By Kurt R. Karst –

Ever since the FDC Act was amended in November 1997 by the the FDA Modernization Act (“FDAMA”) to add a new section creating a period of “pediatric exclusivity,” we’ve had more than a passing interest in the provision.  In fact, it was the topic of this blogger’s first law review article published in 2000 (see here).  Under FDC Act § 505A, now referred to as the Best Pharmaceuticals for Children Act (“BPCA”), pediatric exclusivity provides for a 6-month add-on to unexpired periods of patent and non-patent exclusivities listed in the Orange Book for a sponsor’s drug (i.e., active moiety) (as least insofar as an initial grant of pediatric exclusivity is concerned) if the sponsor has conducted pediatric studies.  The BPCA is the “carrot” in the carrot and stick metaphor often used to describe the two pediatric testing statutes.  The other statute – the so-called “stick” – is the Pediatric Research Equity Act (“PREA”), codified at FDC Act § 505B, and under which FDA can require sponsors to conduct pediatric testing for on-label uses.  (PREA was enacted after FDA’s so-called “Pediatric Rule” was struck down in court – see Association of American Physicians and Surgeons, Inc. v. FDA, 226 F.Supp.2d 204 (D.D.C. 2002).)  Together, the BPCA and PREA have been recognized by the U.S. Government Accountability Office and others as an ongoing success. 

Over the years, the BPCA has undergone several changes.  Most recently, in July 2012, the FDA Safety and Innovation Act (“FDASIA”) made the BPCA permanent.  Prior to that, FDC Act § 505A was reauthorized and amended generally every 5 years along with each iteration of the Prescription Drug User Fee Amendments.  For example, the 2007 FDA Amendments Act (“FDAAA”) authorized the BPCA for another 5 years and also tweaked some of the language in the process. 

Notwithstanding changes in the BPCA, folks have always considered one thing to be true: in order to obtain a period of pediatric exclusivity, FDA must first issue a Pediatric Written Request (“PWR”) laying out the studies to be conducted in pediatric subjects.  Indeed, FDA’s initial guidance document announced in July 1998 and revised in September 1999, titled Qualifying for Pediatric Exclusivity Under Section 505A of the Federal Food, Drug, and Cosmetic Act, said as much: “In general, a 505(b)(1) (21 U.S.C. 355(b)(1)) application will qualify for pediatric exclusivity if all of the following have occurred: 1. The Agency issued a Written Request for pediatric studies . . . .”  But a recent Citizen Petition (Docket No. FDA-2014-P-0830) submitted to FDA on behalf of Merz North America calls into question the long-held belief that issuance of a PWR is a condition precedent to FDA awarding pediatric exclusivity – at least with respect to Merz’ (formerly Shionogi Pharma, Inc.’s) orphan drug CUVPOSA (glycopyrrolate) Oral Solution, which FDA approved on July 28, 2010 under NDA No. 022571 to reduce chronic severe drooling in pediatric patients (aged 3-16) with neurologic conditions associated with problem drooling (e.g., cerebral palsy).

According to the petition:

Merz’ predecessor fulfilled the requirements for six-month pediatric exclusivity pursuant to FFDCA § 505A(h) as it existed at the time [FDA] approved Cuvposa in 2010.  The pediatric studies were performed as required under a provision of law and regulations (i.e., for NDA approval), and thus satisfied the requirements for pediatric exclusivity under § 505A(h) without a formal written request from FDA.  Although FDA waived the pediatric study requirements under the [PREA] based on Cuvposa’s orphan drug status, the Agency failed to consider that Cuvposa was still eligible for six-month pediatric exclusivity.  Accordingly, this exclusivity period should now be recognized and attached to the remaining Cuvposa orphan drug exclusivity and patent periods.

Alternatively, says Merz:

[I]f FDA determines that a written request for pediatric studies was required pursuant to § 505A(h) in 2010, then FDA’s 2001 meeting of the Pediatric Subcommittee of the Anti-Infective Drugs Advisory Committee ("2001 AC Meeting" or "Meeting") legally constitutes this written request.  The conclusions of the AC and the direction provided to FDA and the sponsor satisfy the legal and policy reasons for the written request.  The Agency did not consider this fact and therefore did not consider the eligibility of Cuvposa for six-month pediatric exclusivity.  Accordingly, this exclusivity period should now be
recognized and attached to the remaining Cuvposa orphan drug exclusivity and patent periods.

The key to the first argument for pediatric exclusivity for CUVPOSA, says the Petitioner, is FDC Act § 505A(h), which was initially codified at FDC Act § 505A(i) in 1997.  That provision has undergone several changes since 1997, initially stating:

(i) Relationship to regulations.  Notwithstanding any other provision of law, if any pediatric study is required pursuant to regulations promulgated by the Secretary and such study meets the completeness, timeliness, and other requirements of this section, such study shall be deemed to satisfy the requirement for market exclusivity pursuant to this section.

Then changing to the following with the 2007 FDAAA:

(h) Relationship to pediatric research requirements.  Notwithstanding any other provision of law, if any pediatric study is required by a provision of law (including a regulation) other than this section and such study meets the completeness, timeliness, and other requirements of this section, such study shall be deemed to satisfy the requirement for market exclusivity pursuant to this section.

And finally to the following with the 2012 enactment of FDASIA:

(h) Relationship to pediatric research requirements.  Exclusivity under this section shall only be granted for the completion of a study or studies that are the subject of a written request and for which reports are submitted and accepted in accordance with subsection (d)(3).  Written requests under this section may consist of a study or studies required under section 355c of this title [FDC Act § 505B].

The difference between the 2007 statute,which was in effect when FDA approved CUVPOSA, and the 2012 (and current) version is significant for two reasons, says Merz:

First, it includes language referencing written requests which was not present in that particular subsection when Cuvposa was approved.  Second, it facially narrows the relationship between studies conducted for pediatric exclusivity and for other required purposes.  The previous language broadly referenced pediatric studies conducted as required by another provision of law or regulation, but the new language only references PREA studies by name as being eligible for pediatric exclusivity. . . .

For Cuvposa to have been eligible for pediatric exclusivity under § 505A(h) in 2010, two requirements must have been met.  First, the pediatric studies performed must have been "required by a provision of law (including a regulation)."  Second, the studies must also have met the pediatric exclusivity requirements.  Cuvposa met the first hurdle for receiving pediatric exclusivity under § 505A(h) because the sponsor was required to complete pediatric studies for NDA approval under both the FFDCA and the regulations. . . . Cuvposa also cleared the second hurdle for pediatric exclusivity under § 505A(h) — that the studies meet the "completeness, timeliness, and other requirements" for exclusivity.  The completeness requirement was certainly met because, if not, then the NDA would not have been approved.  The timeliness factor is not relevant here, because the studies were completed as required for NDA approval.  As far as any of the "other requirements" — a written request, internal review of the request, and internal review of the completed studies — none of these were required for Cuvposa to be eligible for exclusivity under § 505A(h).

And even if FDA sticks to its long-held position that a PWR is a condition precedent to awarding pediatric exclusivity, then Merz says that requirement was already met by virtue of the 2001 AC Meeting concerning the design of clinical trials to study anti-muscarinics for drooling in children with cerebral palsy and other neurologic diseases.  According to the Petitioner, the 2001 AC Meeting “addressed the most critical elements of a written request, including pharmacokinetic studies; clinical study design including patient selection and related ethical issues; clinical study outcomes; dose titration, including safety/risk/benefit balancing; and labeling issues,” and the meeting conclusions “provided the roadmap for Cuvposa development and approval.”  In addition, says Petitioner, “the meeting satisfies the historical purpose of the written request — to provide sponsors with information regarding the conduct of pediatric studies to qualify for exclusivity.” 

By Kurt R. Karst –

It’s been quite a while since we last posted on the so-called “RLD (Reference Listed Drug) Theory of Liability.”  It’s the theory put forward by plaintiffs’ attorneys in a lot of failure-to-warn generic drug product liability cases which posits that FDA’s regulations impose new or additional responsibilities on an ANDA sponsor whose drug product is unilaterally designated by FDA as an RLD once the brand-name RLD NDA drug product is discontinued and withdrawn from the market.  Under this theory, the U.S. Supreme Court’s preemption analysis in PLIVA Inc. v. Mensing, 131 S.Ct. 2567 (2011), essentially shielding generic drug manufacturers from liability because of the FDC Act’s same labeling requirement, is inapplicable to a generic drug manufacturer because it has stepped into the role of an NDA sponsor by virtue of FDA deisignating its drug as the RLD.  Rather, say plaintiffs’ attorneys, a court should employ the impossibility preemption analysis utilized by the Court in Wyeth v. Levine, 555 U.S. 555 (2009), applicable to brand-name drug products approved under an NDA.  Although a decision last summer by the Superior Court of Pennsylvania did say that there’s some merit to the RLD theory of liability (see our previous post here), that’s the only court (federal and state) that has thus far accepted the theory.  Every other court to consider the issue has soundly rejected it (see here, here, and here).  (And there’s still a chance that the Superior Court of Pennsylvania’s decision may be overturned on appeal.)

That leads us to the latest decision on the RLD theory of liability – and it’s a good one!  Last week the U.S. Court of Appeals for the Sixth Circuit issued its decision in In re Darvocet, Darvon, & Propoxyphene Products Liability Litigation, Case Nos. 12-5368, et al. (6th Cir. June 27, 2014).  The Court affirmed in all respects relating to generic drug preemption the judgment of the Kentucky District Court that came out way back in March 2012. dismissing myriad claims against manufacurers of generic versions of DARVON (propoxyphene).  The Plaintiffs in the case put forth several theories of generic drug manufacturer liability.  We’re not going to get into most of them from the Court‘s 48-page decision (we’ll leave that to the folks over at the Drug & Device Law Blog for whom preemption is manna), but we do think the Circuit Court’s decision on RLD status and failure-to-warn liability is important to our readers (pages 18-20 of the decision). 

Pointing to and quoting from a July 2013 FDA guidance document, titled Safety Labeling Changes–Implementation of Section 505(o)(4) of the FD&C Act, the Court says that RLD designation of an ANDA’d drug product does not equate to NDA status.  That FDA guidance states, in relevant part, that while RLD designation generally means that the application sponsor must submit labeling changes when it becomes aware of new safety information, that obligation does not apply to ANDA sponsors:

Under existing FDA regulations, ANDA holders cannot make labeling changes through the formal supplement process under 21 CFR 314.70 in all circumstances in which NDA holders can because an ANDA’s labeling must be the same as the NDA RLD’s labeling. Accordingly the changes-being-effected supplement process under 21 CFR 314.70(c) is not expressly available to ANDA holders except to match the RLD labeling or to respond to FDA’s specific request to submit a labeling change under this provision.

Accordingly, the Sixth Circuit found that “the status of an ANDA holder’s product as the RLD for a given prescription drug product does not alter the ANDA holder’s obligations,” and affirmed the district court’s rejection of the RLD theory of liability.  The decision also makes clear a point we’ve raised before: there’s the “big RLD,” which is the NDA-approved product relied on for safety and effectiveness findings, and the “little RLD,” which is the reference standard used for bioequivalence testing.  Sometimes they’re the one and the same, but in the case of ANDA RLD designation, they’re different. 

Regardless of how the various state and federal courts have addressed the RLD theory of liability, it could all be irrelevant if FDA ultimately adopts a November 2013 proposal – and successfully fends off any challenges to that rule – that would allow generic drug manufacturers to independently update product labeling (with respect to product safety) through the changes being effected supplement process that is currently only available to NDA sponsors.  According to the Spring 2014 Department of Health and Human Services regulatory agenda, a final rule is scheduled to be published in December 2014. 

The Generic Pharmaceutical Association has repeatedly blasted FDA’s November 2013 proposal as unworkable (see here), and recently released results of a survey showing a high preference among doctors, physician assistants, and pharmacists for FDA pre-approval of generic drug labeling changes.  Congressional opposition to FDA’s proposal also seems to be building.  Late last week, two lawmakers penned a letter to the Office of Management and Budget questioning FDA’s legal authority and cost-benefit analysis in issuing the proposed rule.  That letter follows a hearing and several other letters, some of which have already drawn FDA responses (see, e.g, here and here).

By Kurt R. Karst –      

FDA’s recent posting of two Warning Letters (here and here) to companies that failed to pay Generic Drug User Fee Amendment (“GDUFA”) facility user fees for Fiscal Year 2014 (“FY14”) – for a grand total of three GDUFA Warning Letters thus far (see our previous post here) – reminded us of a new interpretation the Agency has arrived at after having initially issued Refuse-to-Receive (“RTR”) letters for scores of ANDAs submitted to the Agency by various companies because a facility user fee was not timely paid.  FDA’s new interpretation of the GDUFA statute harkens back to the much-quoted statement from President Bill Clinton’s grand jury testimony in August 1998, arising out of the Monica Lewinsky scandal, that showed President Clinton questioning the use of the word “is”: “It depends upon what the meaning of the word ‘is’ is.”  Well, under GDUFA, the extent to which the severe penalties of that law apply to a company for which facility fees were not timely paid depends upon what the meaning of the word “new” is.     

GDUFA established four types of user fees that together generate funding for FDA each fiscal year.  The annual facility fee must be paid by both Finished Dosage Form (“FDF”) and Active Pharmaceutical Ingredient (“API”) manufacturers.  Facility fees are the most significant of all GDUFA user fees, and account for a large portion of annual GDUFA fee revenue.  The API and FDF facility fees are based on information submitted to FDA by generic drug facility owners through the so-called self-identification process. 

Once a facility owner has incurred a facility fee, the owner must pay that fee before the due date.  Although normally the due date is the first business day on or after October 1st of each year, when there’s a delay past October 1st of the enactment of an appropriations act to fund FDA (and that provides for the collection and obligation of fees), the due date is the first business day after the enactment of such an appropriations act.  That’s what happened in FY14.  Due to delayed passage of a FY14 appropriations bill, FDA operated under non-standard operating status from October 1, 2013 to October 17, 2013 (see our previous post here).  FDA returned to a standard operating status on October 17, when President Obama signed into law the Continuing Appropriations Act, 2014, funding the federal government at FY13 levels.  As such, the due date for payment of the FY14 facility fees was set at October 18, 2013.

Under GDUFA (FDC Act § 744B(g)(4)(A)(i)), failure to pay the facility fee within 20 calendar days of the due date (i.e., November 8, 2013 for FY14) results in the following:

[FDA] shall place the facility on a publicly available arrears list, such that no new [ANDA] or [Prior Approval Supplement, or “PAS”,] submitted on or after October 1, 2012, from the person that is responsible for paying such fee, or any affiliate of that person, will be received within the meaning of [FDC Act § 505(j)(5)(A)]. [(Emphasis added)]

Importantly, GDUFA defines the term “affiliate” to mean “a business entity that has a relationship with a second business entity if, directly or indirectly—(A) one business entity controls, or has the power to control, the other business entity; or (B) a third party controls, or has power to control, both of the business entities.”  In other words, if you are a large (or even a small or mid-size) generic drug manufacturer with several affiliates, which, in turn, have multiple FDF or API manufacturing facilities, you have to be particularly careful that all facility fees that are owed by those facility owners are timely paid, because the penalties from appearing on the arrears list (the current version is posted here) [http://www.fda.gov/forindustry/userfees/genericdruguserfees/default.htm] flow downstream to the the generic drug manufacturer and to all of its affiliates. 

FDA originally interpreted GDUFA such that any generic drug submission pending at the time that a facility was placed on the arrears list should be subject to the RTR penalty specified at FDC Act § 744B(g)(4)(A)(i).  That meant some companies (and their affiliates) received a stack of RTR letters from FDA’s Office of Generic Drugs (“OGD”) for all of their pending ANDAs and PASs stretching back to October 1, 2012, because there was a facility owned by one affiliate that failed to timely pay an applicable facility fee by November 8, 2013.  As you can imagine, that didn’t settle well with generic drug companies – particuarly if one of the RTR’d ANDAs was a first-to-file opportunity with 180-day exclusivity eligibility on the line.

In a world where generic drug submissions to FDA are promptly reviewed and received or acted on by OGD, the pain of receiving one or two RTR letters for recently submitted applications may not be that bad . . . . but that’s not yet the world in which we live.  Based on information published by FDA on its Paragraph IV Certifications List, OGD is still taking an initial filing (i.e., “receipt” in generic drug parlance) look at ANDAs submitted in early 2013.  With a bolus of nearly 600 ANDA submissions so far in June 2014, as recently reported by Bob Pollock (Lachman Consultants Blog), it may be quite some time until the backlog of ANDAs awaiting a filing decision is resolved.  That means companies need continue to be vigilant to ensure all facility fees are paid so that long-pending applications are not RTR’d . . . . unless FDA were to recognize a new interpretation of GDUFA that dampens the effects of the failure-to-timely-pay provision.  And it just so happens that that’s exactly what FDA has done. 

FDA has reconsidered its original position and has concluded that, in order to give the term “new” in the statutory provision (FDC Act § 744B(g)(4)(A)(i)) its proper effect, the statute should be interpreted to require RTR of an ANDA or PAS only if that application is submitted after the facility has been placed on the arrears list.  This new interpretation is not only more consistent with the intent of the provision, but it’s more fair.  FDA’s new interpretation should generally result in providing an opportunity for ANDA applicants that could be affected to assure that the facility fee is paid and the facility is removed from the arrears list before they proceed down the submission path, because they can refer to the arrears list before submitting an ANDA or PAS and thus know whether or not the application would be RTR’d on that basis. 

Ahhhh . . . but what about all of those pending ANDAs and PASs that we heard about that were RTR’d on the basis of FDA’s prior interpretation of the GDUFA statute?  FDA determined that they were improperly refused, rescinded the RTR letters, and reinstated their original submission dates.  All’s well that ends well.

By Jamie K. Wolszon –

In the past two months we have seen two newsworthy items in the Laboratory-Developed Test (“LDT”) world.  In June, the Defense Health Agency (“DHA”) announced that TRICARE, the U.S. health care program serving Uniformed Service members, retirees and their families, has launched a three-year demonstration program that would expand the LDTs potentially eligible for coverage.  Meanwhile, in May, the Combination Product Coalition (“CPC”) sent a letter to FDA Commissioner Margaret A. Hamburg that argues that FDA should regulate diagnostic kits and LDTs the same way, and that the current dual system is arbitrary and capricious.  Although the letter is framed in terms of equal treatment, since FDA is unlikely to deregulate in vitro diagnostic tests, it appears that the letter is intended to increase FDA regulation of LDTs. 

LDTs are diagnostic tests developed and performed by a laboratory.  They are widely used; among other tests, this category includes genetic tests, tests for rare conditions, and companion diagnostics.  Thousands of different LDTs are currently available, many of which are the standard of care.  Starting in 1992, FDA stated that LDTs were medical devices but that it generally was exercising enforcement discretion.  FDA announced in June 2010 that it was revisiting this years-long policy of exercising enforcement discretion over LDTs and was holding a public workshop to discuss the issue in July 2010.  FDA officials subsequently indicated that it was developing a plan to more actively regulate LDTs under a risk-based framework, to be issued for comment as guidance.  The recently enacted Food and Drug Administration Safety and Innovation Act (“FDASIA”), requires FDA to notify Congress at least 60 days prior to issuing a draft or final guidance on the regulation of LDTs.  The notice must include anticipated details of the action (see here). 

In June 2013, Hamburg renewed FDA’s call for more active FDA regulation of LDTs and touting the Agency’s risk-based framework for regulating LDTs that is “under development.”  Only two days after Dr. Hamburg’s comments, the American Clinical Laboratory Association (“ACLA”) submitted a Citizen Petition expressly requesting that FDA refrain from issuing draft or final guidance, or a proposed or final rule, regarding the Agency’s regulation of LDTs, and also asks FDA to respond to its Citizen Petition by explicitly confirming that LDTs are not devices under the Federal Food, Drug, and Cosmetic Act (“FDCA”). 

TRICARE Demonstration Project.  The TRICARE Management Authority (“TMA”), which prior to the creation of the DHA administered TRICARE, instituted a policy decision that generally required LDTs to receive FDA premarket (“PMA”) approval or 510(k) clearance before TMA would pay for LDTs.  As discussed above, FDA generally exercises enforcement discretion for LDTs, so it is rare for an LDT to be FDA approved or cleared.  As a result, TRICARE beneficiaries could not obtain coverage for almost all LDTs. 

On December 27, 2011, TMA announced a demonstration project that would allow individual laboratories to seek coverage for their LDTs for three years and, if the demonstration project was successful, possibly beyond.  However, the original demonstration project was limited to tests that had both a Centers for Medicare & Medicaid Services (“CMS”) national or local coverage determination and significantly informed clinical decision making for surveillance, surgical interventions, chemotherapy, or radiation therapy for cancer.  That demonstration program is ongoing; however, the new demonstration program expands the original demonstration program to include an LDT that DHA determines demonstrate “reliable evidence” as defined in the TRICARE regulations.  The new demonstration project also includes LDTs for rare disorders for which the test does not necessarily demonstrate “reliable evidence” as defined in the regulations.  TRICARE defines a rare disease as any disease or condition that has a prevalence of less than 200,000 persons in the United States.

In addition to LDTs for rare disorders and tests that demonstrate “reliable evidence,” the demonstration project will include LDTs for prenatal and preconception cystic fibrosis carrier screening, when provided in accordance with American Congress of Obstetricians and Gynecologists ("ACOG") guidelines. 

CPC Letter to Hamburg Advocating for Equal Treatment of LDTs and Diagnostic Kits.  The CPC sent the May 15, 2014 letter in response to ACLA’s Citizen Petition.  The CPC describes itself as an association of “drug, biologic, and device/diagnostics manufacturers dedicated to working with FDA to improve regulation of combination products.”  The letter does not provide a list of the companies that are members of the coalition. 

CPC asks FDA to create a single regulatory framework for diagnostic kits and LDTs, and argues that the current two-tier system is not legally or clinically viable.  CPC argues in its letter that the dual system does a disservice to patients and manufacturers: “If a more restrictive FDA-type system is needed to assure the safety and effectiveness of in vitro diagnostics, FDA’s failure to regulate LDTs is putting patients at risk.  Conversely, if CLIA regulation alone is sufficient, FDA is making IVD manufacturers waste billions of dollars each year complying with unnecessary requirements; dollars better spent developing new tests under a CLIA system without FDA oversight.”  The issue of LDT regulation is a long-standing one, and this letter probably will not spur the immediate issuance or release of a draft policy, but it helps to ensure that the controversy will continue.        

By Alan M. Kirschenbaum –

Today the Office of the Inspector General (OIG) of the Department of Health and Human Services issued a “Special Fraud Alert on Laboratory Payments to Referring Physicians.”  Despite the focus of the Special Fraud Alert on activities of laboratories, drug and device manufacturers would do well to heed the OIG’s warnings about one of those practices – registry payments. 

The Special Fraud Alert contains strong warnings that even registries with a public health benefit are not immune from prosecution under the Federal health care program antikickback law, if the registry is intended as a vehicle to reward or induce referrals.  The OIG cautions that “claims that Registries are intended to promote and support clinical research and treatment are not sufficient to disprove unlawful intent.  Even legitimate actions taken to substantiate such claims, including, for example, retaining an independent Institutional Review Board to develop study protocols and participation guidelines, will not protect a Registry Arrangement if one purpose of the arrangement is to induce or reward referrals.”  The Special Fraud Alert identifies a number of suspect registry characteristics that may be evidence of unlawful purpose.  Some of these are specific to laboratories, but others could easily be extrapolated to drug or device registries:

• The registry sponsor requires that physicians conduct a certain number of procedures in order to obtain compensation
• Compensation is on a per-patient or other basis that takes into account value or volume of referrals
• Compensation is greater than fair market value for the physicians’ efforts in collecting and reporting patient data
• The participating physicians’ efforts are not supported by timely submitted documentation
• The registry collects data only on the registry sponsor’s own product
• Participants are selected based on their prior or anticipated referral volume

The OIG also cautions that “carving out” Federal health care program beneficiaries (by paying physicians only for data collected on non-Federal beneficiary patients) may not protect the arrangement.

For drug and device manufacturers who conduct registries that have been required or requested by FDA, the OIG’s warnings should ordinarily not be of concern.  However, manufacturers conducting other registries should read this Special Fraud Alert and take note that even a well-designed  registry that generates useful scientific or treatment data may be at risk if there is evidence of a marketing motivation.

By James C. Shehan & Karla L. Palmer –

In a curious posting on Friday, June 20, 2014, FDA with little fanfare set forth its latest position on medical marijuana.   Amounting to little more than a statement of general support of scientific research on medical marijuana use, coming 18 years after California passed the nation’s first medical marijuana law, and with 22 states and the District of Columbia now allowing medical use, FDA’s statement is not exactly clear, not exactly bold, and is about as timely as Jeff Spicoli was for history class.

FDA’s latest position is also somewhat at odds with DEA’s refusal to grant a petition to reschedule marijuana due to a lack of adequate and well-controlled studies demonstrating safety and efficacy, which decision was upheld by the D.C. Circuit a little more than a year ago (and posted about here).  DEA staked that position notwithstanding over two hundred comments on the petition, many of which in fact addressed adequate and well-controlled studies.  DEA relied as it is required to do on HHS’s medical and scientific evaluation of medical marijuana use in denying the rescheduling petition (almost a dozen years after it was filed).  DEA stated that the limited existing clinical evidence was not adequate to warrant rescheduling.  Relying on HHS, DEA found there were no “adequate and well-controlled studies proving efficacy” of the use of marijuana in medical treatment.

FDA’s latest statement — cast as “advice to caregivers and patients“– begins with a cautionary heading likely borrowed from Reefer Madness: “Untested Drugs Can Have Unknown Consequences.”  The Agency then observes that there is a demand for “treatment options for unmet medical needs,” which has “[i]n some instances,” led patients and their caregivers to turn to marijuana for conditions such as glaucoma, AIDS wasting syndrome, neuropathic pain, cancer, multiple sclerosis, chemotherapy-induced nausea, and certain seizure disorders.  FDA acknowledges the significant scientific interest that exists for the use of marijuana for treatment of various medical conditions.  FDA also notes that it has approved one drug containing a synthetic version of an active substance present in marijuana and one drug containing a synthetic substance similar to marijuana compounds but not present in marijuana.

With this background, FDA summarizes the IND and NDA processes for studying and gaining approval for new drugs.  Interestingly, it also describes the expanded access process and declares its willingness to work with the patient and medical communities, as well as our “federal partners” to allow access to experimental treatments.  To our knowledge, expanded access has never been used for marijuana.

Turning to the likely point of the posting, — “FDA Supports Sound Scientific Research” – FDA asserts that it “has an important role to play in supporting scientific research into the medical uses of marijuana.” and expresses its support for “those in the medical research community who intend to study marijuana.” FDA also notes that it supports research into the medical use of marijuana through cooperation with the DEA and The National Institute on Drug Abuse (NIDA) within NIH.  It also refers to discussions with state officials in Florida, Georgia, Louisiana, New York and Pennsylvania about how their plans for medical research of marijuana and its derivatives can meet federal requirements and scientific standards.  The posting concludes with links to two other FDA documents: FDA and Marijuana: Questions and Answers, and Marijuana Research with Human Subjects.

Although FDA fails to mention that marijuana use – both medical and recreational – is legal in at least two states and being considered by others, there can be no doubt that state actions on medical and recreational marijuana and the conflict between state and federal laws and regulations have left the federal government in a difficult position.  And FDA’s public position in support of careful scientific research is certainly consistent with its mandate and history.  But again, coming 18 years after the states have moved forward on this topic and with hundreds of thousands of Americans already using medical  marijuana (not to mention the millions of recreational users), one questions whether this guidance comes too little and too late to matter.

For those of who are puzzled by the Jeff Spicoli reference in the first paragraph, we close with a relevant quote on timeliness from the 1982 classic film, “Fast Times at Ridgemont High.”  Mr. Hand, US history teacher: “What’s the reason for your truancy?”  Jeff Spicoli, student and habitual marijuana user: “Just couldn’t make it on time.”

By Kurt R. Karst –      

Although we’re not patent attorneys, we’re smart enough to know that the September 16, 2011 enactment of the Leahy-Smith America Invents Act (“AIA”) signaled a sea change in the patent world.  Indeed, the effects of the AIA were immediately felt in our FDA-regulated space – and specifically, the Hatch-Waxman space – with an AIA provision resulting in a patent term extension that effectively ended a decade-old dispute (see our previous post here).  Then we started to see signs that the AIA’s Inter Partes Review (“IPR”) provisions – an administrative patent challenge proceeding at the U.S. Patent and Trademark Office (“PTO”) before the Patent Trial and Appeal Board (“PTAB”) that serves as a parallel or alternative to district court litigation to adjudicate patentability of issued patents – might be of some utility to generic drug manufacturers (see our previous post here).  Indeed, just last week we saw what has been billed as the first IPR decision involving pharmaceutical-related patents (see here).  Now, we’ve just witnessed the first intersection of the AIA’s Covered Business Methods (“CBM”) petition review provisions and the Hatch-Waxman Amendments.  Earlier this week, generic drug manufacturers Amneal Pharmaceuticals, LLC, Par Pharmaceutical, Inc., and Roxane Laboratories, Inc. submitted a Petition to the PTAB challenging U.S. Patent No. 7,895,059 (“the ‘059 patent”), which is listed in the Orange Book for XYREM (sodium oxybate), and is titled “Sensitive drug distribution system and method.”  The challenge comes just about halfway through the lifespan of the AIA’s CBM provisions, which sunset on September 16, 2020. 

So what’s a “covered business methods patent” and how can the AIA’s CBM provisions be at all relevant to Hatch-Waxman?  (Hint: It involves Orange Book-listed patents covering a Risk Evaluation and Mitigation Strategies (“REMS”), though you might have already guessed that based on the ‘059 patent description above.) 

The AIA defines a CBM patent as any “patent that claims a method or corresponding apparatus for performing data processing or other operations used in the practice, administration, or management of a financial product or service, except that the term does not include patents for technological inventions.”  The CBM petition challenge process allows a party charged with infringement of a patent (which occurs nearly each day under Hatch-Waxman) to challenge that CBM patent through a petition process before the PTAB.  (The PTO’s webpage on the AIA’s CBM provisions is available here.)  “CBM was largely imagined as a proceeding for the ¬financial services industry,” according to one of our patent law cheat sheets put out by Sterne Kessler Goldstein & Fox PLLC, which firm (H. Keeto Sabharwal, Dennies Varughese, and Deborah Sterling) also filed the recent CBM challenge to the ‘059 patent.  “In light of some Supreme Court decisions, notably In re Bilski, Congress determined certain ¬financial services patents need a special proceeding to test patentability.”  

But ¬financial services industry patents are a far cry from pharmaceutical industry patents . . . . aren’t they?  The answer, by way of the recent challenge from Amneal, Par, and Roxane, seems to be “usually yes,” but in some cases – at least where there are patents covering a REMS – “sometimes no.”  That’s right, we’re talking about an argument that Orange Book-listed REMS patents fall under the CBM patent definition.  According to the Petition, which seeks cancellation of all 16 claims of the ‘059 patent:

The challenged claims simply recite methods for centralized distribution of retail goods, specifically drugs, through a central pharmacy that encompasses steps such as interfacing with financial businesses, such as insurance companies, in order to secure payment for the prescription, rendering them incidental to a financial product or service.  And these claims are directed to methods and not any technological invention.  The claims’ recitation of a generic computer processor does not change this conclusion.  Moreover, the claimed distribution methods are not novel or nonobvious and do not solve a technological problem with any technological solution.  CBM review is, therefore, appropriate.

Citing the U.S. Supreme Court’s 2012 decision in Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289, 1297 (2012), and the very recent decision in Alice Corp. v. CLS Bank Int’l, No. 13-298, 573 U.S. (2014), the Petitioners argue that the ‘059 patent claims “are merely drawn to abstract ideas, and nothing more, artfully drafted in an effort designed to monopolize the abstract idea itself.”  These are the type of claims the Supreme Court warned against, say Petitioners. 

The filing of the Petition is now a new front in a larger battle over REMS and generic competition issues.  It follows recent FDA citizen petition decisions (here and here) and antitrust litigation that recently (and once again) brought the Federal Trade Commission into the fray (here and here). 

By Ricardo Carvajal –

As widely reported in the press, several food industry trade associations sued the state of Vermont to overturn its recently enacted law requiring that a food “entirely or partially produced with genetic engineering” be labeled with the “clear and conspicuous words ‘produced with genetic engineering’” – with certain exceptions that we won’t delve into here.  That requirement is based in part on legislative findings that “genetically engineered foods potentially pose risks to health, safety, agriculture, and the environment.”  The requirement is intended to help consumers “make informed decisions regarding the potential health effects of the food they purchase and consume and by which, if they choose, persons may avoid potential health risks of food produced from genetic engineering.”

An allegation central to the complaint is that Vermont’s labeling requirement violates the First Amendment because it “compels manufacturers to use their labels to convey an opinion with which they disagree, namely, that consumers should assign significance to the fact that a product contains an ingredient derived from a genetically engineered plant.”  Indeed, as noted above, the law is premised in part on a finding that genetically engineered foods pose potential health and safety risks to which consumers must be alerted so that they can choose to avoid those risks.  The complaint notes that more than twenty years’ worth of federal government reviews have reached contrary conclusions – a contradiction that would seem to lie at the heart of the law’s potential vulnerability.

Setting aside the fact that Vermont’s perspective on the risks posed by genetically engineered foods is at odds with that of the federal government, Vermont’s perspective highlights a conundrum faced by opponents of genetic engineering: the more they emphasize the purported risks presented by genetically engineered foods as a means of justifying labeling requirements, the more the speech that they seek to compel takes on the character of a warning.  In that regard, we were reminded of recent litigation successfully challenging FDA’s regulation requiring graphic warnings for cigarettes (see here).  Obviously, those graphic warnings were qualitatively different from the words “produced with genetic engineering.”  However, from a manufacturer’s perspective, the intended underlying message is similar – in essence, “don’t buy this product.” 

Under what circumstances can the government constitutionally compel a manufacturer to convey such a message?  In the cigarette warning case, the DC Circuit put the question thusly:

[H]ow much leeway should this Court grant the government when it seeks to compel a product’s manufacturer to convey the state’s subjective – and perhaps ideological – view that consumers should reject this otherwise legal, but disfavored, product?

The court was able to side-step that question because FDA’s regulation did not survive the court’s Central Hudson analysis.  We’ll see if a permutation of that question resurfaces as the litigation over Vermont’s law moves forward.

By Kurt R. Karst –      

The so-called “drug lag” – i.e., the difference (or perceived difference some might say) in drug availability between the United States and other countries – was one of myriad reasons some folks back in the early 1990s thought it was necessary to enact the Prescription Drug User Fee Act (“PDUFA”) (see here).  After all, if sponsors paid user fees to FDA, the Agency could hire additional personnel and commit to speedier reviews, thus resulting in faster drug approvals – especially vis-à-vis foreign regulatory counterparts, and the European Union in particular. 

In 2012, as Congress was considering the fifth iteration of PDUFA, FDA declared the “drug lag” reversed.  Specifically, in testimony (here at pages 22-25) before the Committee on Energy and Commerce Subcommittee on Health, FDA Commissioner Margaret A. Hamburg, M.D. stated:

Since the enactment of PDUFA, FDA has steadily increased the speed of Americans’ access to important new drugs compared to the European Union (EU) and the world as a whole.  Of the 35 innovative drugs approved in FY 2011, 24 (almost 70 percent) were approved by FDA before any other regulatory agency in the world, including the European Medicines Agency.  Of 57 novel drugs approved by both FDA and the EU between 2006 and 2010, 43 (75 percent) were approved first in the United States.

Accompanying Dr. Hamburg’s testimony was the nifty table below showing that since the late 1990s, the U.S. has regularly led the world in the first introduction of new active drug substances (i.e., novel chemical or biological substances not previously approved to treat any disease).  

U.S. Share of New Active Substances (NAS) First Launched on the World Market

A bipartisan bill introduced last week by Representatives Steve Stivers (R-OH) and Tim Ryan (D-OH), however, implies that the “drug lag” – as well as a “medical device lag” – is alive and well.  Actually, it’s not really an implication, as remarks from Reps. Stivers and Ryan say there’s a lag: “Unfortunately, the United States FDA’s red tape causes delays of up to several years in approval for life-saving and life-changing medical treatments,” and “There are too many examples around the country of illness outbreaks that can be successfully treated with medications that have been approved by the EU and are delayed in the FDA approval process.”  

The answer – or, at least an answer – to the lag say the legislators is H.R. 4918, the Speeding Access to Already Approved Pharmaceuticals Act of 2014.  The two-page bill would peg FDA action to approval of a “pharmaceutical” in the European Union.  (The bill defines a “pharmaceutical” to mean a drug, a biological product, and a medical device.)  The meat of the bill is in a few lines on page two:

(g) EU-APPROVED PHARMACEUTICALS.—

(1) EXPEDITED REVIEW.—Beginning not later than 90 days after a new pharmaceutical is approved for marketing in the European Union, the Secretary shall, at the request of the sponsor of the pharmaceutical, facilitate the development and expedite the review of such new pharmaceutical under section 505 or 515 of this Act or section 351 of the Public Health Service Act, as appropriate.

A particular concern underlying the introduction of the Speeding Access to Already Approved Pharmaceuticals Act of 2014 seems to revolve around new sunscreen ingredients.  According to a press release from Rep. Stivers:

Currently it can take more than a decade for a product to get approved by the FDA.  For example since 2002, eight companies have submitted new and innovative ingredients for sunscreen, but all are still languishing in the FDA’s approval process. 

There are only three FDA-approved sunscreen ingredients available in the U.S which effectively guard against the sun’s UVA rays. Europe, on the other hand, has approved seven sunscreen ingredients that help protect against these harmful UVA rays.

Interest in speeding the approval of new sunscreens has been a hot topic.  As we previously reported, legislation was introduced in the Senate and House of Representatives in March 2014 – the “Sunscreen Innovation Act,” S. 2141 and H.R. 4250 – that would amend the law to include a process for the review of potential sunscreen active ingredients.  H.R. 4250 is advancing quickly through the legislative process.  Last Friday, the Energy and Commerce Committee approved the bill and it will now move on to the House floor. 

We haven’t asked anyone from FDA what they think of the Speeding Access to Already Approved Pharmaceuticals Act of 2014 (and even if we did, we’d likely get a “no comment”), but we suspect that the Agency would not take a shine to taking direction from Europe.  

By Jennifer D. Newberger –

Recognizing that even regulating certain software products as Class I medical devices is more regulation than necessary, FDA released a Draft Guidance document titled, “Medical Device Data Systems [MDDS], Medical Image Storage Devices, and Medical Image Communication Devices.”  This Draft Guidance essentially eliminates all regulatory obligations associated with those devices:  “[FDA] does not intend to enforce compliance with the regulatory controls that apply to MDDS, medical image storage devices, and medical image communications devices, due to the low risk they pose to patients and the importance they play in advancing digital health.”  Draft Guidance, at 4.  The regulatory controls no longer applicable to these types of devices include not only compliance with the quality system regulation (QSR), but also registration and listing and medical device reporting (MDR).  Though the Draft Guidance does not use the phrase “enforcement discretion,” it makes clear that FDA will in fact be exercising enforcement discretion with respect to these products.  This means that, while FDA considers these products to be medical devices, it will no longer regulate them as such.

The Draft Guidance notes that while these devices are exempt from premarket review, there are certain limitations to the exemption.  For example, 21 C.F.R. § 880.9(c) states that if an exempt device is used for assessing the risk of cardiovascular diseases or for use in diabetes management, the device is no longer exempt and must be submitted for premarket review.  The Draft Guidance eliminates these limitations to the exemption, and states that, “to the extent that these limitations apply, FDA does not intend to enforce compliance with regulatory controls for MDDS intended to be used in a system for assessing the risk of cardiovascular diseases (21 CFR 880.9(c)(4)) or for use in diabetes management (21 CFR 880.9(c)(5)).”  Draft Guidance, at 7.  This means that a manufacturer may market an MDDS, medical image storage device, or medical image communications device for assessing the risk of cardiovascular diseases or for use in diabetes management, and that device would not be subject to premarket review or any other regulatory controls.

Finally, the Draft Guidance proposes changes to the Mobile Medical Applications Guidance (Mobile Apps Guidance) released on September 25, 2013 (see our previous post here).  The changes are intended to reflect FDA’s position that it will be exercising enforcement discretion over these products.  For example, the Mobile Apps Guidance, as released, included an app that displays, stores, or transmits patient-specific medical device data as one that would be regulated by FDA.  The Draft Guidance proposes elimination of this example.  The revisions to the Mobile Apps Guidance would also make clear that apps subject to FDA’s enforcement discretion include those that assess the risk of cardiovascular diseases or are intended to be used in diabetes management.

By eliminating the regulatory obligations of these low-risk products, FDA seems to be acknowledging that it cannot reasonably regulate all, or even a majority, of marketed software products, and its resources must be dedicated to those that present a potentially higher risk to patients.  Software that does not analyze data or make patient-specific recommendations, but merely presents, retrieves, and displays data is not among those higher-risk products.  It is refreshing to see FDA take this risk-based approach, and hopefully it will continue to do so as it contemplates regulation of additional software products, such as clinical decision support software.

By Larry K. Houck –

Deputy Assistant Administrator Joseph Rannazzisi, Office of Diversion Control, Drug Enforcement Administration (“DEA”), told the House of Representatives Energy and Commerce’s Subcommittee on Oversight and Investigations on April 29, 2014 that his agency “has steadily increased the frequency of compliance inspections” of manufacturers, distributors, pharmacies, importers, exporters and narcotic treatment programs.  Statement of Joseph T. Rannazzisi, Deputy Administrator, Office of Diversion Control, Drug Enforcement Administration, Before the Subcommittee on Oversight and Investigations Committee on Energy and Commerce, U.S. House of Representatives, “Examining the Growing Problems of Prescription Drug and Heroin Abuse,” Apr. 29, 2014.  We can attest that Mr. Rannzzisi’s assertion is not only accurate, but understated.  The current DEA cyclic inspections are more frequent and more in-depth as well.

Many aspects of DEA inspections are beyond registrants’ control, but there are certain actions that registrants can and should take to prepare for and manage the inevitable DEA inspection.  This article offers practical guidance on some of those actions. 

Non-practitioner registrants (manufacturers, distributors, importers, exporters and narcotic treatment programs) can expect to be inspected about once every three years, and Drug Addiction Treatment Act (“DATA”)-waived practitioners approximately once every five years.  (DATA-waived practitioners are physicians administering, dispensing, and prescribing specific FDA-approved controlled substances for narcotic treatment.  DEA-registered physicians who apply and are qualified pursuant to DATA are issued a waiver, and are then able to conduct maintenance and detoxification treatment using specifically approved schedule III, IV, or V narcotic medications for either 30 or 100 patients at any one time.)  Registrants must understand that although the diversion investigators who conduct the inspections are within DEA’s Office of Diversion Control, the regulatory arm governing legitimate controlled substance handlers, the focus of the Agency, and thus of the investigators, is primarily law enforcement.  Diversion investigators typically prepare for the inspections by reviewing previous inspection reports and Automation of Reports and Consolidated Orders System (“ARCOS”) data (to the extent available).  Investigators will also consider areas of prior non-compliance during the current inspection to ensure that registrants have remedied past deficiencies.

A.  Scope

The federal Controlled Substances Act (“CSA”) authorizes DEA to inspect “controlled premises,” which the CSA defines as places where registrants “may lawfully hold, manufacture, distribute, dispense, administer, or otherwise dispose of controlled substances or listed chemicals or where records relating to those activities are maintained.”  21 U.S.C. § 880(a)(2).  They can inspect and copy required records and reports; inspect finished and unfinished drugs, equipment, containers, labeling, processes and controls.  Investigators may inventory controlled substances on-hand and take samples.  They are not authorized to inspect financial data, sales data other than shipment data, or pricing data unless the registrant provides written consent.

B.  Procedures 

Diversion investigators arrive unannounced.  They must present their DEA credentials and a written notice of their inspection authority.  At least two investigators must be present, but inspection teams may include DEA special agents or officers from other federal or state agencies.  The investigators ask the responsible employee for informed consent by having them sign a Notice of Inspection (“DEA Form-82”).  Registrants may withhold consent or, if given, may withdraw consent at any time.  Withholding or withdrawing consent will require the investigators to obtain an administrative inspection warrant or search warrant from a federal magistrate.

The investigators explain the purpose and scope of the inspection.  Their questions may include inquiries about the officers and employees who have access to controlled substances.  They may walk through the facility upon arrival looking for obvious violations.

C.  Accountability Audit

Registrants must account for all of the controlled substances that they receive and handle; therefore, the investigators likely will conduct an accountability audit of a number of controlled substances, usually at least two drugs in each schedule for a six-month time period, at a minimum.  The investigators begin with a physical count conducted by the registrant — usually a biennial inventory — as the starting point for the audit. 

The accountability audit allows the investigators to determine whether a registrant has maintained complete and accurate records, and thus maintained effective controls against diversion.  The accountability audit will indicate any variance in the quantity of controlled substances that the registrant can account for versus what it should be able to account for during the time period.  The investigators try to balance the controlled substances on-hand at the beginning of the audit period plus receipts against dispositions and quantities on-hand at the end of the period.  Ideally the audit balances, but a negative variance can indicate incomplete or inaccurate records, or a loss.  A positive variance can indicate recordkeeping errors.  There is no “acceptable” discrepancy range for DEA purposes.  Registrants should regularly conduct internal audits to disclose any discrepancies and detect any possible losses without the presence of DEA investigators.

D.  Records and Reports

Diversion investigators also inspect and review required controlled substance records and reports to ensure that they are complete, accurate and available dating back the required two year period.  Registrants with automated records can offer to generate a report of receipt and disposition transactions for the audit period.  Each transaction on the automated report should correspond to a particular Official Order Form (“DEA-222”), invoice, packing slip or other primary record.  Investigators will typically compare and verify a number of transactions on the report with the primary records.  The investigators review DEA-222s to ensure that they have been maintained, are properly executed, complete and accurate, and that orders were filled within sixty days of the date the customer completed them.  Investigators review the registrant’s Powers of Attorney to ensure that individuals executing DEA-222s are properly authorized to do so.  Investigators also review invoices and packing slips to ensure that the registrant has maintained them as required and that those also are complete and accurate.  Investigators verify random transactions with the firm’s vendors and customers to ensure that the transactions occurred and the records are accurate. 

E.  Security

Registrants must provide effective controls to guard against theft and diversion of controlled substances, and must employ specified security (set forth in applicable DEA regulations) depending on their business activity and the type and quantities of controlled substances they handle.  The investigators inspect the overall security system and individual components thereof to ensure that all components meet specifications and are operational.  The investigators test the alarm system by activating a number of sensors.

Diversion investigators may provide some feedback at the end of an on-site inspection.  They likely cannot provide their final conclusions, but can recommend what the registrant can do to comply with the CSA and its implementing regulations.  Registrants may not receive formal notice of the inspection results, audit results and DEA’s intended enforcement action, such as a Letter of Admonition, informal or formal hearing, civil penalty, or administrative action, for a number of months or longer.

F.  Preparing for and Managing Cyclic Inspections

Registrants should consider implementing the following in preparing for and managing cyclic inspections:

1. Designate a primary employee to manage controlled substance operations, and a back-up employee and team to assist him or her.
2. Maintain, review and regularly update controlled substance policies and procedures to ensure that they comply with DEA requirements.
3. Draft detailed policies and procedures mandating how the registrant should manage DEA inspections.
4. Conduct periodic mock DEA inspections comprising an accountability audit, and record, report and security reviews by a third-party who is not responsible for daily controlled substance operations.  The inspections ensure compliance and instill confidence in employees during actual DEA inspections.  Random or periodic audits help discover internal thefts or losses.
5. Maintain an updated list of names, home addresses, dates of birth and social security numbers of officers and responsible employees to provide to investigators.
6. File required controlled substance records and reports daily in one location.  Review the file weekly to ensure records are current, complete and accurate.  Maintain required records and reports for at least two years unless required to be maintained by state law for a longer period of time.
7. Maintain controlled substances in secure areas at all times except during processing, packaging, labelling or conveying to the secure loading area.  Return controlled substances to secure areas at the end of the workday pursuant to company policies addressing the handling of controlled substances.
8. Ensure that controlled substances awaiting return or destruction are properly secured and documented.
9. Be diligent about establishing, maintaining and documenting new and current customer due diligence and suspicious order monitoring and reporting.  Ensure that policies and procedures are up to date and frequently revisited.
10. Change locks or key card access, and update lists of employees who have authorized access to the warehouse, cage and vault after relevant personnel changes.
11. Inspect security system components often.  Repair broken or inoperable components immediately.  Maintain documents and materials related to the security system and its components for future reference.
12. Upon commencement of an inspection, the responsible employee should greet the investigators immediately.  Review each investigator’s credentials and obtain their business cards.  Determine whether the inspection is a routine cyclic inspection or if there is another specific reason for the inspection.  Review the Notice of Inspection presented by the investigators.
13. Take detailed notes of all observations, suggestions and recommendations made by the investigators.  If the employee cannot take contemporaneous notes, they should write them down immediately afterwards.
14. Ask the investigators questions about any aspect of the inspection and audit.  Employees should answer the questions asked, and respond when they know the correct information.  They should not speculate.
15. Do not overlook the drugs in the morgue awaiting destruction or return.
16. Understand the methodology the investigators use to conduct their accountability audit.  Conduct an internal simultaneous audit of the investigators’ audit.
17. Make sure that the investigators understand the recordkeeping system that the company uses.
18. Apprise investigators of limitations of automated transaction reports.  Advise them if such reports are not primary records.
19. Photocopy all records the investigators take, make copies of, review or specifically raise questions about during the investigation.
20. If the investigators take drugs or original records off-site, obtain a DEA receipt (“DEA Form 12”) listing each item.
21. Inform the investigators immediately if they do not have accurate counts and inventories of all the drugs they are auditing, or if they are missing relevant records or reports.
22. Request a final discussion or exit interview with the investigators.  Designate an employee to take detailed notes. 
23. Provide unavailable information and records or reports requested by the investigators as soon as possible if appropriate to do so.

G.  Conclusion

DEA diversion investigators take the lead as to how they conduct cyclic inspections, but registrants can and should proactively prepare for and manage the inspection and audit elements within their control.  Implementing the recommendations provided here will help registrants prepare for and manage the inspection and audit process.

By Kurt R. Karst –      

Interest in and efforts to address shortfalls in the inclusion of women in clinical trials and clinical research, and differences in the sexes in drug development are not new.  There’s the National Institutes of Health (“NIH”) Revitalization Act of 1993, which directed the NIH to establish guidelines for inclusion of women and minorities in clinical research, as well as FDA’s 1993 “Guideline for the Study and Evaluation of Gender Differences in the Clinical Evaluation of Drugs.”  Less than a decade later, the U.S. Government Accountability Office (“GAO”) issued two reports – in May 2000 (“NIH Has Increased Its Efforts to Include Women in Research”) and August 2001 (“Women Sufficiently Represented in New Drug Testing, but FDA Oversight Needs Improvement”) – addressing the issues.  But a 60 Minutes report last February highlighting how the drug AMBIEN (zolpidem) metabolizes differently in males and females reignited interest in the topic. 

Shortly after the 60 Minutes piece aired, the NIH announced that it will change its policies to ensure that female animals and cells are included in research and sex differences analyzed, and members of Congress penned letters to FDA and the GAO (here and here) seeking further information.  These moves were  promptly applauded (here and here) by the Society for Women’s Health Research, which has also held a congressional briefing on the need for sex- and gender-based research.  Other organizations have also recently pressed for sex-specific clinical research (see, e.g., here). 

Then the U.S. Senate in its Fiscal Year 2015 FDA Appropriations Bill & Report (see our previous post here) directed FDA to look closer at gender differences in clinical research:

Inclusion in Clinical Trials– Research has shown that gender differences, as well as differences based on age, race, or other factors, may contribute to differences in the safety and efficacy of drugs, biologics, and devices.  The Committee directs FDA to encourages diverse participation, including women, racial and ethnic minorities, and the elderly, to help assure that clinical trials are representative of those individuals who ultimately will use these medical products, and that the products will be safe and effective for people in these demographic subgroups.  The Committee urges the FDA to issue the Action Plan required by section 907 of the Food and Drug Administration Safety and Innovation Act [(“FDASIA”)] and provide a timeline for implementation of the actions FDA will take, in cooperation with industry stakeholders, to ensure that women, minorities, and others are appropriately represented in clinical research, that meaningful subgroup analyses of clinical trials are conducted, and that subgroup specific clinical trial results are made publically available in an accessible and timely manner.

By way of background, FDASIA 907 requires FDA to publish an action plan on the Agency’s website with recommendations on improving the completeness and quality of data analyses on demographic subgroups, including such data in labeling, and making such data available to patients and providers.  FDASIA 907 also required FDA to issue a report describing the participation of demographic subgroups (sex, age, race, and ethnicity) in clinical studies submitted to FDA in marketing applications.  FDA issued that report in August 2013 (available here).

Now, two members of Congress are ratcheting up debate on the “sex matters” issue.  Earlier this week, Representatives Jim Cooper (D-TN) and Cynthia Lummis (R-WY) announced the introduction of H.R. 4879, the “Research for All Act of 2014.”  The bill would require FDA to “review and develop policies, as appropriate, to ensure that the design and size of clinical trials for products granted expedited approval pursuant to [FDC Act § 506] are sufficient to determine the safety and effectiveness of such products for men and women using subgroup analysis.”  Indeed, the bill would amend FDC Act § 506 (“Fast Track Products”) to add a new subsection, titled “Expedited Review of Drugs and Biological Products To Provide Safer or More Effective Treatment for Males or Females,” under which a drug sponsor could request that FDA designate a product intended to avoid serious adverse events or to treat a serious or life-threatening disease or condition “as an expedited product to provide safer or more effective treatment for males or females.”  Such a designation would provide early and frequent communication with FDA, as well as so-called rolling review of marketing applications.

The Research for All Act of 2014, which was introduced on the same day that some lawmakers sent a letter to NIH requesting that it make demographic data public for all clinical trials, would also amend the PHS Act to require that basis research involving cells, tissues or animals to include both male and female cells, tissues, or animals; update guidelines for clinical and basic research to reflect the growing understanding that sex differences matter, and to ensure better enforcement of those guidelines by NIH, among other things; and require the GAO to update the May 2000 and August 2001 reports mentioned above.

The Research for All Act of 2014 is one of a growing number of FDA and drug-related bills pending in Congress (see our FDA Legislation Tracker).  Although it is unlikely that most of them will be enacted by the time the 113th Congress ends, we may see some of them crop up again as folks seek to lay the groundwork for the next iteration of UFA (User Fee Act) reauthorization.

By Kurt R. Karst –     

After years of relative quiet, the Orange Book list of exclusivity terms has gotten quite a workout over the past year with the addition of several new terms to account for new non-patent marketing exclusivities.  First there was the addition of “NCE*” exclusivity, defined as “NEW CHEMICAL ENTITY (AN ENANTIOMER OF PREVIOUSLY APPROVED RACEMIC MIXTURE. SEE SECTION 505(U) OF THE FEDERAL FOOD AND DRUG COSMETIC ACT),” that FDA created after the approval of NDA No. 204168 for FETZIMA (levomilnacipran) Extended-release Capsules, 20 mg, 40 mg, 80 mg and 120 mg (see our previous post here).  Then there was the addition of “RTO*” and “RTO**” exclusivities, defined as “OTC USE FOR WOMEN AGES 15 AND 16” and “OTC USE FOR WOMEN 14 AND BELOW,” respectively, that FDA created to account for various supplemental approvals under NDA No. 021998 for PLAN B One-Step (levonorgestrel) Tablets, 1.5 mg (see our previous post here).  Now that FDA has approved the first drug product designated as a Qualified Infectious Disease Product (“QIDP”), the Agency has once again added to the Orange Book list of exclusivity terms.  The term “GAIN” was added to the Orange Book Cumulative Supplement last week in relation to NDA No. 021883 for DALVANCE (dalbavancin HCl) Lyophilized Powder for Injection, 500 mg.  FDA approved DALVANCE on May 23, 2014 in the treatment of acute bacterial skin and skin structure infections.  With a period of NCE exclusivity that expires on May 23, 2019, but that is extended under the Generating Antibiotic Incentives Now Act (“GAIN Act”) by an additional 5 years to May 23, 2024, the GAIN exclusivity FDA granted for DALVANCE is the latest expiring period of non-patent exclusivity ever listed in the Orange Book (not to mention the longest period of exclusivity that FDA has granted for a drug product in decades – see FDC Act § 505(j)(5)(F)(i)). 

The GAIN Act was enacted as Title VIII of the 2012 FDA Safety and Innovation Act (“FDASIA”) and is intended to encourage the development of antibacterial and antifungal drug products that treat pathogens that cause serious and life-threatening infections.  The GAIN Act builds on provisions included in the 2007 FDA Amendments Act intended to improve antibiotic access and innovation, and addresses
issues raised since the enactment of FDAAA (see here).  (Legislation currently pending in Congress – the Antibiotic Development to Advance Patient Treatment Act of 2013, or “ADAPT Act” – is viewed as successor legislation to the GAIN Act that would further promote antibiotic drug development and approval (see our previous post here)).  After holding a public meeting in December 2012, FDA proposed a list of qualifying pathogens in June 2013, and finalized that list earlier this month.  In addition to the exclusivity bonus, QIDP-designated products are also eligible for designation as a fast-track product and for priority review consideration.

With respect to marketing exclusivity, the GAIN Act amended the FDC Act to add Section 505E, which, among other things, grants an additional 5 years of marketing exclusivity upon the approval of an NDA for a drug product designated by FDA as a QIDP.  Thus, for a QIDP, the periods of 5-year NCE exclusivity (FDC Act §§ 505(c)(3)(E)(ii) and (j)(5)(F)(ii))), 3-year new clinical investigation exclusivity (FDC Act §§ 505(c)(3)(E)(iii)-(iv) and 505(j)(5)(F)(iii)-(iv)), and 7-year orphan drug exclusivity (FDC Act § 527) become 10 years, 8 years, and 12 years, respectively.  (Pediatric exclusivity granted pursuant to FDC Act § 505A would extend the various exclusivity periods by 6 months.)  In addition, for a QIDP with NCE exclusivity, the period during which an ANDA containing a Paragraph IV certification to an Orange Book-listed patent on the QIDP cannot be submitted is extended from 4 years after QIDP NDA approval to 9 years after approval.  Curiously, the GAIN Act does not specifically extend the 30-month stay period under FDC Act §§ 505(c)(3)(E)(ii) and (j)(5)(F)(ii)) from 7.5 years after NCE NDA approval to 12.5 years after QIDP NCE NDA approval.  In contrast, the statute's pediatric exclusivity provisions at FDC Act § 505A do specifically extend that period by 6 months.

There are some limitations on GAIN exclusivity.  The statute limits the exclusivity extension such that it does not apply to the approval of:

1. a supplement to an application under [FDC Act § 505(b)] for any [QIDP] for which [a GAIN] extension . . . is in effect or has expired;
2. a subsequent application filed with respect to a product approved under [FDC Act § 505] for a change that results in a new indication, route of administration, dosing schedule, dosage form, delivery system, delivery device, or strength; or
3. a product that does not meet the definition of a [QIDP] under [FDC Act § 505E(g)] based upon its approved uses.

The exclusivity record attained with the approval of DALVANCE might not last too long.  Future GAIN Act approvals are on the horizon (see here).  In addition, Congress is debating the creation of new and longer exclusivity periods (see here), such as under the Modernizing Our Drug & Diagnostics Evaluation and Regulatory Network Cures Act of 2013, or “MODDERN Cures Act of 2013” (see here and here).

GTCbio recently announced that it will be holding the 4th Annual CNS Diseases World Summit from September 18-19, 2014 in San Francisco, California.  The summit consists of two individual conferences that will run in parallel: (1) the 7th CNS Partnering & Deal-Making conference; and (2) the 8th Neurodegenerative Conditions Research & Development conference.   

Sessions and panel discussions for the 7th CNS Partnering & Deal-Making conference include:

• New Approaches to Funding in the CNS
• Private/Public Partnerships in Neuroscience Research
• Joint Session with co-located Neurodegenerative Conditions Research & Development Conference: Rare CNS Diseases
• Partnering & Licensing in the CNS
• Up & Coming Trends and Other Considerations in Neuroscience
• Investment Opportunities with Venture Capital
• Private/Public Partnerships to Advance Research
• Regulatory Considerations and Challenges in the CNS
• New Partnership Structures in CNS R&D

Sessions for the 8th Neurodegenerative Conditions Research & Development conference include:

• Novel Therapeutic Targets and Approaches in Alzheimer's Disease
• Drug Mechanisms and Treatments in Parkinson’s Disease
• New Approaches and Treatments in Neurodegenerative and Neuropsychiatric Conditions
• Joint Session with CNS Partnering & Deal-Making Conference: Rare CNS Diseases
• Biomarkers: Translation from Discovery to Clinical

Hyman, Phelps & McNamara, P.C’s David B. Clissold is scheduled to present at the conference.  As such, we’re able to offer FDA Law Blog readers a special 25% discount off of the regular price.  To obtain the discount, please use colleague code HPMCNS25 when registering for the conference. 

By Jeffrey N. Wasserstein –

As we previously noted, waiting for FDA to issue social media guidances was a little like Waiting for Godot. 

Well, Godot has returned and FDA finally released two long awaited draft guidances relating to social media, one relating to the presentation of risk information and one relating to correcting misinformation.  These are so overdue, that if they were library books, FDA would have had its library card revoked years ago.  FDA initially promised these in 2010.

If I were to tweet a summary of FDA’s recently released draft guidance titled “Guidance for Industry: Internet/Social Media Platforms with Character Space Limitations – Presenting Risk and Benefit Information for Prescription Drugs and Medical Devices” (the “Risk Guidance”) it would be a very brief tweet, well within the maximum 140 characters: “FDA to industry: Nothing’s changed #stuckin20thcentury”.   The Risk Guidance can best be summed up by FDA’s statement:

Regardless of character space constraints that may be present on certain Internet/social media platforms, if a firm chooses to make a product benefit claim, the firm should also incorporate risk information within the same character-space-limited communication. The firm should also provide a mechanism to allow direct access to a more complete discussion of the risks associated with its product.  (Risk Guidance at 5).

In other words, each tweet or sponsored link needs to incorporate whatever claims the company wishes to make (which must be accurate and non-misleading) as well as risk information (including all risk concepts from a boxed warning, all risks known to be fatal or life-threatening, and all contraindications from the approved product labeling.)   Each tweet would also need to include a hyperlink that links to a more complete discussion of risk information.  Note that the link cannot lead to a promotional webpage or even the product labeling, but rather must lead to a page that is (hopelessly) “devoted exclusively to the communication of risk information about the product.”  (Risk Guidance at 10).  FDA encourages companies to use links that make it clear that it leads to risk information, although it will not object to URL shorteners, such as tinyurl or bit.ly.  FDA does permit additional links to be provided, such as to the product homepage or PI, assuming there’s enough room.

Ok, so that’s fine, right?  Still plenty of room to make promotional claims?  Not so fast, sport.  Additionally, FDA requires companies to include both the proprietary and established names for drugs within the tweet or sponsored link.  Then, on the hyperlink to the risk information mentioned above, the communication should include both the brand and established name, as well as at least one dosage form and quantitative ingredient information in conjunction with the brand and established names.  In a nod to teenagers everywhere, FDA acknowledged that commonly recognized linguistic symbols may be substituted for words, such as “&” for “and”, as well as abbreviations, such as HCl for hydrochloride.  However, FDA did not address the use of emoticons or LOL and OMG. 

FDA’s example of a permissible tweet is “NoFocus (rememberine HCl) for mild to moderate memory loss-May cause seizures in patients with a seizure disorder www.nofocus.com/risk”.  (Risk Guidance at 14).  Six characters to spare!  And this is a drug that has very few risks, apparently.  Similarly, for an example of a Google sponsored link, three of the six links in the ad that lead to specific parts of the promotional website deal with risk and safety information.  The real takeaway from this Draft Guidance comes early on, when FDA states:  “If an accurate and balanced presentation of both risks and benefits of a specific product is not possible within the constraints of the platform, then the firm should reconsider using that platform for the intended promotional message (other than for permitted reminder promotion).”

Leaving the snark aside (temporarily, we still have another draft guidance to get through!), what FDA is saying is that each space-limited communication needs to adhere to the rules relating to promotional labeling.  This is no real surprise.  While those of us who watch the issue closely would have liked to have seen some out of the box thinking and creativity, this draft guidance is consistent with advice that most regulatory attorneys and consultants have given (see Wasserstein, The Regulation of Social Media: Whither FDA? at 7-9 in Using Social Media in FDA-Regulated Industries:  The Essential Guide (FDLI 2010).  The Risk Guidance doesn’t open any doors, but it might make companies that have drug or medical device products with relatively simple risk profiles more comfortable in tweeting very basic product related tweets.  Alternatively, the benefits claims can be broken up into multiple tweets, provided each is accompanied by the appropriate balancing information, product names, and hyperlinks.

Turning now to the draft guidance titled “Guidance for Industry:  Internet/Social Media Platforms: Correcting Independent Third-Party Misinformation About Prescription Drugs and Medical Devices” (we’ll call this one the “Misinformation Guidance”), we encounter a little more flexibility from FDA.  In the Misinformation Guidance, FDA makes clear that companies do not have obligations to correct misinformation created by third parties, often called User Generated Content, or UGC.  However, if a company voluntarily corrects misinformation in a truthful and not misleading manner, FDA will not object if the corrective information does not satisfy other regulatory requirements regarding labeling and advertising.  (Misinformation Guidance at 3).  In other words, if a firm corrects misinformation about the indication or efficacy, but does not include any safety or risk information, FDA will not take regulatory or enforcement action.

The first question addressed is whether the draft guidance applies to the correction of misinformation.  FDA makes clear that the draft guidance does not apply to corrections of misinformation made by the company itself or to UGC on a company-moderated and controlled discussion group, such as where the company removes or edits negative posts about its products and adds positive commentary.  The company, by doing so, has exerted control over the UGC.  However, FDA clarified that companies are not responsible for correcting misinformation found in UGC about their products when the UGC is truly independent of the firm.  When FDA made a similar statement in a prior draft guidance relating to submission to FDA of real time social media interactions, we noted that “this does not address the issue of whether a regulated company would need to correct misinformation or off label discussions placed on site or platform controlled by the company.”  Either we are more widely read by FDA than we thought, or FDA had already been thinking along the same lines, so that issue has now been laid to rest.

So, what can companies do to correct misinformation in a way that need not comply with promotional labeling and advertising regulatory requirements?  In brief, they should address the misinformation and not use it as a springboard to engage in promotional messaging.  The correction should be posted in the same area or forum or should reference the area where the misinformation is found.  Companies can either post directly (if permitted) or notify the site owner of the misinformation.  In all cases, the company should disclose that the person making the communication is a company employee.  Although risk and other information about the product isn’t required to be included in the correction if not relevant, the approved PI should be included either via PDF or a link to the approved labeling.  The correction should be limited to the scope of the misinformation.

Companies have often been reluctant to monitor third party sites lest they be held responsible for all the content on the site.  FDA stated that if the company is correcting misinformation in part of the forum or site, it should identify the section of the forum or site it is addressing and correct all the misinformation (both positive and negative) within that section.  The company is not responsible for the site other than the clearly defined portion it identifies.  (Misinformation Guidance at 7). 

Another concern companies previously had was that once it tried to correct misinformation, would they be responsible for continuing to monitor the site?  (I’ve heard that stated by FDA’ers at public meetings in the past.)  The Misinformation Guidance makes clear that FDA does not expect companies to continue to monitor the website or forum.  (Misinformation Guidance at 8).

Finally, FDA does not expect companies to submit corrections of misinformation to FDA, but does recommend that companies keep records in case FDA has questions.  The records should include the content of the misinformation, where it appeared, the date it appeared, what corrective information was provided and when the corrective information was provided.

Companies have 90 days from the date of publication of in the Federal Register to provide comments to the draft guidances (written or electronic submissions are both permitted, but not tweets).  So, if you don’t have any exciting summer plans, this summer might be a good time to submit comments on these draft guidances!