By Kurt R. Karst –  

There are general life certitudes, such as the quote attributed to Benjamin Franklin: “In this world nothing can be said to be certain, except death and taxes.”  There are also FDA certitudes we’ve come to recognize.  For example, “everything eventually goes generic” . . . . and eventually FDA will be completely “UFAized.” (“UFAization” is the process by which an FDA component gets to collect fees from industry after the enactment of a User Fee Act – “UFA” – and then subsequently becomes focused on so-called process enhancements to meet goals and commitments.)  So we weren’t at all surprised when FDA announced in a Federal Register notice (Docket No. FDA-2016-N-1092) that will be published later this week (as well as in a FAQ document) that the Agency will hold a public meeting on June 10, 2016 “to gather stakeholder input on the potential development of a user fee program for nonprescription (over-the-counter or OTC) monograph drugs.” That’s right; in addition to all of the other FDA User Fee Programs already in existence, we may soon see an OTC Drug Monograph User Fee Program.

The OTC drug monograph system has been around for quite some time – since 1972 – and it “remains one of the largest and most complex regulatory programs ever undertaken at FDA,” according to FDA. But the process of completing and updating monographs has moved at a glacial pace.  FDA has previously discussed some potential reforms to streamline the process (see our previous post here), but those reforms have not yet panned out.  The creation of a user fee program, however, could result in a “stable and predictable source of adequate funding” that would allow FDA to more quickly complete OTC drug reviews. 

Crafting a user fee program for OTC monograph drugs will certainly require some tailoring to the unique aspects of the monograph system. As FDA recognizes in the Agency’s meeting announcement notice: 

There are some important differences between marketing through approved applications and marketing under the monographs. NDAs and ANDAs are product-based; an application typically is submitted with data for a single drug product to be marketed by a single sponsor, and that application will be approved or not approved.  By contrast, the monograph system is ingredient-based; numerous sponsors may make the same ingredient for the same use, and all may market drug products made with this ingredient as long as they comply with all applicable regulations, including the conditions of the monograph.  Sponsors of monograph drugs are not required to seek FDA approval prior to marketing a product under the monograph.  In addition, the monograph system, where ingredients are determined to be GRASE or not, is a public process. Data are submitted to public dockets, and anyone may provide input.  By contrast, while FDA typically makes NDA information public after approval of a product, it generally cannot do so before. 

With that in mind, FDA lays out the case for the creation of an OTC Drug Monograph User Fee Program, saying that there are several potential benefits:

• Ability to address safety issues of currently marketed products in an efficient and timely manner.
• Timely determination on the safety and efficacy of monograph ingredients under the conditions of the monograph, helping to assure appropriate marketing of thousands of nonprescription products used daily by U.S. consumers.
• Increased availability of certain monograph product innovations proposed by industry.
• Streamlined ability to update monographs to allow modern testing methods in several areas, potentially reducing the need for animal testing, and simplifying and speeding product development.
• Development of information technology infrastructure to speed numerous parts of the monograph review process, and enable a modern robust system for submission of materials and archiving of documents.
• Development of a modern, useful, and transparent FDA monograph website to provide the public and industry with access to important information.
• Ability to hold more public meetings on important monograph issues.
• Increased ability of FDA to respond to monograph-related concerns and questions from the public and industry.
• Establishment of additional infrastructure for the efficient continued conduct of monograph activities in the longer term.

Before the pubic meeting takes place on June 10th, FDA wants folks to chew on a few questions: (1) What types of user fees (e.g., product listing fees, facility fees, application fees, other types of fees) might be appropriate for a potential monograph user-fee program?; (2) What types of performance goals might be important to consider from a public health and sponsor perspective?; and (3) What parameters could be measured to gauge the success of a user-fee program? Many more questions will likely surface in the coming weeks and months as the skeleton of a system is fleshed out. Whether a system that the OTC drug industry can agree to can be hammered out in time for the next round of UFA reauthorizations in 2017 remains to be seen. . . . But it will happen . . . eventually.

By James E. Valentine & Josephine M. Torrente –

In March, FDA published a draft guidance document that describes FDA’s approach to the implementation of the statutory provision in section 7002(e) of the Biologics Price Competition and Innovation Act of 2009 (BPCI Act) under which an application for a biological product, approved under section 505 the Federal Food, Drug, and Cosmetic Act (FD&C Act) on or before March 23, 2020, will be “deemed to be a license” for the biological product under section 351 of the Public Health Service Act (PHS Act) on March 23, 2020 (see our previous post here). On Friday, Hyman, Phelps & McNamara, P.C. (HP&M) formally commented on the draft guidance document, pointing to unanticipated consequences of its approach that would result in an undue burden on current sponsors, particularly sponsors of biological products who intend to submit applications for products under section 505(b)(2) of the FD&C Act prior to March 23, 2020.

FDA’s draft guidance suggests that FDA may interpret the “deemed to be a license” provision to mean that, on March 23, 2020, “applications for biological products that have been approved under section 505 of the FD&C Act will no longer exist as New Drug Applications (NDAs) (or, as applicable, Abbreviated New Drug Applications (ANDAs)) and will be replaced by approved Biologics License Applications (BLAs) under section 351(a) or 351(k) of the PHS Act, as appropriate.” FDA, Draft Guidance for Industry, Implementation of the “Deemed to be a License” Provision of the Biologics Price Competition and Innovation Act of 2009, 5 (Mar. 2016) (emphasis added). FDA then goes further, interpreting the provision to mean that “the Agency will not approve any application under section 505 of the FD&C Act for a biological product . . . that is pending or tentatively approved ‘on’ March 23, 2020, even though section 7002(e)(2) of the BPCI Act expressly permits submission of an application under section 505 of the FD&C Act ‘not later than’ March 23, 2020 . . . .” Id.

As a further result of these interpretations and extensions of the statutory language, the Agency intends to remove products that are deemed to have licenses as “listed drugs” in FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations (the Orange Book) on March 23, 2020. As of that date, therefore, FDA’s findings of safety and effectiveness for such products may not be relied upon by a 505(b)(2) applicant for approval of a related product, even if that product’s NDA is under active review at the time. Id. at 6. Under FDA’s proposed interpretation, some sponsors who submit 505(b)(2) NDAs for biological products well in advance of March 2020 may nonetheless find themselves barred from the NDA pathway to market, and without sufficient data or basis to pursue a 351(a) or (k) BLA pathway.

HP&M’s comment discusses the predictable negative impacts on 505(b)(2) sponsors and the public health that would be caused by FDA’s proposed interpretation of the provision. The comment notes that FDA’s proposed interpretation would impact numerous ongoing development programs, causing irreparable financial harm, stifling innovation and availability of competition, and putting countless patients at unnecessary risk. To avoid these harms, HP&M requests that FDA adopt an alternative statutory reading that would allow 505(b)(2) NDAs submitted by March 23, 2020 to be eligible for review and approval under section 505 of the FD&C Act and, subsequently, deemed to be a license under section 351 of the PHS Act at the time of any approval. This view would preserve the value of investments already made by sponsors of timely submitted 505(b)(2) NDAs which, due only to the vagaries of NDA review (e.g., requests for Major Amendments, Complete Response actions, or unanticipated issues at a contract manufacturer) may not obtain approval by March 23, 2020.

By James E. Valentine & Alexander J. Varond –

FDA recently issued draft guidance, entitled “Special Protocol Assessment,” which, when finalized, will replace FDA’s 2002 final guidance by the same title. At 23-pages long, the draft guidance is much more thorough than its predecessor (only 11 pages) and warrants attention. The draft guidance provides a detailed overview of the policies and procedures adopted by CDER and CBER for special protocol assessment (SPA). SPA is a mechanism through which sponsors seek to reach an agreement with FDA on the size and design of certain types of studies to assess whether the studies have the ability to adequately address scientific and regulatory requirements. According to the draft guidance, CDER has issued more than 1,000 SPA agreements since the program was established in 1997.

Before initiating certain studies, including pivotal Phase 3 studies, a sponsor may submit a study protocol to FDA under the SPA program to obtain feedback about the sufficiency of the study’s design to support the development program and ultimately the product’s marketing application. Federal Food, Drug, and Cosmetic Act (FDC Act) § 505(b)(4)(B)&(C). FDA recommends that an SPA request, including specific questions about the proposed protocol, be submitted at least 90 days prior to the anticipated start of the study. In reality, a sponsor should submit its protocol much earlier than this, as the process is often subject to delays and potentially lengthy negotiation.

The Agency generally responds to SPA requests within 45 days. If agreement is reached on the design of the study, FDA will put the agreement in writing as part of the development plan’s administrative record which indicates that the study is appropriately designed to produce the type of data that could support the sponsor’s application. Otherwise, FDA will issue a “No Agreement Letter” discussing specific design parameters with which FDA does not agree. As we discuss below, even if an agreement is reached and the study is carried out as planned and meets its predefined objectives, FDA has the ability to rescind an SPA agreement for a number of reasons, including on the basis of a “substantial scientific issue” such as a “paradigm shift in disease diagnosis or management.”

The following protocol types are eligible for an SPA:

• Animal carcinogenicity protocols;
• Drug substance and drug product stability protocols;
• Animal efficacy protocols for studies intended to provide primary evidence of effectiveness required for approval or for licensure for products developed under the animal rule;
• Protocols for clinical trials or studies intended to form the primary basis of an efficacy claim, regardless of the product development phase (g., Phase 2 or Phase 3); and
• Protocols for clinical studies necessary to prove biosimilarity and/or interchangeability.

FDA’s draft guidance includes the following significant changes:

• Clarifies the types of protocols eligible for SPA, adding:
  • Animal rule efficacy protocols intended to support approval under part 314 subpart I, and part 601 subpart H, for drugs and biological products, respectively; and
  • Protocols intended to support approval of a biosimilar biological product;
• Provides greater detail about the content of an SPA submission; and
• Clarifies FDA’s process for rescinding an SPA agreement.

We discuss this last change in greater detail below.

Rescinding an SPA Agreement

In drug development, a predictable regulatory framework is key to facilitating investment in new, innovative therapies by industry and investors. The SPA program was introduced by Congress in response to industry concerns that late changes in personnel or thinking within a review division could serve to impose new requirements on study design despite general agreement at an EOP2 meeting and long after a study had been initiated. The SPA program was designed to provide an additional level of certainty about the adequacy and acceptability of specific critical elements of overall protocol design to ensure that the trial conducted under the protocol will support regulatory requirements for approval. However, for some time stakeholders have raised concerns about FDA’s procedures for adhering to its commitments under an SPA agreement, especially in instances where there may be inconsistent interpretations of the underlying science supporting an SPA (see BIO statement here). Each time a commitment is rescinded by FDA – particularly for studies that are near completion or complete – the value of the SPA process is eroded.

FDA’s authority to rescind an SPA agreement is set out in FDC Act § 505(b)(5)(C), which prescribes that, once an SPA agreement has been agreed to, the division director may only change or rescind the SPA if “a substantial scientific issue essential to determining the safety or effectiveness of the drug has been identified after the testing has begun.” Despite this broad statutory standard, FDA’s May 2002 SPA guidance document did not provide any insight into what the Agency would consider as a suitable basis for rescinding an SPA.

The recent example of FDA rescinding an SPA agreement late in the conduct of the trial for Amarin’s drug, Vascepa, demonstrates the type of scenario that has lead to diminished confidence in the SPA program (see our previous post for additional background on Amarin). Vascepa is approved to treat patients with severe hypertriglyceridemia (>500 mg/dL), and Amarin sought to expand its indication to include patients with “persistently high” triglycerides (>200 and ≤ 500 mg/dL). Amarin and FDA negotiated an SPA agreement in 2009 for a single Phase 3 clinical trial to support this new indication. The Amarin study met its primary endpoint, demonstrating statistically significant reductions in triglyceride levels in subjects on Vascepa when compared with the subjects on placebo. The study also met its secondary endpoints. Amarin subsequently submitted a supplemental application for the expanded indication, believing it had satisfied all of FDA’s requirements per the SPA agreement.

In 2013, after Amarin submitted its supplemental NDA, FDA convened an Advisory Committee during which the Agency called into question the clinical validity of the Phase 3 study endpoint of triglyceride lowering, despite having agreed to that endpoint in the SPA. According to FDA, data from several cardiovascular outcomes trials, some of which were reported out after the SPA was entered into by FDA and Amarin, had cast doubt on the clinical benefit of triglyceride lowering while also fostering uncertainty as to whether a reduction in triglyceride levels would translate into a reduction in cardiovascular events, in general. FDA asked the Advisory Committee to weigh in on whether Vascepa’s triglyceride lowering effect was sufficient to approve the drug for use in patients with persistently high triglycerides. The Advisory Committee voted against approval of Vascepa for that indication. Subsequently, FDA rescinded the SPA agreement and issued a complete response letter to Amarin indicating the need for data showing a reduction in cardiovascular events.

The rescission of the Amarin SPA agreement, largely because it was a fully competed and positive trial, led to heightened public scrutiny of the scope of FDA’s basis for rescinding an SPA. It appears FDA, in its new May 2016 draft guidance document, is attempting to assuage some of this concern by providing its view of what can constitute a “substantial scientific issue essential to determining the safety or effectiveness of the [product].” The draft guidance document provides three examples of such scientific issues:

• Identification of data that would call into question the clinical relevance of previously agreed-upon efficacy endpoint (this is what happened with the Amarin SPA agreement);
• Identification of safety concerns related to the product or its pharmacological class; and
• Paradigm shifts in disease diagnosis or management recognized by the scientific community and FDA.

FDA, Draft Guidance, SPA Guidance for Industry, 20 (May 2016).

FDA also identifies areas of scientific and medical innovation that could affect regulatory aspects of drug development (and presumably could be the basis for rescinding an SPA agreement):

• An evolving understanding of protocol design;
• Knowledge of ongoing clinical trials; and
• The accrual of data regarding other product development programs in the same, or similar, pharmacological class.

Id. at 22.

While these examples are descriptive, they neither clearly establish predictable guidelines for what qualifies as a substantial scientific issue nor clarify when such an issue is essential to determining the safety and effectiveness of the drug. If anything they appear to claim nearly unlimited discretion on the part of FDA to rescind SPA agreements. Without plainly delineating the boundaries for the SPA program, and in turn providing a more predictable framework, it is unlikely sponsors will have greater confidence in their reliance on an SPA agreement.

Comments on the Draft Guidance are due by July 5, 2016 here.

By Etan J. Yeshua –

Today, FDA officially announced the availability of a final guidance document that answers questions about the Agency’s menu labeling rule. In doing so, FDA also set May 5, 2017 as the rule’s enforcement date. Although there are only a few differences between the final guidance document and the draft that was published last September (which we reported on here), one difference that caught our eye appears to expand the Agency’s understanding of what constitutes a “menu” by including coupons and other materials that provide a web address where customers can place an order.

The final guidance is available here and is titled “A Labeling Guide for Restaurants and Retail Establishments Selling Away-From-Home Foods – Part II (Menu Labeling Requirements in Accordance with 21 CFR 101.11): Guidance for Industry” (hereinafter “final guidance document”).

The Countdown to Enforcement

As we’ve previously reported, the Affordable Care Act amended the Federal Food, Drug, and Cosmetic Act (FDC Act) in 2010 to require that certain chain restaurants and other covered establishments include calorie and other nutrition information on menus, menu boards, and elsewhere in the restaurant. FDA issued final regulations implementing those “menu labeling” requirements in 2014, and set a compliance date of December 1, 2015. Amid requests from industry, FDA extended the compliance date to December 2016. Then, Congress delayed the implementation date even further (in the omnibus appropriations bill for 2016) by postponing implementation until one year after FDA issues a final guidance on the menu labeling requirements. FDA released the final guidance document last Friday, and formally announced its availability (in the Federal Register) today, with enforcement to begin in one year.

The Definition of “Menu”

The final guidance document is largely identical to the draft that was published in September 2015. However, one seemingly minor addition in the final guidance document may result in restaurants and other covered establishments having to provide calorie information on many more marketing materials than previously thought.

FDA’s final regulations state that an establishment must provide calorie counts on “menus” and “menu boards,” and that certain materials may require calorie counts if they are “part of” the establishment’s menu or menu board: “Determining whether a writing . . . is part of the [menu or menu board] depends on a number of factors, including whether the writing lists the name of a standard menu item (or an image depicting the standard menu item) and the price of the standard menu item, and whether the writing can be used by a customer to make an order selection at the time the customer is viewing the writing.” Food Labeling; Nutrition Labeling of Standard Menu Items in Restaurants and Similar Retail Food Establishments, 79 Fed. Reg. 71,156, 71,254 (Dec. 1, 2014) (to be codified at 21 C.F.R. § 101.11(a)) (emphasis added). In today’s final guidance document, FDA seems to take a more expansive view of this last factor than it previously did.

In the preamble to the final rule, FDA provided the following as examples of writings that “can be used by a consumer to make an order selection at the time the consumer is viewing the writing (e.g., the writing is posted at the cash register in a covered establishment, or the writing lists the phone number or email address of a covered establishment for purposes of placing an order).” 79 Fed. Reg. at 71,177 (emphasis added). The September 2015 draft guidance document similarly stated that “a pizza coupon that includes a phone number to place the order” is considered to provide a means to make an order selection. See FDA Draft Guidance: A Labeling Guide for Restaurants and Retail Establishments Selling Away-From-Home Foods – Part II (Menu Labeling Requirements in Accordance with 21 CFR 101.11) at 19 (Sept. 2015) (emphasis added).

The final guidance document, however, states that even a “web address” can turn a coupon into a menu (provided, of course, that the coupon includes the name, or picture, and price of a standard menu item):

[I]n the example of a pizza coupon that includes a . . . web address where the customer can place an order and that states “1 large pepperoni and sausage pizza $9.99,” the “coupon” can be used by a consumer to make an order selection at the time a consumer is viewing the coupon (i.e., the coupon includes the name of the standard menu item, price of the standard menu item and a . . . web address where an order can be placed).

Final guidance document at 19-20.

It is not clear whether a “web address where the customer can place an order” (emphasis added) includes an establishment’s homepage (e.g., www.CafeEtan.com), or only the specific webpage from which customers can place an order (e.g., www.CafeEtan.com/order). It is also not clear whether a street address would similarly turn a coupon or other marketing material into a menu.

The Agency continues to accept comments to the final guidance document’s docket at www.regulations.gov, and questions about menu labeling at CalorieLabeling@fda.hhs.gov.

By Riëtte van Laack & Wes Siegner –

Under the FDC Act, dog and cat food products that are intended to treat or prevent disease and to provide nutrients in support of the animal’s daily nutrient needs can be regulated as drugs or foods or both. Drugs may be not be marketed without pre-market approval. Thus, according to FDA, pet food products intended to treat sick animals are illegal. Unlike human food products, where FDC Act provisions addressing health claims and food for special dietary use, and the Orphan Drug Act Amendments of 1988 defining “medical food” permit certain disease-related claims, there are no such provisions applicable to products intended for animals. However, as FDA explains in a new guidance, under limited specific circumstances, FDA will exercise enforcement discretion with regard to these products. The guidance identifies eleven factors FDA will consider.

Although the Agency considers these products drugs, it will exercise enforcement discretion if manufacturing and labeling complies with the regulations for animal feed; i.e., the manufacturing facility must be registered as an animal feed establishment, the product must be manufactured in accordance with cGMPS and preventive controls applicable to animal food manufacturing, and the product must contain only ingredients that are GRAS ingredients, approved food additives, or ingredients defined in the 2015 Official Publication of the Association of American Feed Control Officials. In addition, the product labeling must comply with all labeling requirements for animal food products.

The label of the product may not include representation regarding its effect on disease. Labeling and other marketing materials may reference the disease but only if the distribution of these materials is be limited so that the information is available for veterinary professionals only. In addition, the product may be made available to the public only through licensed veterinarians or through sales to individuals purchasing the product under the direction of a veterinarian.

The draft guidance was published in 2012. The Draft Guidance identified specific factors determining enforcement priorities. The Final Guidance is less specific and merely advises Districts to consider enforcement action when one of more of the factors listed by FDA is not present.

All in all, the final Guidance is substantially similar to the draft guidance. FDA does not explain whether it did consider any of the suggestions made in comments. For example, comments advised FDA that the type of foods at issue generally do not treat or prevent disease but instead “manage” disease in that they address the nutritional needs of animals with diseases. Similarities with medical foods for humans were noted.

Comments also recommended that FDA not include a date in the reference to the AAFCO Official Publication because this would create issues the moment that publication would be updated. Rather than removing the date, FDA updated it to refer to the 2015 version which has already been replaced by the 2016 edition.

This guidance does not apply to products intended for nutritional supplementation of foods for animals and products marketed as dietary supplements for animals. These are the subject of a different unpublished FDA enforcement discretion policy.

By Kurt R. Karst –   

Speculating about the prospects that FDA will grant a period of marketing exclusivity – 5-year New Chemical Entity (“NCE”) exclusivity, 3-year new clinical investigation exclusivity, 7-year orphan drug exclusivity, or any other type of exclusivity or add-on exclusivity – upon the approval of a marketing application can be a risky venture.  Just ask ViroPharma Incorporated (“ViroPharma”), which made certain statements about the prospect of FDA granting a period of 3-year exclusivity upon the December 14, 2011 approval of a supplemental NDA for VANCOCIN (vancomycin HCl) Capsules.  FDA denied 3-year exclusivity (see our previous post here) and ViroPharma quickly found itself embroiled in years-long class action securities litigation. 

Despite the risks of predicting whether or not FDA will grant marketing exclusivity (or a particular type of exclusivity), we still see investment groups and companies making predictions – some stronger than others.  Often these predictions aren’t accompanied by any legal analysis.  But, like tabloids, they’re interesting reading nevertheless.  As Sean Connery’s character William Forrester says to Rob Brown’s character Jamal Wallace in the 2000 film Finding Forrester “The Times is dinner, but The National Enquirer, that’s dessert.”

Take, for example, recent statements made by Flamel Technologies (“Flamel”) with respect to the company’s AKOVAZ (ephedrine sulfate) Injection, 50 mg/mL, which FDA approved on April 29, 2016 under NDA 208289 (a 505(b)(2) NDA) as a pressor agent to address clinically important hypotension in surgical settings.  Ephedrine sulfate has been marketed by Akorn Pharmaceuticals (“Akorn”), among others, for many years without approval of a marketing application.  According to a Flamel press release, AKOVAZ “is the first [NDA] to receive approval from the FDA for ephedrine sulfate.”  An investment note issued after the approval of AKOVAZ goes further (not “farther,” right Jamal?):

The FDA will need to address the marketing status of the [Akorn] grandfathered product and [Flamel] told us this morning the FDA will make a decision on Akovaz NCE (new chemical entity) status sometime this month.  In theory, NCE status would confer 5-yrs of regulatory exclusivity.  While [Flamel] mgmt has downplayed their ability to secure NCE status on Akovaz in the past, the mgmt team informed us it remains possible the molecule may be approved with NCE status or that a scenario may exist where [Flamel] and [Akorn] both get NCE status, e.g. shared NCE status that precludes other brands and generics from coming to market over the next 5-yrs.

At first blush, it might appear that AKOVAZ contains an NCE eligible for 5-year exclusivity.  After all, searches of Drugs@FDA and the Orange Book don’t show any FDA approval of a marketing application for a drug product containing “ephedrine” or “ephedrine sulfate” – just various NDAs and ANDAs for drug products containing some form of pseudoephedrine.  And although FDA has identified the AKOVAZ NDA as a “Chemical Type 7” NDA – i.e., “Drug already marketed without an approved NDA” – even that status is not an absolute indicator of NCE exclusivity eligibility.  FDA’s Manual of Policies and Procedures (“MAPP”) on NDA Classification Codes (MAPP 5018.2) explains that:

A Type 7 NDA is for a drug product that contains an active moiety that has not been previously approved in an application, but has been marketed in the United States. This classification applies only to the first NDA approved for a drug product containing this (these) active moiety(ies).

Type 7 NDAs include, but are not limited to:

(1) The first post-1962 application for an active moiety marketed prior to 1938.
(2) The first application for an active moiety first marketed between 1938 and 1962 that is identical, related or similar (IRS)6 to a drug covered by a Drug Efficacy Study Implementation (DESI) notice.
(3) The first application for an IRS drug product first marketed after 1962.
(4) The first application for an active moiety that was first marketed without an NDA after 1962.

An analysis of NCE exclusivity eligibility requires more than just consulting Drugs@FDA and the Orange Book, because those databases are are incomplete.  It requires, at the very least, a look-back at all NDAs approved by FDA under FDC Act § 505 since the FDC Act was signed into law by President Roosevelt on June 25, 1938, including those many, many NDAs whose approvals were withdrawn in the early 1970s under FDA’s NDA “clean-up initiative” (35 Fed. Reg. 11,929 (July 24, 1970)). 

That’s where FDA’s so-called “Ever-Approved List” comes in handy.  It’s a list of drug products purported to have been approved by FDA since 1938 under a marketing application submitted pursuant to FDC Act § 505.  The “Ever-Approved List” is not readily available, but fortunately, we have a copy of the list.  A review of that list shows that FDA has approved many NDAs, starting in 1938, for drug products containing “ephedrine” and “ephedrine sulfate.”  Consider, for example:

• NDA 000016 for 3M Pharmaceuticals Inc.’s RINOFEDS Capsules, which FDA approved on March 16, 1939, and that contains atropine, ephedrine, and phenobarbital (approval withdrawn on 1/30/1973);
• NDA 000212 for Glaxo Wellcome Inc.’s VAPOROLE Nasal Spray, which FDA approved on December 14, 1938, and that contains ephedrine 1% (approval withdrawn on August 6, 1971);  
• NDA 000029 for Reese Chemical Co.’s BLUE Tablets, which FDA approved on September 20, 1938, and that contains calcium lactate, ephedrine sulfate, and iodobenzoic acid (approval withdrawn on July 24, 1970);
• NDA 002441 for Smith Miller and Patch Inc.’s Tablet dosage form drug product approved on May 4, 1940, and that contains ephedrine sulfate, phenobarbital, and potassium chloride;
• NDA 003167 for PHD Laboratory Inc’s DEX-O-FED Oral Drops, which FDA approved on Decemner 13, 1940, and that contains chlorobutanol 30% and ephedrine sulfate 50% (approval withdrawn on July 24, 1970); and, more “recently”;
• NDA 011768 for Roerig’s (a Division of Pfizer Inc.) MARAX Tablets, which FDA approved on May 27, 1959, and that contains ephedrine sulfate, hydroxyzine HCl, and theophylline (approval withdrawn on August 7, 1998; 63 Fed. Reg. 36,923 (July 8, 1998)); and
• NDA 012879 for Roerig’s (a Division of Pfizer Inc.) MARAX and MARAX-DF Oral Syrup, which FDA approved on August 21, 1961 and May 24, 1963, respectively, and that contain ephedrine sulfate, hydroxyzine HCl, and theophylline (approval withdrawn on August 7, 1998; 63 Fed. Reg. 36,923 (July 8, 1998)).

Given these previous NDA approvals (as well as several more not listed here), it’s difficult to understand how AKOVAZ could contain an NCE that should be awarded 5-year exclusivity.  But that’s a determination FDA has to make.  How FDA’s determination ends up squaring with predictions made about the drug remains to be seen, but we will likely know in the coming weeks or months. 

By Anne K. Walsh –

A drug or device company (or its officers, management, or employees) who are the target of a False Claims Act lawsuit or investigation face the potential threat of being excluded from Medicare, Medicaid, and other Federal health care programs.  For a drug or device company, exclusion means that none of the company’s products are eligible for payment under a Federal health care program.  For an individual, exclusion effectively bans the subject individual from working in the health care industry during the exclusion period.  Thus it is critical that any response to a False Claims Act investigation include not only arguments to avoid prosecution, but also to dissuade the government from seeking an exclusion remedy. 

Under section 1128(b)(7) of the Social Security Act (the “Act”), the Office of the Inspector General (OIG) of the Department of Health and Human Services may exclude any individual or entity (collectively “person”) that has engaged in conduct described in section 1128A or 1128B of the Act.  Specifically, (b)(7) exclusion may be imposed on any person that submits, or causes to be submitted, false or fraudulent claims to a Federal health care program, or that violates the Federal health care program anti-kickback statute.  The Act provides OIG with “permissive” exclusion authority in these situations, meaning that it has discretion whether to exclude the person, versus the mandatory exclusion that certain conduct requires under the Act. 

Over 19 years ago, HHS OIG issued non-binding guidance (62 Fed. Reg. 67392 (Dec. 24, 1997)) that set forth criteria OIG intended to use in determining whether to exercise its permissive exclusion authority.  In 2014, OIG solicited comments for revising these criteria, and based on the five comments it received and the office’s experience to date, issued revised guidance on April 18, 2016.  In short, the guidance explains how OIG will base its decision to exclude on its assessment of future risk to the Federal health care programs.  The “risk spectrum” depicts the lowest risk person as one that self-discloses its conduct, which could result in OIG giving the person a release from potential (b)(7) exclusion.  A person in the middle of the spectrum could avoid exclusion in exchange for agreeing to certain integrity obligations.  If OIG deems a person in the highest risk category, there would be no way to avoid exclusion.

In evaluating a person’s place on the risk spectrum, the new guidance describes the facts that HHS OIG considers relevant to the following four broad categories: 

(1) Nature and circumstances of conduct

• Higher risk exists if the conduct poses an actual or potential risk to patients or causes substantial financial loss to Federal health care programs, or indicates a pattern of misconduct
• Higher risk exists if individuals with managerial control led the unlawful activity, or if the person previously was under a corporate integrity agreement (“CIA”).

(2) Conduct during the government’s investigation

• Higher risk if the person obstructed the investigation or failed to comply with a subpoena
• Lower risk if the person initiated an internal investigation and self-disclosed the conduct, or cooperated with the investigation

(3) Significant ameliorative efforts

• Lower risk if the person has taken disciplinary action or devoted more resources to the compliance function

(4) History of compliance

• Higher risk if the entity fails to meet the elements of the compliance program outlined in the U.S. Sentencing Commission Guidelines Manual

While a person in the midst of a government investigation under the False Claims Act may be singularly focused on avoiding prosecution, it is important to keep an eye on factors during the investigation that may result in potential exclusion.  The goals are aligned for the most part, but the impact of certain conduct – even actions taken during the investigation – may affect the OIG’s consideration of whether to impose exclusion in the event of a determination of liability.

By Riëtte van Laack –

Last year (October 2015), POM Wonderful LLC (POM) petitioned the U.S. Supreme Court for review of the decision of the U.S. Court of Appeals for the District of Columbia (see our previous post here).  As we discussed, POM’s arguments in its Petition essentially repeated the arguments in its request for en banc review by the D.C. Circuit.  At issue were seventeen of the thirty six advertising claims the Court of Appeals included in its decision.  According to POM, the seventeen claims should have been reviewed de novo by the Court of Appeals. Instead, the Court of Appeals merely accepted FTC’s determination that the claims were misleading. According to POM, FTC’s determination was in error. In its Petition, POM acknowledged that the outcome in the case would not change because of the other 19 claims that POM did not contest; it would be liable for false advertising in any case.

After a number of extensions, the FTC filed its brief in opposition of review on March 28, 2016.  The FTC argued that the seventeen ads were part of the original complaint.  Importantly, FTC said that POM’s request for de novo review of the seventeen ads was made too late, i.e., in POM’s reply brief rather than in its opening briefs in its appeal. Thus, the Supreme Court’s denial is not surprising.

The decision leaves in place the January 2015 ruling by the U.S. Court of Appeals for the District of Columbia.  Nevertheless, this may not be the end of what some may consider the epic battle between the two parties. What remains is a determination of “the spoils of the war.”  In the FTC’s Complaint filed in 2010, the FTC reserved the right to file a court action seeking restitution and other remedies after it issued a cease and desist order and the order becomes final.  POM potentially faces a restitution action for millions of dollars.

By Kurt R. Karst –      

On April 29, 2016, Represetatives Gerry Connolly (D-VA) and Morgan Griffith (R-VA) announced the introduction of H.R. 5127, the “Curb Opioid Misuse by Advancing Technology (COMBAT) Act.”  The COMBAT Act is the latest effort by Congress to incentivize the development of abuse-deterrent opioids.  The bill also continues a trend of what we’ve termed “exclusivity stacking” that started in 1997 with the creation of 6-month pediatric exclusivity, and which concept has grown in popularity in recent years with the introduction of numerous legislative proposals (see our previous posts here and here).

The COMBAT Act would amend FDC Act §§ 505(c)(3)(E) (applicable to 505(b)(2) NDAs) and 505(j)(5)(F) (applicable to ANDAs) to add a new subsection (vi) to each provision that would extend by 12 months a period of 3-year new clinical investigation exclusivity granted by FDA as a result of the approval of an applicant’s original NDA (either a “full” 505(b)(1) NDA or a 505(b)(2) NDA), or a supplement to an approved NDA, thus delaying approval of a second-in-time 505(b)(2) NDA or an ANDA.  The 12-extension would be awarded if the NDA sponsor “provides documentation to [FDA] demonstrating that the drug that is the subject of the application or supplement— (I) is approved, in whole or in part, on the basis of one or more new clinical abuse potential studies; and (II) is approved with labeling that characterizes the abuse-deterrent properties of the drug product.”

FDC Act §§ 505(c)(3)(E) and 505(j)(5)(F) currently provide that 3-year exclusivity is awarded if an NDA applicant conducts “new clinical investigations” that FDA determines are “essential to the approval” of a marketing application. The statute also defines in general terms the scope of 3-year exclusivity, stating with respect to an original NDA that the exclusivity applies to the “conditions of approval,” and with respect to “a change approved” in the case of an NDA supplement. 

The scope of 3-year exclusivity has been a hot topic in recent years. In June 2015, the U.S. District Court for the District of Columbia ruled in Veloxis Pharmaceuticals, Inc. v. FDA, ___ F.Supp.3d ___, 2015 WL 3750672 (June 12, 2015), that 3-year exclusivity is triggered if there is “an overlap in the conditions of approval between the first-in-time 505(b) drug and the second-in-time 505(b)(2) NDA.” Id. *18 (emphasis in original).  The court also noted that “[t]he effect of [3-year] exclusivity . . . . turns on whether a second-in-time 505(b)(2) NDA shares any conditions of approval with the first-in-time 505(b) drug granted exclusivity.” Id. *25 (see our previous post here).  In other words, a second-in-time 505(b)(2) NDA can be blocked from obtaining approval because of a period of 3-year exclusvity applicable to a first-in-time 505(b) NDA regardless of whether or not the second-in-time 505(b)(2) NDA relies on FDA’s findings of safety or effectiveness for the first-in-time 505(b) NDA.

The COMBAT Act would clarify that the term “new clinical investigations” includes “new clinical abuse potential studies intended to assess the impact of potentially abuse-deterrent properties of drug products in human subjects.” The bill would also direct how FDA must define – in regulations that would need to be promulgated by the Agency – the terms “conditions of approval” and “change approved in the supplement” for purposes of 4-year exclusivity.  Specifically, the bill states that both terms must include, for purposes of a subsequent 505(b)(2) NDA:

any abuse-deterrent properties of a drug product subject to the extension provided by subsection (c)(3)(E)(vi) of such section 505 (as added by subsection (a)), such that [FDA] may not make the approval of an application submitted under subsection (b)(2) of such section 505 effective before the expiration of 4 years from the date of the approval of the application or supplement under subsection (b) of such section 505, including the extension under subsection (c)(3)(E)(vi) of such section 505, unless the application submitted under subsection (b)(2) of such section 505— (A) is approved, in whole or in part, on the basis of one or more new clinical abuse potential studies; and (B) is approved with labeling that characterizes the abuse-deterrent properties of the drug product. [(Emphasis added)]

For purposes of ANDA approval, the bill states that the terms “conditions of approval” and “change approved in the supplement” must include:

any abuse-deterrent properties of a drug product subject to the extension provided by subsection (j)(5)(F)(vi) of such section 505 (as added by subsection (b)), such that [FDA] may not make the approval of an abbreviated application for a drug product submitted under subsection (j) of such section 505 effective before the expiration of 4 years from the date of the approval of the application or supplement under subsection (b) of such section 505, including the extension under subsection (j)(5)(F)(vi) of such section 505.

The COMBAT Act’s scope of exclusivity language applicable to ANDAs is pretty straightforward, but the parallel provision applicable to 505(b)(2) NDAs caught our attention. The text stating “any abuse-deterrent properties of a drug product subject to the extension” appears to reflect the broad scope of 3-year exclusivity recognized by the D.C. District Court in Veloxis, but the “unless” clause appears to narrow the scope of exclusivity, such that a second-in-time 505(b)(2) NDA would not be blocked from obtaining approval because of a period of 3-year exclusivity applicable to a first-in-time 505(b) NDA if the second-in-time 505(b)(2) NDA applicant conducts “new clinical abuse potential studies” leading to abuse-deterrence labeling.  If this interpretation is correct, then the COMBAT Act would effectively create a “carve-out” of the scope of 3-year exclusivity for certain 505(b)(2) NDAs.

So that ANDA applicants are not left in the lurch, the COMBAT Act would also create a 60-day extension to 180-day exclusivity. Specifically, the bill would amend FDC Act § 505(j)(5)(B) to add new subsection (v), which states:

With respect to an [ANDA] described in clause (iv), if such application is approved on or after the date of enactment of the Curb Opioid Misuse By Advancing Technology Act of 2016, the 180-day period specified in such clause shall be extended for an additional period of 60 days if the first applicant submitting the abbreviated application provides documentation to [FDA] demonstrating that the listed drug referred to paragraph (2)(A)(i) and referenced in the abbreviated application— (I) is approved, in whole or in part, on the basis of one or more new clinical abuse potential studies; and (II) is approved with labeling that characterizes the abuse-deterrent properties of the drug product.

Thus, in certain circumstances, 180-day exclusivity would become 240-day exclusivity. In fact, because the Reference Listed Drug (RLD”) cited in an ANDA may not initially be approved with abuse-deterrence labeling, but only after an ANDA is submitted to FDA containing a Paragraph IV certification challenging a patent listed in the Orange Book for the RLD, an ANDA applicant initially anticipating only 180-day exclusivity eligibility may get an unanticipated 60-day windfall (provided such ANDA applicant can demonstrate equivalence under FDA’s tier-based approach – see our previous post here).

By Jay W. Cormier –

The National Institutes of Health (NIH) recently announced that it would be suspending drug manufacturing at two of its facilities after preliminary findings by two outside consulting groups found that certain sterile products were not manufactured in compliance with GMP quality standards.  As a result, clinical studies using the drug products at these facilities that are subject to this suspension will, in turn, be halted until NIH can bring its manufacturing facilities into compliance. 

Recall that last summer, two NIH manufacturing facilities were inspected by FDA and issued a scathing Form 483 (see our earlier post here).  It isn’t exactly clear whether the two facilities mentioned in this latest press release (a National Cancer Institute laboratory engaged in cell therapy production and a National Institute of Mental Health facility producing positron emission tomography (PET) materials) are different than the two facilities that were closed immediately following the 2015 inspection (those two facilities were the Pharmaceutical Development Section and Clinical Center Pharmacy).  We attempted to clarify this with NIH contact listed on the press release, but our calls have not been returned. 

If it is the same facilities, it seems odd to us that NIH would announce the closure of the same facilities twice.  So, we are inclined to believe that these recent closures bring the total drug product manufacturing facilities have been at least partially closed due to a lack of cGMP compliance to four facilities.  If this is the case, it is very interesting as we cannot recall an instance where a manufacturer voluntarily shut down two of its facilities in response to a company-wide review of manufacturing facilities following negative inspectional findings at two other of its facilities.

Adding a twist to the whole story, in December, NIH formed the Clinical Center Working Group of the Advisory Committee to the Director (which NIH refers to as the “Clinical Center Red Team”), whose charge is defined as:

To make recommendations about ways to enhance the organization, financing, and management of the clinical center to improve the quality of patient care, and reduce the risk of clinical research and research-related activities. To inform its deliberations, the working group may examine the structural and cultural issues at the Clinical Center that may have contributed to the deficiencies identified in the Pharmacy and Pharmaceutical Development Service, and review other research activities at the Clinical Center that pose a potential risk to research participants.

The Clinical Center Working Group was expected to deliver its report to the full Advisory Committee to the Director on Thursday, April 21st in a meeting scheduled from 4-6pm.  Setting aside for a moment (or rather for a later post) that it has taken NIH almost a year to receive this report – an eternity in the world of major cGMP violations – we are glad to see that the Working Group is producing its report.  Although NIH announced that the report would be delivered to the NIH Advisory Committee at a specific date and time, a week later NIH has yet to disclose either the report or a summary of its contents.  We look forward to hearing about the report and to seeing what additional changes NIH makes to its drug manufacturing practices. 

We will be watching to see if the report or any summary of it is made public.  Because of the significance of the issues at NIH, and that NIH is funded through taxpayer funds, we urge NIH to make the report public expeditiously. 

By Kurt R. Karst –

On April 27, 2016, Eagle Pharmaceuticals, Inc. (“Eagle”) filed a Complaint in the U.S. District Court for the District of Columbia alleging that FDA violated the Administrative Procedure Act (“APA”) when the Agency refused to grant periods of 7-year orphan drug exclusivity upon the December 7, 2015 approval of Eagle’s 505(b)(2) NDA 208194 for BENDEKA (bendamustine HCl) Injection, 100 mg/4 mL (25 mg/mL) for both the treatment of patients with Chronic Lymphocytic Leukemia (“CLL”) and for the treatment of patients with indolent B-cell Non-Hodgkin Lymphoma (“NHL”) that has progressed during or within six months of treatment with rituximab or a rituximab-containing regimen.  We suspected that a lawsuit against FDA might be in the works when Eagle announced in late March 2016 that FDA refused to grant orphan drug exclusivity for BENDEKA and that the company was “evaluating all options to challenge the FDA’s decision.”

The story of BENDEKA follows a path similar to that of Depomed Inc.’s (“Depomed’s”) GRALISE (gabapentin) Tablets (NDA 022544), and it raises for a second time in court the issue of whether FDA can lawfully require a company to demonstrate “clinical superiority” to obtain orphan drug exclusivity. 

FDA designated BENDEKA as an orphan drug on July 2, 2014 for both the treatment of CLL and NHL. Because FDA had previously approved Bendamustine HCL for these two uses – specifically, Teva Pharmaceutical Industries Ltd.’s (“Teva’s”), TREANDA (bendamustine HCl) for Injection, for Intravenous Infusion (NDA 022249) – FDA required that Eagle provide a plausible hypothesis of clinical superiority to obtain orphan drug designation. As a ready-to-dilute concentrate solution for injection administered by infusion over 10 minutes after dilution in 50 mL of sodium chloride or a saline/dextrose mixture, FDA accepted Eagle’s hypothesis that the lower volume could provide a benefit to CLL and NHL patients. 

Fast-forward to December 7, 2015. Although Teva’s orphan drug exclusivity (as extended by pediatric exclusivity) for TREANDA for the treatment of CLL expired on September 20, 2015, orphan drug exclusivity for TREANDA for the treatment of NHL (as extended by pediatric exclusivity) remains in effect until May 01, 2016.  (As an aside, we note that after determining in response to a Citizen Petition [Docket No. FDA-2015-P-3980] that generic drug applicants could omit information on the protected NHL use, on March 24, 2016, FDA approved two ANDAs for generic TREANDA for the treatment of CLL [i.e., ANDA 204771 and ANDA 205476].)  As a result of a licensing agreement between Teva and Eagle, however, Teva agreed to waive unexpired orphan drug exclusivity with respect to BENDEKA.  That waiver paved the way to the December 2015 approval of BENDEKA without Eagle having to “break” Teva’s unexpired orphan drug exclusivity for TREANDA for the treatment of NHL by demonstrating “clinical superiority” over TREANDA.  But the issue of “clinical superiority” remained an issue in FDA’s mind for Eagle to be granted orphan drug exclusivity.

FDA’s orphan drug regulations 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. (For a list of clinical superiority precedents, see our previous post here.)  As FDA explained in a 2012 petition response concerning orphan drug exclusivity for WILATE (von Willebrand Factor/Coagulation Factor VIII Complex (Human)) (see our previous post here), as well in the preambles to FDA’s 2011 proposed rule and 2013 final rule amending the Agency’s orphan drug regulations (see our previous posts here and here), where clinical superiority is concerned, FDA says that the standard for obtaining designation is different from the standard for obtaining exclusivity:

Though the sponsor of a subsequent orphan drug must set forth a plausible hypothesis of clinical superiority over the previously approved drug at the designation stage, such a sponsor faces a higher standard at the time of approval. At approval, the sponsor of a drug which was designated on the basis of a plausible hypothesis of clinical superiority must demonstrate that its drug is clinically superior to the previously approved drug.  Should the sponsor fail to do so, then the subsequent drug will be considered to be the same drug as the previously approved drug, and will not be able to gain marketing approval if the previously approved drug’s orphan-drug exclusive approval period is still running.  Once this exclusivity has expired, the subsequent drug may be approved . . . , but it will not be eligible for orphan-drug exclusivity because the same drug has already been approved for the same orphan indication.

FDA’s heightened standard for demonstrating clinical superiority to obtain orphan drug exclusivity was at the heart of Depomed’s September 2012 lawsuit against FDA (see our previous post here).  Depomed prevailed in the lawsuit.  In a September 2014 Memorandum Opinion, Judge Ketanji Brown Jackson of the U.S. District Court for the District of Columbia decided the case on Chevron Step 1 grounds, finding that “the plain language of the Orphan Drug Act requires the FDA to recognize exclusivity for Gralise” (see our previous post here).  The court stated that the statute:

employs the familiar and readily diagrammable formula, ‘if x and y, then z.’ Congress has crafted its command to the Secretary of the FDA in a manner that sets forth two circumstances – a drug that has been designated for a rare disease or condition, and the FDA’s approval of a marketing application for that drug – that, if present, result in a particular consequence: a seven-year period of abstinence regarding marketing approval for other such drugs.

FDA decided not to appeal Judge Jackson’s decision. Instead, FDA published in the December 23, 2014 Federal Register a “clarification of policy” notice in which the Agency addresses the effects of the Depomed court decision (see our previous post here).  In that notice, FDA “double-downed” on the Agency’s pre-Depomed regulations.  In short, FDA says that Judge Jackson’s decision is limited to GRALISE, and that the Agency will continue to apply its clinical superiority regulatory paradigm insofar as orphan drug exclusivity is concerned.  Specifically, FDA states:

In consideration of any uncertainty created by the court’s decision in Depomed, the Agency is issuing this statement. It is the Agency’s position that, given the limited terms of the court’s decision to GRALISE, FDA intends to continue to apply its existing regulations in part 316 to orphan-drug exclusivity matters.  FDA interprets section 527 of the FD&C Act and its regulations (both the older regulations that still apply to original requests for designation made on or before August 12, 2013, as well as the current regulations) to require the sponsor of a designated drug that is the “same” as a previously approved drug to demonstrate that its drug is “clinically superior” to that drug upon approval in order for the subsequently approved drug to be eligible for orphan-drug exclusivity.

At the time, we commented that FDA’s out-of-left-field-strategy might be a way for the Agency to draw out another lawsuit from an affected sponsor so that FDA could have another crack to relitigate the issue in court. That appears to almost have happened in the case of another Eagle drug – RYANODEX (dantrolene sodium) for Injectable Suspension – where Eagle issued what we termed a “Depomed Threat.”  But in that case, FDA ultimately granted Eagle orphan drug exclusivity after finding a basis on which to find that clinical superiority was demonstrated (see our previous post here).  No “Depomed Threat” deterred FDA in the case of BENDEKA, so we’re off to court where FDA will once again attempt to defend the Agency’s interpretation of the statute to require a demonstration of clinical superiority for a company with orphan drug designation to obtain orphan drug exclusivity.

Citing and quoting from what appears to be a rather lengthy March 24, 2016 FDA letter ruling, Eagle says in the company’s Complaint that “FDA denied Bendeka exclusivity . . . taking essentially the same position it took in Depomed”:

First, the letter ruling explained FDA’s position that Depomed was wrongly decided. Id. at 39 (“[T]he Depomed court erred in not deferring to FDA’s statutory interpretation ….”); id. at 32 (“We are not bound to follow the Depomed decision, and we do not believe that the Depomed court’s conclusion is compelled by the statute ….” (internal citation omitted)); id. at 9 (“Because FDA concluded that the decision was inconsistent with FDA’s clinical superiority framework and the important policy interests at stake, the Agency has continued to implement its long-standing clinical superiority framework for designation and exclusivity decisions.”).

Second, FDA defended its regulatory scheme: FDA acknowledged that it had indeed granted orphan drug designation for Bendeka, but argued that Congress’s exclusivity incentive for orphan drugs is not particularly important compared to other incentives in the statute. See id. at 10, 34. Thus, FDA argued that, despite granting orphan drug designation, the agency was free to deny exclusivity at the end of the process. Id. at 32-40.

Third, despite FDA’s conclusion when it designated Bendeka as an orphan drug that Bendeka presented a plausible hypothesis of clinical superiority over a similar drug named Treanda, FDA reversed course in 2016. FDA now concluded that, although Bendeka is safe and effective, Eagle had not proffered sufficient evidence that Bendeka is in fact clinically superior to Treanda under the regulatory requirement this Court found unlawful in Depomed. Id. at 32.

“Had FDA respected Judge Jackson’s [Depomed] ruling in 2014,” says Eagle, “this case would not be necessary.  Unfortunately, FDA’s defiance of this Court’s prior order leaves Plaintiff no choice but to file this suit.”

Eagle is seeking both declaratory and injunctive relief. Eagle wants, among other things, a declaration that FDA’s refusal to grant orphan drug exclusivity to Eagle for Bendeka violates the APA, that Eagle is entitled to orphan drug exclusivity, and that FDA’s orphan drug regulations at 21 C.F.R. §§ 316.3(b)(12), 316.31(a), 316.34(a), (c) are invalid under the FDC Act, insofar as they purport to permit FDA to not recognize orphan drug exclusivity for BENDEKA; and injunctive relief “effectuating Eagle’s orphan drug exclusivity by enjoining [FDA] from approving any other drug covered by Eagle’s exclusivity for the treatment of CLL or indolent B-cell NHL until December 7, 2022.”  The case has been assigned to Judge Gladys Kessler.

By Kurt R. Karst –

Disputes involving non-patent marketing exclusivity available to 505(b)(1) and 505(b)(2) NDA applicants – either 5-year New Chemical Entity (“NCE”) exclusivity, 3-year new clinical investigation exclusivity, or 7-year orphan drug exclusivity – have increased dramatically over the past few years, and there’s no end in sight.  Just take a look at the various postings in the “Hatch-Waxman” category on this blog over the past year or two and you’ll see what we mean.  We’ve seen numerous lawsuits challenging FDA decisions on the availability of or scope of exclusivity, as well as several citizen petitions requesting that FDA make a particular determination on the appropriate exclusivity period to award an NDA applicant.  We’ve also seen several cases in which FDA has inexplicably delayed or failed to make an exclusivity decision after approving an NDA – e.g., AVYCAZ (ceftazidime-avibactam) Injection (NDA 206494; approved on February 25, 2015), AURYXIA (ferric citrate) Tablets (NDA 205874; approved on September 5, 2014), and SURFAXIN (lucinactant) Intratracheal Suspension (NDA 021746; approved on March 6, 2012) – or where FDA “punts” on making an exclusivity determination hoping that the issue will go away with time – e.g., XTAMPZA ER (oxycodone) Extended-release Capsules (NDA 208090), where FDA comments in a November 6, 2015 Tentative Approval letter that “We need not determine at this time whether approval of your 505(b)(2) NDA for XTAMPZA ER would otherwise be blocked by any other drug’s marketing exclusivity expiring before termination of the 30-month stay.”).

The latest exclusivity challenge comes in the form of a Citizen Petition (Docket No. FDA-2016-P-1163) submitted to FDA on behalf of Vifor Fresenius Medical Care Renal Pharma France (“Vifor Fresenius”) requesting that FDA award a period of 5-year NCE exclusivity for Vifor Fresenius’s VELPHORO (sucroferric oxyhydroxide) Chewable Tablets, which FDA approved on November 27, 2013 under NDA 205109 for the control of serum phosphorus levels in patients with chronic kidney disease on dialysis.  Although FDA has failed to make an exclusivity decision for another iron-based drug product (AURYXIA, noted above), in the case of VELPHORO it’s not FDA’s failure to act that is being challenged, but rather FDA’s decision to award a period of 3-year exclusivity instead of 5-year NCE exclusivity. 

According to Vifor Fresenius, VELPHORO is entitled to 5-year exclusivity under either FDA’s “active moiety standard” or the FDC Act’s “active ingredient standard,” which the U.S. District Court for the District of Columbia recently addressed in Amarin Pharms. Ir. Ltd. v. FDA, 106 F. Supp. 3d 196, 198 (D.D.C. 2015) (see our previous post here), and for which a decision out of FDA seems likely any day now.  Vifor Fresenius lays out detailed arguments, including:

• Velphoro is a novel iron-based phosphate binder with a different active moiety from previous iron-based products.  The Agency initially rejected five-year exclusivity for Velphoro on the basis of previously approved intravenous iron-carbohydrate iron supplements.  But these products do not share an active moiety with Velphoro.  Velphoro, a chewable phosphate binder, has as its active moiety a form of insoluble polynuclear iron(III)-oxyhydroxide that is specifically designed to minimize the release of iron: by contrast, the iron supplements are designed to release iron and have a ferric iron (Fe3+) active moiety.
• FDA has agreed that there are significant physicocheinical differences between Velphoro’s iron oxyhydroxide active moiety and the iron oxyhydroxides in Previously approved products.  The polynuclear iron(III)-oxyhydroxide moiety in Velphoro is different in significant respects from iron oxyhydroxides in previously approved products, as the Agency itself has concurred.  For example, the iron oxyhydroxides in previously approved products contain particles that are billions of times smaller, differ in their iron release properties, and differ in their structure and chloride content.
• Velphoro does not contain a previously approved active ingredient.  The FDCA requires that the Agency assess approved active ingredients as a whole, rather than focus narrowly on active moieties.  This approach is also consistent with FDA’s approach to active ingredient sameness in the ANDA approval context.  Here, the approved active ingredients in other iron-carbohydrate drugs differ in activity, differ in particle size, differ in iron release and solubility, contain different carbohydrates and other components, and contain significantly higher stoichiometric ratios of carbohydrates, resulting in dramatic differences in therapeutic effect.
• Velphoro’s physicochemical differences are essential for the desired therapeutic indication, not minor differences that the Agency can ignore. The Agency agrees that Velphoro has physicochemical differences from intravenous iron supplements that it also concurs are “essential for the desired therapeutic indication.”  Velphoro is a solid that binds phosphate for purposes of excretion, and is designed so that it causes only minimal iron absorption into the body.  By contrast, the iron-carbohydrate anemia drugs are injectables introduced into the bloodstream and designed for the purpose of delivering iron into the body.  In evaluating active ingredients, the Agency should not ignore differences that are essential to activity.

Until FDA makes a decison on NCE exclusivity, Vifor Fresenius wants FDA to stay the acceptance of any new ANDAs or 505(b)(2) NDAs that reference VELPHORO, and any action on a previously-submitted ANDA or 505(b)(2) NDA that references VELPHORO.  A single patent is listed in the Orange Book for VELPHORO that expires on December 19, 2016, so it’s possible that an application is pending at FDA with a Paragraph III patent certification. 

Metal-containing products have historically been difficult for FDA to evaluate for active moiety and exclusivity purposes.  Consider, for example, the September 2003 memorandum FDA included in NDA 021626 for RADIOGARDASE (insoluble Prussian Blue) Capsules evaluating whether different ferric(III) hexacyanoferrate(II) compounds are different active moieties.  There’s also FDA’s recent Manual of Policies and Procedures (“MAPP”) on NDA Classification Codes (MAPP 5018.2).  As we noted in a previous post, the MAPP specifically addresses the active moiety in metal-containing substances. 

We’re not entirely certain where FDA will land on the VELPHORO petition, but we note that it’s not very often that FDA changes an exclusivity decision . . . . at least not absent litigation.  So we may be headed down that path once again. 

The short answer to that question is “No,” says Hyman, Phelps & McNamara, P.C.’s Jeffrey K. Shapiro in an article published in the March/April 2016 issue of the Food and Drug Law Institute’s Update Magazine.  Mr. Shapiro examines the Department of Justice’s recent criminal prosecution of Vascular Solutions, Inc. (“VSI”), which ended with a unanimous jury acquittal for VSI and its chief executive officer of, among other things, misbranding products due to off-label promotion.

“[Z]ombielike, FDA/DOJ continue to pursue truthful and non-misleading off-label promotion as if it were per se a crime,” writes Mr. Shapiro.  “Absent an unlikely U-turn at the Supreme Court, the federal courts likely will continue to find that FDA’s prohibition against truthful and non-misleading off-label promotion is inconsistent with the First Amendment.  However, FDA’s Warning Letters and DOJ enforcement actions could continue for years before enough case law accumulates to force real change, with some companies and individuals choosing to settle rather than risk overwhelming punishment.”

By Ricardo Carvajal –

The would-be marketer of a probiotic suppository submitted a citizen petition (Docket No. FDA-2016-P-1133) to FDA asking the agency to “amend the definition of dietary supplement under the present statutory authority [of DSHEA] and to treat probiotic suppositories the same as oral probiotic dietary supplements.”  In support of that request, the petition argues in part that:

• A probiotic suppository should not be regulated as a drug if no drug claims are made for it;
• Probiotics delivered through a suppository convey essentially the same benefits as those conveyed by probiotics consumed as dietary supplements, and would be consumed for the same purpose – namely “to deliver supplemental microorganisms to the existing populations of beneficial organisms in an individual to help maintain a healthy microbe state in the gut”;
• Suppositories offer a more efficient route of administration, and avoid the possible breakdown of microbes in the stomach and upper GI tract;
• Certain individuals have difficulties orally ingesting supplements; and
• A probiotic suppository provides an alternative to fecal transplant (a subject that we previously addressed here).

The petition asks FDA to amend the definition of “dietary supplement” by replacing the phrase “is intended to be taken by mouth as a pill, capsule, tablet or liquid” with the phrase “is intended for enteral administration.”  Alternatively, the petition asks FDA to “allow a supplemental probiotic which is inserted as a rectal suppository to be classified as a dietary supplement as another delivery route in addition to the oral route.”  

It’s not clear which definition of “dietary supplement” the petition refers to, as the phrase “is intended to be taken by mouth as a pill, capsule, tablet or liquid” does not appear in the FDC Act’s definition of “dietary supplement” or in associated regulations (in relevant part, the statute defines “dietary supplement” as an article “intended for ingestion” in a variety of forms).  In any event, the petition does not explain what authority FDA could rely on to eliminate the statutory criterion of ingestion, or under what authority FDA could allow a suppository to be classified as a dietary supplement.  Indeed, in accord with the existing statutory definition, FDA has consistently taken the position that articles not intended for ingestion do not qualify as dietary supplements.  

By James C. Shehan –

In a bluntly-worded warning letter to contract manufacturer Sri Krishna Pharmaceuticals Ltd. issued April 1, 2016, we see another example of increasing FDA concern over data integrity issues at non-US drug manufacturing facilities, particularly those in India. This rather remarkable letter contains observations of GMP deficiencies in four general areas: (1) failure to include complete data in laboratory records; (2) failure to exercise appropriate controls over computer systems; (3) failure to establish adequate written procedures for production and process controls; and (4) failure in certain instances to follow established written procedures that existed. While the heading of each multi-part observation is somewhat bland, the body of each is quite detailed about data integrity issues and contains both specific descriptions of deceptive practices and FDA assertions that Sri Krishna has admitted to these deceptive practices.” We have previously discussed (see our post here), FDA warning letters on data integrity (18 out of 23 of CDER’s 2015 warning letters). Specifically, letters addressed to facilities in India and China (15 out of those 18) are running at record levels. This warning letter to Sri Krishna fits neatly into this clear pattern.

Moreover, the letter demands that Sri Krishna undertake three follow-up actions: (1) a “comprehensive investigation into the extent of the inaccuracies in data records and reporting,” including “interviews of current and former employees … by a qualified third party;” (2) a “current risk assessment of the potential effects of the observed failures on the quality of your drugs,” including the risk to patients; and (3) a “management strategy for your firm that includes the details of your global corrective action and preventive action plan,” and that includes “[i]nterim measures describing the actions you have taken or will take to protect patients and to ensure the quality of your drugs, such as notifying your customers, recalling product, conducting additional testing, … drug application actions, and enhanced complaint monitoring.”

The essence of the agency’s incomplete data observation is that Sri Krishna regularly deleted non-conforming test results and repeated tests in order to generate conforming results. The warning letter gives details on at least five different situations in which this occurred, including one in which 28 original data files were deleted and another in which a clock was changed prior to samples being reanalyzed. In some instances, “trial” tests were performed and the data from them stored on separate computer drives from those drives on which the data that were reported to FDA was stored.

Sri Krishna’s admissions of these violations are documented in numerous places in the warning letter: “Your management acknowledged that employees in your QC laboratories conduct trial HPLC injections prior to the injections submitted as the reported test results; “Your response acknowledges that an analyst deleted eight injections, including the blank, six standards, and a sample;” and “Your analyst deleted data from the first set of injections and submitted only the second set in the validation documentation. The analyst stated that he planned to back-date the preparation data within the worksheets.”

FDA even makes an allegation of a kind that this blogger has never seen before – that Sri Krishna falsified data specifically for inclusion in its response to FDA’s 483: “your response includes a chromatogram for trial injection … that differs from the chromatogram our investigator collected. It appears to have been reintegrated; the y-axis scale was changed, and only two of the original … peaks can be seen.”

Regarding Sri Krishna’s computer systems, the agency states that Sri Krishna quality control analysts used administrator privileges to make changes in manufacturing records, alter date and time settings, overwrite files and delete original data. While acknowledging that Sri Krishna committed after the inspection to set up user restrictions, discontinue certain practices, and institute audit trails for computerized systems, FDA expressed apparent deep unhappiness with the company’s response. Sri Krishna’s actions are “insufficient to correct the broad data manipulation and deletion problems observed at your facility and to prevent their recurrence.” FDA thus asked that Sri Krishna’s response clarify specific user roles for each laboratory system and “provide an assessment of the effectiveness of these newly implemented system controls.”

FDA’s citation of a failure to establish adequate written procedures concerns another apparent deception about a process performance qualification protocol for alternate manufacturing equipment for a specific product. The company is alleged to have said that it initiated a prospective qualification of this equipment, but FDA states that the protocol, while written, was not approved or implemented and the samples required were never collected. FDA rejects the company’s offer to perform a retrospective validation to fix this deficiency.

The allegation of a failure to follow correctly established written procedures is linked to an accusation of destruction of original batch records and substitution thereto of backdated replacement pages. Tantalizingly, the letter states that FDA found original pages from five batch records “discarded outside your facility,” but then sorely disappoints by failing to give any details about the dumpster diving that we imagined resulted in this discovery.

The agency’s detailed description of the corrective actions that it expects of Sri Krishna is unusual but seems to be part of a trend in warning letters. First, FDA requests a “comprehensive investigation” of the data integrity issues that covers all of the company’s laboratory and manufacturing operations, not just those found at fault by FDA, or a justification for exclusion of any part of these operations. The company is asked to assess and evaluate the effect of, via a third party, “data integrity deficiencies” and “[i]dentify omissions, alterations, deletions, record destruction, non-contemporaneous record completion, and other deficiencies.”  As mentioned previously, FDA specifically recommends that the company have a third party interview current and former employees “to identify the nature, scope, and root cause of data inaccuracies.” 

Second, FDA requests “a current risk assessment of the potential effects of the observed failures on the quality of your drugs,” including an analysis of the risks to patients and the risk posed by continuing to operate.

Third, FDA wants a very detailed “management strategy for [the] firm that includes the details of [a] global corrective action and preventive action plan.” This should include a detailed corrective action plan on ensuring reliability and completeness of data and a root cause evaluation of the data integrity lapses, including details on what has happened to the employees implicated in these lapses. FDA also asks Sri Krishna to outline interim measures it will take to protect patients, such as notifying customers, conducting recalls, conducting additional testing and enhancing complaint monitoring. FDA notes that there is no evidence that Sri Krishna has informed its customers of manufacturing changes and ominously states it “is important that you … promptly notify[] … customers of a significant production problem that could interrupt supply or potentially pose a hazard to the consumer.” Long-term measures are also expected to be part of the corrective action plan, including “enhancements” to procedures, systems and “human resources.”

Coincidentally, this warning letter on data integrity has come out at almost the same time as a new FDA guidance on data integrity (see our post here). We continue to watch these developments closely, and to wonder whether more severe sanctions will be forthcoming from the agency.

Readers seeking further enlightenment on these issues or simply looking to gather good karma may want to register here for a PLI webinar on FDA compliance and enforcement strategies to be given by  Jennifer D. Newberger, Jennifer M. Thomas and Anne K. Walsh of Hyman, Phelps & McNamara at 1:00 PM EST on April 27th or attend a conference on creation of effective documentation for FDA regulated products to be given by Brian Donato, Jeffrey Shapiro and Roger Thies of Hyman, Phelps & McNamara in Arlington, Virginia on May 3rd.