By Karla L. Palmer

FDA published for comment two non-binding draft guidance documents addressing compounding of commercially available drug products by traditional pharmacies under FDCA Section 503A and outsourcing facilities under Section 503B.  [Section 503A Draft Guidance is HERE, blogged separately] and Section 503B Guidance is [HERE].  These non-binding draft guidance documents reflect FDA’s latest attempt to restrict what may be compounded by narrowly construing what is and is not essentially a copy of a commercially available drug product.  If finalized, the Section 530B guidance would affect, by FDA’s estimates, approximately 40 outsourcing facilities.  The deadline for submitting comments on the draft guidance documents is October 11, 2016.

Section 503B Draft Guidance      

            Under Section 503B, outsourcing facilities may compound “essentially a copy of an approved drug” in limited circumstances.  Section 503B(d)(2).  Section 503B defines “essentially” copies somewhat differently than Section 503A, including referencing non-prescription marketed drugs, whether the compounded and commercially available substances are “identical,” and, if compounded from bulk substances, whether the compounded version produces a “clinical” difference for the patient (which FDA generally describes the same as the “significant” difference requirement under Section 503A).  FDA attaches to its draft Section503B guidance at Appendices A and B a very handy flow chart HERE to assist outsourcing facilities in determining whether a drug is essentially a copy of an approved drug.  Under the statute, and as depicted on FDA’s chart, essentially copies have two components: (1) A drug that is identical or nearly identical to an approved drug or an unapproved non-prescription drug is evaluated under Section 503B(d)(2)(A); and, (2) all other compounded drugs are evaluated under Section 503B(d)(2)(B).  FDA also defines “covered OTC drug products” in the draft guidance as a marketed drug not subject to Section 503(b) (prescription requirements) and not subject to approval under Section 505 to mean any non-prescription drug product marketed without an approved application; it includes monograph and non-monograph products as well. 

The draft guidance describes how FDA intends to apply its definition of “essentially a copy” of a compounded drug when applied to an approved drug (unless it appears on FDA’s shortage list) and how it intends to apply that definition when the compound is compared to a covered OTC product.  Some of the draft’s salient points are as follows:

Compounded drugs “nearly identical” to approved drugs: Referring to Box 1 of Appendix A, FDA will consider whether the compounded and approved drug have the same:  

(1) Active ingredients;

(2) Route of administration;

(3) Dosage form;

(4) Dosage strength; and

(5) Excipients (if excipients of the approved drug are known).   .    

If these characteristics between the two products are the same, then FDA will consider the products identical or nearly identical, and they may not be compounded.  Importantly, unlike in Section 503A, FDA will NOT exempt products from this restriction based on a determination by a prescriber that the compound produces a “clinical difference” for the patient (addressed below). However, in shortage situations, it expects compounds to be identical or nearly identical to the approved drug on FDA’s published shortage list. FDA does not intend to take action concerning compounding a shortage drug if it was on the list at the time the facility received the order, or within “60 days of … distributing or dispensing the drug.”  FDA notes there will be some regulatory flexibility, but if an outsourcing facility continues to fill orders more than 60 days after the drug is removed from the list, it may take regulatory action.   

If the compound differs in one or more of the above characteristics, then FDA would not consider it generally to be “identical or nearly identical.”  FDA would then turn to Section 503B(d)(2)(B) (see Appendix A) to determine whether the compound is appropriate. 

 Section 503B(d)(2)(B) states that a compounded drug is “essentially a copy” of an approved drug if a component of the compounded product is also a component of an approved drug, unless there is a change that produces a “clinical difference” for the patient as determined by the practitioner.  FDA further defines this section as follows:

Using the same bulk substance as the approved drug (Box 3):  FDA states that if the compounded bulk substance and approved drug products are the same, then the compound is essentially a copy, unless there is a determination of “clinical difference.” These provisions apply to a compound whether compounded from bulk substances or from drugs in finished form.    

Prescriber determination of clinical difference (Box 4):  To rely on a prescriber determination of “clinical difference,” the outsourcing facility should ensure that the determination is stated (in no particular format) on either the non-patient specific order or the patient specific prescription.  For non-patient specific orders, the facility should obtain a practitioner statement that specifies the change, and that the compound will only be provided to a patient “for whom the change produces a clinical difference.”  The facility may make the notation, if confirmed by the health care facility or prescriber (including date of the conversation).  FDA provides examples on pages 9-10 of the draft guidance, and elaborates on written statements that may suffice for non-patient specific orders:  

• “Liquid form, compounded drug will be prescribed to patients who can’t swallow tablet” (if the comparable drug is a tablet)
• “Dilution for infusion solution to be administered to patients who need this formulation during surgery” (if the comparable drug is not available at that concentration, pre-mixed with the particular diluent in an infusion bag)
• “1 mg, pediatric patients need lower dose” (if the comparable drug is only available in 25 mg dose).

And for patient-specific prescriptions:

• “No Dye X, patient allergy” (if the comparable drug contains the dye)
• “Liquid form, patient can’t swallow tablet” (if the comparable drug is a tablet)
• “150 mg drug X in 120 ml cherry-flavored Syrup USP, patient needs alcohol-free preparation (if the comparable drug is only available in formulations that contain alcohol)

An order or a prescription containing only a formulation will not suffice.  FDA adds that “lower price” is not sufficient to establish that the compound is not essentially a copy of the approved drug.  FDA does not intend to “question” the determinations of “clinical difference;” it will consider whether such determination is documented.

            Essentially a copy of one or more approved drug products:  FDA’s draft guidance also focuses on that statute’s statement that the compound must not be essentially a copy of “one or more” approved drug products.  FDA intends “to consider a compounded drug product that has bulk substances that are components of one or more approved drugs to be essentially a copy of an approved drug product” unless the change produces a “clinical difference.” 

            FDA’s application of the “essentially a copy” definition when the compounded drug is compared to a covered OTC product:  The Agency sets forth at Appendix B a flow chart for determining whether compounding copies of covered OTC drug products is appropriate. If the compounded drug is nearly identical to a covered OTC drug, FDA intends to apply the policy described above for “nearly identical” prescription drugs.  If it is not identical or nearly identical to the covered OTC drug, then

FDA will not permit compounding, if a component of the compounded drug is a bulk drug and is also a component of a covered OTC, unless there “is a change that produces for an individual patient a clinical difference,” as determined by the practitioner, between the compound and the comparable approved drug.  FDA leaves unanswered the result if there is no comparable “approved” drug (and what exactly is a “comparable approved drug to an OTC product).   FDA notes that a “clinical difference between the compounded drug and an unapproved drug (such as a covered OTC drug) does not exempt the compounded drug from the definition in section 503B(d)(2)(B).”  FDA should also clarify in final guidance whether this means that a compounder may not compound essentially copies of covered OTC drugs under any circumstance, or what documentation, if any would suffice to permit compounds of essentially copies of covered OTC drugs.  FDA also states that the statute does not provide an “essentially a copy” exemption for covered OTC drugs that may appear on FDA’s shortage list; thus copies of these OTC drugs may not be compounded in shortage situations. 

            Lastly, like with Section 503A’s draft guidance, FDA emphasizes that outsourcing facilities must keep good records to demonstrate compliance.     

By David C. Gibbons & Jeffrey N. Wasserstein –

The United States Court of Appeals for the Seventh Circuit recently issued an unpublished Opinion in United States v. LeBeau, No. 16-1289, 2016 WL 3619838 (7th Cir. July 5, 2016), a case in which the pro se defendant-appellant raised a First Amendment defense after pleading guilty to a misdemeanor violation of the federal Food, Drug, and Cosmetic Act (“FD&C Act”) for introducing an unapproved new drug into interstate commerce. 

In LeBeau, the defendant was charged with four misdemeanor counts of violating the FD&C Act for selling his product, “Perfect Colon Formula #1,” for use in the cure, treatment, prevention, or mitigation of a variety of conditions, which had not previously been generally recognized as safe and effective nor approved by FDA for such uses.   Ultimately, LeBeau pled guilty to one of those counts, that is, for distributing his product for use in the treatment of food allergies.  LeBeau at 2; Brief of Plaintiff-Appellee, United States v. LeBeau, No. 16-1289, at 3-4 (May 5, 2016).  LeBeau’s plea agreement permitted him to preserve certain legal issues for appeal.  Brief of Plaintiff-Appellee, at 4.

The appellant-defendant raised several issues on appeal, one of which was that the promotion of Perfect Colon Formula #1 for its intended uses was protected commercial speech under the First Amendment.  LeBeau at 1.  The government argued that LeBeau was not being prosecuted for his speech, but rather his speech was used as evidence of his intent to introduce an unapproved new drug into interstate commerce.  The district court agreed with the government on this point and gave no relief to LeBeau.  On appeal, the Seventh Circuit affirmed the lower court’s conclusion that “the government is not prosecuting LeBeau for having made claims about his products.  Rather, it is prosecuting LeBeau for his acts—his attempts to profit from the sale of a product—which he represented to have palliative properties—without having received [FDA] approval to do so.”  Id. at 3.  Specifically regarding LeBeau’s First Amendment defense, the Seventh Circuit went on to say that, “[b]ecause LeBeau’s statements promoted the unlawful sale of an unapproved drug, they were not entitled to [First Amendment] protection.”  Id.

Although this Seventh Circuit opinion arises from an unpublished Opinion, it is important to consider the proposition for which this case stands, which was not at issue in Caronia, and its progeny, nor the more recent settlements in Amarin and Pacira.  That is, First Amendment protection does not extend to commercial speech regarding an unapproved product—that is, a product for which there are no “lawful” uses—even if that speech is truthful and not misleading.  Seventh Circuit precedent in United States v. Caputo, 517 F.3d 935, 940-941 (7th Cir. 2008), cited by the court in LeBeau, elucidates this point.  In Caputo, the Seventh Circuit stated that First Amendment protection for the promotion of off-label uses of a medical product rests on the “assumption” that a manufacturer can lawfully promote the product at all.  Id. at 940.  The Court stated, “[u]nless the [product] itself could be sold lawfully, there were no lawful off-label uses to promote.”  Id.  Thus, it appears that the Seventh Circuit would draw a distinction between commercial speech promoting unapproved uses of FDA-approved products and the promotion of unapproved products.  First Amendment protection for truthful and non-misleading speech may apply to the former, but not the latter, according to the Seventh Circuit.

There are some important limitations of the LeBeau opinion to consider.  First, as noted above, LeBeau is an unpublished opinion, thus, with limited precedential value.  However, the principles articulated by the court in Caputo carry weight, at least in the Seventh Circuit, and were relied on, in part, by the court in LeBeau.  Second, the pro se defendant-appellant’s arguments in his appellate brief were, at best, unartfully rendered and made without a sufficient understanding of the FD&C Act, the substantial jurisprudence concerning First Amendment protection for truthful and non-misleading commercial speech, and appellate practice.  Finally, the promotional statements at issue in LeBeau were related to labeling statements associated with an unlawfully marketed drug.  It is important to recall FDA regulations regarding preapproval promotion of unapproved, investigational drugs, which permit commercial speech in the context of scientific exchange and are intended only to restrict “promotional claims of safety or effectiveness of the drug for a use for which it is under investigation and to preclude commercialization of the drug before it is approved for commercial distribution.”  21 C.F.R. § 312.7(a).

By Karla L. Palmer –   

On July 11, 2016, FDA published for comment two draft guidance documents addressing compounding of commercially available drug products by traditional pharmacies under FDCA Section 503A and outsourcing facilities under Section 503B (the Section 503A Draft Guidance is available here and the Section 503B Guidance is available here, blogged separately).  This non-binding, draft guidance documents reflect FDA’s latest attempt to significantly restrict what may be compounded by narrowly construing what is and is not essentially a copy of a commercially available drug product.  If finalized, the Section 530A guidance would affect, by FDA’s estimates, approximately 6,900 pharmacies.  The deadline for submitting comments on the draft guidance documents is October 11, 2016.

Section 503A Draft Guidance      

Under the plain language of Section of Section 503A, traditional compounders may compound essentially copies of commercially available drug products so long as not “regularly or in inordinate amounts.”  FDA’s draft guidance attempts to define the scope of “regularly or in inordinate amounts.”  FDA’s draft also defines “commercially available” and “essentially a copy of a commercially available” drug.  These terms have become increasingly important in the wake of FDA’s attempts to curtain how and what drugs may be compounded compounders may 

“Commercially Available” – FDA defines “commercially available” as a marketed drug product.  It will not consider a drug “commercially available” if it is discontinued and no longer marketed or it appears of FDA’s published shortage list.      

“Essentially a copy” – A compound is “essentially a copy” of a commercially available drug if: (1) it has the same active pharmaceutical ingredient (“API”); (2) the APIs have the same, similar or easily substitutable dosage strength; and (3) the commercially available drug can be used by the same route of administration as the compounded drug – UNLESS a prescriber determines there is a “change, made for an identified individual patient, which produces for that patient a significant difference.” 

FDA describes what may cause a compounded drug to be “essentially a copy” and thus violative of Section 503A:

“Same API” – FDA intends to consider drugs with the same API to be “essentially a copy” unless a prescriber determines there is a change between the compounded and manufactured drug product that will produce a significant difference for the patient for whom it is prescribed. 

“Same, similar or easily substitutable strength” – Two drugs will have similar dosage strength if the strength of the compound is within 10% of the commercial product.  FDA would consider dosages easily substitutable if a patient could take, for example two 25mg manufactured doses, instead of one 50 milligram compounded dose. 

“Same route of administration” (i.e., topical, intravenous, oral) – FDA states it does not intend to consider a product with the same API and similar/substitutable strengths to be essentially copies if they have different routes of administration.  FDA includes an important “however:” if the compound and manufactured drug have the same API and same/substitutable strengths, and the commercially available drug can be used “(regardless of how it is labeled)” by the route of administration prescribed for the compound, FDA considers the compound to be a copy of a commercially available drug.  FDA, Draft Guidance at 7, lines 250-59.  FDA uses as an example an injectable drug labeled for intra-muscular use, but can be drawn from the vial by a smaller needle for other administration.  If the doctor preferred a compound to be used in this situation, he or she must document the significant difference between the compound and the commercially available drug.  As another example, FDA states that if X and Y are two commercially available oral drugs, FDA intends to consider a compounded formulation of X and Y in strengths within 10% of the commercially available drugs to be essentially a copy, unless the prescriber determination of significant difference has been documented.  

“Statement of Significant Difference” – FDA proposes that any determination of a significant difference in the compounded preparation from the commercially available product should be documented on the prescription.  FDA states there would be no required format, but gives examples of acceptable statements. Just a patient name and formulation would not be sufficient, states FDA.  Importantly, FDA adds that the “significant benefit that the prescriber identifies must be produced by the change” the compounder makes to the commercially available product.  FDA specifically states that “lower prices” are not sufficient to establish something is not essentially a copy.  If the prescriber does not make clear the significant difference, then the compounder should contact the prescriber and make a specific notation of the difference, including date, on the prescription.

FDA’s Shortage List: Documentation Required – For compounding drugs on FDA’s shortage list, FDA states the compounder or prescriber should include a notation on the prescription that the drug is on the shortage list (including an indication of the date the list was checked). 

“Regularly or in Inordinate Amounts” – As required by the statute, FDA’s draft  defines the vague statutory phrase “regularly or in inordinate amounts.”  The statute permits compounders to compounding essentially copies of commercially available drugs so long as not “regularly or in inordinate amounts.”  FDA suggests “regularly” or “inordinate amounts” means if a drug “is compounded more frequently than needed to address unanticipated, emergency circumstances or in more than the small quantities needed to address unanticipated, emergency circumstances.”  As examples of other non-exhaustive factors FDA will consider:

1. Compounding copies of more than a small number of prescriptions;
2. The compounder routinely substitutes compounds that are essentially copies;
3. The compounder offers pre-printed prescription pads that a prescriber may complete without making a “significant difference” determination;
4. The drug is not compounded on an “as needed basis”, but on a routine or preset schedule. 

FDA states that, at this time, it does not plan to take action against a compounder that fills 4 or less prescriptions of essentially copies of the relevant drug product in a month.  If the prescription appropriately documents the significant difference, FDA would not count it in the four “permitted” prescriptions.

Recordkeeping

FDA’s draft states that a physician or pharmacist seeking to compound a drug under 503A should maintain records to demonstrate compliance with the statute.  This would include notation on prescriptions of “significant difference,” and records of the frequency of compounding “essentially copies” to that they can demonstrate such compounding is not “regularly or in inordinate amounts.” 

Given repeated emphasis of the importance of documentation, and maintaining the documentation, FDA plainly believes documentation is critical to establishing whether the compounded product is appropriate.  It will be interesting to see how compounders and drug manufacturers react to FDA’s draft guidance.

By Kurt R. Karst –      

It’s been a while since we posted on a 180-day exclusivity forfeiture issue, though we suspect that we’ll be doing it more in the coming months with some interesting issues on the horizon. But for now, FDA Blog Readers will have to be content with an oldie but a goodie (at least insofar as 2015 is consider old in Hatch-Waxman time).

We recently got our hands on a Memorandum prepared by FDA’s Office of Generic Drugs concerning the Agency’s December 3, 2015 approval of Sun Pharma Global FZE’s (“Sun’s”) ANDA 078340 for generic versions of Novartis Pharmaceuticals Corporation’s GLEEVEC (imatinib mesylate) Tablets, 100 mg and 400 mg, that we though was worth sharing with folks. The ANDA, which contained a Paragraph IV certification qualifying Sun as a first applicant eligible for 180-day exclusivity, was considered received (i.e., filed) by FDA as of March 12, 2007, and was tentatively approved about 32 months later, on November 13, 2009. 

By way of background, under FDC Act § 505(j)(5)(D)(i)(IV), one of the six 180-day exclusivity provisions added to the FDC Act by Title XI of the 2003 Medicare Modernization Act (“MMA”), 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.

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 Sun ANDA 078340, but we note them nevertheless.

FDA’s letter approving ANDA 078340 says, with respect to 180-day exclusivity, that:

Sun was the first ANDA applicant to submit a substantially complete ANDA for Imatinib Mesylate Tablets, 100 mg (base) and 400 mg (base) with a paragraph IV certification to the ‘051 patent. Therefore, with this approval, Sun is eligible for 180-days of generic drug exclusivity for Imatinib Mesylate Tablets, 100 mg (base) and 400 mg (base).  This exclusivity, which is provided for under section 505(j)(5)(B)(iv) of the FD&C Act, will begin to run from the date of the commercial marketing identified in section 505(j)(5)(B)(iv).  Please submit correspondence to this ANDA informing the agency of the date the exclusivity begins to run.

Although FDA sometimes drops a footnote in an approval letter to explain that an applicant who failed to obtain timely tentative approval neverless remains eligible for exclusivity because of some excuse excepting the applicant from the statutory 30-month period (e.g., ANDA 200156 for Armodafinil Tablets, 100 mg and 200 mg), FDA did not do so in the case of ANDA 078340.  But there’s a story there nevertheless. 

According to FDA’s July 1, 2015 Memorandum, despite Sun’s failure to obtain timely tentative approval by September 12, 2009, the company avoided forfeiting eligiblity for 180-day exclusivity because of a chemistry discipline review issue that remained pending on September 12, 2009.  The specifics of the chemistry review issue are redacted from FDA’s July 1, 2015 Memorandum; however, FDA explains that:

On September 8, 2009, FDA and Sun held [a] chemistry teleconference, during which FDA asked the firm, among other things, to provide a commitment to provide [the requested chemistry information] after tentative approval. Sun responded to this request on September 9, 2009, and provided a commitment to provide [the requested chemistry information] within 15 days of receiving tentative approval.  FDA’s review of Sun’s September 9, 2009 amendment, including the commitment to submit [the requested chemistry information], extended past the 30-month date. . . .  FDA reviewed Sun’s amendment and found chemistry to be acceptable on October 9, 2009, approximately one month after the 30-month forfeiture date.  Based on the above facts, we have determined that there was a change in requirements for approval related to [chemistry information] which FDA was actively addressing at the 30-month forfeiture date, and that this change was a cause of Sun’s failure to obtain tentative approval by the 30-month forfeiture date.

Although FDA could have ended the Agency’s analysis there, the Agency went on to address an argument from Sun that there was a change in ANDA bioequivalence requirements that caused the company to miss the 30-month tentative approval deadline. Specifically, Sun argued that after the submission of ANDA 078340, “FDA required for the first time that the [bioequivalence] studies for [imatinib mesylate tablets] be performed on a patient population” instead of a health volunteer population. FDA identified this as a bioequivalence deficiency in November 19, 2007 correspondence to Sun.  Sun performed new studies and amended ANDA 078340 on April 2, 2009, and again on July 29, 2009. FDA reviewed Sun’s submissions and found bioequivalence to be acceptable on August 27, 2009, about two weeks prior to the September 12, 2009 30-month forfeiture event date.  “Sun’s bioequivalence data was determined to be acceptable prior to the 30-month forfeiture date; therefore, any changes in bioequivalence requirements could not have caused Sun’s failure to obtain tentative approval within 30 months,” says FDA in the July 1, 2015 Memorandum.

Although FDA’s memorandum doesn’t relay the most scintillating 180-day exclusivity forfeiture story we’ve seen, the case provides greater visibility into FDA’s thinking on 180-day exclusivity forfeiture. In addition, it serves as a reminder that just because an ANDA approval letter is silent with respect to 180-day exclusivity forfeiture for failure to obtain timely tentative approval (or with respect to any of the other forfeiture provisions for that matter) doesn’t mean there’s not something else lurking out there providing an explanation. 

By Riette Van Laack –

On June 30, as required under the consent decree in the action by the National Resource Defense Council against FDA (see our previous post here), FDA published the amended tentative final monograph for consumer antiseptic rubs, also referred to as consumer rubs, leave on products or hand sanitizers. This category of products includes antiseptic wipes.

As we previously reported here and here, FDA has published two other proposed rules pursuant to the consent decree: a proposal to classify all consumer antiseptic hand wash products non-GRASE and a proposal to reclassify the health care antiseptics as category III (i.e., additional data are needed for safety or effectiveness). 

In the most recent action, FDA proposes to (re)classify alcohol (60-95 percent), isopropyl alcohol (70 to 91.3 percent) and benzalkonium chloride as category III because the Agency has determined that it currently has insufficient data to conclude that these active ingredients are Generally Recognized as Safe and Effective (GRASE) under FDA’s updated standards.  Unless additional data are submitted to support GRASE under the updated standards, FDA will declare them non-monograph ingredients in the final monograph.  FDA hastens to note that this proposal should not be interpreted as FDA’s determination that the consumer antiseptic rubs on the market are not safe or effective.  

It likely will come as welcome news for industry that the Agency does not propose to require clinical outcome data to support Generally Recognized as Effective (GRAE) status for the consumer antiseptic rubs.  FDA previously required such data for the consumer hand wash products in light of the easily available alternative of washing with soap and water.  However, antiseptic rubs are intended to be used by consumers when soap and water are not available, and there is no readily available alternative for antiseptic rubs.

Studies needed to support GRAE status for consumer antiseptic rubs include in vitro testing and in vivo studies.  The in vitro test consists of a determination of the antimicrobial activity against potential pathogens; including 25 representative clinical isolates and 25 reference strains of specified organisms.

The in vivo study consists of a clinical simulation test.  FDA continues to propose a bacterial log reduction as evidence that a consumer antiseptic rub is GRAE.  As with the health care antiseptics, FDA proposes a log reduction standard for one-time use application only; for an active ingredient to be GRAE, a single application must result in a 2.5 log reduction on each hand within 5 minutes after application.

FDA also is asking for data and information about the impact of product use factors, e.g., the impact of volume of product per application on the efficacy of the product.  FDA plans to use this information when developing the requirements for final formulation testing and labeling for the final formulations.

All three ingredients included in this proposed regulation are also included in the proposed regulation for health care antiseptics, so the requirements for additional safety data should not come as a surprise, as FDA’s considerations are largely identical for both categories of products.

FDA’s proposal does not address labeling and testing of final formulations because, at this time, no active ingredients are considered GRASE.  The Agency indicates that, if any of the three ingredients are determined to be GRASE, the final rule will address requirements for final formulations, including efficacy testing.

The proposed rule is open for comments for 180 days.  In addition, companies will have one year to submit new data and information, and comments on any new data or information may then be submitted to the docket for an additional 60 days. 

Hyman, Phelps & McNamara, P.C., the nation’s largest boutique food and drug regulatory law firm, seeks two attorneys to help with our fast-growing and robust practice. 

The ideal candidate for one position is an attorney with substantive expertise in medical device regulation.   

The other attorney is a junior to mid-level associate with excellent credentials, strong verbal and writing skills, and a demonstrated interest in food and drug law and regulation.

Compensation is competitive and commensurate with experience.  HP&M is an equal opportunity employer.

Please send your curriculum vitae, transcript, and a writing sample to Anne K. Walsh (awalsh@hpm.com).  Candidates must be members of the DC Bar or eligible to waive in.

By Andrew J. Hull & Mark I. Schwartz

On Tuesday, the U.S. Court of Appeals for the Federal Circuit affirmed a preliminary injunction against Apotex Inc. and Apotex Corp. (collectively, “Apotex”) related to Apotex’s biosimilar version of Amgen Inc. and Amgen Manufacturing Limited’s (collectively, “Amgen’s”) NEULASTA (pegfilgrastim).  Last December, the U.S. District Court for the Southern District of Florida had enjoined Apotex from entering the market with its biosimilar product until 180 days after Apotex provided Amgen with notice of FDA licensure of its biosimilar product (referred to as a “Section 351(k) BLA,” or as an “abbreviated BLA” or “aBLA”) (see our previous post here).  Apotex immediately appealed the decision to the Federal Circuit.

 As many of our readers are aware, the Biologics Price Competition and Innovation Act of 2009 (“BPCIA”) set up an intricate multi-stage process for litigating potential patent disputes between the reference product sponsor and the biosimilar product applicant before the biosimilar product reaches the market (otherwise referred to as the “patent dance”).  While the parties are not required to participate in all of these steps, there are various statutory provisions that incentivize the parties to engage at each stage. 

 Specifically, the notice provisions of Public Health Service Act (“PHS Act”) § 351(l)(8)(A) (“Paragraph (8)(A)”) require an applicant to give the reference product sponsor notice at least 180 days before commercially marketing its “licensed” product (“Paragraph (8)(A) notice”).  PHS Act § 351(l)(8)(A).  The reference product sponsor can then seek a preliminary injunction against the applicant marketing the newly licensed aBLA within those 180 days based on alleged patent infringement of certain patents held by the reference product sponsor.  Id. § 351(l)(8)(A).

 Apotex engaged in the earlier steps of the patent dance with its biosimilar version of Amgen’s NEULASTA, and, in April 2015, provided Amgen with notice (identical to the information required in a Paragraph (8)(A) notice) of its future intent to commercially market the product, even though Apotex had not yet obtained an FDA license for the product.

 Subsequent to Apotex’s pre-licensure notice to Amgen, the Federal Circuit issued its decision in Amgen, Inc. v. Sandoz, Inc., 794 F.3d 1347 (Fed. Cir. 2015) (see our previous post here), in which the Court held that the Paragraph (8)(A) notice must be provided after, not before, FDA licensure of the biosimilar, id. at 1358.  The Court also concluded that Paragraph (8)(A) is “mandatory” for the applicant.  Id. at 1359.

 After the Sandoz decision, Amgen sought the underlying preliminary injunction that would require Apotex to provide Amgen with Paragraph (8)(A) notice upon licensing of its biosimilar, and that would enjoin Apotex from marketing that product until 180 days from such notice.  The district court agreed with Amgen’s assessment that Sandoz required an applicant to make a Paragraph (8)(A) notice, and granted the preliminary injunction.

 On appeal, the issue before the Federal Circuit was whether the 180-day notice provision of Paragraph (8)(A) is mandatory for all applicants upon licensure and, if so, whether that requirement is enforceable by a preliminary injunction.

 The Federal Circuit rejected Apotex’s argument that the Paragraph (8)(A) notice was not a requirement to an applicant that had previously provided notice under Paragraph (2)(A) (an earlier patent dance step):

 Paragraph (8)(A) provides that “[t]he subsection (k) applicant shall provide notice to the reference product sponsor not later than 180 days before the date of the first commercial marketing of the biological product licensed under subsection (k).” § 262(l)(8)(A) (emphasis added).  The word “shall” generally indicates that the directive is mandatory.  See Nat’l Ass’n of Home Builders v. Defs. of Wildlife, 551 U.S. 644, 661–62 (2007); Lopez v. Davis, 531 U.S. 230, 241 (2001); Lexecon Inc. v. Milberg Weiss Bershad Hynes & Lerach, 523 U.S. 26, 35 (1998).  We ruled in Amgen v. Sandoz that this language is, indeed, “mandatory,” and we did not say that it was mandatory only in no- (2)(A)-notice circumstances.  794 F.3d at 1359.  Decision at 15.

 The Court also rebuffed Apotex’s argument that requiring the 180-day notice period would effectively provide the reference product sponsor with an additional 180 days of exclusivity.  The Court understood Paragraph (8)(A) to require notification upon issuance of the license, and not necessarily upon the date the license is effective.  Id. at 17.  Additionally, the Court explained that the purpose of Paragraph (8)(A)’s 180-day notice requirement is to give the parties adequate time for fair and accurate decision-making regarding potential patent litigation, and to give parties and the courts, in the event of litigation, appropriate time to litigate and adjudicate these matters:

 As this court explained in Amgen v. Sandoz, the purpose is to ensure that, starting from when the applicant’s product, uses, and processes are fixed by the license, the necessary decision-making regarding further patent litigation is not conducted under time pressure that will impair its fairness and accuracy.  Id. at1358, 1360.  At the least, the reference product sponsor needs time to make a decision about seeking relief based on yet-to-be litigated patents, and a district court needs time for litigants to prepare their cases, in a complicated area, to provide a reliable basis for judgment.  While that may not be true in every single case, Congress clearly made a categorical fixed-period judgment in (8)(A)—as it did elsewhere in the Biologics Act—and we have explained that the “statute must be interpreted as it is enacted, not especially in light of particular, untypical facts of a given case.” Id. at 1358.  Decision at 17-18.

 Finally, the Court rejected Apotex’s argument that a declaratory judgment was the only relief available to aggrieved reference product sponsors.  Noting the lack of a “clear and valid legislative command” limiting the federal courts’ equitable jurisdiction over violations of Paragraph (8)(A), the Court held that the reference product sponsor could seek a preliminary injunction to enjoin an applicant to comply with the notice provisions of Paragraph (8)(A).  Id. at 21.

 As we mentioned in our earlier post, we believe that the Federal Circuit’s decision in this matter may not be the final song played at this dance.  We would not be surprised to see Apotex petition the Supreme Court for writ of certiorari, especially in the event that the Supreme Court chooses not to take up this issue on a different appeal (see our previous post here for the most recent developments in the Sandoz case).  We will keep you posted on any developments.

By Allyson B. Mullen, Jeff N. Gibbs, McKenzie E. Cato* –

Technological advances have resulted in Next Generation Sequencing (NGS) being used more and more frequently by diagnostic laboratories.  NGS in vitro diagnostics (IVDs) present a new set of regulatory and technical challenges for FDA and the lab community because, unlike traditional IVDs which are generally focused on a small number of specific analytes, NGS can produce volumes of data regarding millions of base pairs.  Moreover, the significance of the resulting data may not be immediately known (e.g., the clinical value of a mutation may not be known for years). 

For years, FDA and the lab community have been contemplating how best to regulate NGS-based IVDs.  In November 2013, FDA cleared the first NGS instrument platform through the de novo process (K123989) signaling the formal entry of NGS into the world of clinical diagnostics.  FDA’s registration and listing database shows that since this original clearance, only two other companies have listed NGS instruments.

FDA has also held three public meetings (September 2014, February 2015, and November 2015) regarding regulation of and standards relating to NGS IVDs.  As part of the most recent meeting, in November 2015, FDA published a discussion paper entitled “Use of Databases for Establishing the Clinical Relevance of Human Genetic Variants.”  The combined efforts of FDA and the lab community through these meetings led to FDA’s issuance of two draft guidances relating to NGS IVDs.  The first, “Use of Standards in FDA Regulatory Oversight of Next Generation Sequencing (NGS)-Based In Vitro Diagnostics (IVDs) Used for Diagnosing Germline Diseases,” provides recommendations for designing, developing, and validating NGS IVDs and discusses use of standards as part of the regulatory controls.  The second, “Use of Public Human Genetic Variant Databases to Support Clinical Validity for Next Generation Sequencing (NGS)-Based In Vitro Diagnostics,” describes how publicly available databases can be used as a source of valid scientific evidence to support the clinical validity of an NGS IVD.  Both aspects are important to a clear regulatory pathway for NGS IVDs.

We will be posting a detailed analysis of these draft guidances next week.  These draft guidances currently only apply to IVDs subject to regulatory oversight by FDA.  Should FDA’s efforts to regulate laboratory developed tests (LDTs) come to bear, these draft guidances would also apply to the numerous NGS-based LDTs. FDA will be accepting comments on the draft guidances through October 5, 2016.

*Summer Associate

Hyman, Phelps & McNamara, P.C., the nation’s largest boutique food and drug regulatory law firm, seeks two attorneys to help with our fast-growing and robust practice. 

The ideal candidate for one position is an attorney with substantive expertise in medical device regulation.   

The other attorney is a junior to mid-level associate with excellent credentials, strong verbal and writing skills, and a demonstrated interest in food and drug law and regulation.

Compensation is competitive and commensurate with experience.  HP&M is an equal opportunity employer.

Please send your curriculum vitae, transcript, and a writing sample to Anne K. Walsh (awalsh@hpm.com).  Candidates must be members of the DC Bar or eligible to waive in.

By Jennifer M. Thomas & John R. Fleder –

On July 6, 2016, the Eighth Circuit upheld a district court ruling in United States v. DeCoster that imposed three-month prison sentences and $100,000 fines on Austin “Jack” and Peter Decoster, the owner and chief operating officer, respectively, of Quality Egg, LLC.  We have previously blogged about the Quality Egg case here, and written about it in FDLI’s Top Food and Drug Cases of 2015.

This case is among the first in decades to analyze the limits of the Park Doctrine (also known as the “Responsible Corporate Officer” doctrine).  The significance of the Decosters’ case is highlighted by the involvement of numerous amici:  The Washington Legal Foundation, Cato Institute, Chamber of Commerce of the United States, Pharmaceutical Research and Manufacturers of America, and the National Association of Manufacturers all submitted briefs to the Eighth Circuit on behalf of the Decosters.  And the Decosters’ legal war is unlikely to end with their defeat in this battle.  Three Eighth Circuit judges wrote three different opinions in this case, making it highly likely that the Decosters will seek en banc review of the decision and/or petition the Supreme Court for a writ of certiorari.

Despite the fractured nature of the Eighth Circuit’s ruling and the likelihood of further appeal, the multiple opinions issued today are of interest and worth reading in their entirety.  Importantly, while they wrote separately and reached different conclusions, the three Eighth Circuit judges appeared unanimous in finding that a penalty of imprisonment for a misdemeanor violation of the FDC Act would violate principles of due process if the offense is merely one of “vicarious liability,” defined as liability “for the actionable conduct of a subordinate . . . based on the relationship between the two parties.”  United States v. Austin Decoster, No. 15-1890, slip op. at 8 (8th Cir. Jul. 6, 2016).

Judge Murphy, writing on behalf of the court, addressed the problem of “vicarious liability” by clarifying that Park liability under the FDC Act does not impose vicarious liability, but rather recognizes the “blameworthiness” of a corporate officer that “fail[s] to prevent or remedy the conditions which gave rise to the charges against him.”  Id.  (internal quotations omitted) (citing United States v. Park, 421 U.S. 658, 673, 675 (1975)).  Judge Gruender, in concurrence, further distinguished the present case from one involving “vicarious liability,” pointing to the fact that the district court had found the Decosters negligent.  See United States v. Austin Decoster, No. 15-1890, slip op. at 14 (8th Cir. Jul. 6, 2016).  He wrote separately from Judge Murphy to emphasize that, pursuant to the Supreme Court’s reasoning in Park, negligence is an absolute prerequisite to imposing a sentence of imprisonment on a responsible corporate officer under the FDC Act.  Id. at 14-18.  Finally, Judge Beam in dissent did not disagree with the other two judges that “vicarious liability” could not justify the imposition of imprisonment for a violation of the FDC Act, but he went further to conclude that a finding of negligence was also insufficient.  To impose a sentence of incarceration under the FDC Act, he opined, the government would have needed to demonstrate that the Decosters had the necessary mens rea or “guilty minds” – in other words, that they knew they were violating the law.  Judge Beam reasoned that the mens rea requirement applies to FDC Act violations because that statute contains no “express congressional statement to the contrary.”  Id. at 22-23.  Thus, he dissented from the majority opinion in favor of upholding the Decosters’ sentence.

We will continue to follow this case and keep blog readers informed, and may follow with further analysis of this Eighth Circuit holding at a later date.

By Kurt R. Karst –      

We like hunting down orphan drug clinical superiority precedents. And although it’s been said that “the thrill is in the chase, never in the capture” (by a Doctor Who character at least), we enjoy the capture just as much as the chase. Earlier this year we put our a scorecard of precedents where FDA determined that an orphan drug is clinically superiority to another drug that is otherwise the same drug for the same orphan condition.  We have two more precedents to add to the scorecard.  Both concern “greater safety” clinical superiority, and put that clinical superiority basis on par with the number of precedents we know of for the so-called Major Contribution to Patient Care (“MC-to-PC”) basis (now seven each). Today, we’re posting on one of those decisions.  We’ll post on the second – and perhaps more interesting precedent – in the coming days. 

We refer to our previous post for a more detailed discussion of orphan drug clinical superiority, but remind folks here that FDA’s orphan drug regulations (21 C.F.R. Part 316) define a “clinically superior” drug as “a drug . . . shown to provide a significant therapeutic advantage over and above that provided by an approved orphan drug (that is otherwise the same drug)” in one of three ways: (1) greater effectiveness as assessed by effect on a clinically meaningful endpoint in adequate and well controlled trials; (2) greater safety in a substantial portion of the target population; or (3) demonstration that the drug makes a major contribution to patient care. By virtue of showing clinically superior, a drug is not considered the same as a previously approved drug (even if it contains the same active moiety and is approved for the same orphan indication as the previously approved drug), and can be approved notwithstanding a period of orphan drug exclusivity applicable to the previous drug and may obtain its own period of 7-year orphan drug exclusivity.

On August 20, 2012, FDA designated Nova Laboratories Limited’s (“Nova’s”) Mercaptopurine Oral Solution as an orphan drug for the treatment of Acute Lymphoblastic Leukemia (“ALL”) in pediatric patients. Pediatric ALL, which peaks between the ages of 1 and 4 years, is reportedly the most common malignancy diagnosed in children, representing about 23% of childhood cancers.  Nevertheless, in 2012, when Nova requested orphan drug designation, the United States prevalence of pediatric ALL, and, indeed adult and pediatric ALL together, was well below the statutory 200,000 prevalence threshold: about 66,000, according the National Cancer Institute’s Surveillance, Epidemiology, and End Results Program database.

With a drug for a disease that is clearly a rare (orphan) disease, the only obstacle for Nova to overcome seemed to be providing a plausible hypothesis of clinical superiority. You see, FDA previously approved mercaptopurine for the treatment of ALL, including pediatric ALL.  Specifically, FDA approved PURINETHOL (mercaptopurine) Tablets on September 11, 1953 under NDA 009053, which is currently held by Stason Pharmaceuticals.  But the tablet dosage form raised issues for pediatric patients.  According to Nova: 

Presently, a single 50mg strength tablet formulation of [mercaptopurine] is marketed in the United States. Tablet formulations are not acceptable to nearly all pre-school (less than 5 years of age) children and the majority of school-aged children 6-12 years.  As a consequence, children are often given unlicensed liquid formulations of [mercaptopurine] prepared extemporaneously in pharmacies. Alternatively, parents and carers of children are dispensed the tablet form of [mercaptopurine] and therefore have to resort to splitting or crushing the tablet(s) before mixing it into water or food prior to administration.

FDA’s Office of Orphan Products Development agreed with Nova in a July 18, 2012 Memorandum:

The approval by the FDA of mercaptopurine (MF) tablets for the treatment of ALL provides a more than adequate scientific rationale. The issue with this application then becomes whether an oral liquid formulation is clinically superior (i.e., safer or more efficacious) than the approved tablet formulation or a major contribution to patient care. As noted in the November 30, 2009 review of application 09-2863 [from Orbona Pharma Ltd.] for another oral liquid formulation of MP for ALL, there are significant safety issues associated with the use of MP for the treatment ofALL and these safety issues can be compounded when the tablets are manipulated in order to dose pediatric patients.  It is certainly feasible that parents attempting to prepare a dose of MF could accidentally over or underdose their child with serious consequences.  Consequently, an oral iquid formulation of MF would be a “safer” product than the approved tablet formulation by eliminating the need for compounding procedures and thus reducing or avoiding potential serious medication errors. Therefore, for purposes of orphan designation, the sponsor has provided a plausible hypothesis for expecting an oral liquid formulation of MP to be a safer product than the approved tablet formulation of the drug.

FDA ultimately approved Nova’s mercaptopurine drug product for pediatric ALL. In fact, FDA approved the drug for all ALL patients.  Specifically, on April 28, 2014 FDA approved Nova’s NDA 205919 for PURIXAN (mercaptopurine) Oral Suspension, 20 mg/mL, “ for use in pediatric, children, and adult patients for maintenance therapy of [ALL] as part of a combination regimen.” Although PURIXAN was approved for a use broader than the orphan drug designated use (but still an orphan use), FDA granted Nova a period of orphan drug exclusivity that expires on April 28, 2021.

McKenzie E. Cato* and Allyson B. Mullen

Many device companies struggle to ensure that the patients enrolled in their clinical studies are representative of the sex, age, race, and ethnic make-up of the U.S. population.  In part, this task is difficult because device clinical studies are often small and occur at only a few study sites.  FDA has previously attempted to provide clarification regarding sex, age, race, and ethnicity in earlier guidances, Evaluation of Sex-Specific Data in Medical Device Clinical Studies (Dec. 2011) and Collection of Race and Ethnicity Data in Clinical Trials (Sept. 2005). 

In 2012, Congress directed FDA publish a report “addressing the extent to which clinical trial participation and the inclusion of safety and effectiveness data by demographic subgroups including sex, age, race, and ethnicity, is included in applications submitted to the Food and Drug Administration.”  The report was required to include information about clinical trials for all products, not only medical devices.  See Food and Drug Administration Safety and Innovation Act, Pub. L. No. 112-144, § 907, 126 Stat. 993, 1092-93 (2012).

FDA submitted the required report to Congress in August 2013.  The report reviewed original premarket approval (PMA) applications for medical devices approved in 2011.  Of the approved PMAs evaluated for the report, only 40% publicly reported an age-based analysis, only 27% contained a race or ethnicity subgroup analysis, and only 16% had public statements regarding race or ethnicity analyses.  In August 2014, FDA published an Action Plan on enhancing the collection and availability of demographic subgroup data across all premarket submission types, not just PMAs.  On April 9, 2015, the Institute of Medicine held a public workshop to discuss “strategies for ensuring diversity, inclusion, and meaningful participation in clinical trials.”  FDA released a draft guidance on June 20, 2016, titled Evaluation and Reporting of Age, Race, and Ethnicity Data in Medical Device Clinical Studies, incorporating the recommendations from the IOM workshop.  Once finalized, the draft guidance will be an extension of the earlier guidances. 

FDA’s stated goal of the draft guidance is to “improve the quality, consistency and transparency of data regarding the performance of medical devices within specific age, race and ethnic groups.”  The three specific objectives of the draft guidance are to:

1. Encourage the collection and consideration of relevant age, race, ethnicity, and associated covariates during study design for devices for which safety, effectiveness, or benefit-risk profile is expected to vary across these groups;
2. Outline recommended analyses of study subgroup data; and
3. Specify FDA’s expectations for reporting age, race, and ethnicity-specific information in summaries and labeling for approved or cleared medical devices.

FDA’s recommendations for each of these three objectives are discussed in turn below.  FDA emphasizes throughout the draft guidance that when there are clinically relevant differences in treatment effects across age, race, or ethnic groups, the effects should be considered in the study design and reported in the device labeling.

Achieving Appropriate Enrollment

The draft guidance explains that it is important for medical device clinical trials to include representative proportions of age, race, and ethnicity subgroups to reflect the intended use population, particularly when there are clinically meaningful differences in safety, effectiveness, or benefit-risk profile across demographic subgroups.  The draft guidance discusses potential barriers to enrollment and cites a 2009 FDA report to Congress on how to address low enrollment of certain populations of clinical trials.  The draft guidance also includes a list of suggestions for enhancing enrollment of relevant age, race, and ethnicity subgroups.  Sponsors are advised to justify in the investigational plan how the enrollment criteria will provide reasonable representation of the intended population.

While the enrollment suggestions may be helpful to some sponsors, they may be of limited utility in certain situations.  Perhaps most importantly, the draft guidance does not directly address the unique challenges faced by many device companies in planning a clinical trial, such as having only a few study sites and small total numbers of patients enrolled in many studies, particularly for 510(k)s.

If there are age, race, or ethnicity differences in terms of (1) prevalence, (2) diagnosis and treatment patterns, (3) proportions of age, race, and ethnicity subgroups included in past studies for the target indication, or (4) outcomes related to safety or effectiveness, FDA advises sponsors to provide this information in the protocol and submission documents.  Specifically, FDA recommends that sponsors describe this information as part of the risk analysis section of the investigational plan, the study protocol, investigator training materials, sections of the marketing application containing results of clinical investigations, and in any interim or final reports for any mandated postmarket studies.

It appears that FDA intends to continually assess whether there are any clinically meaningful age, race, or ethnicity differences in both the premarket and postmarket setting.  If the Agency determines that additional data are needed from a particular demographic subgroup before the device is approved or cleared, it may recommend that sponsors include provisions to encourage enrollment of certain subgroups.  It is unclear how a sponsor would incorporate a “recommendation” from FDA for “further enrollment” during the premarket review stage, since presumably, by that time, the study will be completed and data collected and analyzed.  FDA may also determine that postmarket evaluation of age, race, or ethnicity may be warranted if there are premarket “signals” indicating that there may be clinically meaningful outcome differences in age, race, or ethnic subgroups.

The draft guidance provides recommendations for sponsors and investigators for avoiding loss to follow-up of subjects.  FDA explains that disproportionate loss to follow-up among minorities and older patients may be a barrier to diverse study representation.

Study Design, Analysis, and Interpretation of Study Results

FDA explains that biological differences across age, race, and ethnic groups, such as gonad development, skin texture and color, hormone levels, metabolism, and bone density, can influence the safety and effectiveness of a device.  Thus, FDA believes it is important for any differences in data across age, race, and ethnic groups to be accounted for in study design and analysis.

At the IDE study design and early enrollment stage, sponsors are advised to discuss in the Statistical Analysis Plan their strategy for achieving diverse enrollment, any key covariates that could explain differences across subgroups, and whether clinical outcome measurements may differ across subgroups. 

For both premarket and postmarket studies, the draft guidance recommends that sponsors submit descriptive statistics to the Agency for outcomes of interest by subgroup, and address the issue of confounding variables by using multivariable analyses adjusted for patient characteristics that could confound the relationship between the subgroup and study outcomes.  The recommended statistical analyses are discussed in detail in the draft guidance. 

In interpreting study results, if sponsors find that there are any clinically meaningful differences, they are advised to discuss with FDA whether any additional data are needed.  If the results of study analyses demonstrate that there are insufficient data to assess whether there are clinically meaningful differences, FDA may determine that clinical data from additional subjects in one or more subgroup is necessary.  Additionally, FDA may request additional confirmatory studies, though the draft guidance notes that this would be rare.  In cases where sample sizes may not be large enough to detect clinically meaningful differences, the draft guidance recommends that sponsors consult with FDA.

Submitting Age, Race, and Ethnicity Data in Submissions to FDA and Reporting in Public Documents

FDA recommends that sponsors submit and publicly report, in 510(k), PMA, and de novo documents, the study demographics (i.e., proportion enrolled and completed by subgroup).  If known, sponsors are advised to discuss the generalizability of study findings to the subgroups.  FDA recommends that sponsors analyze and submit any co-morbidities and/or other baseline characteristics by subgroup.  FDA also recommends that sponsors report whether loss to follow-up disproportionately affected a particular subgroup.  Sponsors are advised to submit or publicly report this information as follows:

• IDE Study Design and Early Enrollment Stage: As part of IDE annual progress reports
• Premarket Submission Stage: As part of the marketing application (including in the labeling) in sections discussing results of clinical investigations and in the 510(k) Summary
• Postmarket Submission Stage: In interim and final reports for any required postmarket studies

FDA staff will also include this information in the PMA Summary of Safety and Effectiveness, HDE Summary of Safety and Probable Benefit, de novo decision summaries, and mandated postmarket study summaries, all of which are publicly available on FDA’s website.  Interestingly, FDA does not say that it will include this information in its 510(k) decision summaries published by the Office of In Vitro Diagnostics and Radiological Health (OIR).

FDA recommends that outcome analyses, including any covariates that may explain outcome differences, also be included in labeling and review summaries.  In particular, FDA recommends that sponsors discuss how differences across subgroups affect the benefit-risk profile of the device.

The draft guidance includes several flowcharts for various study designs: (1) recommendations for demographic subgroup-specific statistical study design; (2) recommendations for demographic subgroup-specific statistical analysis for one-arm studies; (3) recommendations for demographic subgroup-specific statistical analysis for comparative studies; and (4) recommendations for submitting and reporting subgroup-specific participation and outcome information.

The recommendations in this draft guidance have the potential to impose a substantial burden on sponsors not already performing these analyses.  Information provided in an FDA guidance document is, of course, not binding on sponsors, but it does represent FDA’s current expectation for manufacturers and applicants.  While FDA can require additional premarket or postmarket studies to address questions regarding device safety and effectiveness across demographic subgroups, it remains to be seen the extent to which sponsors will proactively approach FDA with these questions or report demographic subgroup differences in their submissions.  We agree that it is important to understand the safety and effectiveness of devices in age, racial, and ethnic subgroups.  This draft guidance, however, does not appear to consider the practical limitations to understanding these key points based on the current study design of most device clinical studies.  This draft guidance would benefit from taking a more practical approach to performing these analyses.

* Summer Associate

In recent years, the level of scrutiny of foreign pharmaceutical manufacturing facilities in countries like China and India has skyrocketed—along with the demand for and dependence of Western countries on the supply of goods coming from those facilities.  A recent webinar, International Pharmaceutical Supply Chain Imperiled Like Never Before, presented by lawyers from Dechert and Hyman, Phelps & McNamara, PC, discussed current pharmaceutical supply chain developments and the steps drug manufacturers should be taking to prevent and remediate compliance issues.

Key questions addressed during the webinar include:

How has the FDA's enforcement focus shifted?

Until recently, most FDA enforcement activity (including warning letters, seizures, injunction actions, consent decrees, criminal prosecution, etc.) relating to pharmaceutical manufacturing was aimed at U.S. facilities. However, the FDA's enforcement focus has shifted to foreign facilities, resulting in a significant increase in investigations in China and India.

• The FDA is staffing up in both China and India, which is a leading indicator that we will see increased enforcement activity in these jurisdictions. While the number of inspections in China and India have held steady, the number of violations they’re finding suggests there is greater scrutiny.
• Within the last 12 months, 25 Warning Letters were issued with 23 of them being to facilities outside of the U.S.
  • Approximately two thirds of the letters alleged violations of data integrity or deficient systems designed to protect data integrity.
  • Many of the cited facilities were subject to Import Alerts, which barr importation of drugs manufactured at those plants, of Active Pharmaceutical Ingredients (APIs) from those plants, and finished dosage forms of drugs manufactured with those APIs.

What should we know about the CFDI?

The Center for Food and Drug Inspection (CFDI) is the department responsible for inspections at the China Food and Drug Administration (CFDA), China’s FDA equivalent.

• The CFDI typically conducts an inspection with a team of at least three people. Inspections are often unannounced and can be completed quickly.
• Retaining an experienced translator is important since the CFDI inspectors usually do not speak English. The inspection results are revealed in a written report only.
• Should your CFDI inspection go poorly, be prepared for: 
  • Import bans publicized on the CFDA website (in Chinese only).
  • Return of drug registration application.
  • Renewal application denied.

Who needs to be prepared?

• Pharmaceutical manufacturers with facilities in China, India, or Europe.
• Pharmaceutical manufacturers that use contract manufacturers in China, India, or Europe. 
  • Nearly 40 percent of drugs sold in the U.S. are manufactured in foreign countries.
• Pharmaceutical manufacturers or related contract manufacturers that use APIs from overseas facilities. 
  • About 80 percent of APIs used in drugs manufactured in the U.S. come from foreign countries.

What important anti-corruption enforcement trends are we seeing in both the United States and Asia?

Recent enforcement of anti-bribery has been vigorous.

• United States
  • In recent years, the DOJ has brought more than a hundred cases against corporations and individuals, resulting in $4 billion in penalties. The SEC has brought actions against 85 companies and approximately 35 individuals, with many billions of dollars in fines, disgorgement and prejudgment interest.
  • An increase in cross-border cooperation among enforcement authorities.
  • An increase in holding corporate executives accountable for corrupt behavior.
• Asia 
  • Emerging markets, such as China and India, rank among the highest in terms of perceived corruption on a jurisdiction basis, leading to a ramp up in anti-corruption efforts.
  • Traditionally China has investigated and taken enforcement action against corrupt officials who receive bribes but, since 2012, when the anti-graft campaign was launched, the focus has also been on companies and individuals who give bribes.
  • The majority of these investigations and enforcement actions have been in areas that affect public safety and the livelihood of Chinese people, most particularly in the life sciences industry.

Continued enforcement against pharmaceutical companies, with a new supply chain focus.

• The head of the SEC’s FCPA unit recently announced a renewed focus on the pharmaceutical industry.
• Prior FCPA enforcement actions have targeted pharmaceutical companies that provided cash, trips, entertainment and other things of value to physicians in state-owned health systems in order to induce them to prescribe the companies’ products. 
• Chinese authorities' investigations and enforcement actions against pharmaceutical companies continue unabated.
• The supply chain represents the next frontier for FCPA and Chinese enforcement in the pharmaceutical industry, focusing on bribes paid within the pharmaceutical in-country supply chain, including by local manufacturers, to secure advantages that ultimately benefit multinational pharmaceutical companies.

How can we avoid risk and create a culture of compliance?

• Conduct internal audits with a focus on electronic data recording systems.
• Encourage unannounced Quality Assurance visits to ensure that workers are making contemporaneous entries.
• Perform mock inspections.
• Do not rely on inspection results from foreign regulators or customers.
• Demonstrate top-down senior management support for compliance.
• Develop clearly written compliance policies and procedures for high-risk areas (i.e., gifts, entertainment, hospitality, sponsored travel, and political contributions) that take into account both overseas (FCPA, UK Bribery Action) and local requirements.
• Know your vendors and supply chain partners well — vet them in advance, and monitor them thereafter — as you will be held accountable for any wrongdoing on their part.

A copy of the webinar presentation is available here. You can access a recording of the webinar here.

By Karla L. Palmer –

The Government Accountability Office (GAO) issued three reports during 2015 making eleven recommendations to the Drug Enforcement Administration (DEA) to more effectively perform their functions under the Controlled Substances Act (CSA) and DEA’s implementing regulations (see previous posts here and here).  GAO now reports that, as of June 2016, DEA has taken actions to address some of the recommendations, but has fully implemented just two of them.  See the entire 26-page report here.

In brief, GAO reported in February 2015 that DEA had not effectively administered the quota process, and that DEA and FDA had failed to establish a sufficiently collaborative relationship to address shortages of drugs containing controlled substances subject to quotas.  DEA has taken some actions to address GAO’s seven recommendations concerning administration of the quota process including finalizing an information sharing agreement with FDA addressing drug shortages, and strengthening internal controls regarding implementation of the quota system.  However, DEA has failed to address fully GAO’s five other recommendations from GAO’s February 2015 Report regarding more effective implementation of the DEA quota process.

In June 2015, GAO reported that DEA registrants were not aware of resources and other information available to them to enhance regulatory compliance and better understand their obligations as DEA registrants.  GAO recommended that DEA take three actions to increase registrants’ awareness and improve information flow.  GAO reports that DEA has made some strides in addressing GAO’s recommendations including developing web-based training and updating the Pharmacist’s Manual to reflect new regulations (which to our knowledge has not yet been published).  However, because DEA did not mention plans to develop and distribute additional guidance for distributors or pharmacies, GAO reported that DEA has not fully implemented its recommendations. 

Specifically with respect to drug distributors, DEA had “raised concerns” about GAO’s recommendation to solicit input from distributors concerning suspicious order reporting and monitoring.  DEA stated that, short of providing arbitrary thresholds to distributors, “it cannot provide more specific suspicious orders guidance because the variables that indicate a suspicious order differ among distributors and their customers.”  

GAO states that in April 2016, DEA provided information about ongoing efforts to educate distributors about their roles and responsibilities for monitoring and reporting suspicious orders (e.g., DEA’s Distributors’ Conferences) and plans for additional yearly distributor training.  DEA “did not mention” plans to develop and distribute additional guidance for distributors.  GAO believes that a guidance document like DEA’s Pharmacist and Practitioner Manuals could assist distributors in understanding and meeting their obligations under the CSA.  Interestingly, GAO stated that although DEA may not be able to provide guidance that will definitively answer the question of what constitutes a suspicious order (notwithstanding significant recent litigation at the DC Circuit on this precise issue) or offer advice about which customers to ship to, DEA could, for example, provide guidance around best practices in developing suspicious orders monitoring systems.  Industry would likely welcome such guidance, so long as DEA does not, in turn, use it as a roadmap in litigation against those same distributors based on non-compliance.  Finally, GAO noted that in the absence of clear guidance from DEA, GAO’s  survey data reveals that many distributors are setting thresholds on the amount of certain controlled substances that can be ordered by their customers (i.e., pharmacies and practitioners), “which can negatively impact pharmacies and ultimately patients’ access.” GAO plans to continue to monitor the agency’s efforts in this area, and thus the recommendation remains open.

Lastly, in September 2015, GAO reported that DEA’s confidential informant policies were not consistent with certain provisions of the Attorney General’s Guidelines.  GAO asserts that DEA failed to address the requirement to provide the informant with written instructions about authorized illegal activity and the requirement of obtaining a signed acknowledgment from the informant.  GAO recommended DEA update these policies and processes.  DEA expects to complete revisions this summer, but until finalized, GAO noted that this recommendation also remains open.  

By Kurt R. Karst –      

First, FDA gets hit with a June 27th preemptive lawsuit over approval of generic versions of CRESTOR (rosuvastatin calcium) Tablets; and then, on June 28th, a second lawsuit is filed by Lannett Company Inc. and Lannett Holdings, Inc. (collectively “Lannett”) challenging FDA’s recent rescission of Lannett’s ANDA 202750 for the oral chemotherapy drug Temozolomide Capsules, 5 mg, 20 mg, 100 mg, 140 mg, 180 mg, and 250 mg. It looks like it may not be much of an Independence Day Holiday for some of FDA’s attorneys.  

Lannett’s five-count Complaint was filed in the U.S. District Court for the District of Columbia and challenges FDA’s May 17, 2016 approval rescission of ANDA 202750 for Temozolomide Capsules, which the Agency had approved on March 23, 2016. According to FDA, the Agency approved the ANDA in error.  You see, ANDA 202750 apparently identifies Chinese company Chongqing Lummy Pharmaceutical Co. Ltd. (“Lummy”) as the manufacturer of the active pharmaceutical ingredient for the drug product.  FDA inspected Lummy in mid-March 2016.  On April 19, 2016, the Agency placed Lummy on Import Alert, pointing to concerns over the company's Current Good Manufacturing Practices (“CGMPs”) as the reason for the Import Alert; and on June 21, 2016, FDA issued a Warning Letter to Lummy summarizing significant CGMP deviations.

Lannett says in the Complaint that on April 1, 2016, FDA sent the company a “General Advice” letter “indicating that Lummy would not be releasing any new Temozolomide active pharmaceutical ingredient into the U.S. market until FDA deemed the Lummy facility acceptable.” FDA’s letter requested a call with Lannett to discuss two issues: first, a commitment by Lannett not to distribute any Temozolomide drug product (or to recall drug product already distributed by Lannett; and second, a “necessary withdrawal” of Lannett ANDA 202750.  After some further correspondence in which FDA gave Lannett three options – (1) request FDA to withdraw approval of the ANDA; (2) agree to immediate rescission of the ANDA approval; and (3) provide FDA with information demonstrating that the compliance status at Lummy was acceptable as of March 23, 2016 – FDA issued an “ANDA Approval Rescission” letter on May 17, 2016.  According to Lannett:

The letter stated that while some FDA officials had information at the time of the ANDA approval indicating that Lummy’s compliance status was unacceptable, the “information was not adequately conveyed to the FDA officials making the final decisions about the ANDA approval.” The letter also stated that the approval was a mistake. It stated that the agency had authority to rescind the ANDA, because the procedures of 21 U.S.C. § 355(e) do not apply, such that there is “no applicable statute displac[ing] FDA’s inherent authority to correct its mistake.” The agency concluded that “FDA is correcting its error and rescinding the approval letter issued for ANDA 202750 on March 23, 2016.”

Lannett alleges in the Complaint that FDA’s rescission of ANDA 202750 violates the Administrative Procedure Act (“APA”) and the Fifth Amendment’s due process right to a hearing in connection with deprivation of a property right. Lannett asks the court to, among other things, set aside and declare as unlawful FDA’s ANDA approval rescission, and to enjoin FDA from revoking the approval of ANDA 202750 without a hearing and the procedures established at FDC Act § 505(e).

Various disputes concerning mistaken ANDA approvals and withdrawal (or suspension) of ANDA approvals have cropped up over the past few years. There’s Armenpharm, Ltd.’s recent opposition to FDA’s efforts to suspend the approval of the company’s ANDA 060851 for Chloramphenicol Capsules, 250 mg (see our previous post here).  Also, a couple of years ago, Mallinckrodt Inc. sued FDA after the Agency downgraded the company’s ANDA 202608 for generic CONCERTA (methylphenidate HCl) Extended-Release Tablets.  Among other things, Mallinckrodt argued that the downgrade was tantamount to withdrawal of ANDA approval (see our previous posts here and here).  There’s also the short-lived lawsuit Novartis Pharmaceuticals Corporation filed back in 2010 after FDA mistakenly approved ANDA 078278 for a generic version of FAMVIR (famciclovir) Tablets (see our previous post here).  And who could forget the litigation surrounding FDA’s decision to strip Ranbaxy Laboratories, Ltd. of tentative ANDA approvals for generic VALCYTE (valganciclovir) Tablets and NEXIUM (esomeprazole magnesium) Delayed-release Capsules (see our previous post here). 

But perhaps the closest parallel to Lannett’s lawsuit is decades old.  Way back in 1989, FDA issued a letter to American Therapeutics, Inc. (“American Therapeutics”) rescinding approval of the company’s ANDA for Chlorzoxazone because of CGMP concerns, and shortly after the ANDA was approved.  American Therapeutics argued before FDA that the rescission is “an illegal action in violation of the FD&C Act, the Administrative Procedures Act, and [the company’s] fundamental due process rights guaranteed by the U.S. Constitution.”  Ultimately, American Therapeutics sued FDA (in D.C. District Court).  In February 1990, in American Therapeutics v. Sullivan, 755 F. Supp. 1 (D.D.C. 1990), the court ruled for FDA in a short decision:

There is no regulation or statutory provision that contemplates rescission of an approval issued by mistake. . . . FDA is entitled to some deference when its actions are examined. This was a good faith mistake promptly discovered and corrected, nothing more.  There is authority that suggests an agency must be given some leeway to remedy mistakes.  No precedent from this circuit has been cited that indicates a contrary approach.  It is not the function of a district court under these circumstances to intervene where an unresolved issue of statutory interpretation and administrative law within the exclusive jurisdiction of the Court of Appeals is presented.  [(Citations omitted)]

Where will the cards fall here given the American Therapeutics decision?  We’ll see soon enough.