Last week, just before the new Orange Book (print and electronic versions) made its debut, we opined (see our previous post here) that changes to the Orange Book Preface would likely be made. Now that the print version of the Orange Book is available (here), we’ve had a chance to peruse those Preface (and Patent and Exclusivity Information Addendum) revisions.  Although the changes made to the 2017 Orange Book Preface are not nearly as substantial as the 2016 facelift (see our previous post here), there are some noteworthy changes, which we highlight below.  For ease of use and reference, we put together a redline of the 2017 Orange Book Preface and Patent and Exclusivity Information Addendum showing the additions and deletions compared to the 2016 versions.

Orange Book Preface

• Right off the bat, FDA deletes from the 2017 Preface any specific reference to drug products subject to pending DESI proceedings. Now gone is the text stating “Drugs on the market approved only on the basis of safety (covered by the ongoing Drug Efficacy Study Implementation [DESI] review [e.g., Donnatal® Tablets and Librax® Capsules] or pre-1938 drugs [e.g., Phenobarbital Tablets]) are not included in this publication.” We anticipated that FDA would remove any reference to Librax, given the recent discovery that the drug was approved in the mid-1960s (see our previous post here); however, we didn’t expect the deletion of all that DESI-related and grandfather drug information. Now such products truly “are not included in this publication.”
• In Section 1.2 (Therapeutic Equivalence-Related Terms) of the Preface, FDA clarifies certain common terms, such as “pharmaceutical equivalents” and, in particular, “strength” to comport with definitions (at 21 C.F.R. § 314.3) that became effective on December 5, 2016 with the implementation of certain provisions of the 2003 Medicare Modernization Act (“MMA”).
• Curiously, FDA, in a discussion of the term “therapeutic equivalents” in Section 1.2, deletes the following sentence:“Therapeutic equivalence determinations are not made for unapproved, off-label uses.” This sentence has appeared in the Preface since the 17th (1997) edition of the publication, and was likely added to the Orange Book Preface as a result of the U.S. Court of Appeals for the District of Columbia Circuit’s August 1996 decision in Bristol-Myers Squibb v. Shalala, 91 F.3d 1493 (D.C. Cir. 1996) (here). That decision affirmed an ANDA applicant’s ability to omit patent- or exclusivity- protected labeling information in a manner consistent with the FDC Act’s “same labeling” requirement. In reaching its decision, the D.C. Circuit ruled that the FDC Act “expresses the legislature’s concern that the new generic be safe and effective for each indication that will appear on its label; whether the label for the new generic lists every indication approved for the use of the pioneer is a matter of indifference.”
• In Section 1.4 (Reference Listed Drug and Reference Standard) of the Preface, FDA elucidates the terms “Reference Listed Drug” and “Reference Standard” and the process for their designation, as discussed in recent guidance issued by the Agency (see our previous post here).
• Fast-forwarding to Section 1.8 (Description of Certain Special Circumstances) of the Preface, FDA includes some added discussion around Levothyroxine Sodium and therapeutic equivalence ratings. In particular, FDA explains the rating of ANDA 076187 vis-à-vis other approved drug products and in light of a recent Citizen Petition decision (Docket No. FDA-2015-P-0403).

Orange Book Patent and Exclusivity Information Addendum

• FDA makes several noteworthy revisions to the Patent and Exclusivity Information Addendum, which precedes the Prescription and OTC Drug Product Patent and Exclusivity List. The changes reflect FDA’s new regulations implementing the MMA (e.g., patent information listings, and, in particular, method-of-use patent information), as well as new law, policy and court decisions.
• FDA’s descriptions of 5-year new chemical entity exclusivity and 3-year new clinical investigation exclusivity have been refined to reflect the Agency’s current interpretations of the law. For example, FDA’s revised description of 3-year exclusivity now states that if 3-year exclusivity is granted, then “a subsequent ANDA or a 505(b)(2) application may not be approved for the exclusivity-protected ‘conditions of approval of such drug’ before the expiration of three years from the date of approval of the original application. If a NDA or 505(b)(2) applicant has exclusivity only for a new indication or use, this exclusivity generally does not preclude the approval of an ANDA or 505(b)(2) application for indications and uses not covered by the exclusivity, assuming the proposed drug product will be safe and effective as labeled.” This revised description appears to be intended to more clearly convey FDA’s focus on the scope of 3-year exclusivity (see our previous posts here and here).
• FDA includes a note around the end of the Addendum stating: “Please note that the date of approval for an NDA for which FDA recommends controls under the Controlled Substances Act is the later of the date on the approval letter for the NDA or the date of issuance of the interim final rule controlling the drug (see section 505(x)(1) and (2) of the FD&C Act).” This note is consistent with changes FDA recently implemented in the Agency’s regulations defining the term “date of approval” (21 C.F.R. § 314.3). Those changes were necessary after the statute was amended in November 2015 by the IRTNMTA (Improving Regulatory Transparency for New Medical Therapies Act) to add FDC Act § 505(x) (see our previous post here). For an example of the IRTNMTA in action, check out NDA 205525 for SYNDROS (dronabinol oral solution), 5 mg/mL. FDA “approved” NDA 205525 on July 1, 2016; however, the drug product is not yet listed in the Orange Book as an approved drug.  Why?  Because SYNDROS is not yet truly approved for Orange Book listing purposes, as the scheduling of the product under the Controlled Substances Act is pending.

Well, there you have it: the 2017 Orange Book notes for junkies. We’ll surely revisit this post in 2018 when the 38th edition of the Orange Book is published.

In a Complaint filed on January 27, 2017 in the U.S. District Court for the District of Columbia, ANDA applicant Amneal Pharmaceuticals LLC (“Amneal”) alleges that FDA incorrectly ruled that Amneal forfeited eligibility for 180-day exclusivity for generic versions of NAMENDA XR (memantine HCl) Extended-release Capsules, 7 mg, 14 mg, 21 mg, and 28 mg. As such, Amneal seeks declaratory and injunctive relief, asking the  court to vacate FDA’s forfeiture determination, declare that Amneal has not forfeited 180-day exclusivity, and to enter an order vacating or setting aside FDA’s final approval of several ANDAs already approved for generic versions of NAMENDA XR.

The lawsuit involves forfeiture of 180-day exclusivity under FDC Act § 505(j)(5)(D)(i)(IV). That provision, added by the 2003 Medicare Modernization Act, states that 180-day exclusivity eligibility is forfeited if:

The first applicant fails to obtain tentative approval of the application within 30 months after the date on which the application is filed, unless the failure is caused by a change in or a review of the requirements for approval of the application imposed after the date on which the application is filed.  [(Emphasis added)]

The 2007 FDA Amendments Act (“FDAAA”) clarified FDC Act § 505(j)(5)(D)(i)(IV), such that if “approval of the [ANDA] was delayed because of a [citizen] petition, the 30-month period under such subsection is deemed to be extended by a period of time equal to the period beginning on the date on which the Secretary received the petition and ending on the date of final agency action on the petition (inclusive of such beginning and ending dates) . . . .” (FDC Act § 505(q)(1)(G)). The 2012 FDA Safety and Innovation Act (“FDASIA”) made further changes with respect to the application of FDC Act § 505(j)(5)(D)(i)(IV) to certain ANDAs (see our previous post here). Neither the FDAAA, nor the FDASIA provisions came into play with Amneal ANDA 205825, but we note them nevertheless.

What does come into play, however, is the causation clause under FDC Act § 505(j)(5)(D)(i)(IV). FDA’s position has been that even if one of the causes of failure to obtain tentative approval by the 30-month forfeiture date was a change in or a review of the requirements for approval imposed after the application was submitted, a first applicant will not forfeit eligibility notwithstanding that there may have been other causes for failure to obtain tentative approval by the 30-month forfeiture date that were not caused by a change in or review of the requirements for approval.  That is, to avoid forfeiture, an applicant need only show that acceptability of one aspect of its ANDA (e.g., chemistry, labeling, or bioequivalence) was delayed due, at least in part, to a change in or review of the requirements for approval, irrespective of what other elements may also have been outstanding at the 30-month date.  In other words, “but-for” causation is not required in order to qualify for the exception under FDC Act § 505(j)(5)(D)(i)(IV).  FDA’s position is that this interpretation best effectuates the policy embodied in the exception, insofar as it does not penalize first applicants for reviews of or changes in approval requirements imposed after their ANDAs are submitted that cause the failure to obtain approvals or tentative approvals within 30 months, and continues to incentivize applicants to challenge patents by preserving (in many instances) the opportunity to obtain 180-day exclusivity.  FDA recently reiterated this position in draft guidance on 180-day exclusivity (see our previous post here).

Amneal submitted ANDA 205825 to FDA on June 10, 2013 containing Paragraph IV certifications challenging certain patents listed in the Orange Book for NAMENDA XR. FDA initially Refused to Receive (“RTR”) the ANDA, but rescinded that RTR decision on February 18, 2014 and acknowledged receipt of ANDA 205825 as of the initial June 10, 2013 receipt date.  As a result, Amneal is a “first applicant” – and apparently the sole first applicant – eligible for 180-day exclusivity for generic NAMENDA XR.

Seven months after rescinding the RTR determination for ANDA 205825, FDA issued a Complete Response Letter refusing to approve the ANDA and raising several questions, including a request for data from the manufacture of a commercial size lot (batch). Amneal supplied that information to FDA approximately eight months later, and provided additional information in September 2015, just a few months before the December 10, 2015 30-month forfeiture date under FDC Act § 505(j)(5)(D)(i)(IV).  In October 2015, FDA issued an Import Alert against Amneal’s API manufacturer, necessitating a change in API supplier by Amneal, which Amneal proposed in November 2015.  After other back-and-forth with FDA, including a second Complete Response Letter dated December 7, 2015, the Agency finally approved Amneal ANDA 205825 on October 12, 2016. . . . as well as ANDAs from other, subsequent Paragraph IV ANDA applicants.

As to Amneal’s eligibility for 180-day exclusivity, the last sentence above says it all. FDA determined in a September 21, 2016 Memorandum to ANDA 205825, and later in a September 28, 2016 Letter Decision sent to counsel for Amneal, that Amneal forfeited eligibility for 180-day exclusivity.  According to FDA, Amneal failed to obtain timely tentative approval or ANDA approval by the forfeiture date (i.e., December 10, 2015), and such failure was not caused by a change in or review of the requirements for approval.

It’s the causality element that Amneal takes particular issue with in the company’s Complaint: “FDA should not impose forfeiture if, as a factual matter, there is any causal connection between the failure to obtain tentative approval and a change in or review of approval requirements for the application,” according to Amneal (emphasis in original). To that end, Amneal argues that FDA’s forfeiture decision violates the FDC Act and the Administrative Procedure Act and must be vacated and set aside for at least four reasons:

1. FDA’s application of an irrebuttable adverse presumption of no causation if the change in or review of the approval requirements is resolved as of the forfeiture date is contrary to the causation analysis required by the FDCA and is arbitrary and capricious;

2. FDA’s decision is not the product of reasoned decision making because it failed to provide an explanation for rejecting any causal connection between the 14-month delay resulting from FDA’s demand for commercial-scale batch information and Amneal’s ability to obtain timely tentative approval;

3. FDA’s conclusion that its demand for commercial-scale batch information was not a change in or review of approval requirements because FDA had not changed a secret, undisclosed policy is contrary to the FDCA and is arbitrary and capricious;

4. FDA failed to consider the impact, either alone or in the aggregate, of the months-long delay in deciding whether to receive Amneal’s ANDA. The delay in receipt was itself the product of a change in or review of approval requirements and should have been considered by FDA as a potential cause for the failure to timely obtain tentative approval. FDA should also have considered the delay in receipt in an analysis of the causal effect of FDA’s demand for commercial-scale information.

In addition to requesting that the court set aside current ANDA approvals and declare that Amneal has not forfeited 180-day exclusivity eligibility, Amneal also requests that the court preliminarily and permanently enjoin FDA from granting final approval to any ANDA, other than Amneal ANDA 205825, until the expiration of Amneal’s 180-day exclusivity.

FDA recently put forth its first interpretation of the Regenerative Advanced Therapy (“RAT”) designation program, which was established by section 3033 of the 21st Century Cures Act. Although it consists of just a few short paragraphs on FDA’s website (here), the guidance confirms that FDA will use its standard definitions found in its Expedited Programs Guidance for terms like “serious or life-threatening,” and it signals that FDA has begun the lengthy process of implementing the new designation program. For a healthy dose of nostalgia, recall a simpler time, when breakthrough therapy designation was the newest tool in FDA’s expedited programs kit (here).

Background

Section 3033 of the 21st Century Cures Act provides that a drug is eligible for RAT designation if:

• “(A) the drug is a regenerative medicine therapy [which] includes cell therapy, therapeutic tissue engineering products, human cell and tissue products, and combination products using any such therapies or products, except for those regulated solely under section 361 of the Public Health Service Act and part 1271 of title 21, Code of Federal Regulations;
• (B) the drug is intended to treat, modify, reverse, or cure a serious or life-threatening disease or condition; and
• (C) preliminary clinical evidence indicates that the drug has the potential to address unmet medical needs.”

FDA’s website clears up any potential confusion related to the “includes” clause in the first prong by stating that “regenerative medicine therapy . . . is defined as a cell therapy, therapeutic tissue engineering products, human cell and tissue products, and combination products using any such therapies or products, except for those regulated solely under section 361 of the Public Health Service Act and part 1271 of title 21, Code of Federal Regulations.” (Emphasis added.)

Given the definition of RAT, it’s useful to recall that, per 21 CFR 1271.10(a), 361 human cells, tissues, or cellular or tissue-based products (“HCT/Ps”):

• Are minimally manipulated;
• Are intended for homologous use (as reflected in labeling and advertising);
• Are not manufactured by combining cells or tissues with another article, except for water, crystalloids, or a sterilizing, preserving, or storage agent; and
• Do not have a systemic effect nor are they dependent upon the metabolic activity of living cells for their primary function, with certain limited exceptions.

If any of these requirements are not met, the HCT/P is still subject to regulation under 21 C.F.R. Part 1271, but in addition is likely subject to biologic, drug, or medical device regulation.

In practice, many of the HCT/Ps in regenerative medicine that do not qualify as 361 HCT/Ps are regulated as biologics subject to section 351 of the PHS Act and approved via a biologics license application (BLA). The BLA process is perhaps the most burdensome and lengthy premarket review process that FDA imposes. To address this, Congress created the RAT designation.

Evolving Definition of Regenerative Therapy

The definition of RAT established by 21st Century Cures is considerably broader than the one recently provided by FDA in a presentation on regenerative medicine and regulatory science. In a October 2016 presentation, FDA stated that regenerative medicine products are generally for repair, replacement, or regeneration and usually are a combination of a biological product with a medical device (e.g., a 3D, cell-scaffold product).

Instead of focusing on function, a la “repair, replacement, or regeneration,” the 21st Century Cures definition puts greater emphasis on product type (e.g., whether it is a therapeutic engineering product), as opposed to intended use. After all, a RAT need only be “intended to treat . . . a serious or life-threatening disease or condition.” (Emphasis added.) This intended use is in no way unique to regenerative medicine, and the Agency may seek to narrow the intended uses that qualify as RATs in future guidance.

RAT Designation Process

Requests for RAT designation can be made concurrently or at any time after submission of an IND. FDA is required to respond within 60 days. If CBER’s Office of Tissues and Advanced Therapies (“OTAT”) determines that a RAT designation request is incomplete or that the drug development program does not meet the criteria for designation, it will inform the sponsor and include a written description of the rationale for its determination. FDA’s RAT website also provides that:

• Sponsors should refer to FDA’s Expedited Programs Guidance for FDA’s interpretation of whether a disease or condition is “serious or life-threatening” and whether a drug is “intended to treat a serious disease or condition.”
• Consistent with fast track and breakthrough therapy designations, FDA does not expect that sponsors submit primary data. Instead, FDA requests that sponsors describe the preliminary clinical evidence.
• Sponsors should provide a brief description of any available therapies for the disease or condition, the study design, the population studied, and the endpoint(s) used, and a description of the study results and statistical analyses (e.g., subgroup analyses).
• Requests for RAT designation should be submitted to OTAT.
• The cover letter for a request should clearly specify that the submission contains a “REQUEST FOR REGENERATIVE ADVANCED THERAPY DESIGNATION” in bold, upper case letters.

Benefits of RAT Designation

RAT designation affords the following benefits to sponsors:

• Expedited development and review by FDA (i.e., the same actions as for breakthrough therapy designation);
• Early interactions “to discuss any potential surrogate or intermediate endpoint to be used to support the accelerated approval of the product;” and
• Eligibility for accelerated approval under current FDA preapproval standards but with new postapproval requirements.

Signaling for Expanded Use of Accelerated Approval

The new postapproval requirements are a key differentiating factor from the breakthrough therapy designation. Sponsors of RAT-designated products approved via the accelerated approval pathway have additional options to meet post-approval requirements beyond the standard, controlled clinical trial. Post-approval requirements can be met through:

• Clinical evidence, clinical studies, patient registries, or other sources of real world evidence, such as electronic health records;
• The collection of larger confirmatory data sets; or

Postapproval monitoring of all patients treated with such therapy prior to approval of the therapy.

The new designation, therefore, encourages FDA to further develop and utilize the Subpart H/accelerated approval pathway. For a comprehensive review of FDA’s use of accelerated approval, refer to our paper, here.

Notably, the January 2015 House version of 21st Century Cures at section 2041 addressed regenerative medicine from a different angle. It directed FDA to issue a guidance document on surrogate and intermediate endpoints for accelerated approval of regenerative medicine products. Although this original approach was less ambitious, it also highlighted the need for accelerated approval to bring to market products in the budding field of regenerative medicine.

In late November, FDA announced that it would not be finalizing the 2014 draft LDT Guidance.  The Agency had, however, done a significant amount of work regarding the draft guidance and evaluating the regulatory framework for lab tests.  In an effort to document the work that it had done and further the public discussion regarding LDTs, FDA issued a discussion paper on Friday (the 13th) laying out key elements of a possible revised future LDT regulatory framework.

Released in the last week of the Obama administration, the discussion paper is in no way a formal proposal by FDA. We think, however, it is worth noting a few key elements that could potentially appear in a renewed attempt to regulate LDTs in a new administration.  The discussion paper states the following:

• LDTs on the market at the time a final guidance is issued would not be expected to comply with any FDA regulatory requirements except for MDR reporting, unless necessary to protect the public health;

• Certain categories of LDTs entering the market after issuance of a final guidance would be exempt from regulation, unless necessary to protect the public health.  These categories are consistent with the proposed LDT guidance and included, among others, low risk LDTs, LDTs for rare diseases, and Traditional LDTs;

• FDA has the ability to regulate any of the exempt LDTs if it concludes that the test is not analytically or clinically valid or there is insufficient data to support analytical or clinical validity, the LDT manufacturer has engaged in deceptive promotion, or there is a reasonable probability that an LDT will cause death or serious adverse health consequences (in other words, FDA believes it can regulate selected LDTs);

• For the remaining tests that will be subject to FDA regulatory oversight, the requirements would be phased in using a risk-based approach in four years rather than nine years as proposed in the draft guidance;

• Tests that enter the market after a final guidance is issued but before their phase-in date could be offered commercially during its premarket review, and manufacturers would have two years to comply with the Quality System Regulation (QSR);

• The third-party premarket review program could be expanded to accept certain LDT approvals, including, for example New York Department of Health (note: the discussion paper does not consider the statutory limitations to having a third-party reviewer evaluate clinical data related to an LDT);

• FDA could accept compliance with the Clinical Laboratory Improvement Amendments quality requirements to satisfy the QSR, with the exception of design controls, acceptance activities, and corrective and preventive actions (CAPA);

• Evidence of clinical validity should be made publicly available; and

• Changes to LDTs would require premarket review if the change significantly changes the performance specifications or intended use of the test.

As we discussed in our last LDT post (see here), there are a number of ways FDA could still attempt to regulate LDTs even without a final guidance.  The discussion paper does not allude to how FDA could proceed to indirectly regulate LDTs until it puts forth a new LDT proposal, beyond noting that FDA reserves the right to attack LDT tests it considers invalid.

The discussion paper does, however, make clear that FDA believes compliance wouldn’t be too burdensome for laboratories. Whether that assessment is correct is debatable.  For example, the discussion paper says that “clinical validity, especially of established tests, can often be supported by literature, well-curated databases, or other appropriate sources that meet the valid scientific evidence standard.”  As we have previously noted, FDA rarely accepts data other than prospective clinical studies; even performing studies using banked samples can be difficult.  It is possible that third-party reviewers may be more accepting of alternative forms of clinical data; however, we do not expect FDA would change its standards.

As is so often the case, the devil is in the details. Assuming FDA does resume its quest to regulate LDTs, we will have to wait quite a while to learn the details.

FDA’s October 6, 2016 Final Rule implementing certain provisions of the December 8, 2003 Medicare Modernization Act (“MMA”), Pub. L. No. 108-173, 117 Stat. 2066, ushered in a lot of changes for NDA and ANDA applicants and sponsors (see our previous post here).  The new regulations went into effect on Monday, December 5, 2016, and FDA immediately began to enforce them.

While we’re likely to see controversy and various issues crop up in the years to come as the new MMA rules are tested, one of the new requirements in particular has come up over and over again in the weeks since December 5, 2016. It concerns ANDA amendments and new 21 C.F.R. § 314.96(d).  (The corresponding regulation applicable to 505(b)(2) NDA applicants is at 21 C.F.R. § 314.60(f).)  This regulation states:

(d)(1) Patent certification requirements.  An amendment to an ANDA is required to contain an appropriate patent certification or statement described in Sec.  314.94(a)(12) or a recertification for a previously submitted paragraph IV certification if approval is sought for any of the following types of amendments:

(i) To add a new indication or other condition of use;

(ii) To add a new strength;

(iii) To make other than minor changes in product formulation; or

(iv) To change the physical form or crystalline structure of the active ingredient.

(2) If the amendment to the ANDA does not contain a patent certification or statement, the applicant must verify that the proposed change described in the amendment is not one of the types of amendments described in paragraph (d)(1) of this section.

New Subsection (d)(1) codifies FDA’s position, developed over the past decade or so, that certain changes proposed in an ANDA amendment require an applicant to recertify to patent information listed in the Orange Book for the brand-name RLD, and, in the case of a Paragraph IV certification, to provide a new notice of Paragraph IV certification. A patent infringement lawsuit filed in response to such a renotification can result in the imposition of a superseding 30-month litigation stay on ANDA approval.  We previously blogged on that issue here, and there are various FDA Citizen Petition Decisions discussing the issue (Docket No. FDA-2012-P-0943; Docket No. FDA-2011-P-0127; Docket No. FDA-2010-P-0223; Docket No. FDA-2010-P-0632), as well as instances in which the issue has been raised in patent infringement litigation because of a product change in an amendment (See, e.g., Alza Corp. et al. v. Impax Laboratories Inc. et al., Case No. 1:10-cv-01024 [here]; Alza Corp. et al. v. Impax Laboratories, Inc. et al., Case No. 1:11-cv-00395 [here]; Teva Branded Pharmaceutical Products R&D Inc. et al. v. Perrigo Pharmaceuticals Co. et al., Case No. 13-cv-01441 [here]).

New Subsection (d)(2) is a new requirement. FDA explains in the preamble to the MMA Final Rule that “if the amendment to the 505(b)(2) application or ANDA does not contain a patent certification or statement, the applicant must verify that the proposed change described in the amendment is not one of the types of amendments described in Sec. Sec. 314.60(f)(1)(i) through (iv) and 314.96(d)(1)(i) through (iv).”  And when FDA says “must,” the Agency really means “must.”

Immediately after the December 5, 2016 effective date of the new regulations, FDA’s Office of Generic Drugs (“OGD”) provided ANDA applicants with a courtesy reminder (often by phone) that any ANDA amendment, if it does not contain a patent certification (or section viii statement), must include a verification statement pursuant to 21 C.F.R. § 314.96(d)(2). The verification statement can be rather simple, and may be included in a cover letter to the ANDA amendment.  For example, “This amendment does not seek approval for a change listed in 21 C.F.R. § 314.96(d)(1),” or “I verify this amendment is not listed in 21 C.F.R. § 314.96(d)(1).”

In recent weeks, OGD appears to have stopped providing courtesy reminders by phone to ANDA applicants. Instead, OGD is sending out more official correspondence saying that an amendment submitted without a verification is deficient.  Here’s an example of such correspondence:

This is in reference to your abbreviated new drug application (ANDA) XXXXXX for [DRUG]. Your amendment dated [DATE], was submitted to the Agency on or after December 5, 2016, the effective date of the final rule on Abbreviated New Drug Applications and 505(b)(2) Applications; Final Rule, 81 FR 69580 (Oct. 6, 2016).  This rule revised 21 CFR 314.96(d), which concerns amendments to unapproved ANDAs.  In part, the rule now requires an amendment to an unapproved ANDA to contain an appropriate patent certification or section viii statement described in 21 CFR 314.94(a)(12), or a recertification for a previously submitted paragraph IV certification, if approval is sought for changes described in any of the following types of amendments:

(i) To add a new indication or other condition of use;

(ii) To add a new strength;

(iii) To make other than minor changes in product formulation; or

(iv) To change the physical form or crystalline structure of the active ingredient.

If an amendment to an unapproved ANDA does not contain a patent certification or section viii statement, or a recertification, the applicant must verify that the proposed change described in the amendment is not one of the types of amendments described above.

Your amendment is deficient under 21 CFR 314.96(d). It currently does not contain (1) a patent certification or section viii statement, (2) a recertification, or (3) a verification statement.  As appropriate, please submit a patent certification or section viii statement, a recertification, or a verification statement (referencing your amendment dated [DATE]).

For future reference, to comply with the requirement of 21 CFR 314.96(d), we recommend that a patent certification or section viii statement, or recertification be referenced in the cover letter of an amendment to an unapproved ANDA and included in module 1.3 of such unapproved ANDA. Similarly, we recommend that a verification statement be included in the cover letter of an amendment to an unapproved ANDA.  For inquiries related to this requirement please contact the Patent and Exclusivity Team at CDER-OGDPET@fda.hhs.gov.

Avoiding such a deficiency letter is relatively simple: Remember to incorporate the verification in any template correspondence for an ANDA amendment.

We’ll probably see more from FDA and other interested parties on the new verification requirement as new scenarios crop up. (And we’re likely to see a lot of ink spilled on what types of amendment changes might trigger the patent certification/recertification requirement.  After all, the phrase “other condition of use” at 21 C.F.R. § 314.96(d)(1)(i) seems pretty ambiguous.) In fact, we’ve already come across one instance that seems to run contrary to the “either/or” choice FDA explains in the preamble to the MMA Final Rule (i.e., “if the amendment to the 505(b)(2) application or ANDA does not contain a patent certification or statement, the applicant must verify. . . .”). In the case of a timely-listed later-listed Orange Book patent, an ANDA applicant must certify to the patent in an amendment; however, the amendment may not be for one of the changes listed at 21 C.F.R. § 314.96(d)(1), and thus requires a verification under 21 C.F.R. § 314.96(d)(2).

Hardly a day goes by that we don’t see a press release or announcement that a company has requested or received from FDA’s Office of Orphan Products Development (“OOPD”) designation of its drug or biological product as an “orphan drug.” There’s a reason for that: FDA is receiving orphan drug designation requests at a record rate of 1.6 per day (2.23 per work day in 2016), and is granting designation requests at a near-record rate of 0.9 per day (1.28 per work day in 2016)!  If you haven’t already guessed, it’s time for the FDA Law Blog’s annual rundown of orphan drug designations and approval!

In 2016, FDA’s orphan drug program continued to break new ground with massive numbers of orphan drug designation requests. Orphan drug designations and approvals (which include not only approvals of NDAs for new molecular entities and BLAs for original biological products, but also applications approved for new orphan uses of previously approved drugs and biologics) dipped slightly from 2015, but not by much (see our previous post here).  2016 was still the second best year for orphan drug designations, and the third best year for orphan drug approvals since the enactment of the Orphan Drug Act.

FDA’s OOPD received an astonishing 582 requests for orphan drug designation in 2016.  That 110 more than the record set in 2015.  OOPD also granted an amazing 333 orphan drug designations in 2016.  That’s 21 fewer designations than the 2015 record, but still not too shabby.  There were 9 fewer orphan drug approvals in 2016 compared to the near-record-tying 48 approvals in 2015. (FDA set a record in 2014 with 49 orphan drug approvals.)  Since 1983, FDA has approved almost 600 orphan drugs, has granted nearly 4,000 orphan drug designations, and has received nearly 5,800 orphan drug designation requests.

Below are three tables – one for each metric we track – showing the year-by-year numbers since 1983. The numbers are largely based on information from FDA’s Orphan Drug Designations and Approvals Database.

Over the years, we’ve pointed out the fact that while OOPD’s workload continues to increase, the Office’s staff and resources have not kept pace. Despite the massive increase in workload and added responsibilities over the years, OOPD’s staff has remained at about 25 employees for quite some time.  Moreover, funding for OOPD has remained relatively flat over the past few years.

The stress on limited OOPD resources was apparent in a FDA Voice blog post from July 2016. There, Dr. Gayatri Rao, OOPD Director, noted the increased workload and the effect on meeting internal Office review goals:

[T]he sustained increase in designation requests over the last three years, coupled with the increasing number of incentive programs and competing workload priorities, have forced us to reconsider our internal review target. Reviewing these applications in an efficient and timely manner continues to be a top priority, but to ensure we continue to conduct these reviews with the appropriate level of care and consideration, our current goal is to review on average 75% of designation requests within 120 days of receipt.

Perhaps the soon-to-be-released budget will include some much needed additional funding for OOPD . . . . but we’re not holding our breath.

On Wednesday, January 25, 2017, a new chapter will begin in the decades-old story of FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations (the “Orange Book”).  According to a note posted on the Electronic Orange Book website last week (as well as in a separate notice published on FDA’s website earlier this week): “On January 25, 2017, The Orange Book data will be updated to reflect the recent publication of the draft guidance for industry ‘Referencing Approved Drug Products in ANDA Submissions.’” This blogger, and presumably Orange Book aficionados everywhere, are pretty excited about the updates that are coming to both the electronic and print versions of the Orange Book (and presumably to the Orange Book Express app as well).

The draft guidance document FDA mentions in the note above – Referencing Approved Drug Products in ANDA Submissions (Docket No. FDA-2017-D-0114) – was one of many guidance documents FDA released in the days before the January 20, 2017 Presidential Inauguration.  And it’s a very, very welcome addition to the growing list of guidance documents in the Hatch-Waxman space.  Why?  Because in the draft guidance FDA defines and explains, for what is really the first time (with the exception of some new definitions included in FDA’s recent rules implementing the 2003 Medicare Modernization Act), terms fundamental to Hatch-Waxman and ANDA submissions that have for many years been misunderstood or misused (by FDA and the pharmaceutical industry).

Those terms are “Reference Listed Drug” (“RLD”), “Reference Standard,” and “Basis of Submission.” Each term refers to something very specific and critical to an ANDA submission.  Way back in 2012, we attempted to highlight the differences among these terms in a post titled “Big RLD” Versus “Little rld” – What’s the Difference?  But now we have something official from FDA that provides both a full explanation of the terms, as well as FDA policies relevant to each term.  Here’s a summary of the RLD, Reference Standard, and Basis of Submission concepts FDA provides in an appendix to the draft guidance:

• The reference listed drug (RLD) for an ANDA is the drug product that the proposed generic drug is intended to duplicate and to which the ANDA applicant must refer in its ANDA. The RLD must be a listed drug approved under section 505(c) of the FD&C Act based on a demonstration of safety and effectiveness. FDA identifies in the Orange Book listed drugs that are eligible to be RLDs. Starting in 2017, FDA intends to modify the Orange Book to clarify which listed drugs are RLDs and which are reference standards, and to indicate which products in the Discontinued Section may be referred to as an RLD. In the electronic Orange Book, there will be a column for RLDs. In the printed version of the Orange Book, the RLDs will be identified by a specific symbol.
• In vivo bioequivalence studies needed to support an ANDA must be conducted using the drug product that FDA has selected as the reference standard. The reference standard may or may not be the same listed drug as the RLD. While the reference standard is selected by FDA for the purposes of conducting any in vivo bioequivalence testing required for approval, all other comparisons of the proposed generic drug to determine whether it meets the statutory requirements for approval under section 505(j) of the FD&C Act (e.g., sameness requirements) generally must be to the RLD. The reference standard for a drug product selected by FDA generally is identified in the Orange Book. In the electronic Orange Book, there will be a column for reference standards. In the printed version of the Orange Book, the reference standards will be identified by a specific symbol.
• If you mistakenly identify the reference standard as the RLD in your ANDA, you may submit an amendment to a pending ANDA or a supplement to an approved ANDA to correct the information. FDA considers this error to be a deficiency related to identification of the appropriate listed drug as the RLD, rather than a change in the RLD itself. The cover letter for such a submission should clearly identify that the purpose of the submission is “Correction of RLD information.”
• The basis of submission statement in an ANDA (e.g., in section 1.12.11 of the ANDA) and in Form FDA 356h (field 20) should include the RLD and the RLD application number. For a petitioned ANDA, the basis of submission statement in the ANDA (e.g., in section 1.12.11 of the ANDA) also should include a reference to the FDA-assigned docket number for the suitability petition and a copy of FDA’s correspondence approving the suitability petition. The reference standard, if it is different from the RLD, should be identified in the appropriate sections of the ANDA (e.g., sections 1.12.11, 2.7.1, 5.2, and 5.3.1).

As FDA notes above, modifications to the Orange Book are on the way. And those changes will go live on January 25, 2017. But we don’t have to wait until then to get a peek at the new Orange Book. FDA recently published a 17-minute webinar explaining the changes to the Orange Book and the policies laid out in the draft guidance. In a presentation accompanying the webinar, FDA shows how the electronic and print versions of the Orange Book will be modified. In the print version of the Orange Book, RLDs will continue to be identified by the “+” symbol; however, FDA will now identify Reference Standards by the “!” symbol. Here’s an example:  The Orange Book Express app, which FDA introduced to the world on November 9, 2015 (see our previous post here), will also presumably be updated to reflect the new RLD and Reference Standard changes.We assume that other changes will also be made to the Orange Book with the introduction of the 2017 (and 37th) edition . . . and to the Preface in particular. That being said, we don’t anticipate quite the facelift that the Preface got last year (see our previous post here). At the very least, we assume that the Preface will be updated to remove any mention of LIBRAX as a drug product covered by an ongoing Drug Efficacy Study Implementation proceeding. After all, FDA only recently discovered and affirmed that LIBRAX is an approved drug . . . and has been for decades, according to the Agency (see our previous post here).

In the electronic version of the Orange Book, RLDs are now identified by “RLD” in the RLD column (instead of a “Yes” or “No”), and Reference Standards will be identified by “RS” in a new RS column. Here’s an example.

In the electronic version of the Orange Book, RLDs are now identified by “RLD” in the RLD column (instead of a “Yes” or “No”), and Reference Standards will be identified by “RS” in a new RS column. Here’s an example:

The Orange Book Express app, which FDA introduced to the world on November 9, 2015 (see our previous post here), will also presumably be updated to reflect the new RLD and Reference Standard changes.

We assume that other changes will also be made to the Orange Book with the introduction of the 2017 (and 37th) edition . . . and to the Preface in particular. That being said, we don’t anticipate quite the facelift that the Preface got last year (see our previous post here).  At the very least, we assume that the Preface will be updated to remove any mention of LIBRAX as a drug product covered by an ongoing Drug Efficacy Study Implementation proceeding.  After all, FDA only recently discovered and affirmed that LIBRAX is an approved drug . . . and has been for decades, according to the Agency (see our previous post here).

The Hemp Industries Association has filed a Petition for Review in the Ninth Circuit to block implementation of the Drug Enforcement Administration’s (“DEA’s”) recent final rule on Marijuana extracts. The DEA final rule designates non-psychoactive cannabinoids, including cannabidiol, as “marihuana extract” and adds all cannabinoids, including exempted portions of the Cannabis sativa L. plant, to schedule I of the federal Controlled Substances Act (“CSA”).  See Establishment of a New Drug Code for Marihuana Extract, 81 Fed. Reg. 90,194. 90,196 (Dec. 14, 2016) (here).

The petition seeks judicial review of DEA’s final rule creating a new drug code without following required CSA procedures or making findings required by the CSA to control substances. The petition claims that DEA’s rule creates a drug code for substances that are not controlled under the CSA; that the final rule “dictates that the mere presence of ‘cannabinoids,’ which are not controlled substances, is the determinative factor of whether a compound is a ‘marihuana extract.’” Petition at 2. It further claims that the final rule too broadly defines “marihuana extract” by including portions of the Cannabis sativa L. plant that are exempt from control under the CSA or exempt from being treated as controlled substances pursuant to the CSA and the Agricultural Act of 2014. Id. at 2-3.

The CSA defines “marihuana” as “all parts of the plant Cannabis sativa L., whether growing or not; the seeds thereof; the resin extracted from any part of such plant; and every compound, manufacture, salt, derivative, mixture, or preparation of such plant, its seeds or resin” but excludes “the mature stalks of [the] plant, fiber produced from [the] stalks, oil or cake made from the seeds of [the] plant, any other compound, manufacture, salt, derivative, mixture, or preparation of [the] mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed[s] . . . incapable of germination.” 21 U.S.C. § 802(16). Yet, the DEA final rule on marijuana extracts appears to include all portions of the marijuana plant, including those specifically excluded by the CSA from the definition of marijuana.

Petitioner, the Hemp Industries Association, successfully challenged DEA’s 2003 rulemaking that amended the regulation to include naturally occurring tetrahydrocannabinols (“THC”) within the definition of “synthetic THC” and, therefore, treat it as a schedule I substance, even though it falls outside the CSA definition of marijuana. Hemp Indus. Ass’n v. DEA, 357 F.3d 1012 (9th Cir. 2004) (here). The Court of Appeals for the Ninth Circuit concluded that DEA “cannot regulate naturally-occurring THC not contained within or derived from marijuana – i.e., non-psychoactive hemp products – because non-psychoactive hemp is not included in Schedule I.” Id. at 1018. The Court held that DEA’s broadening of the definition of THC to include naturally occurring THC “contravenes the unambiguously expressed intent of Congress in the CSA and cannot be upheld.” Id. The Court permanently enjoined DEA from enforcing the rules scheduling THC. Id. at 1019. However, the Court’s decision is limited to the Ninth Circuit.

It will be interesting to follow this petition given how the marijuana/hemp/THC state regulatory landscape has changed considerably since 2004.

On January 20, 2017, the Trump administration took a first step toward delaying, reconsidering, and potentially undoing numerous regulations and policies issued by the Obama administration. In order to ensure that “the President’s appointees or designees have the opportunity to review any new or pending regulations,” White House Chief of Staff Reince Priebus issued to the heads of executive departments and agencies a memorandum titled “Regulatory Freeze Pending Review.”

The memo first requests that no regulation be sent to the Office of the Federal Register for publication until a Presidential appointee or designee has reviewed and approved it. Second, the memo states that regulations that were sent to the Office of the Federal Register but that have not yet been published in the Federal Register are to be immediately withdrawn, and then reviewed by a Presidential appointee or designee. Lastly, regulations that have been published in the Federal Register but that have not yet taken effect are to have their effective date postponed for 60 days (from January 20, 2017), after which the agency or department is to “consider potentially proposing further notice-and-comment rulemaking” and, if further action is deemed appropriate, “agencies should notify the OMB Director and take further appropriate action in consultation with the OMB Director.”

The freeze applies not only to final regulations but also to notices of proposed rulemaking, guidance documents, and other “substantive action by an agency . . . that is or is expected to lead to the promulgation of a final rule,” as well as to “any agency statement of general applicability and future effect ‘that sets forth a policy on a statutory, regulatory, or technical issue or an interpretation of a statutory or regulatory issue.’” The memo provides exceptions for “emergency situations or other urgent circumstances relating to health, safety, financial, or national security matters,” and for regulations that are subject to statutory or judicial deadlines.

The implications for industry have the potential to be significant and the freeze may provide an opportunity to further engage with agencies and departments and to influence pending rules and policies. For example:

• On January 13, 2017, FDA reopened the comment period – until February 13, 2017 – requesting data to help the Agency determine whether certain food ingredients should be added to the definition of “dietary fiber”;FDA action could be delayed once the comment period closes.
• On January 9, 2017, FDA published in the Federal Register a final rule to clarify when products made or derived from tobacco are regulated as drugs, devices, or combination products; the rule was scheduled to take effect on February 8, 2017, but that effective date could now be delayed while the new administration reconsiders the regulation.
• On January 5, 2017 HHS published in the Federal Register a final rule implementing the 340B Drug Pricing Program Ceiling Price policy and Civil Monetary Penalty (“CMP”) standards, including the knowledge requirement related to overcharging 340B Covered Entities (which we blogged about here).The rule was scheduled to take effect on March 6, 2017. That effective date could now be delayed, at least as it pertains to the implementation of the Ceiling Price policy, while the new administration reconsiders the regulation. The CMP regulation was required to be promulgated within 180 days of the enactment of the Affordable Care Act, and although HHS missed that statutory deadline, the CMP regulation may still be covered by the memo’s exception for regulations that are subject to statutory deadlines.

It appears that the new administration has already begun withdrawing documents that had been sent to the Office of the Federal Register and were in the pre-publication stage.  The following “Editorial Note” appears on affected docket webpages: “The FDA requested the withdrawal of this document after it was on public inspection.  It will remain on public inspection until the close of business on January 24.  A copy of the withdrawal request is available at the Office of the Federal Register.”

It feels like déjà vu. In 2011, FDA announced the establishment of a docket to evaluate its policies on communications and activities related to off-label uses of marketed products; late in 2014, FDA committed to issuing new guidance by the end of 2014 to address “unsolicited requests, distributing scientific and medical information on unapproved new uses, and manufacturer discussions regarding scientific information more generally,” which it did not.  Instead, two years after their self-imposed deadline, FDA convened a public meeting to solicit views on these same issues (discussed here).  The comment period for that hearing officially closed on January 9, 2017, and although FDA has published two draft guidance documents touching on communications consistent with the approved labeling or related to healthcare economic information (to be discussed in a separate blog post), FDA punted on the critical issue of off-label promotion.

On January 19, 2017, ten days after the comment period closed, FDA reopened the comment period for 90 days (until April 19, 2017).  According to FDA, commenters at the November 2016 hearing complained that “FDA had not sufficiently discussed the First Amendment in the notification of public hearing.”  82 Fed. Reg. 6367, 6368 (Jan. 19, 2017).  Note that the original Federal Register notice stated FDA solicited comments on “ongoing developments in science and technology, medicine, health care delivery, and constitutional law,” 81 Fed. Reg. 60299, 60300 (Sept. 1, 2016) (emphasis added), and anyone even superficially following these issues understands the First Amendment implications involved.  FDA announced that it had prepared a Memorandum to specifically address First Amendment considerations and FDA’s initial reaction to proposed approaches to addressing them, and asked for public comment on the Memo.

The 60-page document is substantively light, as there is much background and rehashing of FDA’s legal authority contained in earlier public statements and briefs. FDA spends considerable time articulating the public health interests affected by communications about unapproved uses. FDA touts its efforts to date as claiming “to strike a careful balance, supporting medical decision-making for patients in the absence of better options, but doing so without undermining the measures designed to incentivize the development and approval/clearance of medical products that would reduce the need to rely on unapproved use, in light of its risks.” FDA Memo, at 20.

In the Memo, FDA describes its view of case law addressing the First Amendment and FDA regulation of off-label communications. Consistent with earlier statements, FDA attempts to limit the Second Circuit ruling in United States v. Caronia by claiming it does not hold that speech cannot be used as evidence of intended use if the misbranding charge is based solely on truthful, non-misleading speech regarding the unapproved use of an approved product.  FDA relies on a footnote in a qui tam matter in which the Second Circuit opines about the potential use of promotional speech in an FDA enforcement action, without reference to the truthful or non-misleading nature of the speech.  FDA Memo at 22.  FDA also undermines the Caronia decision for not taking into account a study published last year that purportedly shows an association between unapproved uses and adverse drug events. Id. at 23-24.  It is ironic that FDA relies on a published study to support its position, yet puts significant restrictions on the distribution of similarly credentialed literature by industry.

The meat of the memo is FDA’s identification of alternative approaches to address off-label promotion, and the outright rejection of all of the approaches. They include:

1. Prohibiting altogether the use and/or prescribing of an approved/cleared medical product for an unapproved new use – thankfully FDA rejects this position as potentially injurious to the health care providers and patients that can benefit from determining the best treatment options for each patient.
2. Barring approval of generics and other affected products until all periods of exclusivity on the reference product have expired – FDA rejects this alternative because it is contrary to the goal of Congress to ensure consumers benefit from lower-priced versions of products.
3. Creating ceilings or caps on the number of prescriptions for an unapproved use – FDA rejects this approach because, among other things, it typically is unknown for what specific use a health care provider prescribes a product.
4. Limiting Medicare and Medicaid reimbursement to approved uses – FDA rejects this idea because it limits health care provider discretion, and like option #3, would be impossible to administer.
5. Prohibiting specific unapproved uses that are exceptionally concerning or developing tiers based on level of safety concerns with greater regulatory controls for the relatively higher risk products – FDA rejects this approach because it undermines the incentives to engage in premarket review and conduct the necessary research to demonstrate safety and effectiveness. Note, however, that FDA already employs a mechanism in certain circumstances: the REMS program.
6. Requiring firms to list all potential indications for a product in the initial premarket application – FDA rejects this idea because it is not possible to know all potential uses of a medical product from an initial study.
7. Allowing firms to actively promote an unapproved use as long as they disclose that the use in unapproved and include other appropriate warnings – FDA rejects this approach because “studies show there are limitations to disclosures in terms of the recipients’ perception and understanding.” Also, for devices, FDA is concerned that a firm would use the 510(k) pathway for one intended use, and market for different intended uses for which premarket approval is necessary.
8. Educating health care providers and patients to differentiate false and misleading promotion from truthful and non-misleading information – FDA claims this it is not feasible for the government to conduct a training program on the scale necessary. Yet FDA does have a coordinated campaign targeted on this very issue, the Bad Ad program: “FDA’s educational outreach program is designed to educate healthcare providers about the role they can play in helping the agency make sure that prescription drug advertising and promotion is truthful and not misleading.” Indeed, it is designed to “help healthcare providers recognize misleading prescription drug promotion,” and there is an entire course and case studies devoted to this program.
9. Reminding health care providers of potential malpractice liability – FDA rejects this approach as counter to the interest in allowing health care providers to determine the best treatment options for patients.
10. Taxing firms more heavily for sales of products for unapproved uses than for approved uses – FDA rejects this approach because it does not align with the government’s interest of allowing some off-label prescribing or use, and would be impractical to administer and enforce.
11. Permit promotion of unapproved uses listed in medical compendia – FDA rejects reliance on medical compendia because of publication bias and the potential for improper influence in compendia listings.
12. Limiting evidence that could be considered relevant to intended use to speech that the government can prove is false or misleading – FDA rejects this “legal until proven wrong” approach because it could undermine the current incentives to generate scientific evidence.

In essence, FDA has a myriad of reasons not to loosen or tighten restrictions about communications of unapproved uses. Although FDA may rely on these reasons to justify the paralysis the Agency has experienced for the last several years, business and innovation do not stand still.  We will continue to closely follow the comments submitted to this latest FDA notice, and FDA’s response.

Loyal readers know that we at the FDALawBlog have been closely following a significant Park Doctrine case wending its way through the courts, involving father and son Austin (“Jack”) and Peter DeCoster, former executives of Quality Egg, LLC. In an earlier blog posting, we stated that this case is likely the most important Park Doctrine case in more than forty years. On January 10, 2017 the DeCosters timely petitioned the Supreme Court for review of an Eighth Circuit decision upholding their three month prison sentences for misdemeanor violations of the FDC Act involving distribution of egg products.

The DeCosters’ case presents the significant question of whether a corporate executive can be sentenced to imprisonment based on a Park doctrine conviction. The Park doctrine, also known as the “Responsible Corporate Officer” (“RCO”) doctrine, refers to United States v. Park, 421 U.S. 658 (1975) (here), in which the Court held that the Federal Food, Drug, and Cosmetic Act (“FDC Act”), 21 U.S.C. § 331 imposes criminal liability on individuals whose corporate position affords them “the power to prevent or correct” violations of that section, even absent “knowledge of, or personal participation in” the violations. Park, 421 U.S. at 670, 676. Park expanded on an earlier Supreme Court decision upholding strict liability for a responsible corporate officer under a different statute in United States v. Dotterweich, 320 U.S. 277 (1943) (here).

Centrally at issue in the DeCosters’ case is whether their Park doctrine convictions represent “vicarious liability” (liability for the acts of others), or liability tied to their own “blameworthiness” for failure to prevent or remedy the FDC Act violation at issue. See United States v. DeCoster, 828 F. 3d 626, 633 (8th Cir. 2016) (here). Importantly, the DeCosters pleaded guilty as responsible corporate officers, but denied any knowledge of the FDC Act violations committed by Quality Egg, LLC. See id. at 631. They agreed to be sentenced based on facts the court found by a preponderance of the evidence. Id. At sentencing, the district court relied on evidence of the DeCosters negligence in carrying out their corporate roles in sentencing them to a three month imprisonment. Id.

The DeCosters argue in their Petition for a Writ of Certiorari (“Petition”), as they did before the Eighth Circuit, that their convictions as responsible corporate officers under the Park doctrine represents vicarious liability because they did not know of or participate in the violations at issue. As such, they further argue that federal precedent dictates that imprisonment would violate due process. See Petition, at 12-16.   In anticipation of the government’s likely response that – consistent with the Eighth Circuit ruling – the DeCosters’ own negligence in their roles as responsible corporate officers of Quality Egg, LLC subjects them to personal liability that is not “vicarious,” the DeCosters note that the Park doctrine liability to which they pleaded has not historically implicated negligence on the part of the responsible corporate officer. Rather, they assert that it is a strict liability standard based on the executive’s position of authority and the presumed ability to stop or prevent FDC Act violations. Id. at 17-18. They assert that imprisonment cannot follow from a strict liability offense under the due process clause. Id. at 18.

Is there anything new with regard to the DeCosters’ Petition? The answer is a resounding yes, largely found in the second question raised in the Petition. In that question, the DeCosters argue that the Park doctrine itself must be overturned by the Supreme Court. We cannot recall any case where a defendant has asked the Supreme Court to overturn its earlier rulings in Dotterweich and Park. The DeCosters acknowledge in their Petition that they did not ask the lower courts to question the legal validity of those Supreme Court decisions. Of course, those courts have no legal ability to overturn a Supreme Court decision. For both reasons, the lower courts did not discuss whether Dotterweich/Park should be overruled by the Supreme Court.

The DeCosters’ case presents a difficult question that the Supreme Court may well be inclined to address. Specifically, can the government tie the DeCoster’s Park doctrine jail sentences to a degree of negligence, thereby preserving the specter of prison sentences for future individual defendants under a Park theory? If the answer is no, will the government retain its ability to apply strict liability to individual corporate officers under the Park doctrine without jail being an available remedy?

Relying on the unique facts of the DeCosters’ case, the Eighth Circuit was inclined to let the government have its cake and eat it too. However, the present Petition puts this broader question of undeniable importance squarely before the Supreme Court, and numerous amici earlier weighed in in favor of the DeCosters. Will the government’s effort to expand the Park doctrine ultimately destroy it? Will the Park doctrine as we know it survive?

The government of course has an opportunity to oppose the DeCosters’ Petition. We will watch carefully for the government’s brief and report on that brief in a later posting. We also expect that there will be amici briefs filed on both sides of the Petition.

After a relatively slow first 11 months of 2016, FDA’s Office of Prescription Drug Promotion (“OPDP”) issued a flurry of letters in the span of 9 days in December, more than doubling the enforcement letters issued up to that point in the year. And the activity on the prescription product communications front keeps coming in 2017, with the following publications issued this week: Draft Guidance on Manufacturer Communications That Are Consistent With The FDA-Required Labeling – Q&A; Draft Guidance on Drug and Device Manufacturer Communications With Payors, Formulary Committees, and Similar Entities – Q&A; and an FDA Memo re Communications Regarding Unapproved Uses.

Despite an increase in enforcement activity in December, the type of activity, and the nature of the Draft Guidances issued thus far in 2017 pertaining to prescription product communications indicate a dramatic shift in OPDP’s approach from years past. After a string of First Amendment case losses by FDA, OPDP appears to be picking its battles carefully when it comes to enforcement letters, focusing on omission and minimization of risk (a cornerstone of FDA’s enforcement activity in this area) as well as pre-approval promotion.  Of note, FDA’s First Amendment case losses, to date, dealt with issues pertaining to information disseminated about FDA-approved or FDA-cleared prescription products; these cases did not address communications about investigational products for which there were no approvals/clearances.  Consistent with that, we have not seen enforcement letters that solely raise issues around efficacy claims for approved products.  Letters regarding statements about investigational products, however, are another story.

Of the 11 letters issued in 2016, 4 dealt with pre-approval promotion. Given that only 4 of the 70 letters issued by OPDP between 2012 and 2015 dealt with pre-approval promotion, this dramatic increase signals, to us, a sign of things to come in terms of OPDP’s future enforcement activities.

With regard to already marketed products, as mentioned above, there were no letters issued in 2016 dealing solely with efficacy claims. The few letters that addressed efficacy did so briefly, with a focus, primarily, on the communication of risk information (see our previous post here). The Draft Guidances issued this week reflect this approach – indicating flexibility in FDA’s traditional “substantial evidence” standard to substantiate certain product claims.  Stay tuned for our upcoming “deep dive” into these Draft Guidances.

On December 29, 2016, FDA issued final guidance reflecting its policy on Repackaging of Certain Human (Prescription) Drug Products by Pharmacies and Outsourcing Facilities, first issued in draft form in February of 2015, and blogged here.  FDA’s final guidance highlights certain sections because it includes information still subject to review (collection of information) by the Office of Management and Budget. FDA’s Federal Register Notice announcing the guidance seeks comments by February 17, 2017. FDA is still considering applicability of these policies to hospitals and healthcare systems, which it intends to address in yet another guidance document. FDA also issued a separate (revised draft) guidance document on repackaging of biological products, which will be the subject of a separate blog post.

Like the draft guidance, this guidance defines “repackaging:” The act of “taking a finished drug product from the container in which it was distributed by the original manufacturer and placing it into a different container without further manipulation of the drug.”  Repackaging also includes placing contents of multiple finished drug containers (e.g., vials) into one container, “as long as the container does not include other ingredients.”  FDA notes that “if the drug is manipulated in any other way, including if the drug is reconstituted, diluted, mixed, or combined with another ingredient,” then it is not considered repackaging.  The Agency states, for example, that if tablets are removed from a blister pack and placed in a different container, then that would be considered repackaging. However, if the blister packs are placed into a different container for later use (leaving the blister packs intact) then that would not be repackaging.

FDA’s guidance (like the earlier draft) describes generally the approval process for drugs, including FDA’s required review and approval of drug container closure systems. Repackaging may alter the characteristics of drug products in ways that FDA did not consider during the drug approval process, affecting stability, safety and efficacy. FDA notes that repackaged drugs are not subject FDCA’s exemptions in Sections 503A and 503B; thus FDA’s guidance describes when FDA will exercise enforcement discretion concerning stats-licensed pharmacies, federal facilities and outsourcing facilities that repackage drugs. Some highlights of the guidance include:

• The repackaged drug must be an approved product under FDCA Section 505 or an unapproved drug that appears on FDA’s drug shortage list (distributed during any period the drug is listed or 30 days after the shortage ends (which is a new guidance provision)).
• The drug must be repackaged by a state-licensed pharmacy, federal facility or outsourcing facility, and under the direct supervision of a pharmacist.
• If repackaged by a pharmacy or federal facility (but not an outsourcing facility), the drug must be pursuant to a prescription or order for an individually identified patient.  The final guidance does NOT include limits on repackaging in advance of receiving a prescription (which seemed like limits on “anticipatory repackaging”).
• Except for single-dose vials, the drug must be repackaged in a way that does not conflict with approved labeling. However, the guidance notes (unlike the draft) that the repackaging must be in accordance with the handling or storage instructions for the approved product so as to not conflict with approved labeling.
• The most significant changes between the draft and final guidance address beyond use dating (BUD) for repackaged products:
  • Sterile drug products repackaged by state-licensed pharmacies or federal facilities
    • If the repackaged product is an FDA-approved drug product with a specified in-use time, then the repackaged drug must be assigned a BUD that is established in accordance with the in-use time on the product or the expiration date on the product, whatever period is shorter.
    • If the repackaged product is an FDA-approved drug whose labeling does not specify an in-use time, or an unapproved product on FDA’s shortage list, considering the drug’s stated in-use time, the BUD is established in accordance with the revisions to USP<797> (published November 2015) or the expiration date on the drug being repackaged, whichever is shorter.
  • If the product is a sterile drug product repackaged by an outsourcing facility, the facility must establish a BUD in accordance with FDA’s guidance issued in July 2014.
  • If the drug is a non-sterile product repackaged by a state licensed pharmacy, federal facility, or outsourcing facility:
    • For an FDA-approved product with a specified in-use time, then the repackaged drug must be assigned a BUD that is established in accordance with the in-use time on the product, or the expiration date on the product, whatever period is shorter.
    • For an FDA-approved product without an in-use time or an unapproved product the BUD changes according to its formulation (non-aqueous, water containing oral formulations, or topical formulations (Guidance at 8).
• Also new (but as stated in other compounding guidance documents), if the product is repackaged in a pharmacy or federal facility, it must comply with USP<795> (non-sterile) or USP<797> (sterile) guidelines. If an outsourcing facility, it must comply with FDA’s cGMP requirements (other than the BUD guidelines, which must conform to the policy above),
• The drug to be repackaged may not appear on FDA’s list of drugs removed because they are unsafe or ineffective under 21 C.F.R §216.24.
• The drug may not be sold or transferred by an entity other than the entity that repackaged the drug (but does not include administration of a repackaged drug in a healthcare setting).
• The final guidance removes the requirement on page 9 of the draft guidance that the repackaged drug product must be accompanied by a copy of the prescribing information that accompanied the original drug product that was repackaged.
• Repackaged drugs may only be distributed in states in which the facility meets all applicable state requirements.
• Drugs repackaged by outsourcing facilities must include required information on their labels and meet other requirements of 503B, including adverse event reporting (pages 8-10).

Unlike the draft guidance, the final guidance addresses FDA’s establishment registration and listing requirements (i.e., for outsourcing facilities that engage in repackaging), and describes the exemption for pharmacies under Section 510(g) and 21 C.F.R. § 207.10. FDA does not intend to take action against those entities that do not qualify for the registration and listing exemptions (likely meaning pharmacies that also engage in compounding) for failure to register and list drugs that are repackaged in accordance with FDA’s repackaging guidance.

As we previously reported, FDA issued final rules updating the nutrition labeling regulations, 21 C.F.R. §§ 101.9 and 101.36, and the serving size regulation, 21 C.F.R. § 101.12, on May 27, 2016. Despite the rather extensive preamble, the final rules left many questions unanswered. FDA promised to address a number of issues in guidance. The timing of that guidance is crucial because the compliance date for the final rules is July 26, 2018 (smaller businesses with annual food sales of less than 10 million dollars have until July 26, 2019).

Early in August, 2016, FDA created a webpage with industry resources which provided some answers.  Then, on January 4, 2017, FDA announced the availability of two arguably overdue draft guidance documents: a draft guidance clarifying aspects of the final rule regarding nutrition labeling, and a draft guidance providing examples of food products that belong to product categories included in the tables of Reference Amounts Customarily Consumed (RACCs) used to determine serving size.

The draft guidance concerning nutrition labeling answers questions about the nutrition labeling rules and the compliance date. Topics addressed include:

• Compliance date: In August, 2016, FDA interpreted compliance date to mean that food products that are initially introduced into interstate commerce on or after that date would need to include the new version of the Nutrition Facts and Supplement Facts labels. Apparently, this statement resulted in more questions. So, FDA revised its thinking and, according to the draft guidance, will consider the date the food product is labeled for purposes of the compliance date. The location of a food in the distribution chain (e.g., is the product in the warehouse of the manufacturer or in the warehouse of the distributor) is not relevant. In the draft guidance, FDA also clarifies that the 10 million dollar annual sales limit need not be met for all three years prior to the date of the final rule (i.e., 2013, 2014, and 2015), but is met if the smallest sales volume from one of these previous three years is less than 10 million. The sales do, however, concern total food sales, i.e., domestic and international.
• Added sugars: Not surprisingly, since the requirement for listing added sugars is a new (and probably the most controversial) requirement, about 50% of the draft guidance covers questions and answers about the calculation and declaration of “added sugars.” Questions include scenarios for when a juice concentrate constitutes an added sugar, how to declare added sugars in fermented foods, how to determine added sugars when Maillard browning occurs, whether fruit powders and pastes are added sugars, and compliance criteria. FDA provides some helpful examples. The Federal Register Notice announcing the availability of the draft guidance also includes a request for comments to three specific questions regarding added sugars and fruit or vegetable juice concentrates.
• In the discussion, FDA acknowledges that sugars, whether added or naturally present, are biochemically equivalent. The added sugars, however, provide consumers a measure of “empty calories.”
• Rounding of the declaration of quantitative amounts of vitamins and minerals: The new requirement to declare the quantitative amounts (in addition to the percentage Daily Value) of vitamins and minerals (excluding sodium) in the Nutrition Facts box also generated some questions and uncertainties. In response to these questions, FDA prepared a table specifying the recommended rounding of the vitamins and minerals. In addition, the draft guidance discusses the basis for these recommendations.

The draft guidance regarding RACCs provides examples of food products that belong to each product category included in the tables of Reference Amounts Customarily Consumed (RACCs) that may be useful for industry in identifying the correct food category (and therefore the serving size) for a product. Although few may be surprised to see that all watermelon falls in the category of watermelon, the fact that bagel thins are not bagels (with a RACC of 110 g) but are bread (with a RACC of 55 g) may be less obvious. The guidance provides examples, not an all-inclusive list of all products on the market (see here).

The draft guidances are accessible on the industry resources webpage.  That page also includes a link to the draft guidance for Scientific Evaluation of the Evidence on the Beneficial Physiological Effects of Isolated or Synthetic Non-digestible Carbohydrates Submitted as a Citizen Petition (Comments due February 13, 2017).

Comments to the draft guidances are due March 6, 2017.

On Friday, January 13, 2017, FDA issued two revised interim policies on compounding with bulk substances for Section 503A compounders and Section 503B outsourcing facilities.  As you likely recall, FDA’s guidance on use of bulk substances in compounding has had a slow start, in part because of “over nominations” in early 2014 and general confusion in the nomination process (see our previous posts here and here).  And, once FDA created its original “bulks” lists of substances that may be used in compounding, those lists caused significant additional consternation because they included substances that plainly should not have been included. .

FDA’s latest iterations of its two sets of bulks lists include updates based on public comment and meetings of the Agency’s Pharmacy Compounding Advisory Committee, which has held several (quarterly) meetings to review whether bulk substances should be placed on one of FDA’s three bulks lists for Sections 503A and 503B (however, PCAC input is not statutorily required for Section 503B’s bulks lists). The lists are divided into the same three categories as previous lists (i.e., Category 1 (may be used in compounding based on sufficient support in a nomination, and no apparent safety risk); Category 2 (may not be used in compounding based on significant safety risk); and, Category 3 (substances nominated without adequate support, thus may not be used in compounding)). As an aside, FDA continues to assert in these guidances that USP/NF substances referenced in 503A and 503B only include substances that are the subject of a USP/NF “drug” monograph, and not a dietary substance monograph. Presumably, to the extent a compounder seeks to compound with a dietary substance as the active bulk ingredient in a compounded formulation (that is not a component of an approved drug product or otherwise on FDA’s list 1); it would need to nominate that substance per FDA’s interim policy.

Ultimately, FDA must promulgate final lists through notice and comment rulemaking pursuant to the applicable statutes. Because so many substances are at issue, FDA has adopted its interim policy approach, where it reviews and then nominates for comment the proposed substances at a pace of about ten at a time. On December 16, 2016, FDA published its first notice proposing six substances to the Section 503A bulks list, four to not be included on the bulks list, and setting forth criteria for evaluation of substances. [Here, comments due by March 16, 2017]

New Policy Concerning Re-Nominations, Mistaken Nominations, Withdrawal of Nominations

FDA’s latest iterations make one significant change – benefiting those who failed to nominate a particular substance, or who mistakenly nominated a substance which was inadvertently included on, for example, List 3 (substances nominated with insufficient support; thus may not be used in compounding).

Specifically, FDA had repeated several times that once FDA received nominations for the bulks lists (for the nomination period that ended back in 2014), interested parties could nominate additional substances (in a docket opened in October of 2015); but FDA would review those substances only after completion of the review process for the original nominated substances. Thus, any substances inadvertently omitted, or new substances necessary in compounding would, in effect, go to the bottom of the nominations stack. Given the number of already nominated substances, and pace of FDA’s review, any chance of review of new or overlooked substances at any point in the next several years seemed dim at best.

FDA now states that after a substance is nominated to the nominations docket for bulk substances (now deemed the “October docket”), FDA will determine whether the nomination is supported with sufficient information to allow FDA to evaluate it. After FDA makes that determination, the nominated substance will be placed in one of the three bulks categories and published on FDA’s website. FDA states it “generally expects to categorize bulk drug substances nominated to the October docket and to publish updated categories on its website on the first business day of each month.” FDA notes that until substances nominated for the “October docket” have been categorized, FDA’s interim policy does not apply to those substances.

In addition, FDA has created a solution for those substances that may not appear on an appropriate list. Those comments may be submitted to docket number FDA-2015-N-3534.  Further, if a commenter has new information on a previously nominated substance that was placed in Category 3, the substance can be re-nominated with the additional information.  A nominator may request withdrawal of any of its nominations. If the party nominating the substance was the sole nominator, FDA will update the categories described in this guidance to reflect the withdrawn nomination, and will provide notice to the public before removing any nominated substances from Category 1 or Category 2. However, FDA may continue to evaluate a substance at its discretion even if the nominator submits a comment requesting withdrawal of the nomination.

Shortage Medications: Section 503B

As a final note, for medications in shortage, FDA states that does not intend to take action against an outsourcing facility for compounding a drug product using a bulk drug substance that is not on the 503B bulks list if the drug compounded from the bulk drug substance: (i) appeared on FDA’s drug shortage list within 60 days of distribution and dispensing, and (ii) was to fill an order that the outsourcing facility received for the drug while it was on FDA’s drug shortage list. FDA’s Section 503A interim policy does to contain a similar provision for Section n503A facilities that may compound shortage medications.