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  • “Heigh-ho” Taiho! The PTO Says LYTGOBI Patent is Ineligible for PTE Because of Untimely Application . . . And a Corrected NDA Approval Letter is No Saving Grace

    If you’ve been following this blog since the early days, then you know we fervently followed the more-than-decade-long soap opera that was The Medicines Company’s efforts to obtain a Patent Term Extension (“PTE”) from the U.S. Patent and Trademark Office (“PTO”) for U.S. Patent No. 5,196,404 covering ANGIOMAX (bivalirudin) after the company’s patent counsel untimely filed for a PTE 62 days after the ANGIOMAX NDA 020873 approval at 5:18 PM on Friday, December 15, 2000 (see our summary and “coda” posts here and here).  The way that matter ended up—after touching all three branches of the U.S. Government—was that, despite having missed the statutory 60-day filing deadline, the patent was granted a PTE due to a change in the law created by Section 37 of the Leahy-Smith America Invents Act (“AIA”) (Pub. Law No. 112-029), titled “Calculation of 60-Day Period for Application of Patent Term Extension” and referred to by some as “The Dog Ate My Homework Act” or the “Medco Fix.”

    Post-AIA, and a later change to the law to account for controlled substance FDA application approvals, the PTE statute at 35 U.S.C. § 156(d)(1) states (emphasis added):

    To obtain an extension of the term of a patent under this section, the owner of record of the patent or its agent shall submit an application to the Director. Except as provided in paragraph (5), such an application may only be submitted within the sixty-day period beginning on the date the product received permission under the provision of law under which the applicable regulatory review period occurred for commercial marketing or use, or in the case of a drug product described in subsection (i), within the sixty-day period beginning on the covered date (as defined in subsection (i)). . . .

    For purposes of determining the date on which a product receives permission under the second sentence of this paragraph, if such permission is transmitted after 4:30 P.M., Eastern Time, on a business day, or is transmitted on a day that is not a business day, the product shall be deemed to receive such permission on the next business day. For purposes of the preceding sentence, the term “business day” means any Monday, Tuesday, Wednesday, Thursday, or Friday, excluding any legal holiday under section 6103 of title 5.

    Since the PTE statute was created with the September 1984 enactment of the Hatch-Waxman Amendments, and even post-AIA, there have been various instances in which FDA-regulated companies (or their counsel) have failed to timely submit a PTE application to the PTO within the statutory 60-day window (see, e.g., here).  On occasion,  PTE applicants try to fight a PTO determination that the application was untimely. . . . which brings us to the topic of this post.

    Taiho Pharmaceutical Co., Ltd. (Taiho Oncology, Inc.) (“Taiho”) is the sponsor of NDA 214801 for LYTGOBI (futibatinib) Tablets.  Usually at this point in a post we would identify the date of approval of the relevant NDA.  But that’s the controversy here: Did FDA approve LYTGOBI NDA 214801 on September 30, 2022 when the Agency issued its initial approval letter, or on October 5, 2022 when FDA issued a corrected approval letter?  That’s important, because PTE applications for U.S. Patent Nos. 9,108,973 and 10,434,103 (here and here) covering LYTGOBI were filed with the PTO on November 29, 2022, putting the 60-day PTE application deadline outside of the September 30, 2022 approval date, but within an October 5, 2022 approval date.

    In January 2024, FDA affirmed to the PTO in a letter that “NDA 214801 was approved on September 30, 2022, which makes the submission of the patent term extension application on November 29, 2022, not timely within the meaning of 35 U.S.C. 156(d)(l).”  Taiho’s counsel quickly followed up with a letter to FDA and a supplemental submission to the PTO in February 2024 arguing otherwise:

    “[P]ermission for commercial marketing” was not effective under the September 30, 2022 FDA letter because the product would have been misbranded if marketed thereunder.  Rather, “permission for commercial marketing” was only effective upon FDA’s issuance of its corrected October 5, 2022 letter.  Calculating the 60-day period as beginning on that date renders the application timely. . . .

    In this case, it is axiomatic that (a) the error in the approval date and (b) the inaccurate listing of the storage conditions for the product in the initial FDA notification were false.  The statute does not provide any applicable exception for such a falsity.  Accordingly, had Taiho marketed the product with labeling containing those errors, that labeling would have been false.  In addition, leaving the errors in the statement of storage conditions in place would have resulted in the product being labeled to be stored at 32°F-86°F, rather than the correct 59°F-86T Given this 27-degree colder temperature range, and the notation in the initial carton labeling “Do not refrigerate or freeze,” storing at the incorrectly-labeled conditions could have compromised product quality, possibly affecting safety and/or effectiveness of the product.  Thus, regardless of the technicality of an initial notification letter stating approval on September 30, 2022, Taiho was prohibited under the FDCA from marketing LYTGOBI with false labeling, 21 U.S.C. sections 331(a) and 352.(a)(l), and the actual, valid “permission for commercial marketing” of LYTGOBI did not exist until FDA corrected the labeling language in its October 5, 2022 “Corrected Approval” letter.

    But on March 18, 2024, the PTO rendered its decision that the PTE applications were not timely filed because LYTGOBI NDA 214801 was approved on September 30, 2022:

    As admitted by Taiho Pharmaceutical in the PTE application filed on November 29, 2022, LYTGOBI® (futibatinib) received FDA approval for commercial marketing or use of pursuant to section 505(b) of the Federal Food, Drug and Cosmetic Act by the approval letter transmitted on September 30, 2022 at 12:08 pm. . . .

    As a result, the “next business day” proviso of under 35 U.S.C. § 156(d)(1) does not apply here because the approval was transmitted on a business day (a Friday) before 4:30 pm Eastern Time.  Therefore, the filing of the present application for patent term extension on November 29, 2022 was untimely, because the sixty-day period would have begun on September 30, 2022, and ended on November 28, 2022. . . .

    The proposed approval date [] is wholly uncorroborated because applicant failed to provide any evidence on the record to support October 5, 2022 as the approval date.  Instead, the initial PTE application filed on November 29, 2022, the corrected approval letter, and the original approval letter all consistently indicate that September 30, 2022 is the effective approval date.  Thus, absent evidence to the contrary, the approval date remains September 30, 2022.

    Because the PTE application was not timely, Taiho Pharmaceutical is not entitled to extension of the term of U.S. Patent No. 9,108,973 under 35 U.S.C. 156.

    It’s not terribly uncommon for FDA to issue corrected approval letters (and corrected labeling).  Indeed, we found a slew of them spanning decades: here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, here, and here.

    While we didn’t perform our own analysis of the instances linked to above to determine whether or not each of the original approval dates was used for PTE application purposes, or whether the PTO accepted a corrected approval date, in at least one instance—see here and here—the corrected approval date was not used for PTE purposes, but instead, the original approval date.  But there may be more out there.  After all, as we posted in 2016, there have been approval date resets under certain circumstances.  So we’ll sit tight to see whether or not Taiho takes the next step of litigating the issue.

    Categories: Hatch-Waxman

    Clear that Cabinet Tour ‘24

    Medicine cabinet, stuffed to the gills
    Capsules, liquid, patches, and pills
    Expired oxy, hydro, benzos, and more
    All kind of old meds flowing out the door

    We will, we will, clear you
    We will, we will, clear you

    Back by popular demand, coming to a collection site in your town for one day only, is a return of the ever popular Drug Enforcement Administration’s (“DEA’s”) National Prescription Drug Take Back Day.  DEA, with its law enforcement partners, will host thousands of local drop-off locations nationwide for clearing out and proper disposal of unwanted expired and unneeded medication from medicine cabinets between 10:00 am to 2:00 pm local time on Saturday, April 27, 2024.

    Drug Take Back Days have made appearances each spring and autumn since 2010.  Events over the years have led to the removal of more than 17.9 million pounds of unwanted medication across the country.  Last October’s Drug Take Back Day removed 600,000 pounds (300 tons) of medication at almost 4,700 collection sites.

    Additional information about DEA’s National Prescription Drug Take Back Day, including local disposal venues, can be found here.

    Clear that Cabinet Tour ’24…Don’t you dare miss it!

    The Fourth Circuit Upholds CMS’ Definition of “Line-Extension Drug” and “New Formulation”

    On April 10, the Fourth Circuit unanimously affirmed a summary judgment ruling for the Centers for Medicare & Medicaid Services (CMS) regarding the agency’s definitions of “line-extension drug” and “new formulation” for purposes of determining rebates that drug manufacturers may owe the Medicaid Drug Rebate Program (MDRP).  Vanda Pharmaceuticals, Inc. v. Centers for Medicare and Medicaid Servs., No. 23-1457 (4th Cir. Apr. 10, 2024).

    Under the Medicaid Drug Rebate statute, a pharmaceutical manufacturer whose drug prices increase faster than the rate of inflation must pay additional per-unit rebates to the program.  The amount of the additional rebate is the excess (if any) of a drug’s current average manufacturer price (AMP) over the inflation-adjusted AMP for a statutorily specified baseline quarter. To address concerns that manufacturers were making minor changes to drugs in order for them to be characterized as new covered outpatient drugs with updated (and higher) baseline AMPs, Congress amended the statute in 2010 to add an alternative rebate for line extensions of oral dosage form single source or innovator multiple source drugs (i.e., NDA or BLA drugs).  Under that line-extension provision, a manufacturer that introduces a line-extension drug with a new baseline AMP must pay the greater of the rebate calculated in the ordinary manner, or an alternative rebate calculated in a manner that is tied to the inflation rebate of the predicate drug and thereby the predicate drug’s baseline AMP.   The statute defines a “line extension” as a “new formulation” of an existing drug, with certain exceptions.

    In 2020, CMS issued a final rule providing a broad definition of “new formulation” as “any change to the drug, provided that the new formulation contains at least one active ingredient in common with the initial brand name listed drug.”  We wrote a memorandum summarizing CMS’ regulation here.

    In April 2022, Vanda Pharmaceuticals filed a complaint in the Maryland Federal District Court to challenge CMS’ definition on Administrative Procedure Act (APA) grounds.  We previously blogged on the district court’s decision last year.  In short, the Federal District Court for the District of Maryland granted summary judgment to CMS and rejected Vanda’s arguments that (1) a drug approved under a new NDA cannot be a line extension; (2) a line extension, like its predicate drug, must be an oral solid dosage form; (3) CMS’ definition exceeds the plain meaning of “line extension”; and (4) Congress intended to target only slight alterations of a drug, as evidenced by the sole example in the statute of “an extended-release formulation.”  Vanda Pharmaceuticals, Inc. v. CMS, Civ. No. MJM-22-977 (Dist. Md. 2023).

    The Fourth Circuit has now affirmed the Maryland Federal District Court decision, finding that CMS’ definitions of “line extension” and “new formulation” were neither contrary to law nor arbitrary and capricious under the APA.  More specifically, the Fourth Circuit found that the agency’s definition of “line extension” is “clearly within the bounds of the statute” and “a perfectly sensible way to implement the regime set by the Medicaid statute.”  The Court also found “that a broad definition of new formulation is appropriate.”  With regard to whether both the initial brand name drug and the line extension must be an oral solid dosage form, the Court found that CMS’ interpretation that only the initial brand name listed drug must be an oral solid dosage form is the more persuasive.

    As we discussed in our 2023 blog post, this decision has implications extending beyond the MDRP.  The 2022 Inflation Reduction Act (IRA) imposes inflation rebates for Medicare Part D drugs whose price increases outpace the rate of inflation and defines “line extension” in a manner that is virtually identical to the MDRP definition.  The IRA also directs CMS to establish a formula for determining the inflation rebate for line extensions consistent with the formula under the MDRP, and in February of last year, CMS did so by issuing guidance adopting the MDRP definition of a new formulation for purposes of Medicare Part D inflation rebate.  Therefore, the Fourth Circuit’s ruling will impact drug manufacturer rebates for line-extension drugs in both Medicaid and Medicare Part D.  As the Fourth Circuit itself observed, “Line-extension status makes a big difference to the federal purse.  It creates the prospect of larger inflation-based rebates, which make up an increasingly large portion of the total amount paid under the Medicaid Drug Rebate Program—more than half since 2012.”

    Does the Drug Shortage White Paper Fall Short?

    The U.S. Department of Health and Human Services (HHS) recently published a White Paper on Policy Considerations to Prevent Drug Shortages and Mitigate Supply Chain Vulnerabilities in the United States—with input from several HHS stakeholders, including FDA, CMS, and the Administration for Strategic Preparedness and Response.  With the COVID-19 pandemic in the not-so-distant past, we trust that a recitation of the importance of a resilient supply chain is not needed here.  As noted in the White Paper and discussed in greater detail in the Building Resilient Supply Chains, Revitalizing American Manufacturing, and Fostering Broad Based Growth: 100-Day Reviews under Executive Order 14017, 52% of all FDA-registered finished dosage form manufacturing facilities and 73% of all FDA-registered API-manufacturing facilities were located outside the United States as of March 2021. For generic drug manufacturing facilities specifically, the numbers are 63% and 87%.

    To address the underlying causes of shortages, the White Paper suggests that the creation (by Congress) of two programs that link inpatient hospital purchasing and payment decisions to supply chain resilience practices would better incentivize investments in mature manufacturing practices.  The proposed Manufacturing Resiliency Assessment Program (MRAP) would be managed as a public-private partnership and would assign resilience scores to manufacturers of generic drugs, “based on an assessment of manufacturer practices and past performance.”  MRAP would provide oversight of an accreditation body which would conduct assessments—paid for by the manufacturer—based on criteria developed by the MRAP.  HHS would then use MRAP scores in the proposed Hospital Resilient Supply Program (HRSP).  As described in the White Paper, HRSP “could establish demand incentives and/or penalties, facilitating hospital purchasing that prioritizes supply chain resilience, rather than the current structure which generally prioritizes cost alone.”  Specifically, HRSP could link Medicare payments and/or penalties to hospitals based on a scorecard which captures the hospitals progress in “adopting practices that promote supply chain resilience or prevent shortages,” such as inventory management and the inclusion of effective failure-to-supply clauses.

    Putting aside the question of whether the implementation of any program that requires Congressional action is feasible in the current political climate, we think the underlying premise of the White Paper falls short in both scope and in its description of factors that contribute to drug shortages.

    I.  Scope

    Based on the title of the White Paper, one might reasonably assume that the policy considerations proposed apply to all potential drug shortages.  However, only in the “Key Highlights” section is it mentioned that the paper “focuses of generic sterile injectable medicines used in inpatient settings, given their importance to acute inpatient care, and their relative risk of supply disruptions.”  That sterile injectables may be more vulnerable to supply change disruptions is not a novel concept.  FDA previously analyzed 163 drugs that went into shortage in the 5-year period between 2013 and 2017; 63% (103) were sterile injectables and 67% (109) were drugs that have a generic version on the market.  In its report, Drug Shortages: Root Causes and Potential Solutions, FDA explains that the equipment needed to produce sterile injectables is highly specialized and expensive, meaning that in a shortage situation, production capacity cannot be substantially increased without taking the time and expense of procuring and qualifying new equipment.  The White Paper notes that of the 123 drugs in shortage in January 2024,  a quarter were first reported in shortage prior to 2020, with the oldest dating back to 2012, and shortages were experienced across therapeutic areas; analgesics/anesthetics (17%), anti-infective (12%), and cardiovascular (13%) products comprised 42% of shortages.  Unfortunately, the White Paper does not provide further analysis on the generic sterile injectables and instead refers back to FDA’s analysis from 2013-2017.  However, a cursory review of the current FDA Drug Shortages list shows that of the 115 drugs “currently in shortage,” 76 are injections.

    In the White Paper, HHS recognizes that “these challenges affect other products, and therefore, the solutions described here may be applicable in other markets.” However, HHS does not explain how it has made that determination and seems to gloss over entirely the complexities specific to sterile injectable manufacturing.  In Section I.A, the focus of the paper turns back to “drug shortages” generally, but HHS acknowledges that “shortages of medical devices have also been an issue for many decades.”  HHS suggests that its proposed HRSP “could be expanded to the outpatient setting or to include medical devices.”  Similarly, the MRAP could assess the feasibility of metrics for “other medical products, including, medical devices.”  Again, there’s no discussion of why HHS thinks these initiatives could be applicable to medical devices generally given the significant supply chain differences between drugs and medical devices, and even within the larger category of medical devices.  For example, how would HRSP incentives/penalties apply to low-cost, high-volume medical devices (e.g., surgical masks, gloves) versus medical devices that represent large capital expenditures (e.g., surgical robots, MRIs)?

    II.  What about government factors that cause drug shortages?

    Section I.C of the White Paper states, accurately, that “factors that cause drug shortages are multi-faceted and involve many market participants.”  The White Paper briefly discusses both the manufacturing supply chain as well as the roles various intermediaries (e.g., pharmacy benefit managers (PBMs), group purchasing organizations (GPOs), wholesale distributors) play before a finished product ever makes it to a patient.  As described in the White Paper, the factors that cause drug shortages are all caused, in one way or another, by the various market participants themselves.  For example, over-reliance on a few suppliers or manufacturers leave the supply chain vulnerable to disruption, and market concentration among GPOs and PBMs may undermine price competition and limit access.

    What the White Paper does not adequately address is whether there are any government-controlled factors that also cause drug shortages.  Two such factors come to mind: FDA inspections and DEA quotas.  The White Paper states that “FDA has resumed normal inspection operations and continues to prioritize inspections that were delayed due to COVID-19” but does acknowledge that inspections are still an area of significant challenge for FDA.  In 2022, the Government Accountability Office (GAO) reported that FDA needed to improve its foreign inspection program and that report prompted a hearing on Capitol Hill in February of this year where HPM Counsel John Claud offered testimony.  We recently summarized another GAO report which described challenges FDA continues to face with clinical research inspections.

    The White Paper acknowledges that “there is little to no flexible manufacturing capacity” and notes that FDA’s shortage response can include “exercising temporary regulatory discretion to increase supply.”  However, the White Paper does not acknowledge the role that DEA plays.  Specifically, DEA establishes an aggregate production quota (APQ) for each class of controlled substance listed in schedule I and II, and for the list I chemicals ephedrine, pseudoephedrine, and phenylpropanolamine, which limits the amount of each substance that can be manufactured in a given year.   In addition, DEA apportions individual manufacturing quota to API manufacturers and procurement quotas to dosage form manufacturers, which also limits how much each company can manufacture.  While DEA does have the regulatory authority to adjust quotas, such actions are not immediate.  For example, DEA and FDA jointly acknowledged in an August 1, 2023 letter that there have been ongoing shortages of various stimulant medications (e.g., methylphenidate, dextroamphetamine).  On August 10, FDA requested that DEA increase the APQ and individual manufacturing quotas to address the shortage.  A month later, on September 14, a manufacturer requested that DEA increase their methylphenidate manufacturing quota.  Finally, on October 3, 2023, DEA published an increase to the methylphenidate APQ.  DEA later acknowledged in a November 1 letter that it is “actively making changes” to the quota allocation process in order to address these shortages.  As of April 2024, both methylphenidate hydrochloride and various amphetamine products are still on the FDA drug shortage list.  Moreover, DEA announced that for 2024 it would be assigning procurement quotas by quarter rather than for the calendar year.  We are aware that several manufacturers have been delayed in receiving their second quarter quota.

    OPQ’s 2023 Annual Report: an Upbeat Review of CDER’s Quality Efforts

    CDER’s Office of Pharmaceutical Quality (OPQ) issued its 2023 Annual Report last week, and it’s an upbeat assessment of the Office’s policy and outreach efforts. Last year, OPQ saved a more quantitative analysis of its efforts for the other yearly publication it put out, on the State of Pharmaceutical Quality. Again this year, the Annual Report that was released last week did not feature much in the way of specific quality issues. That said, there are certainly some important data to review.

    This year’s report noted that CDER’s Drug Product Catalog contains over 140,000 entries, the same amount as OPQ listed in 2022. Readers also saw that that the Center’s manufacturing Site Catalog remains steady at more than 4,800 entries, the same number we found in the 2022 State of Pharmaceutical Quality report. Those numbers are the stars in the manufacturing universe that CDER uses to plot its regulatory course, so it’s of interest to see how they have remained consistent even if OPQ didn’t take the next step of connecting the points in those constellations.

    OPQ also boasted that last year it performed quality assessments of more than 1,100 approved or tentatively approved applications. In a display of the competition within the generic industry that keeps margins low, this total included 118 new drug applications and 956 generic drug applications. OPQ also worked on 55 novel drug approvals for products with new molecules.

    Drug shortages have been a scourge for FDA, both as they negatively affect consumers and FDA’s reputation. The report stated that OPQ performed 359 expedited quality assessments to address shortages. Unfortunately, it is also unencumbered by any explanation about what those expedited reviews looked like, or, for example, how OPQ coordinates with CDER’s Drug Shortage Staff. From that lack of detail, it would appear that FDA thinks of Good Manufacturing Practice (cGMP) compliance as a timeless and ecumenical pursuit, following the well-worn path laid out in its now-18 year old guidance.

    The role of technology on quality was another feature. The report highlighted CDER’s Framework for Regulatory Advanced Manufacturing Evaluation Initiative and OPQ’s own Emerging Technology Program. It also noted that last year, FDA hosted a two-day public workshop and published a white paper on the regulatory framework for Artificial Intelligence in drug manufacturing, in addition to other efforts. Like many of us, OPQ seems intent on trying to keep up with how technology can/will impact pharmaceutical quality.

    There was also a nod to something we blogged about last year, OPQ’s recent reorganization. Now complete, the Office thinks the re-org will allow it “to adapt to the changing pharmaceutical landscape by being more agile and efficient.” Under the new structure, quality is assessed without concern for the relevant premarket approval process. The new sub-offices are organized to review drugs by type, not by approval route. This strikes us as another signal that FDA sees the policies of cGMP as evergreen, and largely immune to even seismic technology shifts.

    OPQ plays such a vital role in the cGMP and drug quality space, we’re always happy to read about its policy and outreach efforts. But here’s also hoping that we’ll see some more detailed data in an upcoming missive on the industry-wide state of quality.

    FDA Tells Congress What It Wants, What it Really Really Wants (it really really really wants a zigazig-ah)

    Every year, federal agencies submit a budget request to Congress to fund various agency initiatives, and every year FDA includes a list of legislative proposals that it would like to see come out of Congress.  This year is no different, and in fact some of the requests on this year’s list are repeat offenders from last year’s.  And though FDA may not have gotten everything that it wanted last year, reviewing and reflecting on these lists of legislative proposals provides important insight for industry to see where FDA thinks it might need congressional assistance to “better support Agency efforts to protect American consumers and patients.”  Perhaps unsurprisingly given the extraordinary focus on drug pricing in the last decade, generic competition—FDA’s only real way to have an effect on drug pricing—tops this year’s list.

    Under the heading “Facilitating Competition” are multiple initiatives designed to either hasten development of generic drugs or limit blockades to market.  In the first category, FDA asks Congress to amend the FDCA to require drug manufacturers to disclose full information about the name and quantity of inactive ingredients in product labeling and permit FDA to disclose to generic sponsors the names and amounts of such inactive ingredients.  This proposal is clearly intended to address difficulties in formulating generic drugs with the same quantity and quality of inactive ingredients as required by regulation for certain dosage forms.  “FDA believes this change would effectuate timelier and more cost-efficient generic drug development . . . .”  Additionally, FDA moves into the biologics world, seeking to facilitate follow-on competition in that market by asking Congress to do away with the line between interchangeable biosimilars and other biosimilars; eliminating that distinction would allow for substitution of biosimilars (rather than only interchangeable biosimilars) thereby eliminating an obstacle to follow-on biologic access.  Finally, FDA asks Congress to amend to FDCA § 505(j) to address the submission and review of drug-device combination product ANDAs, as well as drug products submitted in an ANDA that are used with devices.  While it is not in question that FDA has the authority to approve combination product ANDAs, FDA seeks amendments to clarify that FDA can request and review data for such applications, that certain differences between the device constituent parts of the reference listed drug (RLD) and the proposed generic are permissible, and that differences in labeling between the RLD and the proposed generic as a result of permissible differences in the device are also permissible.

    In the second category—limiting blockades to marketing—are efforts to limit blocking exclusivities and induced infringement liability.  First, FDA proposes to amend three-year exclusivity such that exclusivity is awarded only where the new drug applicant is actually seeking exclusivity and where the data supporting exclusivity actually demonstrates the hypothesized effect of the drug; this approach would prevent information on new safety risks from blocking competition.  Second, FDA proposes to amend the 180-day forfeiture provisions to address exclusivity parking by adding a 75-day failure to market period triggered by resolution of patent litigation without a finding or infringement or invalidity if there is no settlement agreement limiting the ability to market.  If a settlement agreement does limit ability to market until a certain date, that date would trigger a 75-day failure to market period.  Finally, in response to the GSK and Teva litigation, FDA continues to ask for a legislative fix.  Specifically, FDA asks to add a “safe harbor” from patent infringement liability for applicants for generic applicants marketing with a “skinny label” due to Agency concern that induced infringement litigation threats will impact the “timely availability” of generic drugs.  We note though that the proposed “safe harbor” isn’t exactly a “safe harbor” that would alleviate concerns of allegations of induced infringement arising from skinny labels; instead, it would only limit the use of certain claims from evidence of induced infringement and thus may not have the intended effect.

    In addition to those initiatives relating to generic competition, the FY25 Legislative Proposals is filled with requests for other legislative authority.  Of particular interest to this blogger, FDA includes several initiatives related to animal drugs.  Specifically, FDA seeks a “targeted statutory provision for FDA-regulated biologic products for animals” so that more of these products can become approved, as the Agency estimates that over 95% of such products are not approved right now.  FDA also asks to amend the FDC Act to require labeling updates for new safety information for animal drugs, to allow for REMS for animal drugs, to require postmarketing studies for animal drugs to assess known or potential risks, and to prevent diversion of animal drugs.  FDA also asks for recall authority over drugs—both human and animal—to remove violative drug products from market “more quickly”.  There are a significant number of additional initiatives the Agency requests with sections dedicated to “Enhancing Data, Information, and Postmarket Safety;” “Addressing Medical Product Shortages and Supply Resiliency;” “Modernizing Foods Authority;” and “Other.”  FDA has a lot of wants, and it has seized the opportunity to ask for what it wants, what it really really wants.

    Congressional Hearing on LDTs: Split on FDA Regulation but Support for VALID

    On March 21, 2024, the House Energy and Commerce held a subcommittee hearing titled “Evaluating Approaches to Diagnostic Test Regulation and the Impact of the FDA’s Proposed Rule.”

    House Energy and Commerce Committee Chair Cathy McMorris Rodgers (R-WA) and Subcommittee Chair Brett Guthrie (R-KY), in announcing the hearing, made their views clear: “FDA has proposed a rule that relies upon dubious and misguided legal, economic, and public health arguments and has provided limited opportunities for stakeholders to offer input. The proposed rule extends far beyond the scope of any legislative proposals and would threaten access to reliable tests for children and patients with rare diseases.” They believe any regulatory oversight for laboratory developed tests (LDTs) should be mandated by Congress, rather than the Executive Branch.

    The majority of witnesses, along with several of the Congressional members, agreed that legislation is the appropriate path to regulating laboratory developed tests.  FDA, which was not invited to participate, would surely have concurred.  This seems to have been the outcome that many lawmakers desired. Specifically, Representatives Bucshon (R-IN), Eshoo (D-CA), DeGette (D-CO), and Carter (R-GA) asked targeted questions seeking to get witnesses to go on the record supporting legislative efforts, in lieu of rulemaking by FDA. Congress has on multiple times considered, and failed to enact, LDT legislation (see here and here). Nevertheless, lawmakers appeared eager to pursue a legislative solution and try to force stakeholders back to the table.

    The FDA proposed rule elicited some strong criticism. Susan Van Meter, the president of the American Clinical Laboratory Association, said, “FDA is poised to reshape the regulation of laboratories by bypassing Congress and unilaterally imposing medical device regulation on the professional testing services that laboratories provide.”  She testified that applying such an approach to laboratories is inappropriate and does not strike the right balance between maintaining patient access and encouraging diagnostic innovation.  Multiple witnesses warned that FDA’s rulemaking would inhibit the ability of labs to offer innovative tests due to the high cost and delays of going through the FDA review process.

    Donald Karcher, president of the College of American Pathologists, said most LDTs are developed and used for patients that are cared for in the hospital or health care network where the lab is located, which enables the lab and pathologists to interact directly to adequately assess the clinical validity. He emphasized that FDA regulatory oversight should focus on those tests that pose the highest risk to patients.

    Several witnesses also noted the lack of grandfathering provisions for tests already on the market in the proposed rule, something that was included in the VALID Act.  FDA could, of course, insert grandfathering in the final rule; it remains to be seen if that will happen.

    Committee Chair Rodgers expressed her concerns that FDA regulation of LDTs would substantially increase the regulatory and financial burden on labs, causing them to stop offering many tests, such as those that are used in oncology and cell and gene therapies. Van Meter also testified that this is even more consequential for pediatric patients, small patient populations and patients with rare diseases.  These are areas where “revenue is modest,” she said.

    Zach Rothstein, executive director of AdvamedDx, noted that the VALID Act included certain provisions that are designed to provide regulatory certainty and encourage the development of innovative diagnostics (e.g., technology certification program). Rothstein emphasized that the VALID act has specific provisions related to postmarket modifications and mitigation measures for bringing the tests down to a lower risk test.

    A fundamental divide is over whether LDTs and in vitro diagnostic products (IVDs) should continue to be regulated differently or if legislation can be crafted and enacted that will cover both types of products. While most witnesses appeared to support the legislative approach, Dara Aisner, Medical Director at Colorado Molecular Correlates Laboratory representing the Academic Coalition for Effective Laboratory Developed Tests, said that LDT developers and IVD manufacturers are not in the “same playing field” as they are “not playing the same sport,” and that they should not be held to the same standards.  Years of debate have shown that no legislative proposal will be palatable to all stakeholders.

    Rothstein also expressed concerns over LDTs current regulatory status, and said that FDA’s proposed rule clarifies that IVDs, including those developed by a laboratory, are medical devices. Rothstein further asserted that a modernized regulatory framework for all diagnostic tests should be overseen by FDA, and the focus should be on whether the tests work rather than “where they are developed.”  Jeff Allen, President and CEO of Friends of Cancer Research, also expressed support for FDA regulation, saying that without FDA oversight there’s no way to know how many LDTs are available.

    Consistent with our own analyses, (see here and here), both Representatives and witnesses expressed significant concerns about FDA’s underestimating the number of available LDTs and the number entering the market each year.  Karcher testified that it is not clear how this assessment was done and that even CAP doesn’t have the capability to gather such information. The majority of witnesses believed the number is much higher.  FDA’s understating the number of LDTs would result in FDA understating the total costs of complying with a final rule.

    As we previously blogged, the draft final LDT rule is with OMB’s Office of Information and Regulatory Affairs (OIRA) for review. So far, OIRA has held or is scheduled to hold at least eleven meetings with stakeholders on LDT issues, including some that testified on March 21. Whether these meetings will lead to changes in the rule is unknown.

    The March 21 hearing did generate public support for VALID.  But given Congress’ track record on VALID and its limited ability to tackle any substantive issues, it would be surprising if Congress sprang into action, even after a final rule is issued.  At this point, litigation – not legislation – is the more likely next step after finalization.

    GAO Report on Clinical Research Inspections Encourages FDA to Care for its Clinical Inspection Program

    While Covid is in the rear view for most of us, FDA has had a tough time shaking off the effects of the pandemic on its inspection output. Inspections went down—way down—during the pandemic. In March 2020, FDA temporarily postponed all foreign and domestic and routine surveillance facility inspections. Many have noted that FDA has been slow to recover

    We’ve blogged before on FDA’s post-pandemic inspection work, writing about the resumption of both good manufacturing practice (GMP) and bioresearch monitoring (BIMO) inspections. And a look at FDA’s Data Dashboard for Inspections reveals that the Agency is returning to pre-pandemic numbers. But gaps still remain. In 2022, the Government Accountability Office reported that FDA needed to improve its foreign inspection program. That report prompted a hearing on Capitol Hill in February of this year where HPM Counsel John Claud offered testimony.

    More recently, GAO has published a new report on FDA inspections entitled “FDA Should Evaluate Its Efforts to Recruit and Retain Its Inspection Workforce.” According to GAO, FDA is facing challenges with clinical research inspections to ensure that the sites that oversee the research that lead to drug approvals meet the necessary standards. These are BIMO inspections of hospitals, clinical research organizations (CROs), and other similar facilities where clinical trial work is performed. The vast majority are for drugs.

    GAO reports that BIMO inspections peaked in 2017 when FDA was able to complete over 970 visits. Complete numbers for 2023 and 2024 are not available, but it appears that FDA was only able to complete 537 BIMO inspections in 2022. In other words, the inspectional output was inversely proportional to the importance of clinical research.

    The Agency told GAO that the root of the problem was not having enough investigators. These positions suffer from high turnover due to low pay and frequent travel. But of course, a happy inspectional workforce is vital to this foundational part of FDA’s approval mission.

    Thus, the findings from GAO that FDA needs to nurture and maintain is clinical inspection force are significant. And the problems identified—salary and travel—are entirely predictable and mirror issues plaguing the entire inspection force. GAO concludes that FDA need to monitor this personnel situation, noting it has cited workforce retention and satisfaction “as a concern across multiple FDA programs and sustained attention in this area will be critical.”

    The report comes at a time when FDA is trying to map out how it wants to exercise the authority it has over clinical trials. In December, Commissioner Robert Califf wrote about the importance of transparency in trials, noting the FDA takes a risk-based approach to compliance and enforcement. He also said that notices alerting firms of noncompliance were, in the Agency’s view, highly effective in correcting clinical sites’ practices.

    The stakes remain high, though. The Department of Justice has obtained several convictions for fraud in clinical trials, and drug approval sponsors face mighty obstacles if they do not conduct and maintain the appropriate due diligence on CRO’s and clinical sites. We see the risks when we conduct due diligence for clients and ignoring them only serves to put drug sponsors seeking approval at the top of FDA’s list when it’s looking for ways to prioritize its inspection choices.

    FTC Continues to Rage Against Device Patent Listings in the Orange Book

    The FTC appears to be on a mission to cleanse the Orange Book of patents it deems improperly listed.  For the second time in recent years, the FTC has filed an Amicus Brief explaining exactly which patents should not be in the Orange Book.  Last time, back in 2022, the FTC took on REMS patents, explaining in litigation between Jazz and Avadel that the listing of REMS patents in the Orange Book is anticompetitive; this time, the FTC is going after device patents.  Late last week, the FTC submitted an Amicus Brief in recent Hatch-Waxman patent litigation in the District Court of New Jersey between Reference Listed Drug holder Teva Branded Pharmaceutical Products R&D Inc. and ANDA applicant Amneal Pharmaceuticals explaining that patents that claim the device constituent of a combination product but do not expressly claim the relevant drug substance should not be listed in the Orange Book.

    In a seemingly run of the mill patent suit, Teva sued Amneal for infringement of 5 patents arising from the submission of Amneal’s ANDA referencing Teva’s combination product ProAir HFA NDA in fall 2023.  Those 5 patents, however, all covered the combination product’s device constituent, a Metered Dose Inhaler, rather than the drug constituent, albuterol sulfate.  In accordance with the Hatch-Waxman Amendments, Teva received a routine 30-month stay precluding FDA from approving Amneal’s ANDA for 30 months so that the patent litigation can proceed.  But this litigation coincided with FTC’s recent intervention into antitrust issues in the Orange Book during which the FTC asked 10 sponsors in November 2023, including both Teva and Amneal, to delist device patents.  Seizing on some opportune timing, Amneal, filed a counterclaim against Teva seeking a declaratory judgment of non-infringement and invalidity of all 5 patents, removal of those patents from the Orange Book, and relief from allegedly anticompetitive conduct in violation of state and federal antitrust laws.

    On the heels of its pursuit of the eradication of the “improperly listed” patents in the Orange Book—where notably Teva refused to delist its device patents while Amneal complied—the FTC filed an Amicus Brief in the Teva and Amneal litigation.  The Amicus Brief explains that only drug substance, drug product, and method of use patents are to be listed in the Orange Book yet “Teva has triggered a 30-month stay based on inhaler and dose counter device patents that, on their face, are not specific to any FDA-approved drug” (noting that one patent has been listed with 21 different drug products).  Very clearly, the brief states “In the FTC’s view, device patents that do not mention any drug in their claims do not meet the statutory criteria for Orange Book listing, and a device patent that is improperly listed in the Orange Book must be delisted” (emphasis added).  This is plain as day for FTC, which is interesting considering that FDA—the entity responsible for maintaining the Orange Book—has refused to say a word on the subject, which, presumably, is the entire reason FTC has felt the need to intervene in the first place.

    In reading this Amicus Brief, it is clear that FTC is not happy with Teva following Teva’s refusal to delist its device patents in response to the FTC’s Fall 2023 “warning letter” (called that by FTC in the Amicus Brief).  Though Teva listed the asserted patents as “drug product” patents, FTC explains that “none of the [patents in suit] mention any drug in their claims, much less the active ingredient in ProAir HFA, albuterol sulfate.”  (FTC also notes that the last expiring patents covering albuterol sulfate expired in 1989.)  Because a “drug product” is defined by regulation as a “Finished dosage form . . . that contains a drug substance,” FTC explains that “only those [patents] that claim the finished dosage form containing the drug substance of the relevant NDA” can be listed.  Teva’s patents do not meet that criterion.  FTC compares Teva’s listed patents to those at issue in the 2020 First Circuit decision in In re Lantus Direct purchaser Antitrust Litigation, where the Court held that device component patents that do not explicitly claim the drug product cannot be listed in the Orange Book.

    Unsurprisingly, the brief takes a trip through antitrust laws as well, explaining FTC’s position why such listings are anticompetitive, and, as part of that analysis addresses head-on FDA’s “ministerial role” with respect to the Orange Book.  Indeed, there has been a lot of criticism of FDA for not intervening in Orange Book device patent-listing disputes, but the FTC excuses that because it is not the FDA’s mission to “resolve economic disputes about the coverage of patent claims.”  While that’s not exactly what industry has asked of FDA, framing it that way provides FDA coverage behind its claims that it “’lack[s] the resources, authority, or expertise to police patent claims’ that delay the entry of generic drugs.”  This lets FDA off the hook pretty easily considering that industry has been asking FDA explicitly whether device patents can be listed in the Orange Book for more than 20 years.  Hearing nothing, industry proceeded to list.

    Nevertheless, if FDA is not going to get involved—and it appears that it will continue not to—at least FTC is providing industry with the clear guidelines it has been asking for.  And it doesn’t look like FTC is planning to stop policing the Orange Book any time soon.  It would not be surprising if we see more Amicus Briefs from the FTC in Hatch-Waxman patent suits or if FTC starts to take its own enforcement action beyond the request to delist.  FTC’s resolve here—and its clear assertion of its antitrust authority in this space—should serve as a warning to sponsors of combination products to review their Orange Book patent listings.

    FDA Approval of New Therapy, Duvyzat, for Duchenne Muscular Dystrophy Represents Several Meaningful Firsts

    On March 21st, FDA announced the approval of the first nonsteroidal therapy for the treatment of Duchenne Muscular Dystrophy (DMD) (FDA press release available here). Duvyzat (givinostat), a histone deacetylase (HDAC) inhibitor developed by Italfarmaco, S.p.A., represents a new class of therapeutics to slow progression of DMD and adds significantly to the armamentarium available to treat this relentlessly progressive and devastating condition.  Hyman, Phelps & McNamara, P.C.’s Frank Sasinowski, James Valentine and Charles Raver are honored to have aided Italfarmaco in the development and approval of this new drug, and to be part of the effort to expand treatment options for the young men and boys living with Duchenne, and the families of those affected by Duchenne.

    Even with a growing list of therapies for DMD, this disease continues to cut short the lives of those with Duchenne and rob these young men and boys of the full functions of their bodies and autonomy that many of us take for granted. Several of the approved DMD therapies are available only to those with specific genetic variants, representing small portions of the overall population of people affected, and were approved and made available via Accelerated Approval while studies to confirm clinical benefit are ongoing. As Dr. Emily Freilich, Director of the Division of Neurology 1 in the Office of Neuroscience in CDER noted in FDA’s press release, Duvyzat is the first nonsteroidal DMD therapy approved regardless of genetic mutation.

    Beyond the unmet medical needs that Duvyzat helps to address, we see this approval to be notable from a drug development and regulatory perspective. The primary basis for approval, like other drugs for DMD, was based on a single placebo-controlled randomized trial. However, it was the first of a nonsteroidal treatment of any product class to ever demonstrate an effect on a functional primary endpoint, here, the four-stair climb test (4SC). In addition, Duvyzat’s labeling also reports a nominal statistically significant effect on the North Star Ambulatory Assessment (NSAA), a secondary endpoint in the trial and is regarded by many in the field as the most widely accepted instrument for gauging the magnitude of benefit of a DMD therapy. It was also the first trial to be run with a placebo control over 18 months, whereas other DMD therapies have been tested in pivotal trials of 1 year or less.

    The evidence reviewed by the FDA’s Office of Neuroscience and Division of Neurology 1 to support the approval of Duvyzat, however, goes beyond these traditional DMD functional endpoints. The underlying pathophysiological hallmarks of DMD are loss of muscle and its replacement with fibrotic and fatty tissue. While the mechanism by which Duvyzat and HDAC inhibition treats DMD likely involves multifaceted effects on the inflammatory and other pathophysiology processes set in motion by mutations in the dystrophin gene, Duvyzat showed an effect on muscle loss, the key pathogenic hallmark of DMD. Treatment with Duvyzat over 18 months resulted in a 30% reduction in fat fraction of major muscle groups in the thigh as measured by magnetic resonance spectroscopy.

    Finally, each of the effects of Duvyzat were demonstrated on top of standard of care treatment with corticosteroids. All patients in the pivotal trial were required to be on a stable dose of corticosteroids for 6 months prior to enrollment and continued on corticosteroids throughout the study. While demonstrating an effect on top of an already effective therapy is impressive from a study design standpoint, it is most meaningful in that Duvyzat is not merely an alternative treatment option but it can be used on top of existing corticosteroid therapies to meaningfully delay disease progression for those with Duchenne.

    We authors eagerly await the publication of FDA’s Summary Basis for Approval for the Duvyzat NDA so that we can better understand the basis for the Agency’s finding of substantial evidence of effectiveness, particularly in light of recent FDA guidance on the topic of single study approvals with confirmatory evidence, available here.

    All the data described above can be found in Sections 12 and 14 of the FDA-approved prescribing information (see here). Additional data from studies of Duvyzat are available in the published literature (see e.g., Mercuri E, Vilchez JJ, Boespflug-Tanguy O, et al. Safety and efficacy of givinostat in boys with Duchenne muscular dystrophy (EPIDYS): a multicentre, randomised, double-blind, placebo-controlled, phase 3 trial. Lancet Neurol. 2024;23(4):393-403. doi:10.1016/S1474-4422(24)00036-X).

    Arkansas Law Prohibiting Manufacturer 340B Contract Pharmacy Restrictions Upheld by 8th Circuit

    As drug manufacturers battle the Health Resources and Services Administration (“HRSA”) in federal courts over the role of 340B contract pharmacies, an Eighth Circuit decision to uphold a 2021 Arkansas law may render those cases inconsequential in that state.

    The 340B contract pharmacy dispute involves several manufacturers who are refusing to provide 340B discounts to covered entities if they requested 340B drugs to be delivered to, and dispensed from, a network of contract pharmacies. The drug manufacturers claim that their statutory obligation to offer 340B discounts to covered entities does not require them to deliver the 340B drugs to an unlimited number of contract pharmacies. They argue that the 340B statute had never intended to give contract pharmacies such an outsized role in the program, in part because their proliferation stretched HRSA’s enforcement capacity and resulted in widespread noncompliance. HRSA disagrees, arguing that manufacturers are violating their duty to provide covered entities access to 340B prices based solely on the delivery location. HRSA also argues that Congress’ silence regarding pharmacies and delivery rendered the statute ambiguous, and dictates deference to the agency’s position. In 2021, HRSA threatened to impose penalties and the drug manufacturers sued to enjoin the agency.

    The Arkansas Law

    Against this backdrop, in May 2021, Arkansas enacted a law prohibiting manufacturers from interfering in a covered entity’s agreement with a contract pharmacy. Under this law, manufacturers may not deny contract pharmacies access to a covered entity’s 340B drugs, or deny 340B drug pricing to covered entities who use contract pharmacies for distribution. See Ark. Code Ann. § 23-92-604(c)(1), (2) (Act 1103). The Pharmaceutical Research and Manufacturers Association (“PhRMA”) immediately challenged the law at the agency level, and in September of that year, sued Arkansas on the theory that the law was preempted by the federal 340B statute and the Federal Food, Drug, and Cosmetic Act (FDCA), and was unconstitutional under the dormant commerce clause because of its effect of regulating commerce occurring wholly outside that state’s borders. Two 340B covered entities joined the litigation as intervenors arguing to uphold the law.

    The Eastern District Court of Arkansas reviewed PhRMA’s arguments for field preemption, obstacle preemption and impossibility preemption (the parties asked the court to stay the dormant clause question pending the outcome of the preemption issue). On December 12, 2022, the district court granted intervenors’ motion for summary judgment, holding that federal law did not preempt the Arkansas statute under any theory. On March 12, 2024, a three-judge panel of the Eighth Circuit affirmed.

    The 340B Statute Does Not Preempt the Field

    PhRMA first argued that the 340B Program preempts Act 1103 through field preemption. Field preemption applies when federal regulation occupies the regulated area so pervasively that it leaves no room for states to supplement it, even if the state law is consistent with the federal law. PhRMA argued that Congress established the 340B drug discount program, imposed ceilings on prices drugmakers may charge certain healthcare facilities, specified what those facilities are, and provided compliance and enforcement mechanisms for manufacturers and covered entities.

    However, the court found that the 340B Program is not so pervasive that it left no room for states to supplement it. Pharm. Rsch. & Mfrs. of Am. v. McClain, No. 22-3675, 2024 U.S. App. LEXIS 5840 (8th Cir. 2024) at 13 (“Decision”). The 340B statute is silent about delivery and distribution of pharmaceuticals by pharmacies to patients even though pharmacies are essential and a legally required part of the drug distribution chain. Decision at 8-9. This silence contrasts with 340B’s provisions that directly address distribution by another third-party—wholesalers. Id. at 12. The court held that Congress’s decision not to legislate the issue of pharmacy distribution indicates that Section 340B is not intended to preempt the field, and the state’s traditional police powers should prevail. See id. at 5, 12.

    The court also noted that the practice of pharmacy is an area traditionally left to state regulation. The federal government has long maintained that state law offers an additional, and important, layer of consumer protection that complements federal regulation. Id. at 12-13. Further, the court believed Congress was aware of the role of pharmacies and state pharmacy law when it enacted the 340B Program, and its decision to still stay silent indicated that it did not intend to preempt the field.

    PhRMA also argued that Act 1103 impermissibly interfered with 340B’s “closed system” by adding pharmacies to the enumerated list of covered entities eligible to receive 340B-discounted drugs. However, the court noted that contract pharmacies neither purchase 340B drugs, nor receive the 340B price.  They merely dispense 340B drug to the patients of covered entities, while covered entities purchase and maintain title to the drugs. PhRMA next argued that the oversight and enforcement mechanism of Act 1103 contravenes HHS’s exclusive jurisdiction to implement and enforce the program. Again, the court clarified that HHS and Arkansas would have jurisdiction over different disputes: the federal government addresses pricing, overcharging, refunds, and diversion of 340B drugs, while the state law would act only if a manufacturer denied 340B drugs to covered entities’ contract pharmacies.

    Act 1103 Does Not Conflict with the 340B Statute’s Purpose

    PhRMA also argued that the 340B Program preempts the Arkansas statute through obstacle preemption. The court examined whether the operation of Act 1103 would frustrate the 340B statute’s purpose and intended effects in its chosen field. The court held that the Arkansas statute does not create an obstacle for manufacturers to comply with 340B.  On the contrary, it assists in fulfilling the purpose of 340B. Id. at 15-16. The court explained that Act 1103 does not require manufacturers to provide discounts to contract pharmacies, so the delivery of covered entities’ drugs to contract pharmacies for dispensing should create no obstacle to fulfilling the 340B statute’s purposes. Additionally, Act 1103’s penalties are aimed at activities that fall outside the purview of 340B; the state law is simply deterring manufacturers from interfering with a covered entity’s contract pharmacy arrangements. Id. at 16.

    Act 1103 Does Not Make it Impossible for Drugmakers to Comply with the FDCA

    PhRMA also argued that Act 1103 is preempted by the Federal Food, Drug, and Cosmetic Act through impossibility preemption. Impossibility preemption exists when it is physically impossible for a private party to comply with both state and federal law. Id. at 17. According to PhRMA, Act 1103 will make it impossible for manufacturers of drugs subject to Risk Evaluation and Mitigation Strategies (REMS) to comply with the restrictive distribution requirement the REMS program imposes—for example, that only certain pharmacies may qualify to receive and dispense REMS drugs.

    The court disagreed that Act 1103 would make it impossible for manufacturers to comply with a REMS program. Id. at 17-18. The covered entity would bear the responsibility of seeking out and contracting with a pharmacy that meets the REMS requirements. According to the court, “[j]ust because a medication is subject to multiple legal requirements does not make it impossible to comply with Act 1103. PhRMA alleges no circumstances where a covered entity’s contract pharmacy arrangement has made simultaneous compliance with state and federal law impossible.” Id. at 18. As such, the court held that FDCA does not preempt Act 1103.

    The Road Ahead for the 340B Contract Pharmacy Dispute

    In January 2023, the Third Circuit handed the manufacturers a victory in one of their lawsuits against HRSA challenging covered entities’ unrestricted use of contract pharmacies.  Other decisions are expected at the D.C. and the Seventh Circuit Courts, and if there is a circuit split, we may see the question reach the Supreme Court. However, the Eight Circuit decision upholding the Arkansas law may encourage 340B entities to lobby state legislatures to adopt similar laws, and potentially circumvent those decisions altogether.

    Conference Notebook: ACI’s Cosmetics and Personal Care Products Conference

    The American Conference Institute’s 11th Annual Legal, Regulatory, and Compliance Forum on Cosmetics & Personal Care Products took place this week in New York, and featured a full house of folks talking about the Modernization of Cosmetics Regulation Act (MoCRA), the legal considerations around making environmental, sustainable, and green (ESG) claims, and the impact of state laws. As readers of our blog know, MoCRA was a significant change to regulation of cosmetics. Now in the second year of implementation, companies have started noticing the consequences as FDA implements the new requirements and develops regulations and guidance. As the new law unfolds—and as state laws regarding ingredients and packaging, as well as laws regarding environmental claims continue to affect the cosmetics and personal care industries—the topics covered at the conference have never been more relevant.

    The first panel of the conference discussed upcoming relevant MoCRA deadlines as well as how FDA might develop its monitoring and enforcement system, especially as it relates to safety substantiation. The MoCRA rollout, though, does not preclude that FDA may practice some regulation by enforcement if it deems such action necessary. The Agency’s plans to do so may be affected by FDA’s recent re-organization of its Office of Regulatory Affairs, in addition to the move—for now—of MoCRA oversight from the Center for Food Safety and Nutritional under the Office of Chief Scientist. Such organizational shifts are often motivated by a quest for greater efficiency, but initially the move may be disruptive due to the upheaval of the change.

    Panelists also concluded that, in these early days of MoCRA registration and issuance of guidance, organization and preparation are key tools to handling requirements for adverse events (AEs) and recalls. Although much remains to be decided and industry is waiting for guidance from FDA related to some of these issues such as serious adverse event reporting, conference discussions all embraced the development of an appropriate internal company infrastructure to handle new requirements as part of a good faith display of compliance.

    In addition to MoCRA, several panels touched on state statutes that regulate chemicals in cosmetics, such as the per- and polyfluoroalkyl substances, known as PFAS. MoCRA requires that FDA issue a report on PFAS in cosmetics by the end of 2025, but one takeaway from these discussions was that several states laws create a patchwork of relevant laws, further complicated by a plaintiffs’ bar that is aggressively pursuing class action lawsuits.

    An interesting notice from the conference discussion on PFAS is that, to date, very few if any PFAS class action suits have alleged actual, realized harm from the chemicals. Instead, many of these actions are essentially claim breach of warranty, in which consumers allege that they would not have purchased products at issue if the presence of PFAS had been more clearly noticed. Litigation might include avoiding marketing claims that may trigger suits such as “clean,” “healthy,” “natural,” or “environmentally friendly,” as might be applicable to a particular product. Those claims are often triggers for plaintiff’s litigation if used with products that contain PFAS.

    The second day of the conference included a panel that included speakers the Federal Trade Commission and the National Advertising Division of the National Better Business Bureau. That panel reviewed several of the guidelines relating to advertising and marketing practices. Not surprisingly, key takeaways from the panelists echoed guidance from FTC and several recent cases and matters; i.e., provide clear guidance to paid influencers, advise paid influencers to disclose material connections and sponsorships, and clarify when “reviews” are, in fact, marketing. Furthermore, as part of their internal communications about marketing practices, companies are advised that employees who review their own company’s products must disclose their employment.

    Thriving in the cosmetics and personal care space requires attention to litigation avoidance strategies and regulatory compliance in addition to more traditional business concerns. Truly, these are complex considerations.

    Categories: Cosmetics

    HP&M Director, Allyson Mullen, Appointed to the Association of Medical Diagnostic Manufacturers 2024-2026 Board of Directors

    Hyman, Phelps & McNamara, P.C. (HP&M), the largest dedicated food and drug law firm in the U.S., is pleased to announce that Director Allyson Mullen has been appointed to the Board of Directors of the Association of Medical Diagnostic Manufacturers (AMDM). This prestigious appointment recognizes Ms. Mullen’s extensive experience and contributions to the field of in vitro diagnostic (IVD) regulation.  Ms. Mullen brings to the AMDM board a wealth of knowledge and expertise gained from her years of providing counsel to medical device and IVD manufacturers.

    AMDM facilitates educational resources within the in vitro diagnostic industry.  AMDM is known for serving as a “connector” for FDA and other regulatory bodies to share information and exchange ideas with industry.

    Speaking about her appointment, Ms. Mullen expressed her enthusiasm: “I am honored to join the AMDM Board of Directors. This opportunity allows me to contribute more broadly to an organization that was crucial in my own education when I first joined the in vitro diagnostic industry. I look forward to working with the Board and the members of AMDM to navigate the evolving regulatory landscape and to support the association’s educational mission.”

    Fellow HPM Director Jeff Gibbs to Speak at the 2024 AMDM Annual IVD Regulatory Meeting

    HP&M Director Jeff Gibbs will present at the 2024 AMDM Annual IVD Regulatory Meeting held in Bethesda, MD on April 24-25, 2024, at the Bethesda North Marriott.  Mr. Gibbs’ presentation, entitled “U.S. IVD Overview and Update,” will cover recent developments in IVDs, including the proposed LDT regulation.  More information on the Annual Meeting can be found here.

    Feeling the Heat (or Cold) – New Draft Guidance Addresses Requirements for Devices that Produce Thermal Effects

    FDA recently issued a draft guidance, Evaluation of Thermal Effects of Medical Devices that Produce Tissue Heating and/or Cooling (link), which describes information to include in a marketing application to support the evaluation of thermal effects of medical devices that produce local, regional, and/or systemic changes in tissue temperature due to their use, either by heating or cooling.

    The draft guidance applies to medical devices that heat or cool tissue as an intended or unintended consequence of device use.  Examples of such devices include devices that deliver forms of electromagnetic energy; devices that deliver ultrasound; electroporation devices; devices that produce temperature changes by contact; and devices with components such as batteries, generators, chargers, leads, and electrode contacts that can potentially heat surrounding tissue during use.

    To evaluate the thermal effects of a device, the draft guidance recommends that bench testing precede evaluation of thermal effects.  Bench testing should be conducted first to verify the device meets its specifications and to demonstrate that the subsequent data generated are representative of the final finished device’s performance.

    An evaluation of thermal effects should include an assessment of tissue effects (e.g., thermal damage, tissue appearance, tissue/organ function) and related spread of thermal energy in the tissue.  These assessments may be performed experimentally (i.e., using phantoms, ex vivo animal tissue models, and/or in vivo animal testing), computationally, and/or clinically.  To determine which type of tissue evaluation is appropriate, the draft guidance recommends the magnitude and distribution of the heating and/or cooling provided by the device be considered in addition to the availability of the appropriate experimental model, noting that use of a phantom model or ex vivo animal tissue model may be appropriate for devices with local tissue temperature changes, but may not be suitable for devices with regional or systemic effects, where impact of blood flow on the development of tissue effects needs to be accounted for.

    For ex vivo tissue or in vivo animal testing, the guidance includes discussion of the selection of tissue and test methods, noting that testing should be performed such that the tissue is exposed to the minimum, average, and worst-case temperature-time history.  The draft guidance discusses selection of tissues, tissue test methods, and methods for assessing the thermally affected tissue region(s), including thermal energy spread.  For measuring the thermally affected tissue region(s), the draft guidance recommends use of histological methods or methods evaluating changes in properties, such as electrical, mechanical, and optical properties or properties related to imaging.  For measuring thermal energy spread, the draft guidance discusses probe-based and image-based thermometry.

    When in vivo animal testing is needed, tests should follow good laboratory practices and the animal model should be representative of the intended clinical application.  For example, aesthetic devices intended to create fractional effects, where the technical parameters of the subject device are significantly different from the comparator device, should be tested using an animal model.  Notably, this same example is used for a situation in which data from a study in humans may be needed.  The draft guidance notes that histological data from use of the device in tissues of interest in humans or an appropriate animal model should be provided.  While histological data is common in studies of animal models, it is not clear how human histological data should be obtained in a study of an aesthetic device and the draft guidance provides no discussion of this point.

    The draft guidance also discusses use of computational evaluation of tissue effects and thermal energy spread, recommending that such evaluations should use computational models of relevant tissues, impose clinically relevant boundary conditions, and be validated to predict tissue effects and thermal energy spread in the intended tissue of interest for the full range of spatio-temporal temperature distribution.

    Given the complexity of these studies and the lack of detail regarding the applicability of the guidance to specific devices, seeking a pre-submission may be beneficial to sponsors.  The draft guidance recommends seeking guidance through the pre-submission process to address questions of:

    • The use of phantoms, ex vivo tissue, or in vivo animal models.
    • Selection of appropriate model parameters for the intended clinical application.
    • The induced spatial temperature distribution over time (i.e., “temperature-time history”) needed to support a claimed tissue effect.
    • Design of clinical studies, when needed, to support the device’s indications for use.
    • Scenarios where the recommendations in the guidance may not apply.
    • Evaluation of devices that induce reversible or irreversible electroporation effects, as electroporation-based ablation has been associated with induction of cardiac arrhythmias.

    The draft guidance notes that the recommendations reflect current review practices.  While companies that already market devices that produce tissue heating and/or cooling may already be familiar with FDA’s expectations, availability of the guidance should help those with new devices avoid surprises during review of their marketing applications.

    Categories: Medical Devices

    Surely You Must be Kidding, PTO?!? “No, and Don’t Call Me Shirley!” – The Seemingly Slapstick (But Yet Unfunny) World of Recent Patent Term Extension Decisions (PART 3 . . . and PART 3½)

    After waiting with bated breath for more than a week since posting spicy Part 1 and Part 2 of our three-part series on recent U.S. Patent and Trademark Office (“PTO”) Patent Term Extension (“PTE”) decisions under 35 U.S.C. § 156 for certain FDA-regulated products, we know what you were thinking . . . .  Men in Black from the PTO’s PTE branch might have gotten to us.  Not yet!  (Though we keep looking over our shoulder.)

    Part 1 focused on both the PTO’s historical and current (180-degree and unsupported change in position) on multiple PTEs.  Part 2 (“Part Deux”) investigated the PTO’s position and recent decisions on PTE applications for patents covering products approved—and then withdrawn years later—under the Federal Food, Drug, and Cosmetic Act’s Accelerated Approval provisions (and otherwise).  Today, we move on to Part 3 concerning a group of PTO decisions that left us floored!  And we even throw in Part 3½ in homage to the 1992 comedy “The Naked Gun 2½: The Smell of Fear” starring Leslie Nielson as bumbling Police Lt. Frank Drebin of Police Squad (who also starred in the 1980 movie “Airplane!” referenced in Part 1 of our series, and who made the “Hapsburg” quip in Part 2 of this series).

    Part 3:  Who’s Buried in Grant’s Tomb? 

    This blogger’s 11th grade math teacher, Mr. Neilitz, used to tell a riddle that he associated with an easy-to-answer math problem: “Who’s buried in Grant’s Tomb?”  The answer he was looking for was simply “Grant” (and not a numerical figure), although the full correct answer would be Ulysses S. Grant and his widow Julia Dent Grant.  (And, in truth, the Grants are not really “buried,” they’re “entombed” above ground in matching sarcophagi.)  The point here for our purposes, however, is that “Grant” includes both Ulysses S. Grant and his widow Julia Dent Grant.  Do you really have to identify both “Grants” to be correct?  How, pray tell, does this relate to PTEs you ask?

    The PTE statute at 35 U.S.C. § 156(d)(l)(D) requires that a PTE application contain “a brief description of the activities undertaken by the applicant during the applicable regulatory review period with respect to the approved product and the significant dates applicable to such activities”  In addition, 35 U.S.C. § 156(d)(2)(B)(i) specifies the PTO must “determine if the applicant acted with due diligence during the applicable regulatory review period.”  The lack of due diligence by the applicant during the regulatory review period may be taken into account in calculating the PTE period.

    Given these statutory requirements, the PTO has held that in order to be PTE-eligible, the patent owner or its agent must have undertaken the activities that led to the regulatory approval.  If a patent owner has not been involved in the regulatory process—directly or indirectly—then that patent owner has not lost any patent life.  After all, it never invested the time and resources necessary to obtain approval for commercial marketing or use. That was the case in the PTO’s April 3, 1995 decision denying a PTE as to U.S. Patent No. 4,631,286, where the PTO considered “whether Hoechst-Roussel is eligible to file an application for [PTE] based on a regulatory review conducted by its competitor, the marketing applicant Warner-Lambert, wherein Hoechst-Roussel was not associated with the regulatory review that led to FDA approval for commercial marketing of the approved product.”  The PTO said no: “the application does not set forth any activities undertaken by the ‘applicant’ — the patent owner or its agent, as required by the statute. . . .” (see also Hoechst-Roussel Pharms., Inc. v. Lehman, No. 95-650-A (E.D. Va. Oct. 27, 1995); aff’d, 109 F.3d 756, 759, 42 U.S.P.Q.2d 1220, 1223 (Fed. Cir. 1997).

    Section 2752 of the PTO’s Manual of Patent Examining Procedure further clarifies 35 U.S.C. § 156(d) (and the PTO’s PTE regulations at 21 C.F.R. § 1.740), stating that:

    If the applicant for patent term extension was not the marketing applicant before the regulatory agency, then there must be an agency relationship between the patent owner and the marketing applicant during the regulatory review period. To show that such an applicant is authorized to rely upon the activities of the marketing applicant before the Food and Drug Administration or the Department of Agriculture, it is advisable for the applicant for patent term extension to obtain a letter from the marketing applicant specifically authorizing such reliance. [(Emphasis in original)]

    This brings us to a spate of recent letters from the PTO to PTE applicants we’ve seen titled “REQUIREMENT FOR INFORMATION PURSUANT TO 37 C.F.R. 1.750”.  They all as for the same type of information:

    U.S. Patent No. 10,544,220 (October 24, 2023)

    Pursuant to 37 C.F.R. 1.750, applicant is required to submit the following to the USPTO:

    Evidence that Genmab A/S is expressly authorized to rely upon the regulatory review activities by Genmab US, Inc., the marketing applicant before the Food and Drug Administration to support the application for patent term extension of U.S. 10,544,220 (the ‘220 patent). . . .

    The PTE application paragraph (C) on page 4 indicates that EPKINLY® (epcoritamab-bysp) received approval for commercial marketing or use on May 19, 2023. According to the PTE application, however, the “Marking Applicant for EPKINL Y® ( epcoritamab-bysp) is Genmab US, Inc., Exhibit 3. Genmab A/Sis thus relying upon the premarket activities ofGenmab US, Inc., PTE application paragraph A (page 4), to support application for patent term extension. The Office now requires Genmab A/S to provide evidence, as set forth above, of its eligibility to apply for extension of the term of the ‘220 patent under 35 U.S.C. § 156. Namely, Genmab A/S must demonstrate its agency relationship with the BLA holder (Genmab US, Inc.) as it relates to the approved product and provide evidence of its express authorization to rely upon the regulatory activities by Genmab US, Inc.

    U.S. Patent No. 10,968,453 (November 29, 2023)

    Pursuant to 37 C.F.R. § 1.750, applicant is required to submit the following to the USPTO:

    Evidence that Biogen MA Inc. is expressly authorized to rely upon the regulatory review activities by Biogen, Inc., the marketing applicant before the Food and Drug Administration to support the application for patent term extension of U.S. 10,968,453 (the’ 453 patent). . . .

    The PTE application paragraph (3) on page 5 indicates that QALSODY® (tofersen) received approval for commercial marketing or use on April 25, 2023. According to the PTE application, however, the “Marking Applicant for QALSODY® (tofersen) is Biogen, Inc., Appendix D. Biogen MA Inc. is thus relying upon the premarket activities of Biogen, Inc. to support application for patent term extension. The Office now requires Biogen MA Inc. to provide evidence, as set forth above, of its eligibility to apply for extension of the term of the ‘453 patent under 35 U.S.C. § 156. Namely, Biogen MA Inc. must demonstrate its agency relationship with the NDA holder (Biogen, Inc.) as it relates to the approved product and provide evidence of its express authorization to rely upon the regulatory activities by Biogen, Inc.

    U.S. Patent No. 6,929,639 (December 6, 2023)

    [Boston Scientific Scimed, Inc. (BSSI)] is required to provide evidence of authorization for its reliance on marketing applicant Boston Scientific Corporation’s activities before the FDA. . . .

    The last sentence of the paragraph bridging pages 1-2 of the PTE application states, “BSSI is a whollyowned subsidiary of Boston Scientific Corporation.” Even if BSSI is a wholly-owned subsidiary of Boston Scientific Corporation as stated, it is not clear on the record of this PTE application that BSSI is entitled to rely on the activities of Boston Scientific Corporation before the FDA in connection with the filing of the PTE application for U.S. Patent No. 6,929,639.

    PTE applicant BSSI is required, pursuant to 3 7 CFR 1. 7 5 0, to establish on the record of this PTE application that it is entitled to rely on marketing applicant Boston Scientific Corporation’s activities before the FDA. An authorization letter from an appropriate representative of Boston Scientific Corporation would satisfy this Requirement for Information.

    U.S. Patent No. 7,553,941 (November 28, 2023)

    Pursuant to 37 C.F.R. § 1.750, applicant is required to submit the following to the Office:

    Evidence that Opko Biologics Ltd. is expressly authorized to rely upon the regulatory review activities by Pfizer Ireland Pharmaceuticals (Pfizer), the marketing applicant before the Food and Drug Administration to support the application for patent term extension of U.S. Patent No. 7,553,941. . . .

    The PTE application states “[u]nder the terms of the AMENDED AND RESTATED DEVELOPMENT AND COMMERCIALIZATION LICENSE AGREEMENT between Pfizer Inc. and OPKO Ireland Ltd. (effective May 12, 2020), Patent Term Extension Applicant OPKO Biologics Ltd., through OPKO Ireland Ltd., exclusively licensed U.S. Patent No. 7,553,941 to Pfizer Inc. for purposes of obtaining marketing authorization for NGENLA™ (Somatrogonghla). Accordingly, OPKO Biologics Ltd. is authorized to rely upon the activities of Pfizer Inc. for the purposes of this application for patent term extension of U.S. Patent No. 7,553,941.” PTE Application at 5. However, an exclusive license is not an authorization to rely on the activities of the marketing applicant for a PTE application. Because Opko is relying on the premarket activities of Pfizer to support the application for patent term extension, the USPTO is requiring Opko to provide evidence, as set forth above, of its eligibility to apply for extension of the term of U.S. 7,553,941 under 35 U.S.C. § 156. In particular, Opko must demonstrate its agency relationship with the BLA holder (Pfizer) as it relates to the approved product and its receipt of express authorization to rely upon Pfizer’s regulatory activities.

    Although there are several more examples, we’ll stop here (or here, actually).  But we hope you get our drift: the answer is “Grant; yes, both of them; isn’t that obvious?!”

    Why is it necessary for the PTO to ask someone to confirm the obvious—to “triple stamp a double stamp!”, as Harry from “Dumb and Dumber” might say?  After all, if the registered practitioner submits a PTE application on behalf and alleges reliance on the a PTE regulatory review period of another and there is no conflicting PTE filed and the marketing applicant has not objected, then why can’t the PTO rely on the statements made under the practitioner’s ethical duty pursuant to 37 C.F.R. § 11.18(b).  That regulation is pretty clear.  It states, in part:

    (b) By presenting to the Office or hearing officer in a disciplinary proceeding (whether by signing, filing, submitting, or later advocating) any paper, the party presenting such paper, whether a practitioner or non-practitioner, is certifying that—

    (1) All statements made therein of the party’s own knowledge are true, all statements made therein on information and belief are believed to be true, and all statements made therein are made with the knowledge that whoever, in any matter within the jurisdiction of the Office, knowingly and willfully falsifies, conceals, or covers up by any trick, scheme, or device a material fact, or knowingly and willfully makes any false, fictitious, or fraudulent statements or representations, or knowingly and willfully makes or uses any false writing or document knowing the same to contain any false, fictitious, or fraudulent statement or entry, shall be subject to the penalties set forth under 18 U.S.C. 1001 and any other applicable criminal statute, and violations of the provisions of this section may jeopardize the probative value of the paper. . . .

    Of course, PTE applicants respond to the PTO’s information requests, but it takes time and money to do so.  And the PTO is not alone in putting form over function; FDA is increasingly doing so as well!  Take, for example, a recent instance this blogger faced when submitting generic drug Controlled Correspondence to FDA on behalf of a prospective generic drug applicant.  The Letter of Authorization that needed to be submitted was on company letterhead identifying “COMPANY NAME, INC.”, and the signature block identified the signatory as coming from “COMPANY NAME USA, INC.”  That Controlled Correspondence—actually, five of them, because a separate Control needs to be submitted for each approved strength—was bounced and needed to be resubmitted, resulting in a waste of time snd resources.

    That segues us nicely into a bonus piece . . .

    Part 3½:  Seriously? 

    On April 29, 2022, FDA approved Tap Pharmaceuticals, AG’s (“Tap’s”) NDA 215809 for EMERZA (levothyroxine sodium) Oral Solution.  A PTE application (Docket No. FDA-2023-E-2391) was subsequently submitted to the PTO seeking an extension of U.S. Patent No. 9,345,772.

    On November 4, 2022, the PTO sent a REQUIREMENT FOR INFORMATION PURSUANT TO 37 CFR 1.750 stating, among other things, the following:

    There is a discrepancy in the patent term extension (PTE) application regarding the name of the approved product. The FDA approval letter attached to the PTE application as Exhibit A indicates that the approved product of NDA 215809, referenced in the PTE application, is ERMEZA® (levothyroxine sodium). Thus, our letter to the FDA dated the same day as this Requirement for Information presumes that the PTE application concerns ERMEZA® (levothyroxine sodium).

    However, the second full paragraph of the PTE application is as follows:

    The approved product of NDA 215809 is ERMEZA® (levothyroxine sodium) oral solution (EMERZA® or the Approved Product). EMERZA® was approved for commercial marketing under Section 505(b)(2) of the Federal Food, Drug, and Cosmetic Act (FDCA). (See pages 1 and 35 of the NDA APPROVAL Letter from the FDA, provided as Exhibit A) And the ‘772 patent contains claims that cover EMERZA®.

    We note that the paragraph reproduced above includes one reference to “ERMEZA®” and three references to “EMERZA®.” It would appear that “ERMEZA®” was intended, because that tradename is associated with NDA 215809. Nevertheless, for the sake of clarity, Tap is required to confirm the tradename of the approved product.

    The PTO letter further requests that “Tap is required to provide evidence of authorization for its reliance on marketing applicant Mylan’s activities before the FDA,” and that “Tap is required to provide support for the submission and approval dates of NDA 215809.”

    It appears that Tap never responded to the PTO.  As such, on August 7, 2023—nearly two months after the response deadline—the PTO sent a letter saying that the PTE application for EMERZA had been withdrawn.  Wow!  That’s pretty draconian for a typo (as well as the other issues noted).  And I’ll bet you didn’t even notice that we used “EMERZA” above twice instead of “ERMEZA”!


    Well, there you have it folks.  We hope that it has been an informative—and hopefully an entertaining—ride.  But you may be asking yourself: “Kurt, why invest so much time and effort in calling out all of these PTO actions?”  It’s a fair question.

    First, as folks know, this blogger loves this stuff.  Anything Hatch-Waxman is of interest to me, and is something that I believe deserves the light of day.  The continued integrity of the Hatch-Waxman Amendments—and FDA and PTO interpretations of it—is something in which I am personally invested.

    Second, while I realize there are pressures on PTO (and FDA) to “do something” about drug procing and patent concerns, there’s a right way to go about doing that and a wrong way.  Unjustified position reversals, new interpretations, elevating form over function, and denying patent term because of a spelling error is probably not the best way to go about change.  The controversies and battles they often lead to are expensive—in both private and government time and resources.  Those resources might be better used to explore substantive and meaningful changes to the law that—consistent with the intent of Congress in passing the Hatch-Waxman Amendments—“help ensure the intended balance between encouraging innovation in drug development and accelerating the availability to the public of lower cost alternatives to innovator drugs is maintained.”

    Categories: Hatch-Waxman