’s fatal. It’s a permanent disability. We’re going to customize the approval process to the condition. And, so, we’re going to be rolling out a new pathway for drugs, which is a pathway based on a plausible mechanism. If there’s a rare condition or a condition that’s incurable that affects a small number of people, we may be approving drugs based on a plausible mechanism on sort of a conditional basis.

Let’s say there’s a condition that affects 75 people in the world and there’s a treatment that makes sense physiologically. The mechanism is scientifically plausible that this treatment would help these individuals. No one’s forcing these medications on these individuals. If they want to try these new medications even though we don’t have a randomized controlled trial because it’s not feasible, we will allow that and at the same time monitor everybody who gets it so that we can make inferences as soon as the data speaks with a signal in the data.

The approach to development and regulatory pathway to approval for orphan drugs has been ever-evolving since the Orphan Drug Act was passed in 1983. While FDA has a long-standing history of exercising reasonable judgment when considering drugs for rare diseases (see our previous analysis here), asking FDA officials to “color outside of the lines” can only go so far. Dr. Makary’s proposal for a mechanism-based conditional approval approach to ultra-rare disease holds great promise.

We have seen firsthand the dire consequences of trying to apply regulatory standards that date back to the 1960’s (when the “substantial evidence” requirement was first established) to rare disease settings. We have seen development programs be halted despite great promise, and scientists’ life’s work, patients’ sacrifice from participating in trials, and difficult-to-obtain investment dollars be washed away when impractical study designs were expected. As a result of our cumulative experience across many dozens of ultrarare products in development, we at HPM have been advocating for a similar change to the standard of approval of drugs for ultra rare diseases. We want to give FDA review officials the tools they need to be able to reduce barriers and “customize” what development looks like for ultra rare products (see, e.g., coverage of Frank Sasinowski’s remarks at the May 21, 2024 EveryLife Foundation for Rare Diseases Scientific Workshop, Debating a new pathway for ultrarare).

Where does Commissioner Makary see a place for patients and their loved ones?

Based on our experiences working with patient organizations, it appears that both the patient affairs team responsible for Patient Listening Sessions within the Office of the Commissioner, as well as the Patient-Focused Drug Development (PFDD) staff across CDER and CBER are intact and operational. These programs have been successful in systematically eliciting the patient perspective on specific diseases and their treatments. The program helps FDA understand the context in which regulatory decisions are made for new drugs.

The flagship PFDD program, which consists predominantly of patient group-organized Externally-led Patient-Focused Drug Developments meetings (EL-PFDD) has been active. The current webpage for EL-PFDD lists at least 6 upcoming meetings, primarily focused on rare disease populations (Upcoming EL-PFDD Meetings | FDA). We know that at other EL-PFDD meetings have been granted in the last couple of weeks too. Continuation of these meetings in the face of other programmatic cuts is significant and gives us hope that the patient voice will continue to be heard.

Beyond existing programs, yesterday, Dr. Makary announced a new policy on individuals serving on FDA Advisory Committees, which includes an important commitment to include and perhaps expand of patient and caregiver participation. The announcement states, “As part of this effort, the agency will prioritize and elevate the role of patients and caregivers, strengthening the voices of their communities.” FDA has long-included patients and caregivers as voting members on advisory committees for drugs and biologics, as Patient Representatives, however the program staff have often not been given enough time or resources to recruit individuals with direct disease experience to participate on a particular committee. We hope the Commissioner’s prioritization of the patient voice will lead to a better-resourced Patient Representative program.

What should rare disease and patient stakeholders look for from here?

With every new administration comes change. Experience tells us that top-down policy priorities take time to have an impact on the day-to-day review work, if they do at all, as FDA leadership have many competing priorities and there will necessarily be public health emergencies that pull their attention. Ultimately, predictability and continuity of the drug and biologic review work at FDA are what drive investment and, therefore, innovation in medical research. The maintenance of rare disease and patient-focused personnel at FDA, in addition to the scientific and clinical reviewers themselves, many who have been staunch advocates for patients and their families, offers promise that innovation will not slow down.

However, the proof is in the pudding, so the community should keep an eye on the level of engagement review staff are able to maintain (including in-person sponsor meetings with FDA to provide expert guidance) and how well the Agency is able to meet its review timeframes (e.g., PDUFA dates for NDAs and BLAs being reviewed). We can be excited for new policies while also expecting accountability.