By Ricardo Carvajal –

FDA recently announced the issuance of the 7th edition of the Agency's Questions and Answers Regarding Food Facility Registration.  The latest edition includes nearly 60 new Q&As on a variety of registration-related topics, including:

• Biennial registration renewal – A facility’s registration must be renewed in the last quarter of every even-numbered year.  The new Q&As address scenarios such as a facility’s obligation to renew even when an initial registration has been submitted during any of the first three quarters of a biennial renewal year.
• Unique Facility Identifiers (UFIs) – Although these won’t be required as part of a registration until October 1, 2020, a number of new Q&As address verification and selection of UFIs.  Currently, a DUNS number is FDA’s preferred UFI, but FDA might deem other UFIs acceptable before the requirement takes effect.
• Food product categories and activity types – A registration must include information on food product categories and the types of activity handled by the facility.  The guidance now makes clear that a facility such as a warehouse that frequently changes food product categories “may select all of the food product categories that are normally part of [its] operations.”  The guidance also provides definitions of the different activity types (e.g., “refrigerated human food warehouse/holding facility”).
• Cancelation of registration – Among other things, the guidance explains the circumstances under which FDA will cancel a registration, and the agency’s process for informing the registrant.
• Waiver requests – As of January 4, 2020, registration-related submissions will have to be in electronic format unless FDA grants a waiver.  New Q&As explain the process for obtaining a waiver.

Comments on the guidance are due by February 6, 2017.

Hyman, Phelps & McNamara, P.C. ("HP&M") has once again been ranked as a “Tier 1” law firm in the area of “FDA Law” (both nationally and in Washington, D.C.) by the folks over at U.S. News & World Report, who teamed up with Best Lawyers for the 2017 “Best Law Firms” rankings.  More than 13,000 law firms are ranked in 74 practice areas nationally and in 122 practice areas on the metropolitan lists.  “[R]ankings are based on a rigorous evaluation process that includes the collection of client and lawyer evaluations, peer review from leading attorneys in their field, and review of additional information provided by law firms as part of the formal submission process,” according to U.S. News.  The 2017 list of America’s Best Law Firms can be searched here, or viewed here.  HP&M is noted on page 61 (national ranking) and on page 107 (Washington, D.C. ranking).

By Kurt R. Karst, John R. Fleder & Robert A. Dormer –

The current FDA system to announce hotly contested generic drug approval decisions is broken.  As we see it, FDA’s “system” pleases no one and does not appear to be legally mandated.  Moreover, whatever advantage FDA may think the Agency is getting from hiding the ball from the world on the timing and substance of these decisions is more than overcome by the criticism the Agency has received from judges.  In a new paper, titled “How FDA Announces Drug Approval Decisions: A Broken FDA ‘System’ That Must BE Fixed,” we examine two cases in particular – Hi-Tech Pharmacal Co., Inc., v. United States Food and Drug Administration, No. 08-01495 (JDB) (here) and AstraZeneca Pharmaceuticals LP v. Burwell, No. 16-cv-1336 (RDM) (here) – where FDA’s system to announce ANDA approval decisions has drawn fire from the judge presiding over the case.

FDA’s approval system for handling certain high profile ANDA approval decisions must be fixed. As we note in the paper, there certainly appears to be ample authority conferred on FDA to make changes without the need for additional legislation to be enacted. But if legislation is needed, then we call on FDA to spearhead a legislative fix. Congressional oversight committees may be a sound vehicle to compel FDA to focus on this problem. Perhaps the Department of Health and Human Services may be able to force FDA to change its ways. FDA needs to involve interested stakeholders in this process. We also urge FDA to communicate with the courts to try to get judicial input.

By Jennifer M. Thomas – 

Last week, FDA rolled out a new online reporting program, titled “Reporting Allegations of Regulatory Misconduct,” with little fanfare. No blog post in FDA Voice, no press conference, and even the (longwinded) name of the program seems calculated to send the message “nothing to see here, folks.” Which, of course, made us take a closer look.

1. What is it?

An online tool for reporting allegations of regulatory misconduct against medical device companies. Allegations may be submitted using a simple form, which provides anonymity for the submitter if he or she chooses, or by email or regular mail. According to the program’s homepage, FDA envisions that the types of allegations will include (1) off-label marketing, (2) marketing without the requisite approval/clearance, (3) QSR violations, (4) falsifying records, (5) failure to register and list, (6) failure to submit required reports, or (7) knowingly deceiving FDA. Although the program appears similar in some ways to CDER’s “Bad Ad” Program, the scope is much broader.

2. Is it really “new”?

Not according to FDA. Consistent with the circumstances of its launch, the homepage for FDA’s new reporting tool practically begs readers to view it as a non-event. The homepage indicates that FDA has received these types of reports in the past, and that the online tool is simply a new way of receiving the same information. That said, to our knowledge there has never before been a formal mechanism to capture and track allegations like these.

3. How will FDA use the reports?

This remains to be seen. The homepage mentions only administrative actions in response to allegations submitted through the program, with a Warning Letter or recall request being the harshest administrative measures described (others include conducting inspections, contacting the company for further information, or simply “monitoring the allegation”). Nowhere is there mention of possible referral to the Office of Chief Counsel or Office of Criminal Investigations for review of more egregious alleged misconduct, although several of the categories of misconduct FDA cites as examples are of a kind often referred to the Department of Justice for civil or criminal action. The homepage states that “FDA will not share [the submitter’s] identity or contact information with anyone outside the FDA” unless required by law, but makes no such promise with regard to information obtained from the submitter. Therefore, presumably, FDA is free to share information gleaned through the online reports with other government agencies.

4. Will these reports actually be useful to FDA?

We are trying to see the bright side for FDA, but on balance we think the answer to this question is “no.”

The most likely candidates to use the easy, anonymous, online tool are competitors. This may be an attractive alternative to a trade complaint, with the added benefit that FDA is obligated to follow-up on the allegations. Some companies may simply seek to disrupt a competitor’s business by initiating an FDA investigation. The overall quality and reliability of information FDA receives from competitors probably will be low.

While it is possible that employee whistleblowers will also use this tool, those with significant and well-documented allegations have the potentially much more lucrative option of reporting regulatory misconduct though a qui tam False Claims Act suit. Reporting through this new tool in advance of filing such a suit could have implications for the whistleblower’s ability to recover as a qui tam relator.

It also is highly unlikely that FDA will be able to handle the number of reports that come in through the online reporting tool. As with medical device adverse event reports, the Agency will be forced to prioritize a very few reports, only to then be taken to task for failing to identify or act on serious violations reported to the Agency. See, e.g., GAO Letter Report, Medical Device Reporting: Improvements Needed in FDA’s System for Monitoring Problems with Approved Devices, GAO/HEHS-97-21 (Jan. 29, 1997) (here); GAO Highlights, Shortcomings in FDA’s Premarket Review, Postmarket Surveillance, and Inspections of Device Manufacturing Establishments, GAO-09-370T (June 18, 2009) (here).

5. If this type of report isn’t really new, why does the new online reporting tool matter to industry?

Despite its unassuming appearance, in our view the new reporting tool could present significant additional risks to industry.

First of all, allegations of regulatory misconduct, even if baseless, can disrupt a business as the Agency takes steps to investigate those allegations by conducting inspections, demanding a response from the company, etc. Whereas previously CDRH was under no affirmative obligation to respond to a complainant who, for example, submitted an unreliable or inadequately documented complaint to the Agency, CDRH now has committed to “follow-up communication” and a tracking system. This will allow submitters to demand a response, and will likely necessitate more, and more burdensome, investigative steps by CDRH.

Furthermore, these reports of allegations will be consolidated in a single repository, ripe for requests from the public or other government agencies. Although the reporting tool’s homepage states that records will not be released pursuant to FOIA until an investigation is complete, other government agencies – State Attorneys General, and U.S. Attorneys’ Offices, for example – may request pertinent documents from FDA even during the pendency of an investigation. Relators’ counsel in qui tam cases may also request to see records of an ongoing investigation.

Finally, the fact that allegations are not made public until after an investigation is closed does not necessarily protect companies from bad press tied to baseless accusations. For instance, FDA may close an investigation upon concluding that the allegation does not warrant expenditure of CDRH resources, but without reaching an actual conclusion. The reported allegation would then potentially be subject to disclosure under FOIA, and the company forced to defend itself against that allegation in the court of public opinion.

5. What can companies do about it?

There is no guaranteed way to avoid becoming the subject of an allegation of regulatory misconduct, whether submitted through this new online tool or otherwise. That said, device companies can significantly reduce their risk by having in place a system for internal reporting and a mechanism for fully and efficiently addressing internal reports submitted by employees. Companies should also be sure to respond quickly and completely to any request by CDRH for a response to allegations submitted through the new portal.

6. What do we call it?

Well, we certainly can’t call it “Reporting Allegations of Regulatory Misconduct” – too unwieldy. We welcome your suggestions, but in the meantime – riffing on CDER’s “Bad Ads” – we will be calling it CDRH’s “Bad Acts” Program.

By James E. Valentine & Karla L. Palmer – 

There are a number of lists that are central to FDA’s regulatory framework for the regulation of pharmacy compounding under sections 503A and 503B of the Federal Food, Drug, and Cosmetics Act (FD&C Act). In recent posts, we’ve discussed additions to one such list: the list of drugs that may not be compounded under 503A and 503B (see posts here and here).

FDA’s Pharmacy Compounding Advisory Committee (PCAC) is meeting to consider substances nominated for inclusion on two other lists:

1. Bulk Drug Substances That Can Be Used By Compounders under Section 503A (also known as the “503A Bulks List”)
2. Drug Products That Present Demonstrable Difficulties for Compounding (also known as the “Difficult to Compound List”)

We thought this post would be a good opportunity to discuss what exactly the PCAC is considering when it advises the Agency on whether or not to include a drug on either of these lists.

Substances Nominated for Inclusion on the 503A Bulks List

One of the conditions that must be met for a compounded drug product to qualify for the exemptions in section 503A is that a licensed pharmacist or licensed physician compounds the drug product using bulk substances that meet one of the following criteria:  

1. comply with the standards of an applicable United States Pharmacopoeia [(USP)] or National Formulary [(NF)] monograph, if a monograph exists, and the USP chapter on pharmacy compounding;
2. if such a monograph does not exist, are drug substances that are components of drugs approved by [FDA]; or
3. if such a monograph does not exist and the drug substance is not a component of [an approved drug], that appear on a list developed by [FDA] through regulations issued by [FDA] under subsection (c) [of section 503A (the 503A Bulks List)]

See FD&C Act § 503A(b)(1)(A)(i)).  (FDA defines bulk drug substances as “any substance that is represented for use in a drug and that, when used in the manufacturing, processing, or packaging of a drug, becomes an active ingredient or a finished dosage form of the drug, but the term does not include intermediates used in the synthesis of such substances” (21 C.F.R. 207.3(a)(4)).

Before developing the 503A Bulks List, FDA must convene and consult an advisory committee on compound unless it determines that the issuance of such regulation before consultation with an advisory committee is necessary to protect the public health (see FD&C Act § 503A(c)(1)).  FDA is doing just that at the November 3^rd PCAC meeting.  The full nomination process is discussed in FDA’s Interim Policy that was published in June.

As discussed at the February 2015 PCAC meeting, in the July 2014 Federal Register notice (79 Fed. Reg. 37,747, 37,748) soliciting (re)nominations for the section 503A Bulks List, FDA proposed the following criteria to evaluate the nominated substances: 

1. the physical and chemical characterization of the substance;
2. any safety issues raised by the use of the substance in compounded drug products;
3. historical use of the substance in compounded drug products, including information about the medical condition(s) the substance has been used to treat and any references in peer-reviewed medical literature; and
4. the available evidence of effectiveness or lack of effectiveness of a drug product compounded with the substance, if any such evidence exists.

In evaluating candidates for the 503A Bulks List, FDA is using a balancing test. No single one of these criteria is dispositive; rather, the agency is considering each criterion in the context of the others and balancing them, on a substance-by-substance basis, in deciding whether a particular substance is appropriate for inclusion on the list.

Today, FDA is presenting to the PCAC results of its review of some of the nominated substances to obtain the Committee’s advice on whether to include the substances on the list. Specifically, the substances being discussed at this meeting are:

Whether to Include Products or Categories of Drug Products on the Difficult to Compound List

Both sections 503A and 503B also prohibit compounding of drugs that are on FDA’s Difficult to Compound List. One of the conditions for the exemptions under section 503A is that the compounded drug product is not a drug product that “presents demonstrable difficulties for compounding that reasonably demonstrate an adverse effect on the safety or effectiveness of that drug product” (see FD&C Act § 503A(b)(3)).

Similarly, one of the conditions for the exemptions under section 503B is that the compounded drug product “is not identified (directly or as part of a category of drugs) on a list published by the Secretary . . . of drugs or categories of drugs that present demonstrable difficulties for compounding that are reasonably likely to lead to an adverse effect on the safety or effectiveness of the drug or category of drugs, taking into account the risks and benefits to patients,” or “is compounded in accordance with all applicable conditions identified…as conditions that are necessary to prevent the drug or category of drugs from presenting [such] demonstrable difficulties” (see FD&C Act § 503B(a)(6)).

FDA solicited nominations for the Difficult to Compound List in its December 2013 Federal Register notice (78 Fed. Reg. 72,840). For today’s PCAC meeting, FDA considered a drug product that was nominated for the list, and is proposing the following to the advisory committee:

If you are interested in tuning in to see how the PCAC considers products nominated for these two lists, the public comments concerning the same, and the Committee deliberations (and vote), you can find the webcast information here.

That will be among several food policy topics discussed this Friday at a Food and Drug Law Journal Symposium titled Law and Food Systems: Institutional Pathways Toward a New Paradigm?  Proposals for a single food agency have bubbled up over the years, and the impending election makes now a good time to reconsider the issue.  Hyman, Phelps & McNamara, P.C.'s Ricardo Carvajal will participate in a panel discussion of factors weighing for and against such a restructuring, and keynote speakers will discuss a blueprint for a national food system.  Other topics that will be addressed during the symposium include the relative influence and efficacy of public and private food safety regulation, the role of federal agencies in food justice, the intersection of food and environmental regulation, and a reconsideration biotechnology regulation.  The symposium will be held at Georgetown University Law Center.  Additional information and registration is available here.

Technology continues to change the landscape of healthcare and companies are seeking new and innovative ways to leverage advances in other fields to improve quality of care and the diagnosis and treatment of disease. In doing so, they are required to navigate an increasingly complex and ever changing set of legal and regulatory requirements.

This webinar, presented by Dechert LLP, Hyman, Phelps & McNamara, PC, and InFuture LLC, brings together a cross-disciplinary group to discuss issues facing companies in the digital health section today, including those relating to fundraising and financing, IT/IP, data privacy, the U.S. Food and Drug Administration and the Health Insurance Portability and Accountability Act.

When

Tuesday, November 8, 2016
12:00 p.m. – 1:00 p.m. EST

Where

This presentation will be simulcast via Webex as a webinar. Please click here to register. (A recording of the webinar will be available to all registrants after the live event.)

Speakers

Tony Chan
Partner
Dechert LLP
Washington, D.C.

Jeffrey Gibbs
Director
Hyman, Phelps & McNamara P.C.
Washington, D.C.

Violetta Kokolus
Special Counsel
Dechert LLP
New York

Gregory Reid
President and CEO
InFuture LLC
Boston

Shannon Rushing
Associate
Dechert LLP
Philadelphia

By Ricardo Carvajal –

FDA issued a draft guidance document that addresses disclosures required to be provided by a supplier when certain hazards in food have not been controlled.  A disclosure requirement is included in four of the FSMA rules, namely the preventive controls rule for human food, the preventive controls rule for animal food, the produce safety rule, and the foreign supplier verification program (FSVP) rule.   Because of rolling compliance dates for the rules, the disclosure requirement is not yet in effect for many suppliers.

With respect to the specificity of the disclosure required under the human and animal food preventive controls rules and the FSVP rule, FDA would consider acceptable a general disclosure for biological hazards (e.g., “microbial pathogens” as opposed to “Salmonella”), but not for chemical or physical hazards.  Those hazards would need to be disclosed in more specific terms (e.g., “mycotoxins” for that type of chemical hazard, and “stones” for that type of physical hazard).  As to the method of disclosure, the rules require that the disclosure be made in documents that accompany the food, “in accordance with the practice of the trade.”  According to the draft guidance, FDA would consider acceptable providing the disclosure in documents such as “labels, labeling, bill of lading, shipment-specific certificates of analysis, and other documents or papers associated with the shipment that a food safety manager for the customer is likely to read.”  Methods of disclosure that are unlikely to pass muster include references to websites, as well as documents such as “contractual agreements, letters of guarantee, specifications, or terms and conditions” because those types of documents usually aren’t shipment-specific, and might not be seen by a customer’s food safety manager.

FDA’s recommendations with respect to the disclosure required under the produce safety rule parallel the recommendations summarized above, but are silent with respect to disclosure of chemical and physical hazards because that rule does not require their control.

Comments on the draft guidance are due by May 1, 2017.

By James E. Valentine & Karla L. Palmer –

We reported earlier this month that the Food and Drug Administration (FDA) amended its regulations to update the list of drugs that may not used in compounding under the exceptions set forth in sections 503A and 503B of the Federal Food, Drug, and Cosmetic Act (FDCA). This list reflects those drugs that have been withdrawn or removed from the market because the drugs or components of such drugs have been found to be unsafe or not effective. See 21 C.F.R. § 216.24.  FDA is at it again with another proposed rule that would further amend this list.

In alignment with the votes of the June 2015 Pharmacy Compounding Advisory Committee (see meeting transcript here), the proposed rulemaking would add the following three drugs to the current list of 83 drugs: 

The notice provides a brief summary of the reasons why each drug is being proposed for inclusion. While the Pharmacy Compounding Advisory Committee also voted to include all drug products containing more than 325 mg of acetaminophen per dosage unit, FDA is still considering whether to propose adding it to the list.

Comments on the proposed rule can be submitted until January 3, 2017 here.

By John A. Gilbert, Jr. & Andrew J. Hull –

The Controlled Substances Act (“CSA”) and regulations promulgated by the Drug Enforcement Administration (“DEA”) provide for a right to an administrative hearing in matters where DEA seeks denial or revocation of a DEA registration to handle controlled substances. Such hearings are required to be open to the public. However, there is no routine publication identifying when such hearings will take place. The public, especially other DEA registrants, would benefit from such notice and the opportunity to observe the DEA administrative process.

Many of our readers are likely familiar with DEA’s hearing procedures (see here for an in-depth analysis). When the agency proposes to deny an application for registration or revoke or suspend an existing registration, the agency will issue the party an order to show cause (“OSC”), which provides the registrant a right to request a hearing on this action. In these cases, DEA regulations provide for the matter to be placed on the docket of DEA’s Office of Administrative Law Judges (“OALJ”) and for a hearing to be scheduled before an administrative law judge (“ALJ”).

These hearings are open to the public. See 5 U.S.C. § 556; Am. Bar Ass’n, A Blackletter Statement of Federal Administrative Law, 54 Admin. L. Rev. 1, 20 (2002). However, in most matters, the first time there is any mention in the public record of a hearing is after the hearing is concluded and, in fact, after the ALJ has issued a recommended opinion and the agency has published its final decision, known as a final order, in the Federal Register. According to a 2014 report by DOJ’s Office of the Inspector General (“OIG Report”), the average time it took to adjudicate a matter in 2012 was 371 days (down from an average of 616 days in 2008). OIG Report at 15. As such, a matter may be pending before the agency for a year (or longer) without any notice to the public until it is finally resolved.

Neither the CSA nor DEA’s regulations require that DEA notify the public of an upcoming hearing regarding the denial, revocation, or suspension of most registrations, though an exception applies to bulk manufacturers of a basic class of controlled substances listed in Schedule I and Schedule II. See 21 C.F.R. § 1301.35(b) (requiring notice of hearing in the Federal Register). Instead, DEA’s regulations allow for the notice of hearing to be provided in the OSC served on the individual party in lieu of publication in the Federal Register. See id. § 1301.45 (“The hearing will commence at the place and time designated in the order to show cause or notice of hearing published in the Federal Register . . . .”).

DEA administrative hearings are supposed to be open to the public. The problem is that the public is unlikely to even know that action is being taken against a particular registrant or that a hearing is taking place until after DEA publishes a final order. While DEA should make the existence of these cases and hearings known to the public, particularly because these hearings are public, DEA does not maintain any sort of public hearing docket. The only recourse for members of the public who are interested in following DEA’s ongoing hearings is 1) to contact DEA’s Office of Congressional & Public Affairs and blindly ask if there are any ongoing cases and whether there are any scheduled hearings, or 2) attempt to obtain this information through a FOIA request. We here at FDA Law Blog have tried both methods without much success.

Other federal agencies provide much greater access to information about hearings, along with the ability to view documents filed by the parties in the public docket. For example, the Environmental Protection Agency, the Federal Trade Commission, and the National Labor Relations Board all maintain current dockets that are available to the public on their websites (see here, here, and here).

We recognize that some DEA administrative hearings by their nature should not be totally “open” to the public. For example, some portions of cases may involve trade secrets or other confidential commercial information. However, we can also see some benefits to the public if DEA was to maintain a public docket or otherwise alert the public of ongoing administrative hearings.

First, a public hearing docket would generally create better public access to public information, one of the stated goals of the current administration. See Memorandum from President Barack Obama to Heads of Executive Departments and Agencies on Transparency and Open Government, 74 Fed. Reg. 4685 (Jan. 26, 2009). Second, access to such information could help other registrants fulfill their obligations under the CSA to help protect the public from the risk of diversion. For example, a pharmacy that learns that DEA has issued an OSC proposing to revoke the registration of one of its physician customers may choose to perform additional due diligence, including attending the hearing and/or no longer filling prescriptions for that physician as part of its corresponding responsibility. See 21 C.F.R. § 1316.04(a). Third, public knowledge of ongoing cases would allow interested parties to intervene or file amicus briefs at the discretion of the agency.

DEA has been criticized in recent years by the courts and industry as to its lack of transparency in operations. Providing access to DEA’s ongoing administrative hearing docket would be a great service to industry and the public as a whole, and would go a long way in ensuring greater openness. The most accessible and transparent method would be to maintain an online docket that, at the bare minimum, lists cases where a party has requested a hearing and details the hearing place and date.

DEA has indicated that it intends to significantly revise its hearing regulations. See OIG Report at 41, 46. Creating a hearing docket accessible to the public at the same time it introduces these new hearing regulations would be a significant and helpful step forward by DEA in promoting openness and transparency on matters that should already be open to the public.

By Karla L. Palmer & Andrew J. Hull – 

From time to time, we have posted on significant final orders in DEA administrative cases. We now plan to blog on these cases in a more regular fashion, partly because we have noted that a number of these “routine” revocation cases often also include some significant procedural rulings by the DEA Administrator. In fact, we have noticed an increase in such rulings involving disagreements between the administrative law judges and the Administrator.

Since September of this year, the DEA Acting Administrator has issued four final orders. Three of these cases involve DEA’s revocation of a registrant’s Certificate of Registration due to the registrant’s loss of authority to handle controlled substances in the state in which the registrant is licensed:

• Charles Syzman, D.O., 81 Fed. Reg. 64937 (Sept. 21, 2016)
• Richard J. Settles, D.O., 81 Fed. Reg. 64940 (Sept. 21, 2016)
• Kevin L. Lowe, M.D., 81 Fed. Reg. 64949 (Sept. 21, 2016)

These three cases are typically referred to as “loss of state authority cases,” in which the agency considers state authority to handle controlled substances a necessary condition of maintaining a DEA registration. These cases, as is typical, involve DEA’s summary disposition of the matter once DEA determines that the registrant lacks state authority. We will be blogging on a recently released fourth case, Edge Pharmacy, 81 Fed. Reg. 72092 (Oct. 19, 2016), in the near future.

In this post, however, we focus on the Acting Administrator’s arbitrary use of official notice without applying the requisite procedural safeguards to the respondent in the Settles case referenced above.

The Administrative Procedure Act (APA) allows an agency to take official notice in a final adjudication (somewhat analogous to judicial notice) of certain facts outside of the agency record. See 5 U.S.C. § 556(e) (“When an agency decision rests on official notice of a material fact not appearing in the evidence in the record, a party is entitled, on timely request, to an opportunity to show the contrary.”) The agency must note in its order that it is taking official notice of a material fact, and it must provide the parties an opportunity to refute that official notice.

In the past, DEA has relied on official notice of material facts outside of the agency record. For example, the agency will take official notice of a relevant action by a state medical or pharmacy board related to a registrant’s license or of proceedings in parallel criminal or civil cases. Typically, the Administrator will follow the appropriate procedure of stating it is taking official notice of a certain non-record fact and providing the parties a period of time to challenge that fact. See, e.g., Kamal Tiwari, M.D., 76 Fed. Reg. 71604, 71606 & n.4 (Nov. 18, 2011) (noting that the agency was taking official notice pursuant to 5 U.S.C. § 556(e) of the respondent’s licensing status listed on a state licensing website and providing the respondent with twenty days to dispute the fact).

Notwithstanding the Administrator’s past practice of providing a respondent notice and an opportunity to “show the contrary” consistent with the APA, the Acting Administrator, in the Settles case, appears to have ignored the APA’s statutory process for taking official notice. Dr. Settles, a physician, faced a series of allegations by DEA that he lacked state authority to hold a controlled substance registration, materially falsified an application to DEA, and engaged in various prescribing violations. He waived his right to a hearing, and the Acting Administrator issued the final order based on the record forwarded to him by agency counsel.

However, after the record had been forwarded to him, the Acting Administrator—on his own initiative—reviewed the medical licensing websites of New Mexico and Colorado and relied on these websites to further support the record evidence that Dr. Settles lacked state authority to practice medicine in those states. Settles, 81 Fed. Reg. at 64944 & n.13. The Acting Administrator failed, however, to take official notice of these facts, and he failed to provide Dr. Settles with any opportunity to challenge these findings.

The Acting Administrator’s disregard for the APA’s minimal notice requirements in relying on certain non-record facts is somewhat inexplicable, but not unprecedented. A similar failure to use the APA’s official notice procedures occurred in another case, Gregory White, M.D., 79 Fed. Reg. 24754, 24755 (May 1, 2014), in which the then-Deputy Administrator made a finding based on his own “internet search” on the California medical board’s website without taking official notice—or providing the respondent with opportunity to dispute—his finding as required by the APA. 5 U.S.C. § 556(e).

The ability to take official notice of facts is an important and helpful tool for an agency adjudication. But, like other provisions of the APA, it must be used within its statutory bounds in order to afford an aggrieved party necessary due process.  If DEA relies on certain non-record material facts in its adjudications, it too must go through the statutory process.

One final thought for consideration: The APA prohibits any employee “engaged in the performance of investigative or prosecuting functions for an agency in a case” from “participat[ing] or advis[ing] in the decision, recommended decision or agency review.” 5 U.S.C. § 554(d). Query as to where the boundaries would be in regard to the Acting Administrator’s actions and whether the Acting Administrator’s own internet searches for material facts constitutes an investigative function that would prohibit him from participating or advising in agency review of the record or in writing the final order. The same question would also be relevant to such actions by an administrative law judge.

By Kurt R. Karst –  

There are few things this blogger likes more (workwise at least) than having a hot cup of joe in the morning while reading through an FDA exclusivity decision. (Reading through the latest edition or supplement to the Orange Book while enjoying some coffee is also right up there on the top of the list.)  This blogger recently had one of those enjoyable  experiences after coming across a “new” – that is, “new” insofar as the decision was just publicly released – exclusivity decision buried in an FDA Approval Package (Summary Basis of Approval) for Inspirion Delivery Technologies, LLC’s (“Inspirion’s”) MORPHABOND (morphine sulfate) Extended-release Tablets, 15 mg, 30 mg, 60 mg, and 100 mg. FDA approved MORPHABOND under a 505(b)(2) NDA (NDA 206544) on October 2, 2015 for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment and for which alternative treatment options are inadequate.

In an October 1, 2015 Exclusivity Letter Decision, the CDER Exclusivity Board examines whether or not a period of 3-year exclusivity the Agency apparently granted after approving  a Supplemental NDA (S-016) for AlPharma Pharmaceuticals, LLC’s (“AlPharma’s”) EMBEDA (morphine sulfate and naltrexone HCl) Extended-release Capsules (NDA 022321) should block the approval of MORPHABOND. We say “apparently” because the Orange Book does not show any unexpired period of 3-year exclusivity for EMBEDA in connection with the October 17, 2014 approval of S-016. That supplement revised the EMBEDA labeling to describe the results of data from in vitro and in vivo abuse potential studies. In any case, the 3-year exclusivity applicable to EMBEDA, which is approved for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment and for which alternative treatment options are inadequate, expires on October 17, 2017. 

The 505(b)(2) NDA for MORPHABOND was submitted to FDA in September 2014 and relies on FDA’s safety and effectiveness findings for MS CONTIN (morphine sulfate) Extended-Release Tablets (NDA 019516; approved on May 29, 1987), for which the Orange Book does not identify any unexpired period of patent or non-patent exclusivity. So, if the listed drug cited in the MORPHABOND 505(b)(2) NDA is not EMBEDA, then why are we even talking about a potential block on the approval of MORPHABOND?  Because, FDA interprets the FDC Act’s 3-year exclusivity provisions to apply regardless of a reliance tether.  This interpretation became clear within the past two years in the context of FDA’s consideration – and later court challenge – concerning Veloxis Pharmaceuticals, Inc.’s  (“Veloxis’”) 505(b)(2) application (NDA 206406) for ENVARSUS XR (tacrolimus) Extended-release Tablets.  In that case, FDA’s  determination, which was upheld in court, was that a period of 3-year exclusivity FDA granted in relation to an original NDA for a single-entity drug product for certain conditions of use blocked the approval of NDA 206406 for the protected conditions of use.  You can read up on that FDA decision and district court case here and here.

The EMBEDA-MORPHABOND exclusivity analysis differs from the Veloxis case analysis in two important respects. First, unlike EMBEDA, which contains two active ingredients, MORPHABOND contains only a single active ingredient.  Second, the period of 3-year exclusivity applicable to EMBEDA was granted in the context of a Supplemental NDA instead of an Original NDA.  Also, we should note that for those folks hoping that FDA might opine of the scope of EMBEDA’s 3-year exclusivity as it relates to abuse-deterrent formulations, you’re out of luck.  FDA states pretty early in the Agency’s 18-page Letter Decision that “[t]his memorandum only discusses whether the 3-year exclusivity for Embeda should block the approval of the MorphaBond NDA, and does not address the scope of Embeda’s exclusivity nor whether MorphaBond is eligible for its own period of exclusivity or the scope of any such exclusivity.” Oh well . . . another day perhaps.  But we have more on that below. 

For Supplemental NDAs, FDC Act § 505(c)(3)(E)(iv) provides the following with respect to 3-year exclusivity:

If a supplement to an application approved under subsection (b) [of this section] is approved after [September 24, 1984,] and the supplement contains reports of new clinical investigations (other than bioavailabilty [sic] studies) essential to the approval of the supplement and conducted or sponsored by the person submitting the supplement, the Secretary may not make the approval of an application submitted under subsection (b) [of this section] for a change approved in the supplement effective before the expiration of three years from the date of the approval of the supplement under subsection (b) [of this section] . . . .

Although FDC Act § 505(c)(3)(E)(iv) differs somewhat from FDC Act § 505(c)(3)(E)(iii) concerning Original NDAs, FDA says that the Agency “has taken a consistent approach to both types of applications in determining eligibility for 3-year exclusivity and scope.” From there, FDA lays out the two-step inquiry to determine the blocking effect of another sponsor’s period of 3-year exclusivity, both generally, and in the context of a combination drug product:

[I]n order to determine that a 505(b)(2) NDA is blocked because it seeks approval for a “change approved in a supplement” during another applicant’s 3-year exclusivity period, the 505(b)(2) NDA must be for a drug with the same active moiety as the drug with exclusivity. . . . If the 505(b)(2) application for a single-entity drug seeks approval for the same drug (active moiety) to which exclusivity has attached, then the second aspect of the scope inquiry applies.  To determine whether the 505(b)(2) NDA is barred, FDA must also determine what exclusivity-protected change was approved in the supplement.  To do so, FDA examines the conditions of approval supported by the new clinical investigations (other than bioavailability studies) that were essential to approval of the supplement.  If the 505(b)(2) NDA for a single-entity drug is for the same drug for the same exclusivity-protected change approved in the supplement, it will be blocked. . . .

[I]n determining whether a 505(b)(2) NDA is seeking approval for a “change approved in a supplement” to a fixed-combination and is therefore blocked by 3-year exclusivity for the supplement, FDA similarly limits its inquiry to applications that contain the same combination of active moieties as in the fixed-combination and examines the scope of the new clinical investigations essential to the approval and that were conducted or sponsored by the applicant. If the 505(b)(2) NDA is not seeking approval for a fixed-combination with the same combination of active moieties as the combination with exclusivity, it is not seeking approval for a change approved in the supplement and therefore cannot be blocked.

Based on that last paragraph in particular, you know the outcome of FDA’s EMBEDA-MORPHABOND exclusivity analysis. But here it is in FDA’s own words:

The change approved in the supplement (S-016) for Embeda is the change in conditions of approval for the drug containing the combination of active moieties approved in the Embeda NDA. Thus, the change approved in the supplement only bars approval of other 505(b)(2) NDAs for drugs containing the combination of active moieties approved in Embeda and that otherwise seek approval for the same exclusivity-protected conditions of approval as Embeda.  Because MorphaBond does not contain the combination of active moieties approved in Embeda, any approval of MorphaBond is not an approval for the “change approved in the supplement” (i.e., S-016) for which Embeda currently has exclusivity and no additional inquiry is required.  Therefore, we recommend that the exclusivity awarded to Embeda for S-016 should not block approval of MorphaBond.

Harkening back to an earlier note in the Letter Decision concerning the scope of EMBEDA’s exclusivity (quoted above), FDA states that “[i]f both Embeda and MorphaBond contained the same combination of the two active moieties morphine and naltrexone, we would need to evaluate the nature of the change approved in the NDA supplement and would need to determine which new clinical investigations were essential to approval of S-016.” But FDA did not have to go there. “We need not reach this aspect of the scope of inquiry here, however,” says FDA, “because Embeda and MorphaBond do not contain the same combination of active moieties.”

In addition to FDA’s statutory analysis and conclusion, the Agency discusses several other reasons supporting its determination. With respect to abuse-deterrence, FDA notes that the Agency’s “recommendation in this case is also consistent with the Agency’s efforts to foster the development of AD opioid products more generally. Because the science of abuse deterrence is still evolving and the Agency does not yet know which AD technologies will ultimately prove most effective in deterring opioid abuse, the Agency believes that, when the statute and regulations permit it, it is in the interest of public health to encourage development of multiple AD alternatives.”

Is FDA signaling with this comment how the Agency might determine, and what factors might affect, the scope of 3-year exclusivity for an abuse-deterrent drug product supported by clinical studies? Maybe. . . maybe not.  We hesitate to read too much into this FDA comment.  The fact is that FDA will only make an evaluation and determination when the Agency is faced with a hard set of facts. 

By Robert W. Pollock* & Kurt R. Karst –      

If there’s something strange in your neighborhood; Who you gonna call? If there’s something weird, and it don't look good; Who you gonna call? Unfortunately, FDA doesn’t have a Ghostbusters-type unit to call when there’s something strange or weird compliance-wise going on in your neighborhood that’s holding up final ANDA (or 505(b)(2) NDA) approval. (Oh, and you’re welcome for the earworm!)

The GDUFA program has spurred an increase in the number of inspections for generic drug applicants and the establishments identified in those applications. With the increasing number of inspections, comes an increase in Establishment Inspection Reports (“EIRs”) that need to be written by FDA investigators, cleared by their supervisors, and then reviewed and cleared by the Center for Drug Evaluation and Research’s Office of Compliance. As was noted in a recent post on the Lachman Consultants Blog, there appears to be a growing problem in getting timely resolution of compliance-related issues from the time the EIR leaves the field and up until FDA’s computer systems are updated to provide an acceptable finding.

Our firms (Hyman, Phelps & McNamara, P.C. and Lachman Consultant Services, Inc.) have been hearing a rising chorus of complaints about being stuck in what one applicant called the “Compliance Black Hole.” Another company referred to it as the “Endless Summer,” because that company has been trying to figure out when their compliance status will change in the FDA computers after having received no 483 observations on reinspection since March of this year.

Firms note that calls to FDA Regulatory Project Managers (“RMPs”) or Regulatory Business Project Managers yield the same response: “There is nothing we can do until the computer system is updated.” Many of these responses come after the issuance of a Complete Response Letter (“CRL”) stating that the only outstanding issue is resolution of the status of a facility’s compliance. So the firm is stuck in a waiting mode.   Simply calling the Office of Compliance has yielded basically the same result. Clients are telling us that they do not receive return calls (or that they are simply told to sit tight and wait).

Trying to find a sympathetic ear at FDA is also difficult, particularly when a firm is ready to launch but for the final compliance clearance and approval action. In addition, we have heard from firms with potential date-certain launch dates (either day-181 dates or settlement dates) that they were informed by FDA officials that the compliance status of their application remains unresolved in the Agency’s computer system, notwithstanding the fact that the sponsor was informed by an FDA field investigator that there were either no 483 observations following inspection, that a completed EIR was forwarded to CDER finding satisfactory the firm’s responses to inspectional observations, or that an approval recommendation had gone forward. While we recognize we don’t always have the full picture when we hear these types of observations from sponsors, the frequency of occurrence of such complaints is increasing in dramatic fashion. Last week alone, Lachman Consultants received four inquiries about such issues. Each company expressed exasperation in not being able to get an answer other than “You just have to wait!”, and asked the same question: “Who can I call at FDA to discuss the issues?”

There’s no easy answer to that question. Depending on your level of exasperation, you might start at the top of the FDA Office of Compliance food chain, or perhaps at the Office of Process and Facilities, which is in the Office of Pharmaceutical Quality. (Here’s the CDER List of Key Officials in case you need it.)  It’s unclear how many applications are being delayed because they are stuck in the “Compliance Black Hole” . . . probably dozens, and perhaps several score. But, as noted above, a simple call to FDA is unlikely to do the trick in removing a compliance status block on approval. Instead, a sponsor might consider escalating the issue by requesting a meeting with the relevant FDA officials. After all, he who screams the loudest might be more likely to get FDA’s attention.      

* Mr. Pollock is Senior Advisor, Outside Director to the Board, Lachman Consultant Services, Inc., and is an author of the Lachman Consultants Blog.

For almost 40 years FDA has allowed device firms to promote their device while a 510(k) submission is still pending.  Yet, questions about how to apply this policy still remain.  In an article newly published in MedTech Insight, titled "Promoting Your 510(k)-Pending Device: 5 Questions About FDA's Policy," Hyman, Phelps & McNamara, P.C.'s Jeffrey K. Shapiro answers some of the most frequently asked questions.   

By Riëtte van Laack –

A couple of weeks ago, the Food Safety Inspection Service of the USDA (FSIS) announced the availability of an updated compliance guideline regarding animal-raising claims. The previous guideline dated from 2002.

Traditionally, the FSIS has interpreted the Federal Meat Inspection Act (“FMIA”) and Poultry Products Inspection Act (“PPIA”) to require that labels for federally inspected meat and poultry products be approved before the meat and poultry products are marketed, except when the label is generically approved. Labels with animal-raising claims are not eligible for generic label review and must be submitted to FSIS. Examples of claims include: “Raised Without Antibiotics,” “Organic,” “Grass-Fed,” “Free-Range,” “Raised without the use of hormones.” FSIS allows such claims only if the company submits documentation to support the claim(s). Moreover, FSIS determines whether a claim will be false or misleading. For example, since under U.S. law, chickens may not be treated with hormones, FSIS will not approve a claim “no hormones administered” unless the claim includes the statement: “Federal regulations prohibit the use of hormones in poultry.”

Depending on the claim, the documentation needed to support the animal-raising claim generally includes:

• A detailed written description explaining the controls used for ensuring that the raising claim is valid from birth to harvest or the period of raising being referenced by the claim;
• A signed and dated document describing how the animals are raised (e.g., vegetarian-fed, raised without antibiotics, grass-fed) to support that the specific claim made is truthful and not misleading;
• A written description of the product-tracing and segregation mechanism from time of slaughter or further processing through packaging and wholesale or retail distribution;
• A written description for the identification, control, and segregation of non-conforming animals or products; and
• A current copy of the certificate if the claim is certified by a third party, e.g., organic certification or non-GMO verified project.

The updated guideline provides a number of examples of animal-raising claims and the documentation required for the sample claims. It also addresses what, if any, documentation is required when an establishment wants to “duplicate” animal-raising claims from purchased products/ingredients incorporated into the establishment’s product.

FSIS issued the updated guideline in response to questions it received about animal-raising claims. Much of the information likely already was available in some other format such as on askFSIS, and in policy statements. Although comments may be submitted until December 5, 2016, FSIS advises establishments that wish to use animal-raising claims to use the guideline immediately.