By Kurt R. Karst –      

Over the past several weeks, proponents of a ban on so-called pay-for-delay settlements have put a full-court press on Congressional leaders to include provisions in the final Health Care Bill.  The House bill  includes a provision (§ 2573) sponsored by Bobby Rush (D-IL) that 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.  The Senate bill does not include a pay-for-delay provision sponsored by Sen. Herb Kohl (see our previous post here).

In late December 2009, several Senators wrote a letter to Senate leaders asking for the final Health Care Bill to include the House bill’s ban on pay-for-delay settlements.  “By adopting this provision, conferees can significantly address the rising costs of prescription drugs.  These ‘pay for delay’ agreements between brand name and generic drug companies deny consumers the benefits of generic drug competition,” according to the letter. 

On January 11, 2010, the American Antitrust Institute (“AAI”), among several other organizations, wrote a letter to Senate Majority Leader Harry Reid (D-NV) and House Speaker Nancy Pelosi (D-CA) encouraging inclusion of the Rush amendment in the final Health Care Bill, as well as the Drug Price Competition Act of 2009, which was introduced last year by Sen. Bill Nelson (D-FL), and in the house by Rep. Alcee Hastings (D-FL).  That bill would amend the definition of “first applicant” at FDC Act § 505(j)(5)(B)(iv)(II)(bb) with respect to 180-day exclusivity eligibility so that certain subsequent ANDA applicants could trigger and be eligible for exclusivity (see our previous post here).  According to the AAI letter:

[Pay-for-delay] payments are anticompetitive and should be considered per se illegal: they prevent any generic manufacturer with a legitimate challenge to a patent from potentially entering the market. . . . 

Expanding the exclusivity period is vitally important, since it removes the barrier to entry that has protected collusive settlements between brands and first-filing generics. Including this language in the final health reform legislation would provide a strong complement to Representative Rush’s per se ban on these payments.

Now it is the Federal Trade Commission’s (“FTC’s”) turn to put on the pressure.  On January 12, 2010, the FTC announced that it will hold a press conference at the Rayburn House Office Building on January 13, 2010 “to announce an FTC staff analysis showing that pay-for-delay deals between brand and generic drug companies are costing American consumers billions a year, and to encourage inclusion of the House-passed pay-for-delay provision in the final version of the health care reform bill.”  The FTC – and FTC Chairman Jon Leibowitz in particular – has made no bones about its opposition to pay-for-delay settlements.  In June 2009, Chairman Leibowitz said in a speech that eliminating “pay-for-delay” settlements could save consumers $3.5 billion annually.

By Ricardo Carvajal –

Californians won’t have to contend with this warning in their grocery stores – for now.  A California appellate court has upheld a lower court’s ruling that the Federal Meat Inspection Act (FMIA) preempts Proposition 65 point-of-sale warning requirements for meat.  The suit was filed by trade associations for the meat industry in response to notices of violation sent to meat processors and retailers by a California citizen.  Proposition 65 requires that such a notice be provided before the filing of a citizen suit to enforce that law.  The notices contended that certain meat products containing dioxins and PCB’s, both of which have been identified as carcinogens under Proposition 65, were being sold without a Proposition 65 warning (PCB’s are also listed as reproductive toxins).  Proposition 65 requires that a “clear and reasonable” warning be provided before consumers are exposed to a chemical “known to the state to cause cancer or reproductive toxicity.”  The trade associations sought a declaratory judgment that Proposition 65 is preempted by the FMIA.
 
The trial court granted summary judgment for the trade associations, and ruled that Proposition 65 was impliedly preempted by the FMIA.  The appellate court upheld the grant of summary judgment on the ground that Proposition 65 is expressly preempted by the FMIA.  The appellate court decision is worth reading for its extensive discussion of the scope of “labeling” as that term is used in the FMIA, FDCA, and FIFRA.  Based on its reading of those statutes and applicable judicial precedents, the appellate court concluded that the FMIA expressly preempts a Proposition 65 point-of-sale warning requirement because that warning would constitute “labeling” that is in addition to, or different than the FMIA's labeling requirements.  The appellate court relied on the definition of "labeling" in FDCA section 201(m), as interpreted by the United States Supreme Court in Kordel v. United States, 335 U.S. 345 (1948) (material constitutes labeling if it bears a “textual relationship” to the product, “supplements or explains” the product, and is “designed for use in the distribution and sale” of the product).  No word yet on whether there will be an appeal.

By Peter M. Jaensch –

On January 4, 2010, the Washington Legal Foundation (“WLF”) filed an amicus curiae brief in support of Ortho Biotech Products’ petition for a writ of certiorari in the Supreme Court of the United States, urging review of the decision in United States, ex rel. Mark Eugene Duxbury v. Ortho Biotech Products, L.P., 579 F.3d 13 (1st Cir. 2009).

As discussed in our earlier post, the underlying case asserted qui tam claims under the False Claims Act (“FCA”) against Ortho Biotech that were based on certain of the company’s product promotion activities, alleging promotion of off-label use, marketing the “spread” and providing “kickbacks” to providers in the form, among others, of free product samples.  The District Court dismissed all of the claims, citing multiple grounds.  On appeal, the First Circuit reversed in part, reviving only those claims attributable to Duxbury based on kickbacks.  Ortho Biotech petitioned for certiorari to the Supreme Court on December 3, 2009.  Such petitions are formal pleadings requesting the Court to exercise its discretion to review a lower court's decision, and are rarely granted.

As an amicus in support of Ortho Biotech’s petition, WLF argues that the FCA is meant to combat fraud, not legitimate product promotion, and that it cannot have been Congress’ intent to permit private suits against pharmaceutical and medical device companies for their truthful promotional activities absent the identification of any fraudulently-filed claim.  Ultimately, WLF argues the specific allegation of an actual false claim is a “threshold issue” without which Federal Rule of Civil Procedure 9(b) is dispositive, and requires dismissal of Respondent’s claims.  This argument is buttressed with a warning that, if unreviewed, the Duxbury decision threatens the ability of drug and medical device manufacturers to discuss freely and truthfully their products’ off-label uses and to distribute drug samples – activities which are beneficial to doctors and their patients.

By Dara Katcher Levy –

On December 23, 2009, FDA filed a Motion To Dismiss the First Fishery import matter that we previously blogged about back in late October.  In short, First Fishery had filed suit seeking declaratory judgment and injunctive relief with regard to its product’s placement on Import Alert 99-08 – Detention Without Physical Examination of Processed Foods for Pesticides.  First Fishery alleged that a finding of pesticide in its product was subject to an exemption under the Federal Food, Drug, and Cosmetic Act, and that there had been no final determination by FDA that the sampled product was violative before placing the product on Import Alert..

In its Motion to Dismiss, FDA acknowledges that in November, after correspondence with First Fishery and with the EPA (and after the First Fishery lawsuit was filed), FDA voluntarily released the detained entry and on December 3, 2009, removed the product from Import Alert.  Because of these actions, FDA asserts there is no remaining case or controversy and moves to dismiss.

This case is a prime example that, although FDA may have broad discretion over imports, an appropriate legal challenge in the correct circumstance may force FDA to rein itself in. 

By William T. Koustas –

In yet another twist in the debate regarding FDA’s use of Risk Evaluation and Mitigation Strategies (“REMS”), Kaiser Permanente (“Kaiser”), which is the largest private integrated health care delivery system in the U.S., submitted a citizen petition on December 22, 2009 requesting FDA take several actions in order to mitigate concerns it has with FDA’s implementation of REMS, specifically Elements to Assure Safe Use (“ETASU”). 

In its citizen petition, Kaiser notes that § 505-1 of the Federal Food, Drug and Cosmetic Act (“FDCA”) requires FDA to obtain input from health care providers, patients, etc. with regard to ETASU in order to ensure that a REMS is not unduly burdensome to the patient and to minimize the burden on the health care system.  However, with the exception of REMS for extended-release opioids, Kaiser claims that FDA has not publicly sought input from patients or health care providers on the implementation of REMS as required by § 505-1.  Kaiser further claims that REMS, especially those with ETASU, can add a significant burden to the delivery of health care and thus potentially increase the cost of REMS such that it outweighs the benefits.  As a consequence, Kaiser believes that health care providers and insurers should be consulted before a new REMS with ETASU is implemented.

Kaiser discusses five actions it would like FDA to take in order to minimize the burden of ETASU on health care providers as well as ensuring that they have a voice in the implementation of REMS.  First, Kaiser requests that FDA “increase transparency and opportunity for public comment in the development, implementation and assessment of REMS programs.”  As such, Kaiser would like FDA to provide increased opportunity for public comment on all REMS with ETASU; however, Kaiser also envisions FDA establishing an advisory committee dedicated to the review of ETASU.  In the interim, Kaiser suggests that advisory committees (with a health care provider member) reviewing drugs that will likely receive ETASU also have input on the ETASU itself.  Kaiser argues that this type of input before an ETASU is implemented could reduce the likelihood that the program will need to be altered later as well as lessening the burden on the health care system.

Second, Kaiser would like FDA to make de-identified data collected through the use of ETASU publically available, which would permit health care providers, and other parties, to identify the effectiveness of REMS. 

Third, Kaiser requests that FDA evaluate the effectiveness of ETASU that have been in effect for at least one year and extend that evaluation process to all ETASU on an annual basis.  Kaiser argues that this will ensure that the benefits of the REMS will continue to outweigh the cost to patients and the health care provider while also ensuring its success. 

Fourth, Kaiser’s citizen petition raises the issue of manufacturers using ETASU to limit access of a drug to certain health care providers.  Kaiser acknowledges that an ETASU may require that some drugs only be dispensed by certified pharmacies, but it argues that manufacturers have used this requirement to prevent or limit some health care providers from using their own facilities by refusing to certify them despite the fact that these pharmacies are otherwise qualified to dispense the drug.  According to the citizen petition, some manufacturers have refused to certify a Kaiser pharmacy for no reason other than the fact that the manufacturer has “contracted” with a specialty pharmacy, thus permitting manufacturers to dictate who can prescribe and dispense a drug with ETASU. 

Finally, Kaiser would like FDA to ensure that REMS are implemented in a way to protect patient health information.  Specifically, Kaiser expresses concern that patient enrollment forms for REMS include an authorization for disclosure of such information to third parties and some enrollment forms make receiving the drug contingent on patients accepting this.  Kaiser suggests that this concern could be alleviated if manufacturers were required to identify all entities they distribute patient information to as part of the regular REMS assessments.

By Alan M. Kirschenbaum –

On January 5, 2010, FDA released a “Guidance for Industry on New Contrast Indication Considerations for Device and Approved Drug and Biological Products.”  The primary purpose of the Guidance is to establish a process that allows imaging device manufacturers to obtain approval of new indications for use of a device with an already marketed contrast or radiopharmaceutical imaging drug (a “new contrast indication”), where the drug is not labeled for that indication.  FDA’s publication of the Guidance fulfills one of the Agency’s performance commitments under the Medical Device User Fee Amendments of 2007.  A draft version of this guidance was issued in September 2008, and FDA held a stakeholder meeting on the draft guidance in August 2009. 

Under the Guidance, if a new imaging device modification involves the use of an approved imaging drug in a manner consistent with the latter’s approved labeling, a submission from the device sponsor alone will be sufficient in most cases, without need for a change in the drug labeling.  Conversely, if a new imaging device modification requires a use of the approved imaging drug that is not consistent with the drug’s approved labeling, submissions will be required from both the drug and device sponsors to ensure consistent labeling – a situation that precludes a device manufacturer from implementing a modification unilaterally.  The final guidance provides a number of examples illustrating when a device submission alone would, or would not, be sufficient to support a new contrast indication for the device.  It appears from the examples that FDA will be restrictive in permitting new contrast indications for imaging devices without corresponding changes in the drug labeling.  Moreover, the Guidance requires device manufacturers who seek a new contrast indication modification to submit clinical study support similar to what would be required in an NDA supplement.  In light of these barriers, the Guidance is most likely to facilitate new device modifications for use with contrast only where the drug is used consistent with the indications, dosage, and rate and route of administration in the already approved drug labeling and where the new use does not raise new questions of safety and efficacy.

By David B. Clissold –

Acting on cross motions for summary judgment, a Federal District Court in Kentucky has struck down some provisions of the Family Smoking Prevention and Tobacco Control Act (“Tobacco Act”) as unconstitutional, and upheld others.  As we had reported earlier, the plaintiffs originally argued that portions of the Act violated their free speech rights under the First Amendment; their due process rights under the Fifth Amendment; and effected an unconstitutional “taking” of property under the Fifth Amendment.  For reasons that are not clear, the plaintiffs apparently abandoned most of their Fifth Amendment claims during the course of the proceedings.  Thus, the decision primarily concerned free speech.

Unconstitutional As A Violation Of Free Speech Under The First Amendment

The Tobacco Act provides that labeling or advertising for cigarettes or smokeless tobacco must use only black text on a white background.  The court held this portion of the law unconstitutional since “images of packages of their products, simple brand symbols, and some uses of color communicate important commercial information about their products” such as who makes the product.  In addition, the Tobacco Act's “blanket ban” on all uses of color and images was too broad since it also precluded use of “innocuous images and colors – e.g., images that teach adult consumers how to use novel tobacco products, images that merely identify products and producers, and colors that communicate information about the nature of a product . . .”

The Tobacco Act prohibits any statement in labeling or through the media suggesting that the product was approved by FDA, that FDA deems the product to be safe, or that FDA endorsed the use of the product.  The court held that these prohibitions were reasonable.  However, the law also banned statements suggesting that “the product is safe or less harmful” because it was regulated or inspected by FDA or that it was in compliance with FDA regulations.  This was held to be unconstitutional since it banned “journalists, doctors, scientists, politicians, and numerous other groups and individuals” from making statements about the effect of the FDA regulation of tobacco products.

Too Early To Tell Whether Constitutional Under The First Amendment

The Tobacco Act bans all “outdoor advertising for cigarettes or smokeless tobacco, including billboards, posters, or placards, . . . within 1,000 feet of the perimeter of any public playground or playground area in a public park . . ., elementary school, or secondary school.”  However FDA must issue a regulation “in light of governing First Amendment case law,” explaining how this ban will be enforced before it can take effect.  The court held it could not examine this issue until FDA had issued the final regulation.

Constitutional Under The First Amendment

The Tobacco Act requires tobacco companies to print new government warnings for cigarette packages that occupy the top 50% of the front and rear panels of packaging and include “color graphics depicting the negative health consequences of smoking to accompany the label statements.” Similar warnings, occupying 30% of each of the two principal display panels, are required for smokeless tobacco products.  For all categories of tobacco products, the new warnings must occupy 20% of any advertisements.  The court held that such requirements were reasonable in part because Congress “relied on the international consensus reflected in the World Health Organization’s Framework Convention on Tobacco Control” and also reviewed “the use of a nearly identical warning requirement in Canada.”  The court also noted that even with the warnings, a substantial amount of area remained for use by the manufacturers.  However, the court ruled that the plaintiffs’ takings claim under the 5th Amendment needed to be brought in the Court of Federal Claims, and so the court lacked jurisdiction to decide that issue.

Manufacturers can not promote their brands through sponsorship of “athletic, musical, artistic, or other social or cultural event[s]” and FDA must reissue regulations that prohibit the sponsorship of athletic, social, and cultural events “in the brand name” of a tobacco product.  The court found because such events “glamorized” smoking and that many children were exposed to the events, the limitations on sponsorship were permitted.  The law also directs FDA to reissue regulations that prevent a tobacco manufacturer from distributing items such as caps and t-shirts that bear the name or logo of a tobacco brand.  The court agreed that it was impossible to limit the distribution of these items to adults only and noted that even if it was, the wearers would become “walking advertisements” conveying the notion “that tobacco use is widely accepted.”  Accordingly, the court held that the ban on such items was constitutional. With respect to the law's ban on free samples, gifts with purchase, and marketing tobacco products with non-tobacco products, the court held that these provisions restricted distribution, but did not implicate free speech rights.

The Tobacco Act’s Modified Risk Tobacco Products (“MRTP”) provision prohibits the labeling, or advertising of a tobacco product from suggesting that the product is less harmful than other tobacco products, and prohibits manufacturers from taking any action that would be reasonably expected to result in consumers believing that the tobacco product or its smoke may be less harmful than other tobacco products, without prior FDA approval of the product as “modified risk.” The plaintiffs had already lost a motion for a preliminary injunction in November 2009 that this law violated free speech.  None of the arguments presented subsequently were enough to change the court’s mind.

Conclusion

Both sides can claim at least partial victory under this decision, and it is not yet clear whether any of the parties will appeal any portion of the ruling.  In upholding many of the challenged provisions of the Tobacco Act, the court relied on Congressional findings and reports from the Institute of Medicine, World Health Organization, National Cancer Institute, and other organizations that focused on the effect that tobacco advertising may have on underage smoking.  The court agreed that preventing children from smoking was a “substantial” government interest, and found that most of the Tobacco Act’s provisions controlling the advertising and promotion of cigarettes and smokeless tobacco were directly related to promoting that interest.  Aside from any appeal in this case, the next significant challenge is likely to be whether FDA’s regulation to control outdoor advertising passes constitutional muster.

By Kurt R. Karst –      

Following FDA’s decision, reflected in the October 2009 Orange Book Cumulative Supplement (page A-28), to grant 5-year New Chemical Entity Exclusivity (“NCE”) for EMEND (fosaprepitant dimeglumine) Injection, the Agency has issued an exclusivity determination explaining its decision.  Fosaprepitant is a phosphamide derivative (a type of covalent derivative) and a pro-drug of the previously-approved active ingredient in EMEND (aprepitant) Capsules (NDA No. 21-549).

Under the FDC Act, FDA grants 5-year exclusivity for NCEs.  An NCE is a drug that contains no “active moiety” that has been approved by FDA in another NDA.  An “active moiety” is defined in FDA’s regulations at 21 C.F.R. § 314.108(a) to mean “the molecule or ion, excluding those appended portions of the molecule that cause the drug to be an ester, salt (including a salt with hydrogen or coordination bonds), or other noncovalent derivative (such as a complex, chelate, or clathrate) of the molecule, responsible for the physiological or pharmacological action of the drug substance.”  In addition, FDA stated in the preamble to the Agency’s 1989 proposed regulations implementing the Hatch-Waxman Amendments that “[a] compound (other than an ester) that requires metabolic conversion to produce an already approved active moiety is considered a ‘new molecular entity,’ . . . and will be considered a new chemical entity entitled to 5 years of exclusivity. 

Thus, for purposes of determining whether a particular drug product is eligible for 5-year NCE exclusivity, FDA’s Exclusivity Summary completed for each NDA approval asks the following about the chemical structure of a drug:

Has FDA previously approved under section 505 of the Act any drug product containing the same active moiety as the drug under consideration?  Answer “yes” if the active moiety (including other esterified forms, salts, complexes, chelates or clathrates) has been previously approved, but this particular form of the active moiety, e.g., this particular ester or salt (including salts with hydrogen or coordination bonding) or other non-covalent derivative (such as a complex, chelate, or clathrate) has not been approved.  Answer “no” if the compound requires metabolic conversion (other than deesterification of an esterified form of the drug) to produce an already approved active moiety.

According to FDA’s exclusivity determination memorandum, which was added to the Summary Basis of Approval for EMEND (NDA No. 22-023):

Emend for Injection under FDA’s interpretation of 21 CFR § 314.108 should have been classified at the time of approval as an NCE. . . .  Fosaprepitant dimeglumine is a pro-drug phosphoramide derivative of aprepitant.  A phosphoramide is a compound in which one or more of the OR groups of phosphoric acid have been replaced with covalent bonds to an amino or substituted amino group.  Fosaprepitant dimeglumine is neither an ester, salt (including a salt with hydrogen or coordination bonds), nor other noncovalent derivative (such as a complex, chelate, or clathrate) of the molecule aprepitant.  It is a covalent phosphoramide derivative.  As a non-ester covalent derivative of aprepitant, under 21 CFR § 314.108, fosaprepitant dimeglumine is a new chemical entity entitled to 5 years of exclusivity.

Fosaprepitant is not the first instance in which FDA has reversed an exclusivity decision.  In October 2004, FDA informed the sponsor of VITRASE (hyaluronidase) Injection that contrary to the Agency’s earlier decision to grant 3-year exclusivity for the product, “[a]fter reviewing information and data regarding hyaluronidase drug products . . . the Agency has decided that 5-year exclusivity is appropriate because we have inadequate information to determine whether any active moiety in Vitrase is the same as any previously approved active moiety.”

By Kurt R. Karst –      

A recent Impact Report (subscription required) from the Tufts Center for the Study of Drug Development (“CSDD”), titled “Drug approvals for neglected diseases increase along with more R&D funding,” concludes that new products to treat neglected diseases (such as malaria, kinetoplastids, diarrheal diseases, roundworm, bacterial pneumonia and meningitis, and typhoid and paratyphoid fever) have received marketing approval from regulatory agencies at a steadily increasing rate in the past several years as research and development  funding for neglected diseases has dramatically increased.  The report is based on research conducted by CSDD Senior Research Fellow Joshua P Cohen.  

Among other things, CSDD found that:

• The annual rate of new product approvals for neglected diseases increased from an average of 1.8 in 1975-1999 to 2.6 in 2000-2009;

• Between 1999 and 2008, annual funding for neglected diseases rose from less than $100 million annually to more than $2.5 billion today, and today government research and development funding accounts for 69% of all neglected disease product development funding, with non-profit organizations and the drug industry contributing 21% and 10%, respectively;

• Vaccines have displaced drugs as the primary products being developed for neglected diseases, and products to treat HIV/AIDS and malaria accounted for 81% of negelected disease approvals from 2000-2009;

• Public-private partnerships for new product development accounted for 46% of all approvals to treat neglected diseases in 2000-2009, which is up from 15% in 1975-1999.

A provision included in the Agriculture, Rural Development, FDA, and Related Agencies Appropriations Act of 2010, Pub. L. No. 111-80, could also lead to a greater number of products approved to treat neglected diseases in the coming years.  As we previously reported, § 740 of the law requires FDA to establish within the Agency “a review group which shall recommend to the Commissioner of Food and Drugs appropriate preclinical, trial design, and regulatory paradigms and optimal solutions for the prevention, diagnosis, and treatment of neglected diseases of the developing world.”  FDA is also required to submit a report to Congress on the review group’s findings and recommendations, and to issue guidance and develop internal review standards based on those recommendations.

By Ricardo Carvajal & David B. Clissold –

The most recent issue of the Food and Drug Law Journal contains an article on the Family Smoking Prevention and Tobacco Control Act (“Tobacco Act”) authored by Hyman, Phelps & McNamara’s (“HPM’s”) Ricardo Carvajal, David B. Clissold, and Jeffrey K. Shapiro.  The Tobacco Act provides FDA with regulatory authority over virtually every aspect of the design, production, marketing, and advertising of tobacco products. Although the new law has its detractors, there is little question that the law’s enactment marks a dramatic shift in the relationship between the federal government and the tobacco industry.  This article provides a summary of the new law’s major provisions and highlights some of the legal issues that implementation of the law is likely to raise.  The authors gratefully acknowledge HPM’s Tom Scarlett for his review of a draft of the manuscript.

The most recent issue of the Food and Drug Law Institute's Update magazine contains an article authored by Ricardo Carvajal and David B. Clissold that focuses on the Tobacco Act's impact on retailers.  In the sectors that FDA has historically regulated, FDA has focused the bulk of its resources on ensuring that manufacturers and wholesale distributors are in compliance with the law.  FDA has generally undertaken little enforcement activity against retailers, whose conduct is typically policed by state authorities.  This could change under the Tobacco Act, which aims to restrict the availability and appeal of tobacco products to youth.

Our colleague and friend, Stephen H. McNamara passed away on December 28, 2009 of complications from cancer at the age of 66.  Steve is survived by Caroline, his wife of 43 years, and his children, Matthew (Veronica) McNamara, and Deborah  (Nicholas) Hutchins and six grandchildren. 

Steve was a member of this firm from 1984 until poor health forced his withdrawal from practice in 2003.  He was an eminent figure in the food and drug bar, admired by his clients, fellow practitioners, and opponents.  He provided valuable advice to the Congress in the development of the Dietary Supplement Health and Education Act.  In his professional endeavors he was respected for his attention to detail and for the imaginative solutions he found for knotty issues.  He was universally admired for his civility and respect for others.

Prior to joining HPM, Steve was the Senior Vice President and General Counsel for the Cosmetic, Toiletry and Fragrance Association, Inc. (now the Personal Care Products Council).  Steve was also proud of his service at the U.S. Food and Drug Administration, where he was a staff attorney, senior trial attorney, and ultimately the associate chief counsel for food.  For about a year, he served as the acting chief counsel.  He was twice recognized by the agency with the FDA Award of Merit (FDA’s highest award for service). 

Steve served as a chaplain’s assistant in the U.S. Army from 1967-1969, and was awarded the Bronze Star for meritorious service, the Purple Heart for wounds received in action in Vietnam, and the Army Commendation Medal. 

He was a graduate of the University of Virginia and the University of Virginia School of Law.

Steve was a complete and very good man, worthy of the honors accorded him and deserving of the love felt by those who knew him. We will remember how he loved his family.  We will remember him for his love and militant support of the Irish.  We will remember him as a scholar, focused on the classical world.  And his friends will always remember his love of ice cream. Steve will be greatly missed.

We extend our heartfelt sympathy to his wonderful wife, Caroline, who has supported him through such difficult times, and to his entire family.   A memorial service will be held for Steve in January 2010.

By William T. Koustas –

As FDA becomes more comfortable with the authority provided to it by the Food and Drug Administration Amendments Act of 2007 (“FDAAA”), the frequency of Risk Evaluation and Mitigation Strategies (“REMS”) being applied to an entire class of drugs is increasing.  (See our REMS Tracker.)  The most notable example of this is the class-wide REMS for extended-release opioid drugs, where FDA may impose onerous new requirements on the manufacturers, prescribers, dispensers and consumers of such products.  In light of these developments, a recent article in the December issue of the Regulatory Affairs Professionals Society’s Regulatory Focus publication authored by Hyman, Phelps & McNamara’s William T. Koustas, titled “Trends in FDA’s Use of Class-wide REMS,” explores the current state of class-wide REMS through interesting and relevant examples.  Understanding FDA’s current implementation of class-wide REMS may be the best means of preparing for the future use of REMS.  

By Alan M. Kirschenbaum, Kurt R. Karst & J.P. Ellison –

On Thursday morning, the U.S. Senate passed, by a 60-39 vote, H.R. 3590, the Patient Protection and Affordable Care Act.  Last weekend, Sen. Harry Reid (D-NV) unveiled a 383-page Manager’s Amendment to the bill.  The bill retains the discount, rebate, and industry fee provisions we previously reported on, except that the device industry fee (in § 10904) has been eliminated for 2010, and the aggregate annual fee imposed on covered manufacturers or importers of medical devices sold in the U.S. is set at $2 billion for the years 2011 through 2017 and $3 billion for years after 2017.

The Manager’s Amendment also includes changes (at § 10104(j)) to the False Claims Act (“FCA”).  The FCA amendment appears intended to address recent court decisions interpreting the public disclosure and original source provisions of the FCA.  While the stated purpose of these amendments, according to a section-by-section summary of the bill, is “to ensure that whistleblowers who play a significant role in exposing fraud can be included in otherwise meritorious litigation,”  the provisions seem likely to inject further uncertainty into already complicated questions of when a public disclosure has occurred and when a relator is an original source of publicly disclosed information.

The Manager’s Amendment (at § 10606) also changes the intent requirement for health care fraud under 18 U.S.C. § 1347, such that “a person need not have actual knowledge of this section or specific intent to commit a violation of this section.”  In addition, a potentially significant change for FDA-regulated companies, is the insertion of FDC Act § 301 in the definition of “Federal health care offense” at 18 U.S.C. § 24(a).  This means that an FDA offense could be a predicate for a health care fraud case.

The bill (at § 10609) aslo includes the so-called “Generic Loophole Bill” introduced by Sen. Jeanne Shaheen (D-NH) earlier this year.  As we previously reported, the measure would permit FDA to approve a generic drug notwithstanding certain “last minute [labeling] changes” to the reference listed drug labeling that could otherwise delay ANDA approval.  Absent from the Senate bill are proposed amendments (see our previous post here) concerning authorized generics and “pay-for-delay” settlements.

The bill’s provisions on follow-on biologics do not appear to have changed.  Sen. Sherrod Brown’s (D-OH) amendment (SA 2895) that would cut the proposed 12-year exclusivity period for an innovator product short if the innovator’s product is a blockbuster drug is not included in the bill. 

A side-by-side comparison of the drug and device provisions in the House and Senate healthcare reform bills that we prepared is available here.  The Congressional Budget Office’s December 19, 2009 cost estimate of the bill is available here, and the December 20, 2009 corrected cost estimate is available here.  Additional background information on the bill is available here. 

By Nisha P. Shah –

On December 8, 2009, the Food and Drug Administration ("FDA") issued its final, non-binding guidance for industry on “Patient-Reported Outcome Measures: Use in Medical Product Development to Support Labeling Claims.”  A draft guidance was published in February 2006.  The final guidance explains how FDA evaluates patient-reported outcomes ("PRO") instruments used in measuring endpoints in clinical trial studies.  The guidance also sets forth standards of how sponsors can generate and use PRO instruments to improve the probability of supporting claims in the product labeling.

The guidance defines PRO as a measurement “coming directly from the patient about the status of a patient’s health condition” without interpretation of the response by a health care professional or anyone else. PRO endpoints can serve as either primary, secondary, or exploratory endpoints. PRO instruments can be useful tools to evaluate the effect of treatment on one or more “concepts,” or how a person functions or feels about a health condition or its treatment. The instruments can capture significant clinical information that traditional evaluations by health care professionals cannot, such as a patient’s perception of improvement in pain and mobility.

In determining whether to use existing PRO instruments or to develop a new one, sponsors should consider “their labeling goals, a PRO instrument conceptual framework, and the relationship of the PRO endpoints to other clinical trial endpoints in preliminary endpoint models for the planned confirmatory trials.” If existing PRO instruments do not adequately support the sponsor’s goals, the guidance describes procedures for sponsors to generate their own PRO instrument.

Regardless of whether an existing or new instrument is used, the guidance cautions against measuring “general concepts”, such as overall physical health, because the instrument may not distinguish adverse events of treatment that may affect the general concept but were unknown at the time the clinical trial study was designed.  The measurement of more specific concepts, such as improvement in pain, may be more useful in supporting labeling claims.

In developing a new instrument, sponsors should conduct patient interviews, focus groups, and additional assessments to ensure comprehension and completeness of the items contained in the PRO instrument, as well as to demonstrate content validity and reliability. Sponsors are advised to maintain appropriate documentation through the evolution of developing and testing the instrument because the agency will examine the final version of the instrument “in light of its development history,” including “the complete list of items generated and the reasons for deleting or modifying items.” The guidance states that FDA will review this documentation along with clinical trial results to determine whether a labeling claim is substantiated.

The guidance also spells out FDA’s specific concerns when using electronic PRO instruments.  FDA expressed concerns particularly over the principal investigator’s ability to maintain control and to have access to the records that serve as the electronic source documentation for the purpose of an FDA inspection. Additional measures the sponsor should address in the protocol when using an electronic PRO instrument include database security and measures to prevent loss of adverse event data. 

Much like capturing the more traditional clinical endpoints, sponsors should consider measures to optimize the quality of the PRO instrument, minimize inconsistencies in conducting the trial, and develop a statistical analysis plan to analyze the PRO endpoints and handle incomplete data. To interpret the clinical trial results, FDA maintains that “it [is] informative to examine the cumulative distribution function ("CDF") of responses between treatment groups to characterize the treatment effect and examine the possibility that the mean improvement reflects different responses in patient subsets,” rather than focusing on the statistical significance of the PRO measures alone.

The guidance encourages sponsors to solicit feedback early in the process of instrument and protocol development and engage the FDA in a discussion about a new PRO instrument before clinical trial protocols are finalized, and includes a checklist of background information to provide when submitting a PRO instrument to FDA for review.

By William T. Koustas & John R. Fleder –

A new lawsuit challenges the government’s ability to exclude individuals from participating in federal health care programs after a person has been convicted of a Food, Drug and Cosmetic Act (“FDCA”) misdemeanor.  Michael Friedman and Howard R. Udell v. Kathleen Sebelius et al, No. 309CV01741RNC (D. Conn. filed Oct. 28, 2009).

In May 2007, Purdue Frederick Co. Inc. (“Purdue”) pleaded guilty to a FDCA felony count of misbranding drug products (OxyContin) with the intent to defraud or mislead.  As part of a global resolution, Howard R. Udell and Michael Friedman, two former senior executives at Purdue, pleaded guilty to FDCA misdemeanor charges of misbranding.  The government believes that persons can convicted under the FDCA misdemeanor provisions without any showing that a person intended to violate the law or even knew about the violation.  This theory is often referred to as the “responsible corporate officer” principle that executives who do not prevent violations of the FDCA may be held strictly liable for those violations.

Though this appeared to be the end of the federal government’s interest in these individuals, in November 2007, the Office of Inspector General of the Department of Health and Human Services (“OIG”) sent Mr. Udell and Mr. Friedman Notices of Intent to Exclude them from participating in Medicare, Medicaid and all federal health care programs, pursuant to 42 U.S.C. § 1320a-7(b)(3), based on their earlier misdemeanor criminal convictions.  That statute permits exclusion if a person has been convicted of a misdemeanor relating to fraud or for the unlawful manufacture, distribution, prescription or dispensing of a controlled substance.  Mr. Udell and Mr. Friedman contend that these provisions are inapplicable to them because their criminal guilty pleas only relate to their status at Purdue, not to their commission of fraud or to controlled substances violations.

According to the Complaint filed in this case, Mr. Udell and Mr. Friedman made written submissions to the OIG challenging their proposed exclusions.  On March 31, 2008, the OIG rejected these submissions by “excluding” the two individuals.  However, they challenged the exclusion decisions in the United States District Court for the District of Connecticut.  That Court refused to rule on the merits of the case until all administrative remedies had been exhausted.  On August 31, 2009, the Department of Health and Human Services (“HHS”) Departmental Appeals Board affirmed the exclusion decisions.  As a result, the two individuals filed another court action challenging what they contend is a final decision by HHS.

Mr. Udell and Mr. Friedman filed this new complaint in October 2009, arguing that: (1) their misdemeanor convictions are not an excludable offense under 42 U.S.C. §§ 1320a-7(b)(1), 7(b)(3); (2) the debarment was an abuse of discretion and arbitrary and capricious as their convictions were merely based on the fact that they were “responsible corporate officers” and never had intent or actual knowledge of the company’s wrongdoing; and (3) their twelve year exclusionary period violates the law because HHS did not consider certain mitigating factors, and the exclusionary period was not supported by substantial evidence.  The plaintiffs are seeking a declaratory judgment that the exclusion was contrary to law as well as seeking an order to enjoin HHS from excluding  the plaintiffs and further publicizing the exclusion actions.

The government has not filed any substantive response to the Complaint.  However, in a filing dated December 23, 2009, the parties agreed to have the case transferred to the United States District Court for the District of Columbia.

This case certainly demonstrates that, as Yogi Berra once said, “It ain’t over until its over.”  People like Mr. Udell and Mr. Friedman think that once they accept responsibility for a company’s action by taking the harsh step of pleading guilty to a crime, solely because of their corporate positions, their problems with the government are in the past.  Surely the government can and should seek to reach a global resolution when someone pleads guilty so that that person is not surprised by a later government action that could make that person unemployable in the health care field.