By Jeffrey K. Shapiro & Jessica A. Ritsick –

Under FDA’s regulations (10 C.F.R. § 10.75), the decision of an FDA employee (other than the Commissioner) is subject to supervisory review in four circumstances: (1) when an employee so requests; (2) when a supervisor initiates review; (3) when an interested person outside the agency so requests; and (4) when delegations of authority so require.  Id. § 10.75(a)(1)-(4).  Those in industry know, of course, that appeals can be triggered by interested persons outside the agency (circumstance #3, above).  But there also can be appeals pursuant to an employee’s request (circumstance #1, above). 

On September 4, 2012, CDRH released internal Standard Operating Procedures ("SOP"), titled "Resolution of Internal Differences of Opinion in Regulatory Decision-Making," to explain how to resolve internal differences of opinion in making regulatory decisions, implementing 21 CFR § 10.75 “for internal review of CDRH decisions, as it applies to supervisory review of regulatory decisions on the initiative of Center employees in the process of reaching those decisions.” 

One can imagine such appeals occurring in a situation where an employee vehemently disagrees with a decision either favorable or unfavorable to a firm.  Thus, those in industry do have some stake in the procedure governing FDA internal appeals. 

Interestingly, the SOP permits an employee to approach CDRH’s Ombudsman to discuss the situation if the employee is uncomfortable with approaching management.  The SOP gives the Ombudsman three additional duties: (1) reviewing the dispute (called the “Initiation Memo”), and determining if the dispute moves up the chain to higher management or if it is dead in the water; (2) suggesting alternative ways to resolve the dispute beyond the formal SOP procedures; and (3) if he sees fit, activating accelerated dispute review when an initiator believes the dispute “may have a significant and immediate impact on the public health.”  None of these duties are in his job description, at least according to FDA’s website, which says the Ombudsman’s duty is to investigate “complaints from outside FDA and [facilitate] the resolution of disputes between CDRH and the industry it regulates” (emphasis added).  On the other hand, making use of the Ombudsman in sensitive internal disputes does likely fall within the Ombudsman’s core competency.

Also interesting in the SOP is its allowance for use of outside experts in resolving disputes.  “Reference to outside expertise may consist of an advisory panel meeting or a homework assignment to selected Special Government Employees (SGEs) with relevant expertise.”  This use of outside experts could potentially conflict with 21 CFR § 10.75(d), which states:  “Internal agency review of a decision must be based on the information in the administrative file.  If an interested person presents new information not in the file, the matter will be returned to the appropriate lower level in the agency for reevaluation based on the new information.”  Thus, it would seem possible that bringing in an outside expert to lend his or her expertise to resolve a dispute—a dispute of scientific, clinical, or regulatory opinion—would be “new information not in the file,” such that the issue should be bumped back down the chain and reevaluated, as opposed to the up-the-chain review prescribed in the SOP. 

FDA might argue that “interested person” refers to an interested person “outside the agency” and that the requirement does not apply to internal employee appeals.  However, the phrase “interested person outside the agency” appears elsewhere in this short supervisory appeals regulation, but not here.  Thus, it could be argued that FDA knew how to specify whether an interested person was within or outside the agency, and in this case, did not limit the “no new information” requirement to persons outside the agency.

By Kurt R. Karst –      

Just weeks after Federal Trade Commssion (“FTC”) Chairman Jon Leibowitz signaled in a speech that the Commission would appeal to the U.S. Supreme Court the U.S. Court of Appeals for the Eleventh Circuit’s April 2012 ruling (and subsequent July 2012 denial of the FTC’s Petition for Rehearing en banc) affirming a February 2010 decision by the U.S. District Court for the Northern District of Georgia largely dismissing multidistrict litigation brought by the FTC (and certain private plaintiffs) challenging certain drug patent settlement agreements in which Solvay Pharmaceuticals, Inc. (“Solvay”) allegedly paid some generic drug companies to delay generic competition to Solvay’s drug product ANDROGEL (testosterone gel) (see our previous posts here and here), the FTC filed a Petition for Writ of Certiorari asking the U.S. Supreme Court to take up the case (Supreme Court Docket No. 12-416). 

In Androgel, the FTC filed a Complaint (originally filed in the U.S. District Court for the Central District of California) alleging that Solvay and certain generic drug companies violated various federal antitrust laws when they agreed to dismiss patent infringement litigation on U.S. Patent No. 6,503,894 in exchange for a profit-sharing arrangement and provided the generic competitors would not launch their generic versions of ANDROGEL until 2015.  The Georgia District Court, in granting the defendants’ Motion to Dismiss, found that the settlements are not an unreasonable restraint of trade under applicable law and that the FTC failed to state an antitrust claim.  In affirming the district court decision, the Eleventh Circuit held that, “absent sham [patent] litigation or fraud in obtaining the patent, a reverse payment settlement is immune from antitrust attack so long as its anticompetitive effects fall within the scope of the exclusionary potential of the patent.”  In late September, the Georgia District Court dismissed the remaining claims in the case brought by the private plaintiffs concerning sham patent infringement litigation and concluded that they were not objectively baseless as a matter of law. 

The FTC’s Petition comes in the wake of two other Petitions for Writ of Certiorari (Supreme Court Docket Nos. 12-245 and 12-265) asking the U.S. Supreme Court to review the July 2012 decision by the U.S. Court of Appeals for the Third Circuit in In Re: K-DUR Antitrust Litigation.  In that case, and in contrast to the Androgel decision, the Court rejected the so-called “scope of the patent test” when considering whether patent settlement agreements violate the antitrust laws, and instead applied a “quick look rule of reason” (see our previous posts here and here).  Under that analysis, “the finder of fact must treat any payment from a patent holder to a generic patent challenger who agrees to delay entry into the market as prima facie evidence of an unreasonable restraint of trade, which could be rebutted by showing that the payment (1) was for a purpose other than delayed entry or (2) offers some pro-competitive benefit.” 

The K-Dur Petitions have already drawn significant attention.  Amicus briefs have been filed by PhRMA, GPhA, the Washington Legal Foundation, Bayer Corporation, and the New York Intellectual Property Law Association (available here, here, here, here, and here).  Our friends over at Patent Docs have taken a close look at several of the amicus briefs in posts over the past couple of weeks.

In its Androgel Petition, the FTC presents the following question to the U.S. Supreme Court, juxtaposing the Androgel and K-Dur decisions: “Whether reverse-payment agreements are per se lawful unless the underlying patent litigation was a sham or the patent was obtained by fraud (as the [Eleventh Circuit] held), or instead are presumptively anticompetitive and unlawful (as the Third Circuit held).”  In arguing for Supreme Court review, the FTC launches into why Androgel was wrongly decided:

The decision below is incorrect.  In the Eleventh Circuit’s view, a reverse-payment agreement is lawful unless it imposes greater restrictions on generic competition than would a judicial ruling that the brand-name manufacturer’s patent is valid and infringed.  That approach effectively equates a brand-name manufacturer’s allegation of infringement with a judgment in the manufacturer’s favor.  But defendants oftent prevail in patent-infringement suits; the Hatch-Waxman Amendments are designed to facilitate judicial resolution of validity and infringement issues in the generic-drug context; and the federal antitrust laws flatly prohibit potential competitors from forming naked agreements not to compete.  The anticompetitive potential of reverse-payment agreements – which are estimated to cost consumers billions of dollars annually – is sufficiantly clear that they should be treated as presumptively unlawful under the federal competition laws.  [(Emphasis in original.)]

The FTC puts forth several reasons why Supreme Court review is warranted and says that Androgel “is a superior vehicle for addressing the question presented because it is brought by an agency charged by Congress with challenging unfair methods of competition, and it comes to the Court in the straightforward posture of a final judgment following the dismissal of the FTC’s complaint for declaratory and injunctive relief.” 

These are the same reasons cited by FTC Commissioner J. Thomas Rosch in a speech given prior to the filing of the FTC’s Androgel Petition.  In that speech, Commissioner Rosch shared his views as to what he believes are the six reasons the Supreme Court, despite having declined several prior Petitions on drug patent settlement cases, will grant certiorari in either or both of the K-Dur and Androgel cases, and why Androgel is better postured for Supreme Court review.  According to Commissioner Rosch:

[T]he Androgel case would be the better vehicle for Supreme Court review of the pay-for-delay issue.  First, the case was decided on a motion to dismiss so it presents a pure issue of law.  In contrast, the K-Dur decision was decided on summary judgment.  Second, the Eleventh Circuit’s decision was a final judgment; the Third Circuit’s decision was not.  Further proceedings in the K-Dur case could help clarify the application of the Third Circuit’s new test.  Third, the Androgel case was brought by one of the two federal agencies charged with protecting consumer interests through the enforcement of the antitrust laws.  The K-Dur case was brought by private plaintiffs, and the FTC’s role has been limited to that of an amicus.

Commissioner Rosch also said that he expects Congress to remain relatively quiet on drug patent settlement legislation . . . at least until there is something out of the Supreme Court.  “[I]f and when the Court rules on the issue, there is likely to be a strong push by the losing side for legislation to overturn the Court’s decision,” said Commissioner Rosch.

In other drug patent settlement news, we note that the U.S. District Court for the District of New Jersey recently denied the FTC’s motion for leave to file an amicus brief (see our previous post) in private antitrust litigation concerning Wyeth Pharmaceuticals Inc.’s anti-depressant drug EFFEXOR XR (venlafaxine HCl) Extended-release Tablets.  One issue in that case is whether a branded drug company’s commitment not to launch an Authorized Generic (“AG”) to compete with a generic version of the product approved under an ANDA constitutes a “payment” under K-Dur.  The FTC’s proposed amicus brief stated that a “No-AG” agreement is a “convenient method” for brand-name drug companies to pay generic patent challengers to delay their entry into the market, and that the Third Circuit’s K-Dur decision should not be limited to overt cash payments.  In denying the FTC’s motion, the New Jersey District Court found that “the FTC has not expressed an interest that is not represented competently in this case,” and that “the extent to which the FTC is partial to a particular outcome weighs against granting the agency’s motion.”

Finally, in recent closing letters (here and here), the FTC concluded that “no further action is warranted” as a result of the Commission’s nonpublic investigation to determine whether certain companies engaged in any unfair methods of competition that violate the FTC Act by entering into agreements regarding the oral contraceptive drug products YASMIN and YAZ containing drospirenone and ethinyl estradiol.

By Carmelina G. Allis –

Should FDA’s Center for Devices and Radiological Health (“CDRH”) regulate medical mobile apps?  Or should medical mobile apps be regulated by another office within FDA? Or should they be regulated by a separate entity under the Department of Health and Human Services (“HHS”)?

At least one Representative in the U.S. Congress (Rep. Mike Honda, D-CA) believes that mobile apps deserve special attention and should be independently regulated.  Rep. Honda is introducing in the U.S. House of Representatives the “Healthcare Innovation and Marketplace Technologies Act” (“HIMTA”), a bill which seeks to establish the “Office of Mobile Health” within FDA.  The office would provide recommendations on medical mobile app issues, including establishing an app developer support program to ensure the developers are operating within privacy regulations and other HHS requirements.  Reports (see, e.g., here and here) say that the bill is being introduced to ensure that competition, innovation, and entrepreneurship in the mobile app market are not stifled by regulatory issues that generally apply to traditional, non-software device types.

This proposed bill is likely to be welcomed by many mobile app developers – in particular the small or startup ones who still wonder why their products would be subject to FDA regulatory oversight at all.  Most of those companies do not have the personnel, infrastructure, or sufficient expertise to navigate the monstrous and confusing FDA regulatory framework.

FDA has not set forth a clear regulatory path for medical mobile apps, and app developers are concerned about whether the regulatory burdens that FDA could impose on those products may limit their ability to timely enter the market.  This is a fast-paced, quickly growing market sector, and the FDA premarketing process may be too slow and unnecessarily burdensome for these new technologies.

So the question still remains as to whether medical mobile apps should be regulated by FDA’s CDRH, another office independent from CDRH, or simply an office separate from FDA altogether.  At least one person on the Hill thinks that these products should still remain within FDA, but regulated differently. 

We will keep you posted on the outcome of this proposed bill and will post a copy of the bill once it is available.

By Kurt R. Karst –      

Those of us who work in the drug approval world know that a high degree of coordination among various FDA components is necessary for a smooth and efficient approval process.  This is particularly true for ANDA generic drug approval, where the Office of Generic Drugs (“OGD”) must coordinate with the Office of Compliance to, among other things, schedule facility inspections (domestic and foreign) and close all inspectional issues.  OGD will not approve an ANDA unless the Office of Compliance has given a clean bill of health for the facilities covered under the application.  In recent years, coordination between OGD and the Office of Compliance seems to have broken down.  These days it is not uncommon that OGD is in a position to approve an ANDA, but for clearance from the Office of Compliance on a manufacturing facility covered under the ANDA.  Sometimes it is merely a paperwork exercise, and sometimes more is involved.  Well, one company has said “enough!” 

Earlier this week, Apotex Inc. and Apotex Corp. (collectively, “Apotex”) filed a Complaint against FDA in the U.S. District Court for the District of Columbia seeking declaratory and injunctive relief for FDA’s alleged failure to confirm that an Apotex facility that manufactures drug for two pending applications – ANDA Nos. 201505 and 200832 – for generic versions of the popular blood pressure-lowering drugs AVALIDE (irbesartan/hydrochlorothiazide) Tablets and AVAPRO (irbesartan) Tablets operates in conformance with current Good Manufacturing Practice.  According to Apotex, both ANDAs were ready for approval on September 27, 2012 when 180-day exclusivity expired.

Apotex states in its filing that FDA (or, more specifically, the Office of Compliance) has failed to clear the facility:

despite the fact that such compliance recommendations were made for other recently approved Apotex ANDAs that rely on this manufacturing facility, including one that was approved just last week on September 25, 2012.  FDA’s unreasonable delay is in part due to its inability to locate an inspectional report that the agency should have long-since created and reviewed.  By failing to provide this compliance confirmation, Defendants are depriving Apotex of its right to have two pending ANDAs treated the same way that FDA has treated several other, similarly situated ANDAs.

Apotex’s two-count Complaint alleges that FDA’s actions violate the Administrative Procedure Act (“APA”) “because those actions have denied Apotex approval for ANDAs 201505 and 200832 for no reason other than FDA’s inability to process necessary paperwork” (5 U.S.C. § 706), and that “FDA owed Apotex a specific duty to approve those ANDAs when 180-day exclusivity expired” (28 U.S.C. § 1361, mandamus). Apotex seeks, among other things, an interim order directing the Office of Compliance to immediately issue a compliance recommendation to OGD for ANDA Nos. 201505 and 200832, and an orANDAs.  der directing OGD to immediately approve the applications.  Apotex also wants preliminary and permanent relief enjoining FDA “from withholding a compliance recommendation for any Apotex ANDA that relies on facilities that FDA has found to be acceptable in that the methods used in, or the facilities and controls used for, the manufacture, processing, and packing of the drug are adequate to assure and preserve its identity, strength, quality, and purity.”

This is certainly a case to watch, although it could be a non-event if FDA promptly acts on the Apotex ANDAs.

By Ricardo Carvajal & Wes Siegner –

The Department of Health and Human Services Office of Inspector General released two reports (see here and here) critical of dietary supplements in the weight loss and immune support categories.  OIG focused on those categories because they were reported by experts to be among the most popular.  (Perhaps not coincidentally, products marketed in the weight loss and immune support categories have also been of keen interest to the FTC.)

The first report focused on compliance with substantiation and notification requirements for structure/function claims, and concluded as follows:

Overall, substantiation documents for the sampled supplements were inconsistent with FDA guidance on competent and reliable scientific evidence. FDA could not readily determine whether manufacturers had submitted the required notification for their claims.  Seven percent of the supplements lacked the required disclaimer, and 20 percent included prohibited disease claims on their labels. These results raise questions about the extent to which structure/function claims are truthful and not misleading.

Based on those conclusions, OIG recommended that FDA “seek explicit statutory authority to review” structure/function claim substantiation, improve its notification system, and “expand market surveillance.”  FDA generally agreed with the latter two recommendations.  As for seeking an expansion of its authority, FDA agreed to consider the matter, but noted that “certain aspects of the OIG’s recommendation could place considerable demands on FDA’s resources” – likely an understatement of the burden FDA would be taking on if it were saddled with a mandate to review substantiation for structure/function claims.

Although the report acknowledges that manufacturers have a statutory obligation to substantiate their claims, it implies that the obligation has little meaning because FDA’s interpretation of the substantiation standard is set forth in guidance, and not in a regulation (“Manufacturers must have competent and reliable scientific evidence to show that claims are truthful and not misleading, but they do not have to submit the substantiation to FDA, and FDA has only voluntary standards for it.”)  This will come as news to manufacturers who have been subjected to enforcement action based on FDA interpretations of the FDC Act articulated in guidance. 

In addition, the report states that “[d]ietary supplement manufacturers must notify FDA of any structure/function claims no later than 30 days after first introducing a product into the market” (emphasis added).  However, this firm submitted a citizen petition to FDA in February 2000 (Docket No. 1998N-0044) challenging this very interpretation of the structure/function claim notification provision in the FDC Act as overbroad and directly contradicted by the language of the statute.  That petition is still pending.

The second OIG report focused on compliance with requirements for facility registration and inclusion of adverse event reporting information on product labels.  That report concluded as follows:

Twenty-eight percent of contacted companies had facilities that failed to register with FDA as required. Of the companies with facilities that did register, 72 percent failed to provide the complete and accurate information required in the registry. Finally, 20 percent of dietary supplement labels in our sample did not provide the required telephone numbers or addresses.

Based on those conclusions, OIG recommended that FDA improve the accuracy of the registration database, educate industry about the applicable requirements, and “seek authority to impose civil monetary penalties on companies that do not comply with registration requirements.”  FDA generally agreed with OIG’s recommendations.  However, FDA noted that Congress is unlikely to provide FDA with authority to impose civil monetary penalties given that those penalties were excluded from the Food Safety Modernization Act.

By Kurt R. Karst –      

The question was not whether, but when, FDA would be sued over a decision involving 180-day generic drug exclusivity and the so-called “failure to obtain timely tentative approval” forfeiture provision at FDC Act § 505(j)(5)(D)(i)(IV).  That day has finally come.  Earlier this week, Mylan Laboratories Limited and Mylan Pharmaceuticals Inc. (collectively, “Mylan”) filed a Complaint and Motion for a Preliminary Injunction (for which Mylan is seeking an Order to file under seal) against FDA in the U.S. District Court for the District of Columbia challenging the Agency’s decision that Ranbaxy Inc. (“Ranbaxy”) is eligible for 180-day exclusivity for its generic versions of Novartis Pharmaceuticals Corp.’s blockbuster antihypertensive drug DIOVAN (valsartan) Tablets, 40 mg, 80 mg, 160 mg, and 320 mg approved under NDA No. 021283.  

Under FDC Act § 505(j)(5)(D)(i)(IV), which is one of the six 180-day exclusivity forfeiture provisions added to the FDC Act by the 2003 Medicare Modernization Act (“MMA”), 180-day exclusivity eligibility is forfeited if:

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

The 2007 FDA Amendments Act (“FDAAA”) clarified FDC Act § 505(j)(5)(D)(i)(IV), such that if “approval of the [ANDA] was delayed because of a [citizen] petition, the 30-month period under such subsection is deemed to be extended by a period of time equal to the period beginning on the date on which [FDA] received the petition and ending on the date of final agency action on the petition (inclusive of such beginning and ending dates) . . . .”  FDC Act § 505(q)(1)(G).  The 2012 FDA Safety and Innovation Act (“FDASIA”) made further changes with respect to the application of FDC Act § 505(j)(5)(D)(i)(IV) to certain ANDAs.  Neither the FDAAA, nor the FDASIA provisions are at issue in the Mylan case, although a future lawsuit may very well involve them.  Over the years, FDA’s application of FDC Act § 505(j)(5)(D)(i)(IV) has led to scores of forfeitures of 180-day exclusivity (see our 180-Day Exclusivity Tracker) – and, probably, more than all of the other forfeiture provisions combined.  Curiously, however, until the Mylan lawsuit, FDA had never been dragged into court on this MMA provision. 

Over the years, FDA has issued numerous explanations of the Agency’s application of FDC Act § 505(j)(5)(D)(i)(IV).  For example, in a recent Citizen Petition decision (Docket No. FDA-2011-P-0486), FDA explained that under FDC Act § 505(j)(5)(D)(i)(IV),

it is not sufficient to show that FDA changed or reviewed the requirements for approval while the application was under review.  The applicant must also show that its failure to obtain tentative approval at the 30 month date is caused by this change in or review of approval requirements – that is, the issues holding up approval at the 30 month date must be causally connected to the approval requirements that FDA reviewed or changed. [(Emphasis added)]

DIOVAN Tablets is listed in FDA’s Orange Book with three patents, each subject to a period of pediatric exclusivity: U.S. Patent Nos. 5,399,578 (“the ‘578 patent”), 5,972,990 (“the ‘990 patent”), and 6,294,197 (“the ‘197 patent”).  Pediatric exclusivity for the ‘578 patent expired on September 21, 2012, and pediatric exclusiviy for the ‘990 and ‘197 patents expires on April 26, 2017 and December 18, 2017, respectively.  According to FDA’s List of Paragraph IV Patent Certifications, the first ANDA submitted to FDA containing a Paragraph IV certification to any of the Orange Book-listed patents for all four DIOVAN strengths approved under NDA No. 021283 was December 28, 2004.  That application – ANDA No. 077492 – was submitted by Ranbaxy and contains a Paragraph IV certification to the ‘197 patent (as well as a Paragraph III certification – now Paragraph II certification – to the ‘578 patent, and a “section viii” statement to the ‘990 method-of-use patent).  Ranbaxy was not sued with repect to its Paragraph IV certification to the ‘197 patent, so the earliest FDA could approve  ANDA No. 077492 was September 21, 2012, when pediatric exclusivity applicable to the ‘578 patent expired.  September 21, 2012 came and went, however, without an FDA approval decision on the Ranbaxy ANDA.  Meanwhile, Mylan, a subsequent ANDA Paragraph IV applicant, was awaiting an FDA approval decision on its Valsartan Tablets ANDA No. 090866, which was submitted to FDA on September 15, 2008.

FDA had already tentatively approved ANDA No. 077492.  That tentative approval came on October 25, 2007, however, which is well after the 30-month anniversary date of the submission of ANDA No. 077492 (i.e., June 28, 2007 by FDA’s calculation), and before FDA took regulatory action against the company by invoking the Agency’s Application Integrity Policy (see our previous post here).  FDA’s October 25, 2007 tentative approval letter for ANDA No. 077492, which was only recently posted on FDA’s Drugs@FDA website, states the following with respect to 180-day exclusivity:

This letter does not address issues related to the 180-day exclusivity provisions under section 505(j)(5)(B)(iv) of the Act, except to note that for purposes of sections 505(j)(5)(B)(iv) and 505(j)(5)(D)(i)(IV), the agency regards the change in the USP monograph for Valsartan, published on May 1, 2007, . . . to be a change in the requirements for approval imposed after the date on which your ANDA was filed.

Thus, it would seem that FDA has determined that Ranbaxy did not forfeit 180-day exclusivity eligibility for failure to obtain timely tentative approval, because such failure was “caused by a change in or a review of the requirements for approval of the application imposed after the date on which the application [was] filed” – that is, by a change in the USP monograph for valsartan.  Indeed, FDA’s September 28, 2012 decision to only tentatively approve Mylan’s ANDA No. 090866 cements this view.

Mylan’s Complaint alleges that FDA violated the FDC Act and the Administrative Procedure Act (“APA”) by granting Ranbaxy 180-day exclusivity.  Mylan seeks declaratory and injunctive relief, including entry of a judgment setting aside and vacating FDA’s award of 180-day exclusivity to Ranbaxy and an injunction directing FDA to immediately grant final approval of Mylan’s Valsartan Tablets ANDA.  In the alternative, Mylan seeks entry of an iterim injunction staying the approval of all Valsartan Tablets ANDAs pending resolution of the lawsuit.

According to Mylan, FDA has “impermissibly found that Ranbaxy did not forfeit its l80-day exclusivity for Valsartan Tablets, despite Ranbaxy’s failure to obtain tentative approval within the 30-month statutory timeframe,” and that “FDA has taken this final agency action without providing any reasoned basis for its decision . . . .”  Mylan apparently sought an explanation from FDA, but the Agency refused to provide one.  Mylan states in its Complaint that:

the USP monograph update/in-process revision referenced by FDA in the October 25, 2007, Tentative Approval Letter was first proposed and published by USP in January-February 2006 – well over a year before Ranbaxy’s 30-month tentative approval deadline.  The October 25, 2007, Tentative Approval Letter does not provide any explanation or reasoned basis for why this proposed update constituted a “change” in the approval requirements, or how these proposed changes, that Ranbaxy and FDA were aware of as early as February 2006, directly “caused” or otherwise was “causally connected” to Ranbaxy’s failure to meet the 30-month deadline.

Because the October 25, 2007, Tentative Approval Letter does not provide any explanation or reasoned basis for why a USP update can constitute a “change” in the approval requirements, or how these proposed changes directly “caused” or were otherwise “causally connected” to Ranbaxy’s failure to meet the 30-month deadline, Mylan sought such an explanation from the Agency. [(Italics in original)]

FDA refused to provide an explanation, stating in a response to Mylan that:

[W]e cannot provide you the basis on which the Agency detennined that the first applicant for valsartan tablets has not forfeited its eligibility for exclusivity because that analysis rested on confidential infonnation contained in that application.  FDA appreciates the challenge this presents to you and other parties affected by a forfeiture analysis, but the Agency is nonetheless prohibited at this time from disclosing any additional infonnation regarding the forfeiture decision.

FDA’s “express refusal to timely and publicly disclose the basis for its determination that Ranbaxy has not forfeited its exclusivity,” and “express refusal to timely and publicly disclose the basis for its determnination that Mylan is not entitled to final approval” violates the APA, alleges Mylan.  Mylan goes on to note how the courts have “expressly admonished FDA’s practice of frustrating judicial review by refusing to timely address generic exclusivity,” quoting Hi-Tech Pharmacal Co., Inc. v. FDA and Teva Pharm. USA, Inc. v. Sebelius.  (Judge John D. Bates, who handled the Hi-Tech case, has been assigned to the Mylan case.  In Hi-Tech, Judge Bates was particularly critical of FDA's handling of exclusivity decisions – see here.)  “Neither Mylan nor the judicial system need to accept FDA’s ‘trust me’ approach to administering a statute that it is charged with lawfully administering.  Indeed, such a response directly runs afoul of FDA’s obligations under Hatch-Waxman and the APA,” says Mylan.

By Kurt R. Karst –      

Legislation co-sponsored by Representatives Brian Bilbray (R-CA), Carolyn Maloney (D-NY) and Rosa DeLauro (D-CT), and supported by the Melanoma Research Foundation, seeks to encourge the development of so-called “significant drug combinations” by offering the carrot of an extension of marketing exclusivity. 

H.R. 6502, the “Life-Threatening Diseases Compassion through Combination Therapy Act of 2012,” was recently introduced and appears to be modeled after the Generating Antibiotic Incentives Now Act (“GAIN Act”), which was enacted under Title VIII of the FDA Safety and Innovation Act (“FDASIA”) (see here).  The GAIN Act, which is intended to encourage the development of antibacterial and antifungal drug products that treat pathogens that cause serious and life-threatening infections, amended the FDC Act to add Section 505E to, among other things, grant an additional 5 years of marketing exclusivity upon the approval of an NDA for a drug product designated by FDA as a Qualified Infectious Disease Product.  (FDA recently granted the first GAIN Act designation – see here – and there have already been winners and losers as a result of the new law – see here.)  Similarly, H.R. 6502 would amend the FDC Act – also to add Section 505E (and therefore, either an error/oversight, or perhaps an indication that the bill was in the works prior to the enactment of FDASIA) – to add 6-months of marketing exclusivity to 5-year new chemical entity exclusivity, 3-year new clinical investigation exclusivity, “or” 7-year orphan drug exclusivity for a drug product approved under an NDA and that contains a “significant drug combination” designated as such by FDA.  The bill also provides for priority (6-month) review of an NDA for a drug product containing a designated “significant drug combination.”

The bill defines a “significant drug combination” to mean a combination of two or more drugs, which can include a biologic subject to licensure under PHS Act § 351, that:

(1) when used in combination, offer the potential to significantly advance treatment for a serious or life-threatening disease;

(2) in combination, meet the criteria for codevelopment of drug combinations, as specified in the [FDA’s] guidance document entitled “Guidance for Industry: Codevelopment of Two or More Unmarketed Investigational Drugs for Use in Combination” or a successor document; and

(3) includes at least 2 drugs that are not approved under [FDC Act § 505] or licensed under [PHS Act § 351].

To qualify for the exclusivity extension under H.R. 6502, the sponsor of an NDA for a drug product containing at least two new drugs (and/or biologics) must, prior to the approval of the NDA, seek and obtain FDA designation of a drug combination as a “significant drug combination.”  In making “significant drug combination” designations FDA would be required to take into account the recommendations of a task force that would be created by the bill.  Among other things, the task force would be required to develop a list of types of drug combinations that should be designated  as “significant drug combinations.”  

The exclusivity extension under H.R. 6502 does have some limitations.  And they are reminiscent of the exclusivity limitations included in the GAIN Act and in the Biologics Price Competition and Innovation Act of 2009.  Specifically, the exclusivity extension does not apply to certain NDA supplements if an extension was previously granted, and for a subsequent NDA submitted “by the same sponsor or manufacturer of a drug in a designated significant drug combination. . . (or a licensor, predecessor in interest, or other related entity)” for certain changes, such as a new indication, or for “a modification to the structure of the drug that does not result in a change in safety or effectiveness.” 

By Jennifer D. Newberger –

The Government Accountability Office (“GAO”) recently issued a report titled, “Medical Devices: FDA Should Expand Its Consideration of Information Security for Certain Types of Devices.”  The report was intended to examine how FDA protects active implantable devices against information security risks that could affect their safety and effectiveness.  Though the report did not specifically state that its findings should be applied only to PMA devices, GAO evaluated only devices approved through the PMA process.

In the report, GAO:  1) identified the potential security risks associated with active implantable medical devices, 2) determined the extent to which FDA considered potential security threats in its premarket review, and 3) determined what postmarket controls FDA has in place to monitor potential security issues. 

While it is important to consider the potential breaches that could affect safety and effectiveness of these devices, it is also important to recognize that the likelihood of such breaches occurring—particularly intentional breaches—may be quite low.  GAO itself recognizes this in the report, which states that while “researchers recently demonstrated the potential for incidents resulting from intentional threats in two devices—an implantable cardioverter defibrillator and an insulin pump—no such actual incidents are known to have occurred.” 

The review focused on the devices shown by researchers to be vulnerable to security threats—implantable defibrillators and insulin pumps.  GAO looked both at FDA’s premarket and postmarket activities related to identification of potential information security risks. 

GAO identified eight key information security control areas to consider for medical devices:  software testing, verification, and validation; risk assessments; risk management; access control; vulnerability and patch management; technical audit and accountability; security-incident response; and contingency planning.  It also looked at key potential unintentional and intentional threats to the active implantable medical devices.  The unintentional threats are defective software and firmware and interference caused by electromagnetic signals in the environment. 

Key intentional threats include unauthorized access, malware, and denial-of-service attack.  Experts interviewed by GAO agreed that unintentional threats, particularly electromagnetic interference, are less concerning than intentional threats, because manufacturers are aware of these potential threats and have addressed them in their submissions.

GAO also looked at the potential security risks for active implantable devices:  unauthorized change of device settings; unauthorized change to or disabling of therapies; loss or disclosure of sensitive data; and device malfunction.  GAO noted that “there have been no documented information security incidents resulting from the exploitation of vulnerabilities in these types of medical devices by intentional threats in real-world settings.”  The possibility for such exploitation is known primarily due to testing in controlled settings, and manufacturers have noted that these demonstrations of possible exploitation “should not overshadow the clinical benefits offered by medical devices.”

GAO found that, in its premarket review of the devices evaluated, FDA considered information security risks from unintentional threats, but not from intentional threats.  Specifically, FDA considered risks in the following areas:  software testing, verification, and validation; risk assessments; access control; and contingency planning.  The report states that FDA did “not demonstrate that it had considered the potential benefits of mitigation strategies to protect devices against information security risks from certain unintentional or intentional threats in light of the appropriate level of acceptable risk for medical devices with known vulnerabilities.” 

Of course, since no intentional threats are known to have occurred, and FDA already reviews devices for protection against certain unintentional threats (such as electromagnetic interference), there does not seem to be any evidence to conclude that these devices, as currently manufactured and marketed, present an unacceptable level of risk.  Perhaps for this reason, FDA responded to GAO’s inquiries by noting that, during the review process, FDA focuses “on the most relevant risks that could result in harm to patients.”  FDA considers these risks to be clinical, rather than information security, risks.  FDA did acknowledge, however, that information security risks resulting from intentional threats “could occur.”  It will therefore “consider information security risks resulting from intentional threats when reviewing manufacturers’ submissions for new devices.”

GAO also looked at what FDA could do in the postmarket environment to be more cognizant of possible information security threats.  FDA stated that, while it could use postmarket surveillance studies to focus on information security risks, it has no intention to do so, since those studies are intended to address clinical issues.  GAO also stated that FDA could require manufacturers to include in their PMA annual reports any information related to potential information security risks. 

Based on its review, GAO is recommending FDA “develop and implement a more comprehensive plan to assist the agency in enhancing its review and surveillance of medical devices as technology evolves, and that will incorporate the multiple aspects of information security.”  GAO recommends the plan include, at a minimum, the following four actions:  1) increase FDA’s “focus on manufacturers’ identification of potential unintentional and intentional threats, vulnerabilities, the resulting information security risks, and strategies to mitigate these risks during its PMA review process”; 2) “utilize available resources, including those from other entities, such as other federal agencies”;  3) “leverage its postmarket efforts to identify and investigate information security problems”; and 4) “establish specific milestones for completing this review and implementing these changes.”

Given that the risks presented in this report have not yet materialized, and CDRH is in the midst of addressing a variety of issues associated with its review process, the issues discussed in the report may not be high on CDRH’s priority list.

By Jeffrey K. Shapiro & Jessica A. Ritsick –

ISO 13485 (2003) is an internationally recognized management system for the design and manufacture of medical devices.  Most device manufacturers have quality systems intended to comply with ISO 13485.  FDA has finally implemented a 2007 statutory requirement to allow firms to leverage their ISO compliance to potentially delay an inspection for compliance with FDA’s QSR (Quality System Regulation, 21 C.F.R. Part 820).

To be more specific: on June 5, 2012, FDA launched the “Medical Device ISO 13485:2003 Voluntary Audit Report Submission Pilot Program,” implementing Section 228 of the Food and Drug Administration Amendments Act of 2007 (“FDAAA”) – see here and here.  Under Section 228, FDA shall “[f]or the purpose of setting risk-based inspectional priorities . . . accept voluntary submissions of reports of audits assessing conformance with appropriate quality system standards set by the International Organization for Standardization (ISO).”

So how does the program work?  A device manufacturer must have been audited under Global Harmonization Task Force (“GHTF”) members Canada, Australia, Japan, or the EU’s ISO system.  If so, the firm can voluntarily submit—within 90 days of its issuance, via FDA’s e submitter system—the ISO 13485 audit report to FDA, along with all ISO 13485 audit reports issued in the preceding two years, the establishment’s ISO certificate, and any communications from the most recent audit report.  The audit report is required to conform with Canada’s GD211 guidance for quality management system audit reports.

FDA will review the submission to determine whether “there is minimal probability . . . that the establishment will produce nonconforming and/or defective finished devices.”  If the answer is yes, FDA will use the audit as part of its risk assessment to determine whether the establishment can be removed from routine annual field inspection for one year from the last day of the ISO 13485 audit, such that the establishment’s bi annual inspection would be postponed for a year. 

As might be expected, voluntary submission of an ISO 13485 audit does not preclude FDA from conducting “for-cause” or preapproval inspections. 

It remains to be seen whether many companies will take advantage of this program.  Frankly, the benefit seems modest, especially since FDA routinely fails to inspect many companies in the required biannual time frame in any event.    

By Alexander J. Varond –

On September 25, 2012, the President’s Council of Advisors on Science and Technology (“PCAST”) released a report entitled “Report to the President on Propelling Innovation in Drug Discovery, Development, and Evaluation.”  PCAST is a commission of leading scientists and engineers who directly advise the President and make policy recommendations on matters of science and technology.  Its most recent report aims at doubling the number of new drugs approved annually, while increasing drug safety over the next 10-15 years.

HP&M’s own Frank Sasinowski was recognized as a key contributor at PCAST’s release of this major new report this week and is cited as a PCAST Drug Innovation Invited Expert on page xvii of the report.

The President personally asked PCAST to investigate and report on ways to propel this kind of innovation in this country for two reasons:  first, to better address the suffering of Americans in need of healing therapies; and second, to increase America’s competitiveness in that both we have a positive trade balance in pharmaceuticals and also, research on new medicines is a prime source of jobs here in our pharmaceutical industry and in universities across America.  (Note: The President’s only other personal charge to PCAST was on the avian flu crises early in his Administration.)

PCAST engaged a wide range of stakeholders over the past 12 months to identify reasons why the pace of new therapeutic development has not kept up with the huge growth in scientific knowledge, despite substantial increases in R&D budgets.  The report set a somber background by explaining that ninety-six percent of orphan diseases lack effective therapies, the costs of illness in the aging US population will reach staggering amounts (e.g., Alzheimer’s disease may eventually exceed $1 trillion per year in the absence of new therapies), the innovative ecosystem for public health is under significant stress, and R&D productivity is substantially declining.

Two key challenges affecting the ecosystem for innovative medicines are:

1. How to accelerate the translation of biological insights into new medicines, including predicting the efficacy and toxicity of candidate drugs to more rapidly identify drugs that are not viable and validating human proteins as “druggable” targets to accelerate development of candidate medicines; and

2. How to address inefficiencies in clinical trials since most clinical trials are currently organized de novo, each time incurring substantial costs that could be reduced by creating efficient trial networks and trial designs.

The report also identifies areas where economic incentives for certain areas of drug development may be insufficient to promote efficient investment in innovation (e.g., antibiotics and complex diseases).  It offers suggestions such as developing tools to create incentives such as vouchers for priority review, new exclusivity periods, and targeted tax credits.

Eight specific recommendations were made:

1. Support federal initiatives to accelerate therapeutic development such as the National Center for Advancing Translational Sciences and the Reagan-Udall Foundation.

2. Catalyze the creation of broad-based partnership to accelerate therapeutics by filling key knowledge gaps in drug discovery and development, improving clinical trial capabilities, and clarifying the development pathway for innovative medicines by gathering community input on FDA guidance documents.

3. Expand the use of FDA’s existing authorities for accelerated approval while more fully enforcing requirements for post-approval confirmatory studies.

4. Create a new, optional pathway for initial approval of drugs shown to be safe and effective in a specific subgroup of patients (e.g., FDA could allow the approval a drug for patients with morbid obesity while taking steps to minimize the likelihood that the drug is prescribed off-label to mildly obese patients).  This pathway would allow drug sponsors to seek indications for narrow “Special Medical Use” populations which would strongly signal to prescribers and payors that the population that should be prescribed the drug is limited.

5. Explore approaches for adaptive approval via pilot projects under existing pathways to generate evidence across the life-cycle of a drug from pre-marketing through the post-marketing phase.  However, PCAST recommends against prematurely creating these pathways through legislation.

6. Improve FDA’s tools for monitoring and communication of clinical benefits and risks, including post-marketing surveillance and FDA’s Sentinel System.

7. Reform management practices at FDA including adding the use of pre-market review leaders to oversee each drug candidate application from its investigational stage through final marketing decision.

8. Study current and potential economic incentives to promote innovation in drug development.

While the advisory report outlines a number of ambitious goals for the drug discovery and development ecosystem, it gave few details of what new laws or regulations might be implemented.  For that, we must wait and see on how key stakeholders respond, that is, FDA, industry, academia, the investment community, and patient organizations.

By Kurt R. Karst –       

Public turmoil over FDA decisions involving orphan drug exclusivity has been relatively rare in recent years.  That has changed over the past several months.  First there was the lawsuit brough against FDA by K-V Pharmaceutical Company to “restore” orphan drug exclusivity for the pre-term birth drug MAKENA (hydroxyprogesterone caproate) Injection (see our previous post here).  Then there was FDA’s decision – the first ever – to rescind Octapharma USA, Inc.’s orphan drug exclusivity for WILATE (von Willebrand Factor/Coagulation Factor VIII Complex (Human)) (see our previous post here).  And earlier this week, Depomed, Inc. (“Depomed”) filed a Complaint in the U.S. District Court for the District of Columbia challenging FDA’s denial of orphan drug exclusivity for GRALISE (gabapentin) Tablets.

FDA designated GRALISE as an orphan drug in November 2010 for the management of postherpetic neuralgia (“PHN”), and approved the drug product on January 28, 2011 under NDA No. 022544 for the designated indication.  Despite having designated GRALISE as an orphan drug for the approved indication, however, FDA did not grant orphan drug exclusivity.  Why?  Because of issues surrounding what constitutes an “orphan drug” and under what circumstances “clinical superiority” must be shown.

FDA’s orphan drug regulations at 21 C.F.R. § 316.20(a) state that “a sponsor of a drug that is otherwise the same drug as an already approved orphan drug may seek and obtain orphan-drug designation for the subsequent drug for the same rare disease or condition if it can present a plausible hypothesis that its drug may be clinically superior to the first drug” (emphasis added).  Over the years, there has been some confusion as to how FDA interprets the term “orphan drug” in this regulation. 

The term “orphan drug” is specifically defined at 21 C.F.R. § 316.3(b)(10) to mean “a drug intended for use in a rare disease or condition as defined in section 526 of the act.”  But does this mean that an “orphan drug” is any previously approved drug for a rare disease or condition, regardless of whether or not it was designated and approved as an orphan drug?  “Yes,” according to FDA.  In the preamble to FDA’s 2011 proposed orphan drug regulations (see our previous post here), which the Agency says are “intended to clarify regulatory provisions and make minor improvements to address issues that have arisen since” they were promulgated in December 1992, FDA states that “[i]n the absence of a clinical superiority hypothesis, the Agency does not interpret the orphan-drug regulations to permit orphan designation of a drug that is otherwise the same as a drug that is already approved for the orphan use, either where the approved drug received orphan-drug exclusive approval (even after such drug's exclusivity period has run out) or where the approved drug was not previously designated as an orphan drug and thus did not receive orphan exclusive approval” (emphasis added).

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.  As FDA explains in the recent petition response concerning WILATE orphan drug exclusivity (as well in the preamble to the Agency’s 2011 proposed rule), where clinical superiority is concerned, 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.

In the case of GRALISE, FDA required a plausible hypothesis of clinical superiority because the Agency previously approved gabapentin for the management of PHN.  Specifically, FDA approved NEURONTIN (gabapentin) for the management of PHN many years ago, but FDA never designated and approved NEURONTIN as an orphan drug.  Nevertheless, FDA considers NEURONTIN an “orphan drug,” and therefore, according to FDA, a company seeking orphan drug designation for its gabapentin product for the management of PHN must meet the Agency’s “clinical superiority” requirements to obtain designation and orphan drug exclusivity.

The information supporting a plausible hypothesis of clinical superiority (greater safety) was provided to FDA and the Agency designated GRALISE as an orphan drug.  According to Depomed, however:

Contrary to the plain language of the Orphan Drug Act and FDA’s regulations, the letter communicating the grant of orphan-drug designation asserted that the approval of Gralise to manage PHN would not automatically lead to orphan-drug exclusivity.  The letter stated that, “should [Depomed] obtain marketing approval for this product, [Depomed] will have to prove clinical superiority . . . in order to obtain seven years of marketing exclusivity.”

Depomed’s Complaint, which seeks declaratory and injunctive relief, alleges that FDA is violating the Administrative Procedure Act by refusing to grant orphan drug exclusivity for GRALISE.  Instead of recognizing orphan drug exclusivity for GRALISE, FDA “placed additional hurdles between Gralise and orphan-drug exclusivity by attempting to impose requirements that are found nowhere in the statute and that exist in regulation only for circumstances not present here,” alleges Depomed.  Depomed previously communicated concerns with FDA’s interpretation of the Orphan Drug Act in comments submitted to the docket established for FDA’s 2011 proposed rule (Docket No. FDA–2011–N–0583).

By JP Ellison –

Traditionally, challenges to a Drug Enforcement Administration (“DEA”) immediate suspension order (“ISO”) have been litigated, in the first instance, in federal district courts.  This is true even when the physician, pharmacy, distributor, wholesaler or other DEA registrant has taken a “belt and suspenders” approach and filed challenges in both the district court and court of appeals.  In those “dual filing” scenarios, the district court has generally scheduled a temporary restraining order and/or preliminary injunction hearing and addressed the merits before a court of appeals waded into the issue.  The parties, once engaged at the district court level have litigated the issues there, and have sought meaningful relief from a court of appeals—if at all—only on appeal of the district court’s decision.

On August 31, 2012, the D.C. Circuit asked for supplemental briefing on the question of whether Controlled Substance Act permitted the traditional practice of judicial review of ISOs in the district court.  Specifically, the court pointed to its prior decision in Doe v. DEA, 484 F.3d 561 (D.C. Cir. 2007).  While the Doe case did not involve an ISO, the court’s reasoning in that case suggested that the court might have difficulty with an argument that an ISO was “final” for purposes of review under the Administrative Procedure Act (“APA”), but not final under the CSA, which vests jurisdiction for all “final determinations” solely in the courts of appeal.  See 21 U.S.C. § 877.

The parties’ September 7th supplemental briefs took diverging views on the question.  The government took the position (see here) that review of an ISO in the district court was proper.  At oral argument, the government further refined its argument, noting that under the APA, judicial review is available for both “[a]gency action made reviewable by statute and final agency action.”  5 U.S.C. §704.  The government noted that section 824(d) plainly authorized judicial review of the ISO and suggested that review in the district court could lie under the “reviewable by statute” prong of section 704 of the APA.  The appellants argued (see here) that the CSA dictated that the courts of appeals have exclusive jurisdiction.  

At oral argument on September 12th (before Judges Tatel, Henderson and Williams), the comments of Judge Williams, who seemed the most interested in the jurisdictional issue, suggested that he saw practical advantages to jurisdiction lying in the district court, but viewed the statutory language as potentially constraining the courts ability to conclude that the district courts had jurisdiction.

We will continue to follow this issue to see whether the circuit court’s decision—which we would expect later this year—provides litigants with guidance on whether a party facing an ISO should file in the district court or the court of appeals.  In the interim, as DEA continues to issue ISOs, those served with an ISO will remain in search of  (“ISO”) the right court in which to bring a challenge.

By Jennifer M. Thomas & Anne K. Walsh –  

Yesterday, in a big win for industry, District Court Judge Rosemary Collyer granted French company PREVOR’s Motion for Summary Judgment in a case challenging FDA’s decision to regulate PREVOR’s Diphoterine® Skin Wash (“DSW”) product as a drug.  The original Complaint was discussed in an earlier blog post here, and the briefs for all parties are available here, here, here, and here.  PREVOR was represented by Hyman, Phelps & McNamara, P.C. (attorneys Jeffrey N. Gibbs, John R. Fleder, Jennifer M. Thomas, and Anne K. Walsh).  Kudos also to the amici curiae, including the Washington Legal Foundation, Alcoa, and Archer-Daniels-Midland Company.  The case has been closely followed by industry because it involves a new FDA interpretation of the laws concerning combination product classification, as set out in an FDA classification ruling specifically applicable to PREVOR’s product and in two hotly debated draft guidance documents, available here and here (Docket No. FDA-2011-D-0429).

DSW is a “first response” method to help prevent and minimize chemical burn injuries due to accidental chemical exposures, and has long been marketed as a medical device in Europe, Canada, Brazil, and Australia.  FDA’s Office of Combination Products (“OCP”), however, classified DSW as a drug-device combination product with a drug primary mode of action, and determined that it should be regulated by the Center for Drug Evaluation and Research.  The Agency’s Office of Special Medical Programs (“OSMP”) confirmed that classification.  The D.C. District Court disagreed, and determined that both OCP and OSMP employed a new standard (“at least in part” or “even in part”) in reaching its decision.

In her 18-page opinion, Judge Collyer concluded that FDA acted arbitrarily and capriciously.  Specifically, the Court found that FDA had failed to provide a reasoned basis for its classification decision, stating that its “ipse dixit cannot substitute for the ‘qualitative analysis’ or ‘scientific information’ on which FDA says it acted.”  Instead of scientific analysis, the Court opined, FDA substituted “extraordinarily expansive language” in making its classification decision.  And it did so, without offering “more than its say-so.” 

The Court rejected FDA’s contention that the standard it applied was not new, citing the June 2011 guidance documents as evidence, and noting that the agency “fails to cite a single prior instance in which it has applied an ‘even in part’ standard.”  The Court also adopted PREVOR’s comparison to similar products treated as devices, and characterized FDA’s attempt to distinguish those products as “a most ephemeral distinction.”  

The Court questioned “[w]hether FDA would come to the same conclusions without resort to its extra-statutory interpretations.”  It vacated FDA’s decision to designate DSW as a drug-device combination product with a drug primary mode of action, and remanded the case to FDA to make a determination in compliance with its Opinion.  

By Jennifer D. Newberger –

On Thursday, September 20, the Food and Drug Law Institute (“FDLI”) and the Drug Information Association (“DIA”) co-sponsored a program titled “Unwrapping FDA’s UFA Package:  What’s Inside the Statute – What’s Next?”  The program discussed many aspects of the recently passed Food and Drug Administration Safety and Innovation Act (“FDASIA”) (see our summary here), from user fees to substantive changes in the pre- and post-market regulation of drugs and devices.

Some highlights of the device sessions include the following:

Benefit-Risk Determinations.  Though FDASIA does not explicitly require FDA to make benefit-risk determinations in the premarket review of medical devices, CDRH representatives indicated that they intend to do so.  In fact, one representative stated that benefit-risk and increased user participation in the review process are two of the most exciting FDASIA provisions, and that it is important to look not only at clinical data, but also at patient data about the willingness to tolerate certain risks.  She stated that CDRH is already conducting a pilot study in which patients are being surveyed about the risks they are willing to accept for surgical procedures to address obesity.  She also noted that CDRH will be initiating a Patient Preference Project with a meeting in the spring about how best to gather the patient perspective in device reviews.

De Novo Process.  As expected, FDA and industry are both pleased with the changes FDASIA made to the de novo process.  One CDRH representative noted that, while the changes provide an opportunity to be more efficient with de novo devices, there are no user fees for de novo applications.  Thus, it will be important to CDRH to examine whether devices actually qualify for the de novo process and do not have predicates to which they could claim substantial equivalence.  Whether companies would actually seek de novo status to avoid a 510(k) user fee is somewhat doubtful.

Appeals.  FDASIA implemented timeframes for appealing “significant decisions” but did not specify what actions constitute significant decisions.  A CDRH representative at the meeting indicated that CDRH will be issuing a guidance document describing the activities that it considers to be “significant decisions.” CDRH indicated that NSE letters, not approvable decisions, and IDE denials will be among the significant decisions appealable within the FDASIA-specified timeframes.  CDRH stated that letters such as requests for additional information will likely not be considered “significant decisions.”  This means that, while an AI request could continue to be appealed under 21 C.F.R. § 10.75, the process will not have to abide by the timeframes in the new law.

Another issue discussed regarding appeals is when a requester would receive the summary of the decision as mandated by FDASIA.  Since FDASIA requires the sponsor to file an appeal within 30 days of the “significant decision,” it will be important to receive the summary information as soon as possible to incorporate into the appeal.  Based on statements at the meeting, CDRH has not yet determined when it will provide the summary information in response to a request.  It stated that it will “probably” be provided in time to use in the appeal, but appeals historically have been based on the letter itself, and CDRH would expect the same to be true moving forward.  Unfortunately, the denial letters often do not provide much useful information describing the reason for the denial, so sponsors will undoubtedly be looking to receive that summary information to support their appeal and better understand the grounds for the adverse decision.

CDRH stated a concern with the new timeframes, namely, that they will encourage sponsors to appeal decisions rather than working them out informally with the review division.  This concern is unlikely to materialize, since most sponsors would rather resolve issues informally than incur the delay and costs associated with an appeal. 

Device Modifications.  A moderator asked CDRH about the practical effect of the 2011 draft guidance on when to submit a new 510(k) for modifications to a cleared device.  He pointed out that, just because Congress told FDA to do away with that draft guidance and use the 1997 guidance, the 2011 draft gives insight into FDA’s thinking about these issues.  See our earlier blog post on the 2011 draft guidance here.   In response, CDRH said that, from an agency perspective, the 1997 guidance is still in effect, and that if FDA takes action, it will be based on the 1997 guidance.

Reclassification.  The reclassification provision in FDASIA required reclassification through order, rather than regulation; this change was intended to expedite reclassifications.  At the same time, FDASIA said all reclassifications need to go before a panel.  CDRH’s perspective is that, as a result, it could now take longer to downclassify certain devices.  The industry representative on the panel acknowledged that in urging Congress to require a panel prior to reclassification, industry was concerned about upclassification, and perhaps had not considered the impact on downclassifying devices. 

CDRH also seemed unsure about how the new law will affect the progress made to date on reclassifying some of the Class III devices for which FDA has not yet called for PMAs.  CDRH indicated that progress would likely be stalled, and panels would need to be called.  It is not clear whether the law was intended to have this type of retroactive effect.

IDEs.  CDRH has already made certain changes to its IDE template to align with FDASIA’s requirement not to deny IDEs just because CDRH believes they may not support a clearance or approval.  CDRH stated that it wants to incentivize manufacturers to “design the right study,” but it has not yet decided what that incentive will be.  It is contemplating two separate paths, one for sponsors who want to start a study even if it is not ideal from FDA’s perspective, and one for sponsors who will work with FDA to design a study that FDA will “endorse.”  This may involve the creation of a pre-decisional IDE pathway, different from a pre-submission meeting because the pre-decisional meeting will look at data, whereas pre-submission meetings are intended to provide feedback on product development.  Presumably CDRH will be issuing guidance on its new approach to IDEs and clinical trials in the reasonably near future.

By Ricardo Carvajal –

A federal district court dismissed a class action that took issue with a number of allegedly false and misleading claims made on the label of Benecol, a butter/margarine alternative.  The claims at issue include “each serving contains .85g of plant stanol esters,” “proven to reduce cholesterol,” and “no trans fat.” 

Plaintiff contended that the amount of plant stanol esters in the product is insufficient, given that FDA’s health claim regulation for plant sterol/stanol esters and cholesterol requires that a food contain at least 1.7g of plant stanol esters to be eligible for the claim.  However, the court noted that FDA  issued a letter in 2003 permitting use of the claim in relation to products that contain lesser amounts of phytosterols (at least 400 mg per serving), and that FDA had engaged in rulemaking to amend the regulation.   The court observed that “Federal agency action short of formal notice and comment rulemaking can preempt state law.”  Based in part on the compliance of Benecol’s claim with FDA’s 2003 letter, the court found in favor of preemption.

Plaintiff also challenged defendant’s cholesterol-lowering claim on the ground that there were no studies supporting a conclusion that Benecol “as formulated” had the claimed effect.  The court noted that the health claim regulation does not require evidence that products have the claimed effect “as formulated.”  Rather, the regulation establishes “the minimum amount of plant stanol esters that a product must contain” to be eligible for the health claim.  Because plaintiff attempted to impose a requirement different from that imposed under federal law, the court again found in favor of preemption.

Finally, the court found plaintiff’s challenge to defendant’s “no trans fat” claim preempted because “FDA regulations explicitly define the term ‘0 Grams of Trans Fat’” to include levels of less than 0.5 g per serving.  The court concluded that drawing a distinction between “0 grams of trans fat” and “no trans fat” was unreasonable, that the terms were “functionally equivalent,” and that no consumer confusion would result from the use of both claims on the same package.