By Kurt R. Karst –      

Earlier today, FDA sent a letter to Senator Charles Grassley (R-IA) indicating that the Agency may very well be poised to increase prosecution of company officials.  According to the letter, which includes several recommendations based on a committee the Agency formed (comprised of senior FDA leadership) to examine opportunities and develop recommendations to enhance coordination and strategic alignment between FDA’s Office of Criminal Investigations (“OCI”) and other Agency components, the committee recommended to “increase the appropriate use of misdemeanor prosecutions, a valuable enforcement tool, to hold responsible corporate officials accountable.”  In addition, FDA notes that “[c]riteria now have been developed for consideration in selection of misdemeanor prosecution cases and will be incorporated into the revised policies and procedures that cover appropriate use of misdemeanor prosecutions.” 

As we previously reported (here and here), the government believes that persons can be convicted under the FDC Act misdemeanor provisions without any showing that a person intended to violate the law or even knew about the violation.  Under this theory, which is often referred to as the “responsible corporate officer” principle and was derived from the 1975 U.S. Supreme Court case of United States v. Park, executives who do not prevent violations of the FDC Act may be held strictly liable for those violations.

Other committee recommendations described in the FDA letter include:

• “improve procedures for information-sharing between OCI and other Agency components with the goal of enhanced alignment of criminal/regulatory priorities and activities;”

• “that FDA strengthen the mechanisms that are used to ensure that senior leaders share information and coordinate strategic priorities to align criminal enforcement and regulatory activities;” and

• “that the Agency enhance its debarment and disqualification procedures.”

The latter recommendation was made consistent with the findings of a 2009 GAO report critical of FDAs oversight of clinical investigators – see our previous post here.

FDA issued the letter in response to a March 4, 2010 Government Accountability Office (“GAO”) report, titled “Food and Drug Administration: Improved Monitoring and Development of Performance Measures Needed to Strengthen Oversight of Criminal and Misconduct Investigations,” in which the GAO raised concerns about OCI oversight and the lack of performance measures to assess OCI’s success.  Sen. Grassley requested the report after concerns were raised about OCI, and an OCI component, the Office of Internal Affairs (“OIA”).  Specifically, concerns about OCI’s/OIA’s “procedures for conducting and coordinating investigations,” and that “these offices are operating without adequate oversight or accountability, and that OCI’s funding and staffing for criminal investigations have grown significantly despite limited federal resources to fund other FDA activities.”  FDA established OCI in 1991, after the generic drug scandal, to conduct and coordinate criminal investigations for the Agency.  OIA was established in 1995 after a congressional subcommittee recommended that FDA establish an internal affairs office. 

The GAO report concludes that:

Although OCI and OIA have policies that govern how they conduct investigations, FDA’s oversight of these investigations has been limited.  FDA has established a process to ensure compliance with OCI’s policies, but it does not routinely carry out this process as only about 30 percent of the OCI field office assessments have been completed.  OIA’s process to ensure compliance depends on its manager rather than an external reviewer, that is, someone who is not directly involved in ongoing investigations.  Without a review process and consistent implementation, FDA management cannot have reasonable assurance that OCI and OIA investigative policies and procedures are routinely followed and that deficiencies are promptly resolved when identified.  This is particularly important because OCI does work that is different from much of the rest of FDA.

FDA management cannot determine whether OCI’s criminal investigative program is achieving its goals—a key element of accountability—because OCI has not developed performance measures.  Because FDA managers have somewhat different perspectives on how best to assess the performance of OCI’s criminal investigative program, it is unclear how OCI and other FDA managers with oversight responsibility can strategically manage OCI’s criminal investigative program to ensure that it is operating successfully. Assessing program results is especially important given that OCI appears to operate more autonomously than other units within FDA’s regulatory office.

The GAO report also includes three recommendations:

• To ensure OCI’s compliance with investigative policies, instruct the Commissioner of FDA to have regular assessments of OCI’s field offices conducted in accordance with its existing policy.

• To ensure OIA’s compliance with investigative policies, instruct the Commissioner of FDA to establish a review procedure for the assessment of OIA’s compliance with its investigative policies.

• To assess whether OCI’s criminal investigative program is achieving its desired results, instruct the Commissioner of FDA to establish performance measures and assess program results against them.

By Kurt R. Karst –    

Citing FDA approval standards that “may deny the benefits of medical progress to seriously ill patients who face morbidity or death from their disease,” Representative Diane Watson (D-CA) introduced H.R. 4732, the Compassionate Access Act of 2010, earlier this week.  The bill would amend the FDC Act to create a new conditional approval system for drugs, biological products, and devices for seriously ill patients. 

Specifically, the bill would amend FDC Act § 561, titled “Expanded Access to Unapproved Therapies and Diagnostics,” and which was added in 1997 by the FDA Modernization Act, to create new subsection (d) – “Compassionate Investigational Access.”  Under this new subsection:

upon submission by a sponsor of an application intended to provide widespread access to an investigational drug, biological product, or device for eligible patients (referred to in this subsection as ‘Compassionate Investigational Access’), the Secretary shall permit such investigational drug, biological product, or device, to be made available for expanded access under a treatment investigational new drug application or treatment investigational device exemption if the Secretary determines that [certain] requirements . . . are met with respect to Compassionate Investigational Access.

In particular, a sponsor must submit to FDA an application for Compassionate Investigational Access containing:

• Data and information from completed Phase I clinical investigations and any other nonclinical or clinical investigations;

• Preliminary evidence (that may be based on uncontrolled data and on a small  number of patients or a subset of a patient population) that the product may be effective in humans against a serious or life-threatening condition or disease; and

• Evidence that the product is safe at the dose and duration proposed consistent with the level of information needed to initiate a Phase II clinical trial.

A sponsor must also state that it is actively pursuing marketing approval with due diligence.

FDA would then review the application and provide Compassionate Investigational Access approval, or refer the application to a new “Accelerated Approval Advisory Committee” for further review and recommendation.  In making an approval decision, FDA must “consider whether the totality of the information available to the Secretary regarding the safety and effectiveness of an investigational drug, biological product, or device, as compared to the risk of morbidity or death from a condition or disease, indicates that a patient (who may be representative of a small patient subpopulation) may obtain more benefit than risk if treated with the drug, biological product, or device.”  And “[i]f the potential risk to a patient of the condition or disease outweighs the potential risk of the product, and the product may possibly provide benefit to the patient, the Secretary shall provide Compassionate Investigational Access approval of the application.” 

The bill would also create FDC Act § 561A – “Accelerated Approval” – to permit the sponsor of a drug, device, or biologic application to submit an application containing:

data and information that the drug, biological product, or device has an effect on a clinical endpoint or on a surrogate endpoint or biomarker that is reasonably likely to predict clinical benefit to a patient (who may be representative of a small patient subpopulation) suffering from a serious or life-threatening condition or disease.

FDA would have 120 days to provide Accelerated Approval of the application or refer the application to the Accelerated Approval Advisory Committee.  If referred to the  Accelerated Approval Advisory Committee, the committee would have 90 days to make an approval recommendation, which FDA would need to act on within 30 days thereafter – either with an approval decision or an explanation as to why approval is not granted.  That non-approval decision could be appealed.

In addition, the bill would create FDC Act § 561B – “Expanded Access to Investigational Drugs and Devices” – requiring FDA to “establish a new program to expand access to investigational treatments for individuals with serious or life threatening conditions and diseases.”  Among other things, FDA would be required to “establish policies, regulations, and guidance designed to most directly benefit seriously ill patients,” implement training programs with respect to the expanded access programs, and “establish a program or expand upon an existing program to encourage the development of surrogate endpoints and biomarkers that are reasonably likely to predict clinical benefit for serious or life-threatening conditions for which there exist significant unmet patient needs.”  In a similar vein, the bill would amend the FDC Act to add § 568 – “Policies Related to Study Evaluation Information” – requiring FDA to “give consideration to clinical judgment and risks to the patient from the disease or condition involved in the evaluation of the safety and effectiveness of drugs, biological products, and devices that treat serious or life-threatening diseases or conditions” (i.e., non-statistical measures).

Rep. Watson’s bill comes several months after FDA issued its final rule on Expanded Access to Investigational Drugs for Treatment Use in August 2009.  As we previously reported, those regulatons clarified FDA’s existing expanded access regulations and added new types of expanded access for treatment use. 

Rep. Watson’s bill is not the first legislative attempt to create a new approval system for patients to access drugs for serious or life-threatening diseases or conditions.  In 2008, Senator Sam Brownback (R-KS) introduced S. 3046 – the “Access, Compassion, Care, and Ethics for Seriously Ill Patients Act” (the “ACCESS Act”).  That bill proposed to create a three-tiered approval system – “Compassionate Investigational Access,” “Accelerated Approval,” and “Final Approval” – for products for serious or life-threatening diseases or conditions (see our previous post here).  Sen. Brownback's bill was preceded by the U.S. Court of Appeals for the District of Columbia Circuit's August 7, 2007 8-2 opinion in Abigail Alliance for Better Access to Developmental Drugs v. von Eschenbach in which the court held “that there is no fundamental right ‘deeply rooted in this Nation’s history and tradition’ of access to experimental drugs for the terminally ill.” (see our previous post here) 

By Cassandra A. Soltis –

Think twice before putting that claim on your food label – or on your website.  Just last month, FDA issued 16 Warning Letters to food manufacturers regarding unauthorized nutrient content and health claims appearing in food labeling.  In addition, some companies were cited for making certain claims that caused their foods to be drugs. 

For example, Dreyer’s Grand Ice Cream, Inc. was told that some of their products were misbranded for including a “0 g trans fat” claim without an accompanying statement directing consumers to see the Nutrition Facts box for fat and saturated fat content.  FDA also informed Diamond Food, Inc. that its shelled walnuts were drugs because of claims that omega-3 fatty acids in walnuts may help lower cholesterol, protect against heart disease and stroke, and even fight depression and other mental illnesses. 

Why the focus on food claims?  In her open letter to industry, Dr. Margaret A. Hamburg, Commissioner of Food and Drugs, explained that “ready access to reliable information about the calorie and nutrient content of food” is important, particularly in light of the “prevalence of obesity and diet-related disease in the United States.”  She stated that further underscoring the need for accurate food labeling information is the First Lady’s campaign on childhood obesity.  Dr. Hamburg added that the agency intends to work with industry to design a front-of-package (FOP) labeling system that will be meaningful to consumers and help them use and understand the nutrition information provided.   

In that connection, FDA recently released the results of its 2008 U.S. Health and Diet Survey, which included questions about consumers’ use of food labels.  Among the results that caught our attention:

• 54% of consumers surveyed report that they often make use of the food label when purchasing a product for the first time.  66% of consumers who make at least rare use of the label do so to “see how high or low a food is in things like calories, salt, vitamins or fat.” 

• 72% of consumers surveyed report awareness of FOP health or nutrition-related symbols or icons.  Of those who are aware of such symbols, 77% report that they often or sometimes use those symbols when deciding to buy a food. 

• 56% of consumers question the accuracy of claims such as “low fat” or “high fiber.”

This latest evidence of the reliance of consumers on food labeling to make purchasing decisions is likely to stiffen FDA’s resolve to take a harder line on enforcement of labeling requirements.  As we discussed in a prior posting, FOP labeling is likely to garner especially close scrutiny.

By Kurt R. Karst –      

Earlier today, the U.S. Court of Appeals for the District of Columbia Circuit handed Teva Pharmaceuticals USA, Inc. (“Teva”) a significant victory in the company’s lawsuit against FDA concerning the availability of 180-day exclusivity for generic versions of Merck & Co., Inc.’s (“Merck’s”) blockbuster angiotensin II receptor antagonist drugs COZAAR (losartan potassium) Tablets and HYZAAR (hydrochlorothiazide; losartan potassium) Tablets.  Although FDA has made no determination with respect to generic COZAAR and HYZAAR 180-day exclusivity, Teva believes that FDA’s interpretation of the statute, as previously applied in the Agency’s adjudications concerning generic PRECOSE (acarbose) Tablets and generic COSOPT (dorzolamide hydrochloride; timolol maleate), will result in a forfeiture of 180-day exclusivity for both products.  The D.C. Circuit's decision is the culmination of several years of debate concerning the proper interpretation of the “failure to market” 180-day exclusivity forfeiture provisions at FDC Act § 505(j)(5)(D)(i)(I), beginning with FDA's so-called "bookend approach" described in the Agency's generic KYTRIL (granisetron HCl) Injection 180-day exclusivity decision.

As we previously reported (here, here, and here), Teva’s lawsuit challenged FDA’s interpretation of the “failure to market” 180-day exclusivity forfeiture provisions at FDC Act § 505(j)(5)(D)(i)(I), which were added to the FDC Act in December 2003 by the Medicare Modernization Act (“MMA”), and in particular FDA’s interpretation of the patent information withdrawal provision at FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC).  That provisions states that one of the dates for calculating a forfeiture is the date that is 75 days after which “[t]he patent information submitted under [FDC Act § 505(b) or (c)] is withdrawn by the holder of the application approved under [FDC Act § 505(b)].”  FDA has interpreted the provision such that a request to withdraw patent information from the Orange Book is a forfeiture event under FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC).  In discussing its interpretation of FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC), FDA determined that the U.S. Court of Appeals for the District of Columbia Circuit’s 2006 decision in Ranbaxy Labs. Ltd. v. Leavitt (a pre-MMA case) holding that FDA may not condition the delisting of a patent on the existence of patent litigation and deprive an ANDA applicant eligible for 180-day exclusivity of such exclusivity does not apply to the version of the FDC Act amended by the MMA. 

Teva argued in the D.C. District Court that it should not forfeit 180-day exclusivity because FDA’s interpretation of FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC) is unlawful.  Specifically, Teva argued that the mechanism added to the FDC Act by the MMA – i.e., FDC Act § 505(j)(5)(C)(ii)(I) – permitting a cause of action that allows a generic applicant to seek a court order compelling the brand manufacturer to delist a challenged patent must be read together with FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC):

Read together, as statutory provisions must be, it thus is clear that these twin Amendments – the delisting mechanism, on one hand, and the delisting trigger, on the other – were not remotely intended to open the proverbial floodgates to manipulative, exclusivity-divesting patent delistings by brand manufacturers, and thus sub silentio to abrogate the longstanding prohibition against such delistings that Ranbaxy recognized.

In July 2009, Judge Rosemary M. Collyer of the U.S. District Court for the District of Columbia ruled in a 27-page opinion that FDA’s interpretation of FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC) is not ambiguous and that FDA’s interpretation of the statute is reasonable.  The court, analyzing the arguments under the familiar Chevron standard, concluded that, “[a]t Chevron step one this Court must give effect to the clear intent of Congress as reflected in the statute because subsection (bb)(CC) is not ambiguous on its face.”  The court went on to state that “Teva is correct that the statute does not address when an Innovator may withdraw a patent, but what is important is that the statute does not limit the Innovator’s right to withdraw patent information.  The Court cannot take on the role of the legislature by creating such limitations when they were omitted by Congress.”  The court also dismissed the utility of the Ranbaxy decision in interpreting the 180-day exclusivity forfeiture provisions added by the MMA, noting that “Ranbaxy was decided under the Hatch-Waxman Amendments as they existed prior to the enactment of the MMA . . . .  The MMA now provides that the first generic manufacturer is entitled to exclusivity if it has not forfeited that exclusivity.” (emphasis in original)  Ultimately Judge Collyer concluded that “FDA’s interpretation of the MMA is a reasonable interpretation of the balance Congress struck between these competing goals.” 

(The court also denied FDA’s Motion to Dismiss the case on several grounds – that Teva is not challenging final agency action, Teva’s claims are not ripe, Teva has not suffered sufficient injury for Article III standing, and Teva has failed to exhaust administrative remedies – but primarily on the basis that Teva failed to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6), inasmuch as Teva was not challenging a final agency action.  FDA appealed only the ripeness and standing issues.)   

On appeal, Teva offered two primary arguments against FDA’s interpretation of FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC) – which the D.C. Circuit dubbed the “linguistic argument” and the “structural argument.”  Teva’s “linguistic argument”:

. . . takes the form of linguistic analysis focused almost entirely on the text of the “failure to market” forfeiture event and a related provision.  The [MMA], Teva explains, introduced a new procedure, a counterclaim in the brand manufacturer’s patent infringement suit, through which generic companies can force brand companies to delist an improperly asserted patent.  See 21 U.S.C. § 355(j)(5)(C)(ii)(I).  This counterclaim provision is the only portion of the statute that explicitly provides for the delisting of a patent after it has been challenged in an ANDA.  In the company’s view, that singular reference requires the conclusion that the counterclaim provision describes the only scenario in which the FDA may delist a challenged patent.

Under Teva's structural argument, Ranbaxy remains applicable post-MMA:

This brings us to Teva’s structural argument.  Ranbaxy, Teva notes, concerned an FDA policy with a virtually identical effect. See 469 F.3d at 125. This court condemned that rule, partly because it allowed a brand manufacturer,

by delisting its patent, to deprive the generic applicant of a period of marketing exclusivity. By thus reducing the certainty of receiving a period of marketing exclusivity, the FDA’s delisting policy diminishe[d] the incentive for a manufacturer of generic drugs to challenge a patent . . . in the hope of bringing to market a generic competitor for an approved drug without waiting for the patent to expire.  The FDA may not, however, change the incentive structure adopted by the Congress, for the agency is bound “not only by the ultimate purposes Congress has selected, but by the means it has deemed appropriate, and prescribed, for the pursuit of those purposes.”

Id. at 126 (emphasis added, citation omitted).  Nothing in the [MMA] altered that essential incentive structure, says Teva, so the preceding portion of Ranbaxy remains applicable even under the new regime.  Indeed, it is true that the 2003 amendments say nothing specific to undermine our prior understanding of the statute’s intended incentive structure.

The D.C. Circuit’s highly anticipated 31-page opinion, which also addressed the issues of ripeness and standing appealed by FDA, is a game-changer!   The Court ruled (Judges Williams and Griffith) that FDA’s interpretation of FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC) fails at Chevron step one.  Reviewing the district court’s decision de novo, the D.C. Circuit, although not convinced by Teva’s linguistic argument, found Teva’s structural argument to be persuasive: 

The real issue, then, is whether the FDA is right that the 2003 addition of the “failure to market” forfeiture provision, 21 U.S.C. § 355(j)(5)(D)(i)(I), altered the statute’s incentive structure to the point that Ranbaxy’s reasoning no longer controls the agency’s treatment of a delisting request in the wake of a paragraph-IV filing.

The terms of § 355(j)(5)(D)(i)(I) . . . create five possible dates on which a generic manufacturer otherwise entitled to exclusivity can forfeit it: (1) 75 days after the agency finally approves the relevant ANDA; (2) 30 months after the generic submits the relevant ANDA; (3) 75 days after a court judgment that the challenged patent is invalid or not infringed; (4) 75 days after a suit over the challenged patent is settled favorably to the ANDA filer; and (5) 75 days after the challenged patent is delisted. No forfeiture occurs, however, unless one of dates (1)-(2) and one of dates (3)-(5) have come to pass. . . .  Setting aside the subsection at issue in this case—listed as (5) above, and codified as (bb)(CC)—the “failure to market” forfeiture provision does not permit a brand manufacturer to vitiate a generic’s exclusivity without the generic manufacturer’s having had some say in the matter.  No forfeiture can take place unless the brand manufacturer brings an infringement suit against the generic and either loses on the merits or enters an unfavorable settlement agreement.  The latter necessarily entails some participation by the generic; the former invariably involves significant expense for the brand manufacturer, and affords the victorious generic the opportunity to ask the court to delay entering final judgment until a date that would not trigger forfeiture prematurely— before the agency grants final approval to the relevant ANDA.

The FDA’s view turns the last alternative among events (3)-(5) into a fundamentally different forfeiture trigger: it is satisfied when the patent targeted in a paragraph-IV filing “is withdrawn by the” brand manufacturer, full stop—meaning that Congress has now explicitly provided for a scenario in which the brand maker can unilaterally deprive the generic of its exclusivity.  The agency, however, offers not a single cogent reason why Congress might have permitted brand manufacturers to trigger subsection (CC) by withdrawing a challenged patent, outside the counterclaim scenario identified by Teva.

The argument that the plain language of the statute imposes no limit on the circumstances in which the agency may effectuate delisting requests fails. Precisely the same could have been said of the version of the statute that Ranbaxy addressed, and we nevertheless concluded that its structure precluded an FDA rule allowing the agency “to delist a patent upon the request of the [brand manufacturer]” when the delisting would rob the generic maker of earned exclusivity. . . .

As Congress deliberately created the 180-day exclusivity bonus, the FDA cannot justify its interpretation by proudly proclaiming that it has eviscerated that bonus.

We see nothing in the [MMA] that changes the structure of the statute such that brand companies should be newly able to delist challenged patents, thereby triggering a forfeiture event that deprives generic companies of the period of marketing exclusivity they otherwise deserve.  For that reason, the interpretation of the statute that the FDA has adopted in two recent adjudications, and that it regards itself as bound by law to apply to Teva’s ANDAs for losartan products, fails at Chevron step one. [(italics in original; bold emphasis added; citations omitted)]

So, under the D.C. Circuit's opinion, the patent delisting counterclaim provision at FDC Act § 505(j)(5)(C)(ii)(I) added by the MMA must be read together with the patent delisting forfeiture provision at FDC Act § 505(j)(5)(D)(i)(I)(bb)(CC).

Judge Henderson filed a dissenting opinion in the case on the basis that Teva’s lawsuit is not ripe until FDA issues an exclusivity decision.  The case was remanded to the district court for further proceedings “as the court has yet to address the appropriateness of each form of relief that Teva has sought. . . .”  Teva's Complaint requested declaratory and injunctive relief.  

There could very well be a flurry of activity in this case until April 2010, when FDA is expected to approve generic losartan products, as interested parties decide whether or not to seek to overturn the D.C. Circuit’s decision.

By Kurt R. Karst –      

The Patent and Trademark Office’s (“PTO’s”) recent denial of a Patent Term Extension (“PTE”) for U.S. Patent No. 5,270,305, which was reissued as U.S. Patent No. RE40,045 (“the ‘045 patent”), covering Glaxo’s ADVAIR DISKUS (fluticasone propionate; salmeterol xinafoate) should be the last word from the PTO on the availability of PTEs for so-called “synergistic combinations” of previously aproved drugs.  Glaxo’s PTE application was initially submitted to the PTO in October 2000 and was last amended in August 2008 after the issuance of the reissue patent. 

As we previously reported, the PTO’s June 2008 decision, in which the Office denied a PTE for a patent covering SYMBICORT (budesonide; formoterol fumarate dihydrate) Inhalation Aerosol, clarified the PTO’s position that a PTE is not available for a drug product containing two previously approved active ingredients that purportedly act synergistically to create a new product.  Until then, companies – including Glaxo – relied on a statement in § 2751 of the PTO’s Manual of Patent Examining Procedure (“MPEP”) that seemed to raise the possibility that two previously approved active ingredients could synergistically interact to yield a new product eligible for a PTE.  MPEP § 2751 states, in relevant part, that “an approved product having two active ingredients, which are not shown to have a synergistic effect or have pharmacological interaction, will not be considered to have a single active ingredient made of the two active ingredients.”  

Companies relied on this statement notwithstanding a 1994 PTE decision concerning EMLA (lidocaine; prilocaine) Topical Cream, in which the PTO determined that, consistent with the legislative history of the PTE statute at 35 U.S.C. § 156, a patent claiming a combination of two previously and separately approved active ingredients is not eligible for a PTE, regardless of “any enhanced effect of the combination.”  In addition, in 2004, the U.S. Court of Appeals for the Federal Circuit stated in its decision in Arnold Partnership v. Dudas – a case concerning a PTE for VICOPROFEN (ibuprofen; hydrocodone bitartrate) – that “this court doubts that synergistic effects are an appropriate distinction for [PTE] policies, particularly where the statutory language does not distinguish between synergistic and nonsynergistic combinations.”

As with the previous SYMBICORT PTE denial, the PTO ruled that the ‘045 patent is not eligible for a PTE, and that Glaxo’s reliance on the MPEP statement above “is misplaced:”  

The synergistic effect of the active ingredients salmeterol xinafoate and fluticasone propionate has no relevance in determining "first permitted commercial marketing or use of the product" as required by 35 U.S.C. § 156(a)(5)(A).  The term "product" as used in 35 U.S.C. § 156 includes any new drug or antibiotic drug, "as a single entity or in combination with another active ingredient."  35 U.S.C. § 156 (f)(2).  Section 156(f)(2) says nothing about if a combination of active ingredient is synergistic, it is treated as a single entity.  See Arnold Partnership v. Dudas, 362 F.3d 1338, 1343 (Fed. Cir. 2004). . . .

The statement in the MPEP does not require that the USPTO treat an alleged synergistic combination drug product with two active ingredients as a single active ingredient made up of the two active ingredients for patent term extension purposes.  Rather, MPEP § 2751 merely explains that a product having two active ingredients, without synergy, will not be treated as a single active ingredient.  This does not imply that a showing of synergy in a product having two active ingredients, each of which was previously approved for commercial marketing or use, must be considered to be a single active ingredient for patent term extension purposes.  The USPTO construes 35 U.S.C. § 156(f)(2) by giving the plain meaning to each and every term of the provision.  A "drug product" exists as a single entity, i.e., a drug product having one active ingredient, or the drug product is a combination of two or more active ingredients.  No statutory language, regulation, court decision or legislative history account for synergy in the patent term extension context.  As such, Applicant cannot point to any precedent which would require finding that a drug product having two active ingredients, which exhibit a synergistic effect, is a single entity within the meaning of section 156.

So, absent another long-lingering PTE application (or a court challenge), the PTO’s latest decision shoud be the last we hear about this issue. 

By David B. Clissold & Carrie S. Martin –

Last Friday, FDA issued two new draft guidance documents regarding clinical trial designs: Guidance for Industry: Adaptive Design Clinical Trials for Drugs and Biologics (February 2010) and Guidance for Industry: Non-Inferiority Clinical Trials (March 2010).

These draft guidance documents are products of FDA’s Critical Path Initiative (“CPI”), FDA’s effort to modernize the scientific process through which a potential drug or device goes from “proof of concept” to a marketed medical product.  The CPI is an effort to optimize the scientific tests and tools used to determine whether a product is safe and effective.  One of the goals of the CPI is to streamline clinical trials, and the Adaptive Design and Non-Inferiority guidances are solid examples of FDA’s progress towards that objective.

Adaptive Design Guidance

The Adaptive Design draft guidance provides sponsors with information on those features of  adaptive designs that are valid, and discusses elements that may be problematic.  FDA defines an adaptive design clinical trial as one that “includes a prospectively planned opportunity for modification of one or more specified aspects of the study design and hypotheses based on analysis of data (usually interim data) from subjects in the study.”  By allowing these modifications, a study may more efficiently provide information, increase the likelihood of successfully meeting a study objective, or improve the understanding of the drug’s treatment effect.  The guidance notes that such prospectively planned modifications can be submitted with the study protocol or in a statistical analysis plan (“SAP”).

Among the possible study design modifications, the guidance discusses study eligibility criteria, randomization procedure, total sample size, primary endpoints and secondary endpoints, and the methods used to analyze those endpoints.  The Agency explains that the adaptive design concept is best used in adequate and well-controlled studies and that study revisions should be based on blinded data.  A chief concern with adaptive design studies is the possibility of bias and false-positives.  To address these concerns, FDA recommends – among other things – that sponsors submit a written standard operating procedure (“SOP”), which defines who will conduct the interim analysis and implement the adaptation plan.  The Agency recommends using an independent entity for this purpose, such as a Data Monitoring Committee ("DMC"), to control access to unblinded data.

Because adaptive study designs may require more advanced planning by sponsors, the guidance document encourages sponsors to interact with the Agency during the planning stages of the clinical trials.  The timing and frequency of such meetings will vary based on the complexity of the study designs.

Non-Inferiority Clinical Trials Guidance 

The Non-Inferiority draft guidance explores FDA’s thinking on the use of non-inferiority study designs to provide evidence of a drug’s effectiveness.  This includes FDA’s thoughts on how best to choose an appropriate non-inferiority margin and how to analyze the results.  FDA explains that a non-inferiority trial seeks to demonstrate that “any difference between [ ] two treatments is small enough to allow a conclusion that the new drug has at least some effect or, in many cases, an effect that is not too much smaller than the active control.”  This is in contrast to the more common superiority trials, such as a placebo-controlled trial, which seek to prove a new drug is more effective than the control.  Non-inferiority trials are most often used when it would be unethical to use a placebo control. 

In addition to providing recommendations regarding study design and interpretation, the guidance provides answers to nine “commonly asked questions” regarding the estimation of margins, appropriate active control drugs, endpoints, and reliance on a single non-inferiority study to support effectiveness.  The guidance also discusses five examples derived from publicly available information that describe how to choose a non-inferiority margin, how to analyze the results, and other considerations relevant to the design and interpretation of non-inferiority studies.

Comments on both guidance documents are due June 1, 2010, and can be submitted to the Division of Dockets Management (HFA-305), FDA, 5630 Fishers Lane, rm. 1060, Rockville, MD 20852 or electronically at http://www.regulations.gov.

The Washington Legal Foundation has published a Legal Opinion Letter authored by Hyman, Phelps & McNamara, P.C., attorneys Jeffrey N. Wasserstein and Nisha P. Shah.  The article, with the catchy title "Court Empowers Qui Tam Defendants To Sue Third Parties For Indemnification," expands on our earlier discussion of the topic. 

By Kurt R. Karst –      

FDA’s Office of Generic Drugs (“OGD”) has a backlog of Abbreviated New Drug Applications (“ANDAs”) that is nearing 2,000, according to OGD Director Gary Buehler, who presented the data at the recent Generic Pharmaceutical Association (“GPhA”) Annual Meeting.  OGD’s median ANDA approval time was also up about 5 months – to 26.70 months – in Fiscal Year (“FY”) 2009 compared to the FY 2008 figure of 21.65 months.  Both the ANDA backlog and median approval times have progressively increased over the past several years, while the numbers of ANDA receipts and approval actions have remained relatively steady, as illustrated in the tables below from Mr. Buehler’s GPhA presentation.

So why such a ANDA backlog and rising median approval times?  The answer lies in OGD’s resources, according to FDA Commissioner Dr. Margaret Hamburg.  In Her speech at the GPhA Annual Meeting, Dr. Hamburg commented that “no one benefits from a pending-application queue that will soon hit the 2,000 mark.  This is simply unacceptable. . . .  But the unprecedented spike in generics applications has simply outstripped our capacity to properly review, which must remain our foremost focus.  The solution lies in resources.” (emphasis in original)

And “resources” means both funding from Congress and the generic drug industry, according to Dr. Hamburg:

We have already begun to use the $10 million that Congress allotted to our agency to hire 50 additional scientists to address the generics-application backlog. But without action from your industry, too—without your support for a fair system of user fees—we simply cannot achieve for the public what we otherwise could. . . .  We very much want to work with you to see generic drug user fees enacted this year. Adequate and reasonable fees will be key to both more rapid review and to better surveillance.

The President’s FY 2011 budget request for the Department of Health and Human Services includes $51,545,000 in appropriations to OGD (a $10 million increase over last year) and proposes “user fees to support activities related to generic human drug reviews” (as well as new user fees for re-inspections of FDA-regulated facilities).  Contingent upon the enactment of authorizing legislation, generic drug user fees would be expected to bring in an amount not to exceed $38,015,000.

According to FDA’s FY 2011 Congressional Justification, generic drug user fees would more than halve the current median approval time:

FDA will hire additional staff to support the review of [ANDAs] for generic drugs and inspections of generic drug manufacturing facilities.  In the case of user fees, by the end of the first five years of the Generic Drug User Fee Program, the additional user fees will result in a complete review and response for an estimated 80 percent of applications within 12 months of receipt, other than applications excluded because of exclusivity or challenges.

Previous budget requests have proposed the establishment of generic drug user fees (along with draft performance goals); however, legislation has never gotten off the ground and negotiations between FDA and GPhA were stalled, apparently over what FDA’s performance results should be. 

Dr. Hamburg expressed her hope that interested parties “can return to the negotiating table soon.”  GPhA appears to be open to reengaging FDA in user fee negotiations, according to a GPhA press release.

By Kurt R. Karst –      

In yet another setback to the Federal Trade Commission’s (“FTC’s”) battle against settlement agreements between brand name and generic drug companies – so-called “reverse payments” or what the government now calls “pay-for-delay” agreements – the U.S. District Court for the Northern District of Georgia (Atlanta Division) largely dismissed multidistrict litigation brought by the Commission, direct purchasers, and indirect purchasers challenging certain agreements in which Solvay Pharmaceuticals, Inc. allegedly paid generic drug companies to delay generic competition to Solvay’s drug product ANDROGEL (testosterone gel) 1%.  Specifically, the FTC’s complaint (originally filed in the U.S. District Court for the Central District of California) alleged that in 2006, Solvay and generic companies violated various federal antitrust laws when they agreed to dismiss patent infringement litigation on U.S. Patent No. 6,503,894 (“the ‘894 patent”) in exchange for a profit-sharing arrangement and provided the generic competitors would not launch their generic versions of ANDROGEL until 2015.

The court, citing previous circuit court decisions concerning settlement agreement  antitrust challenges – e.g., Valley Drug Co. v. Geneva Pharms., Inc., 344 F.3d 1294, 1303 (11th Cir. 2003); Schering-Plough Corp. v. Fed. Trade Comm’n, 402 F.3d 1056 (11th Cir. 2005); In re Tamoxifen Citrate Antitrust Litigation, 466 F.3d 187 (2d Cir. 2006); and In re Ciprofloxacin Hydrochloride Antitrust Litigation, 544 F.3d 1323 (Fed. Cir. 2008)) – ruled that the settlements are not an unreasonable restraint of trade:

The Plaintiffs do not allege that the settlements between the Defendants exceed the scope of the ‘894 patent.  First, the settlements only exclude generic AndroGel from the market.  The ‘894 patent claims the gel formulation used in AndroGel and that gel formulation is necessary to the manufacture and sale of generic AndroGel.  The settlements do not exclude any product other than generic AndroGel.  Second, the settlements only exclude generic AndroGel from the market until August 31, 2015.  This provides for five years less exclusion than the ‘894 patent, which does not expire until August 2020.  Third, the settlements only prevent Watson, Par, and Paddock from selling generic AndroGel. . . .  Because the Plaintiffs do not allege that the settlements exceed the scope of the ‘894 patent, it does not matter if the Defendants settled their patent disputes with reverse payments. The Plaintiffs’ reverse payment settlement claims must be dismissed. [(internal quotation and citation omitted)]

The decision comes just a month after the FTC issued its report, titled “Pay-for-Delay: How Drug Company Pay-Offs Cost Consumers Billions,” in which the Commission analyzed the effects of settlement agreements in the drug industry over the past 6 years and pleaded for the inclusion of a provision in Health Reform legislation that would address such settlements.  (See our previous post here) 

Earlier this week, the Obama Administration released a Health Reform proposal that includes, among other things, provisions addressing settlement agreements.  (see our previous post on the proposal here)   According to summary:

The President’s proposal adopts a provision from the bipartisan legislation that gives the FTC enforcement authority to address this problem. Specifically, it makes anti-competitive and unlawful any agreement in which a generic drug manufacturer receives anything of value from a brand-name drug manufacturer that contains a provision in which the generic drug manufacturer agrees to limit or forego research, development, marketing, manufacturing or sales of the generic drug. This presumption can only be overcome if the parties to such an agreement demonstrate by clear and convincing evidence that the pro-competitive benefits of the agreement outweigh the anti-competitive effects of the agreement. The proposal also requires the Chief Executive Officer of the branded pharmaceutical company to certify to the accuracy and completeness of any agreements required to be filed with the FTC.

The Obama Administration’s description of its settlement agreement proposal – which FTC Chairman Jon Leibowitz praised – appears to be similar to S. 369, the Preserve Access to Affordable Generics Act, which was passed out of the Senate Judiciary Committee last year.  That bill would amend the FTC Act to permit the FTC to “initiate a proceeding to enforce the provisions of [new Sec. 28] against the parties to any agreement resolving or settling, on a final or interim basis, a patent infringement claim, in connection with the sale of a drug product.”  Such agreements, if challenged, would be presumptively anticompetitive and unlawful unless it can be demonstrated “by clear and convincing evidence that the procompetitive benefits of the agreement outweigh the anticompetitive effects of the agreement.”  In contrast, the bill passed by the House (§ 2573) would amend the FDC Act to add section 505(w) – “Protecting Consumer Access to Generic Drugs” – to, among other things, make it unlawful for any person from being a party to any agreement resolving or settling a patent infringement claim in which an ANDA applicant receives anything of value, and the ANDA applicant agrees not to research, develop, manufacture, market or sell the generic drug that is the subject of a patent infringement claim.  Both bills were scored by the Congressional Budget Office (here and here). 

According to a recently filed report on S. 369, there is some disagreement as to how best to address settlement agreements.  Senators Orrin Hatch (R-UT), Jon Kyl (R-AZ), John Cornyn (R-TX), and Tom Coburn (R-OK) filed their “minority views” criticizing the legal-presumption rule in the bill:

Although this bill has been substantially improved since it was first introduced, we cannot support it in its current form. The original bill would have created a per se violation of the antitrust laws where the parties to a drug patent infringement suit settle the suit in a way that gives something of value to the generic company other than the right to go to market earlier. The reported bill replaces an express per se ban with a presumption that such agreements are anticompetitive and invalid. Because of the way that the bill enforces that presumption, however, we believe that the bill would amount to a de facto per se ban on covered settlements—and would entail all of the evils attendant to a per se ban.

To be clear, we would support creating a legal presumption against drug patent settlements—in effect, requiring the parties to such settlements to show why the terms of the settlement are reasonable and will not harm consumers. Such a test would require the parties to explain what consideration is being transferred between them under the agreement, to estimate the value of that consideration, and to give a neutral and legitimate reason for the exchange. We think that such a test would ferret out settlements that are anticompetitive and designed simply to delay generic market entry, while still allowing the parties to enter into settlements that are reasonable.

For a legal-presumption rule to work, however, the parties must be afforded a forum in which they can quickly and fairly test whether they have overcome the presumption and whether the agreement is valid. Unfortunately, under the reported bill, settlements would be made presumptively unlawful, but the bill does not create a process for quickly resolving whether the agreement is unlawful. The issue would not be resolved until the FTC brings an action to challenge the settlement, which could be years after the settlement was entered into. Moreover, the current bill requires the brand and generic companies to rebut the presumption that the agreement is unlawful by clear and convincing evidence. This is a heavy burden that is not appropriate for commercial litigation and that tilts the scales in a lawsuit sharply in the government’s favor. . . .

By effectively preventing the parties from settling, it is likely that this bill will discourage generic drug companies from bringing challenges to brand companies’ patents in the first place—and as a result, the bill will ultimately reduce competition and raise prices for drugs that are currently subject to invalid or low-quality patents.

Notwithstanding the current legislative initiatives to address settlement agreements – and the loss in the ANDROGEL case – the FTC will presumably continue to fight against such arrangements.  Indeed, settlement agreement antitrust challenges are currently beling litigated in a Pennsylvania district court in Fed. Trade Comm’n v. Cephalon, and before the U.S. Court of appeals for the Second Circuit in Arkansas Carpenters Health and Welfare Fund v. Bayer AG.

By Alan Kirschenbaum —

In an effort to salvage health care reform, the Obama Administration will hold a bipartisan health care reform meeting this Thursday, February 25.  Invited are the Congressional leadership of both parties and the Chairmen and ranking membership of committees involved in health care reform.  Today the White House released a health care reform outline described as a “proposal to work off of at the meeting.”  The outline can be found here and additional detail is posted on the White House web site.  The drug and device-related points of the outline draw on many of the provisions that appear in the House and Senate bills, which we’ve described in previous posts.  (You’ll find our report on the House bill here and the Senate bill here.)  Among the familiar provisions appearing in the President’s outline are the following:

•  Medicare Part D Donut Hole:  Like the House bill, the proposal would phase out the Part D coverage gap over the next ten years.  In 2010, a $250 rebate would be provided to Part D beneficiaries who enter the donut hole.  Though the outline provides no detail, this rebate would presumably be funded by pharmaceutical manufacturers.

•  Medicaid rebates:  Like both the House and Senate bills, the proposal would increase the minimum Medicaid rebate for innovator drugs to 23.1 percent of AMP, impose an additional rebate for new formulations of an innovator drug, and require new rebates on drugs dispensed to Medicaid managed care enrollees.  The proposal does not mention an increase in the minimum rebate for generics, which was included in the Senate bill.

•  Industry fees and excise taxes:  The annual fee on the drug industry, which is $23 billion over 10 years in the Senate bill, is increased to $33 billion but delayed until 2011.  Instead of a fee on the device industry as contained in the Senate bill, the President has opted for the House bill’s excise tax on device sales beginning in 2013.  The outline doesn’t indicate whether the excise tax is 2.5 percent of the wholesale price, as under the House bill.

•  Physician payment sunshine:  Like both the House and Senate bills, the President’s proposal includes physician payment reporting requirements.
 
•  Ending pay-for-delay arrangements:  The President’s proposal adopts House provisions prohibiting brand name drug manufacturers from paying generic manufacturers to forego manufacturing or marketing of generic drugs.

•  Biosimilar approval:  The President’s proposal adopts from both bills a new approval pathway for biosimilars.
 
•  340B program expansion:  A cryptic reference to extending drug discounts to “hospitals and communities that serve low-income patients” indicates that the President’s proposal includes the 340B drug discount program expansion provisions included in both the House and Senate bills, though the extent of the expansion (which differs between the two bills) is uncertain. 

It is far from certain whether Thursday’s meeting will break the partisan logjam on health care reform.  However, if it does, the drug and device provisions outlined in the President’s proposal are likely to be included in any surviving bill.

By David B. Clissold and Nisha P. Shah

On February 19, 2010, FDA issued a proposed rule that would require sponsors to report any person that has or may have engaged in the falsification of data in studies that involve human or animal subjects.  FDA believes the proposed rule is “intended to help ensure the validity of data that the agency receives in support of applications and petitions for FDA product approvals and authorization of certain labeling claims and to protect research subjects.”

Key definitions under the proposed rule are: 
•  “Sponsor” would broadly include sponsors of studies conducted on humans and animals; petitioners submitting food additive, color additive, nutrient content claim, and health claim petitions; and manufacturers or distributors submitting new dietary ingredient notifications.
•  “Falsification of data” would be defined as “creating, altering, recording, or omitting data in such a way that the data do not represent what actually occurred.” The proposed rule would not be intended to address “unintentional errors in recording or reporting information”, such as typographical errors or transposed numbers or characters.
•  “Data” would include, though not limited to, “individual facts, tests, specimens, samples, results, statistics, items of information, or statements made by individuals.”

The rule would require a sponsor to report information indicating that a “person has, or may have, engaged in the falsification of data in the course of reporting study results, or in the course of proposing, designing, performing, recording, supervising, or reviewing studies that involve human subjects or animal subjects conducted by or on behalf of a sponsor.”  A sponsor would not be required to determine definitively that data have been falsified, nor the intent of the person who has, or may have, falsified data.  Rather, a sponsor would be required to report information of which it is aware suggesting that a person has, or may have, engaged in the falsification of data. The reporting obligation would exist regardless of the amount of evidence, if any, the sponsor has with regard to the intent of the person who has, or may have, falsified data.  The agency emphasized that the sponsors should not wait to determine conclusively whether falsification actually occurred, or seek to determine the circumstances that led to the falsification before reporting the information with FDA. Therefore, a sponsor must report any confirmed or possible falsification of data.

The sponsor would be required to report the information to the appropriate FDA center “promptly”, but no later than 45 calendar days after the sponsor becomes aware of the information.  The reporting requirement would be ongoing and cover the periods before and after study completion.  Information in the report to FDA must include the following: 
•  The name of the person who has, or may have, falsified data, 
•  The last know address(es) and phone number(s) of that person, 
•  The specific identify of the potentially affected study, including, when applicable, application information such as the application number, investigational protocol number, study title, study site(s), and study dates, and 
•  Information suggesting that falsification occurred and describing the falsification. 

FDA commented that the agency is considering also whether additional information should be included in the report, such as the National Clinical Trial (“NCT”) number assigned to a study when the study is registered with ClinicalTrials.gov. 

FDA intends to use the reported information to determine whether further agency investigation is warranted in conjunction with other information available to the agency.  According to FDA, these investigations might form the basis of administrative or enforcement actions, such as excluding clinical trials from consideration by FDA, placing a clinical trial on hold, or initiating disqualification of investigators or criminal proceedings.  Failure to report possible falsification of data might constitute a violation of section 301(e) of the Food, Drug, and Cosmetic Act (21 U.S.C. § 331(e)) (concerning failure to make a required report) or 18 U.S.C. § 1001 (concerning the submission of a false statement to the federal government).

This proposed rule is a dramatic shift in regulatory obligations with serious implications for study sponsors and investigators alike.  Currently, if the sponsor of a clinical study under an IND determines that an investigator “is not complying” with the protocol or with FDA regulations (conduct that would include data falsification), they must discontinue the investigator’s participation in the trial and notify FDA.  Note that a mere “suspicion” of non-compliance is not enough to trigger this obligation.  In contrast, the proposed rule requires sponsors to report “possible” falsification.  FDA claims they are not interested in “errors” but as any experienced clinical trial auditor will tell you, there is a lot of gray area between an “error” and “falsification.”  As FDA noted, “falsification is more difficult for FDA to detect than errors . . . because persons who engage in the falsification process are more likely to attempt to conceal their actions.”  That is undoubtedly true, but such people are no more likely to reveal those actions to a sponsor’s representative than they are to an FDA investigator.  Moreover, data falsification is not always obvious right away, even to an auditor or monitor.  FDA generally gets to review these allegations on their own timeline with the benefit of 20:20 hindsight, yet the sponsor is expected to report suspicious activity, or apparently even unusual activity that is not resolved within 45 days, under penalty of civil penalty.  Not addressed in the proposed rule is whether FDA will expect the sponsor to continue to develop evidence for the Agency after it has reported suspected falsification.
 
Comments on the proposed rule must be submitted by May 20, 2010.

By William T. Koustas —

 The FDA has announced that it will require all drugs known as Erythropoiesis-Stimulating Agents (“ESAs”) to have a Risk Evaluation and Mitigation Strategy (“REMS”).  At the present time, this class of drugs is limited to three Amgen products: Procrit, Epogen (both epoetin alfa) and Aranesp (darbepoetin alfa).  FDA required Amgen to create a “risk management program,” or REMS, in April of 2008 for ESAs based on new safety information received from studies that showed ESAs caused tumors to grow faster, leading to premature death in some cancer patients.

 The REMS consists of a medication guide, communication plan, and elements to assure safe use (“ETASU”).  The medication guide is to be provided at retail/hospital outpatient pharmacies as well as in physician offices, clinics, hospital inpatient and in-clinic services and upon request.  The communication plan will consist of letters to Nephrology and Oncology related professional societies, “Dear Healthcare Provider” letters to hospital Directors of Pharmacy/Administrators and to those healthcare providers who directly purchase/prescribe ESAs and ensure access to communication materials online. 

 The most onerous part of this REMS is the required ETASU that includes certification for healthcare providers who both prescribe and dispense ESAs as well as the hospitals themselves.  Amgen has established Assisting Providers and cancer Patients with Risk Information for the Safe use of ESAs (“APPRISE”) which provides each eligible healthcare provider and/or hospital with an APPRISE enrollment number and ensures that they re-enroll in the APPRISE program every three years.  Failure to do so will result in that provider/hospital no longer having access to ESAs.  Further, the ETASU require that Amgen ensure that certified hospitals and healthcare providers only dispense ESAs after they have discussed the risks with the patient and the patient has signed an “Acknowledgment Form.” 

 We have previously discussed on this blog how FDA may expand its use of class-wide REMS as it continues to become more comfortable with its new powers under FDAAA, and this appears to further confirm that FDA is moving in that direction. 
  

By Ricardo Carvajal and A. Wes Siegner –

According to a press release issued by FTC, the agency “has sent letters to 11 companies that promote various Omega-3 fatty acid supplements, telling them they should review their product packaging and labeling to make sure they do not violate federal law by making baseless claims about how the supplements benefit children’s brain and vision function and development.”  The companies have been given two weeks to respond.  As an example of the level of substantiation that FTC would find acceptable, the letters point to “well-conducted, clinical cause-and-effect studies demonstrating that the use of the combination of Omega-3 fatty acids provided in Product X, in the same dosage as provided by one serving of that product, improves or promotes brain function, cognitive function, attention span, intelligence, memory, learning ability, and visual acuity in normal children ages 2 years and older.”

This latest action is consistent with remarks delivered by an FTC staff attorney at the Food and Drug Law Institute’s recent conference on hot topics in food and dietary supplement law.  In her remarks, the staff attorney indicated that FTC intends to closely scrutinize claims relating to omega-3 fatty acids, probiotics, fiber products, antioxidants, and products marketed for use by children.  The products targeted in FTC’s latest action span two of these categories, suggesting that they may have been at especially high risk.  Notably, FTC’s press release encourages the filing of consumer complaints against companies that “may be deceptively advertising dietary supplements for children.”

By Douglas B. Farquhar –

A recent of a New Jersey federal court is bound to encourage some manufacturers of an FDA-approved version of a long-marketed drug to sue competitors that continue to market unapproved versions of the same drug.
 
Mutual Pharmaceutical Company, Inc. and two other companies brought a lawsuit after receiving FDA approval of their applications to market colchicine in July 2009.  Colchicine has been used for centuries to treat gout.  Mutual sought a preliminary injunction to block competitors marketing unapproved versions of the drug.  The motion for preliminary injunction was denied by the California federal court, where the case was filed, as discussed in our .  The California court then transferred the case to the court in New Jersey. 

In a decision issued February 8th, Judge Garrett E. Brown, Jr., of the U.S. District Court for the District of New Jersey, held that, although Mutual cannot sue competitors for marketing the drug in violation of the Federal Food, Drug, and Cosmetic Act (inasmuch as the FDC Act does not permit a private right of action), the Court could not determine, at this preliminary stage of the case, whether the unapproved marketers of the drug had engaged in marketing activities that effectively misrepresented the unapproved status of their drugs in violation of the federal Lanham Act.

The decision is unpublished (meaning that it will not be published in the Federal Reporter, where district court judges can decide to place decisions on matters they think should have precedential impact).  However, inasmuch as the judge issued a decision allowing the case to continue, it will likely boost the optimism of similarly situated marketers of approved drugs that lawsuits will at least harass competitors which have not yet received FDA approvals.

The Court's decision is at odds with numerous court rulings in Lanham Act cases which have ruled that plaintiffs have improperly used the Lanham Act as a vehicle to enforce the FDC Act.  For instance, in Schering-Plough Healthcare Products, Inc., v. Schwarz Pharma, Inc., 586 F.3d 500 (7th Cir., 2009), the Seventh Circuit affirmed the dismissal of a Lanham Act case, ruling that the lawsuit sought to usurp FDA's primary jurisdiction concerning the legality of labels that FDA had earlier approved.   Hyman, Phelps & McNamara, P.C. represented Schwarz Pharma, Inc. and Kremers Urban, LLC in that case.  Our firm is writing an article in the next edition of FDLI Update magazine about the interplay between the Lanham Act and the FDC Act.

By Ricardo Carvajal –

In an effort to grant FDA additional authority over dietary supplements, Senators John McCain and Byron Dorgan have introduced the Dietary Supplement Safety Act of 2010.  The bill would require dietary supplement facilities to provide FDA with information on supplements and their ingredients on an ongoing basis, would substantially alter the requirements applicable to new dietary ingredients ("NDI’s"), would give FDA mandatory recall authority, and would expand adverse event reporting requirements, among other changes. 
 
Particularly noteworthy are the changes in the requirements applicable to NDI’s that would take effect if the bill were to become law.  Currently, FDCA § 413(c) defines an NDI as “a dietary ingredient that was not marketed in the United States before October 15, 1994 and does not include any dietary ingredient which was marketed in the United States before October 15, 1994.”  If a dietary ingredient meets the definition of an NDI, then a manufacturer or distributor must submit a 75-day premarket notification to FDA that provides the basis on which the manufacturer or distributor has concluded that a dietary supplement containing the NDI will reasonably be expected to be safe, with one exception.  A premarket notification need not be submitted if “the dietary supplement contains only dietary ingredients which have been present in the food supply as an article used for food in a form in which the food has not been chemically altered.”

In conjunction with the passage of the Dietary Supplement Health and Education Act of 1994, dietary supplement trade associations developed “grandfather” lists of dietary ingredients that were marketed in the U.S. before October 15, 1994, and therefore were not subject to regulation as NDI’s.  Although FDA does not regard these lists as dispositive of a dietary ingredient’s status as a grandfathered dietary ingredient, manufacturers and distributors continue to rely on the lists.  The proposed legislation would amend the existing definition of an NDI to eliminate the references to October 15, 1994, and instead authorize FDA to establish a list of “accepted dietary ingredients.”  Dietary ingredients not on that list would be regulated as NDI’s.  Further, all such ingredients would have to be the subject of a 75-day premarket notification to FDA because the proposed legislation would abolish the exception to the premarket notification requirement described above. 

In proposing the legislation, Sen. McCain referenced a previous GAO report that made numerous recommendations with regard to FDA’s regulation of dietary supplements, including a recommendation that FDA issue guidance to clarify when a dietary ingredient is a new dietary ingredient (that guidance has yet to issue).  Notably, GAO just sent out letters to a number of supplement manufacturers seeking information on specific dietary ingredients, including substantiation of any company determinations that submission of an NDI notification is not required.  Just as the previous GAO report is being cited in support of calls for reform, the results of the current GAO inquiry could well be seized upon by advocates of reform if that inquiry reveals any apparent shortcomings in FDA’s oversight of NDI’s.