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  • HP&M is Pleased to Welcome Gail Javitt to the Firm as a Director

    Hyman, Phelps & McNamara, P.C. (“HP&M”) is pleased to announce that Gail Javitt has become its newest Director.   Many leading companies have turned to Gail for her deep knowledge, skills, experience and thought leadership on the complex regulatory issues they face while looking to innovate and comply with existing and emerging FDA regulations.

    As a Director at HP&M, Gail will provide strategic FDA regulatory advice for leading medical device, diagnostics, pharmaceutical, biological products, human cellular and tissue-based products (HCT/Ps) throughout the product lifecycle. Gail has successfully resolved disputes for these types of entities both at the pre-and post-market stages. She also has significant experience advising clinical laboratories on FDA and Clinical Laboratory Improvement Amendments (CLIA) requirements for laboratory developed tests.

    In addition, Gail has published and spoken widely on issues at the intersection of law, science, ethics and policy, including FDA regulation of clinical trials, genetic testing, precision medicine and next generation sequencing.  Early in her career, Gail worked at the Genetics and Public Policy Center (part of Johns Hopkins University), as a law and policy director.  In this role, she was responsible for developing policy options to guide the development and use of reproductive and other genetic technologies.

    Gail’s academic experience has included serving as a faculty member at the Berman Institute of Bioethics at Johns Hopkins University and as an adjunct professor at the Georgetown University Law Center, American University’s Washington College of Law and the University of Maryland School of Law.  She earned her J.D., cum laude, from Harvard Law School; her Master’s in Public Health from Johns Hopkins University and her B.A., phi beta kappa, magna cum laude, from Columbia College.

    “Joining a firm known specifically for its intentional focus on the FDA and the needs of the health care and life sciences industry is important to me because of the exceptional resources that they can offer its clients. Combining my experience with the firm’s exceptional bench is an exciting opportunity, and I look forward to the many collaborative successes we will achieve together,” said Ms. Javitt.

     

    Categories: Miscellaneous

    FDA Says That Theranos Discovery Strain Is Causing Other FDA Enforcement Efforts to Take a Backseat

    About eighteen months ago, the government accused former Theranos founder Elizabeth Holmes and former Theranos president Ramesh “Sunny” Balwani of wire fraud and conspiracy, a scheme that fooled investors into providing more than $700 million to the then-promising blood-testing startup.

    In the latest development in US vs. Elizabeth Holmes et al., federal prosecutors have asked Judge Davila to extend a December 31, 2019 court-ordered discovery deadline for FDA to produce documents, which the agency failed to meet.  FDA says it needs until April 30, 2020.  We blogged about the prior court order here.  In the January 13 hearing on FDA’s extension request, the agency’s Chief Counsel, Stacy Amin, participated by phone to describe the Agency’s efforts to respond.

    Ms. Amin argued that time frame had been too short to comply with the large request.  She reported that the Agency had multiple employees working at 200% of their normal capacity in an attempt to meet the court’s initial deadline of December 31, 2019.  Ms. Amin said that several employees and significant resources had been redirected to meet the demand of the court’s discovery request. These strains, she said, have caused FDA to place other regulatory activities on pause, making it difficult for the Agency to meet its public mission to protect public health.  Remarkably, she indicated that even FDA enforcement efforts have taken a backseat to this discovery, including reduced resources for the issuance of warning letters and reduced resources for seeking court injunctions in other cases.  On net, Ms. Amin indicated FDA believes document production can be completed by April 30.

    In light of the trial date of August 4, 2020 (mark your calendars!), Holmes’ and Balwani’s counsel argued that April 30 still would not give them enough time to review the material prior to trial.  The prosecution blamed the defense counsel for their predicament, suggesting that the complexity of the search requests had contributed to FDA’s inability to meet the December 31 deadline.

    Judge Davila did not make a ruling during the hearing and has not yet issued a written order.  Since FDA has already missed the original deadline, the judge will have to either grant the motion for an extention until April 30 or deny the motion and set a different deadline.

    We will continue to provide updates on the Theranos saga as developments occur.  The next court date is February 10, 2020 where the defense’s motions to dismiss will be heard.

    *Work supervised by the Firm while DC Bar application is pending

    The Vanishing PMA Device Advisory Panel Meeting

    Under the Federal Food, Drug, and Cosmetic Act, FDA is authorized to hold advisory panel meetings for premarket approval applications (PMAs).  While FDA originally had to hold a panel meeting for all PMAs pursuant to the Medical Device Amendments of 1976, Congress liberalized the law in 1990 so that FDA panel meetings would only occur “on the Secretary of the Department of Health and Human Service’s own initiative” or “upon the request of an applicant unless the Secretary finds that the information in the application . . . substantially duplicates information which has previously been reviewed by a panel.”

    As we have noted previously, the number of PMA advisory panels has declined significantly in recent years (see also our prior post here).  Whereas in 2010 there were 9 panel meetings, in 2017 there were only 2.  In 2019, this downward trend hit bottom: there was not a single PMA advisory panel meeting.

    To connoisseurs of the device approval process, this was a sad loss.  The PMA panel process provided otherwise inaccessible insights into FDA’s thinking, as well as the ability to analyze the impact of policy changes on substantive decisions (see PMA Advisory Panels: The Impact of FDA’s Change in Policy on Voting Pattern).  And, they sometimes offered traits rarely associated with the application process: drama, excitement, tension, and even humor.

    For those who crave device panel meetings, it was not a total loss.  FDA did hold 9 other panel meetings in 2019, on topics ranging from ethylene oxide sterilization to reclassification of surgical stapler devices.  And, there was one advisory panel meeting for a de novo request (the NeuroAD Therapy System for treatment of Alzheimer’s dementia).  One could have gotten good odds on a bet that the number of de novo panel meetings in 2019 (1) would exceed the number of PMA advisory panel meetings (0).

    Of course, other types of applications are also subject to panel meetings.  For example, FDA convenes panels to consider applications for new molecular entities.  Still, an article published in the January 9 issue of the Pink Sheet (US FDA’s Breakneck Approval Pace Clashes With Advisory Committee Mandate) reports that number of advisory panel meetings for drugs has dropped significantly in recent years.  If these trends continue, advisory committee meetings to review individual product applications may eventually become extinct.

    Categories: Medical Devices

    HP&M Files Citizen Petition Challenging FDA’s Restrictions on Pharmacogenomic Data

    Over the years, we have blogged many times on FDA’s approach towards laboratory-developed tests (LDTs) (see, e.g., prior posts here, here, here, here, and here).  On October 31, 2018, FDA issued a Safety Communication relating to one particular type of LDT: pharmacogenomic (PGx) assays.  On November 1, 2018, the Center for Devices and Radiological Health and the Center for Drug Evaluation and Research issued a joint statement on the same topic.

    Pharmacogenomics, or PGx, generally refers to testing and research related to the impact of genetic variants on drug response.  A growing body of evidence is emerging to support an association between certain genetic variants and patient response to medication.  Scientists and clinicians have been working to review and curate these data and rank the strength of the evidence for specific drugs and variants.  By knowing this information, physicians may be able to make more informed prescribing and dosing decisions

    FDA has itself acknowledged that pharmacogenomics can play an important role in identifying responders and non-responders to medications, avoiding adverse events, and optimizing drug dose. See FDA, Table of Pharmacogenomic Biomarkers in Drug Labeling.  According to FDA, there are currently 385 known gene-drug interactions in FDA-approved prescribing information for hundreds of drugs; some but not all of these products include specific actions to be taken based on the biomarker information.

    In the first quarter of 2019, FDA followed up on its Safety Communication by privately contacting various clinical laboratories and software companies that provide support services to laboratories asking them to cease including information about specific medications in laboratory reports for PGx tests.  During this same time period, FDA issued a Warning Letter to Inova Health Systems on April 4, 2019 after that entity refused to comply with FDA’s request.

    Subsequently, FDA has continued its campaign of privately contacting companies and insisting that they stop providing physicians with any gene-drug association data (even if the data are included in the FDA-approved drug labeling.  For example, Tegretol (carbamazepine) has a black box warning about “serious and sometimes fatal” dermatologic reactions in patients with the HLA-B*15:02 allele.  However, complying with FDA’s recent directives would mean that a laboratory that detects the HLA-B*15:02 allele could not include in the test report information alerting the physician of the risk of a serious adverse reaction to Tegretol.

    Thus, although FDA did not tell labs to stop performing PGx testing, the agency sought to prohibit labs from providing physicians any information about the potential clinical significance of test results.  In effect, FDA said it was up to doctors to sift through the FDA website, guidelines (there are numerous references to PGx data in treatment guidelines), articles, and other sources to try to figure out what the genetic information meant for patients.  Although FDA has asserted in the Safety Communication and elsewhere that providing PGx data to physicians poses risks to patients, the agency has not presented any supporting evidence for this assertion.

    FDA’s actions here also have implications for the broader debate over regulations of LDTs.  FDA has historically said that it would exercise enforcement discretion over LDTs.  The agency’s attack on a broad category of LDTs – PGx – without notice or the opportunity for public discussion, and in the absence of a demonstrated risk to the public, is inconsistent with FDA’s long-standing policy of enforcement discretion for LDTs.

    On January 9, 2020, Hyman, Phelps & McNamara, P.C. Directors Jeffrey N. Gibbs and Gail H. Javitt filed a citizen petition on behalf of the Coalition to Preserve Access to Pharmacogenomic (PGx) Information.  The Coalition is a group of stakeholders, including laboratories, companies that provide support to laboratories, and clinicians who utilize PGx information, committed to providing accurate PGx information to health care providers.

    The citizen petition asserts that FDA’s actions violate the Administrative Procedure Act (APA) (both in relation to LDTs generally and PGx tests specifically) and are contrary to the First Amendment.  While FDA has repeatedly said that providing PGx information presents safety risks, the agency has provided neither corroboration nor details.  On the other hand, it is indisputable that FDA’s actions block the flow of information that can prevent harm and protect patient safety.  PGx information can help doctors avoid multiple risks, such as decreased or elevated serum levels, QT prolongation, weight gain, and undesired metabolic changes.  PGx information is especially important in the psychiatric field, where, according to the National Alliance on Mental Illness, prescribing that has been informed by PGx information has been shown to result in faster remission for conditions such as Major Depressive Disorder.

    The citizen petition asks FDA to:

    1. Issue a revised Safety Communication clarifying that clinical laboratories and software providers may communicate information about gene-drug interactions that is supported by adequate evidence and is not contraindicated by information in FDA-approved prescribing information.
    2. Permit clinical laboratories to include medication-specific information in PGx test reports that is included in FDA-approved prescribing information or otherwise supported by adequate evidence without clearance or approval of a premarket submission.
    3. Conduct any future policy development related to PGx tests in compliance with the APA, which allows for the participation of stakeholders through notice-and-comment rulemaking.

    The citizen petition also requests a public hearing before the Commissioner pursuant to 21 C.F.R. Part 15.

    All interested stakeholders can comment on the petition through the public docket on Regulations.gov (FDA-2020-P-0152).

    Categories: Medical Devices

    Cert-ainly Interesting Times for the FTC at the Supreme Court

    On December 19, 2019, the Federal Trade Commission (“FTC” or the “Agency”) filed a petition for writ of certiorari in the Supreme Court seeking review of a ruling by the Seventh Circuit case FTC v. Credit Bureau Center, LLC.  A detailed overview of the background and reasoning in the appellate decision can be found in our prior post.  For present purposes what matters is that the FTC originally sought an injunction and restitution under section 13(b) of the Federal Trade Commission Act (“FTCA”).  Section 13(b) allows the FTC to seek an injunction whenever it has reason to believe one of its laws has been or may be violated.  After the FTC was initially successful in the district court, it suffered a setback on appeal when the Seventh Circuit held that section 13(b) allows the FTC to seek an injunction but does not allow for restitution as a remedy.  According to the Agency, the Seventh Circuit’s ruling “threatens the FTC’s ability to carry out its mission by eliminating one of its most important and effective enforcement tools.”  Petition for Writ of Certiorari at 1, FTC v. Credit Bureau Ctr., LLC, No. 19-825 (Dec. 19, 2019)

    The Seventh Circuit’s holding created a circuit split on this issue, and, unsurprisingly, the FTC petitioned the Court to review.  If the Supreme Court grants cert. and on the merits agrees with the Seventh Circuit’s ruling, the FTC would be precluded from seeking restitution under section 13(b).  Instead, the Agency would only be able to obtain monetary relief in a court action following a successful administrative cease and desist order and  full administrative trial.

    Notably, another case challenging the FTC’s ability to collect restitution has also sought Supreme Court review.  The petition in Publishers Business Services, Inc. v. FTC, filed in October of 2019, seeks review of a Ninth Circuit ruling upholding an award to the FTC of nearly $24 million in “equitable monetary relief” for a company’s operation of a telemarketing scheme.  See Petition for Writ of Certiorari, Publishers Business Services, Inc. v. FTC, No. 19-507 (Oct. 18, 2019).  Because the company did not raise the issue of whether section 13(b) allows for restitution during the proceedings below, the government argued that the issue could not be reviewed by the Supreme Court.  Brief for the Resp’t in Opp’n at 4, Publishers Business Services, Inc. v. FTC, No. 19-507 (Dec. 13, 2019).  The government’s brief described both the Ninth Circuit’s holding and the reasoning of the dissent, while acknowledging that the interpretation of section 13(b) has created a circuit split that may otherwise warrant review by the Supreme Court.  In the alternative, the government argued that this petition should be held pending the disposition of Liu v. SEC, cert. granted, No. 18-1501 (Nov. 1, 2019).  This case asks the Supreme Court to decide whether district courts may award disgorgement to the Securities and Exchange Commission under provisions of the securities laws analogous to the FTCA.  Publishers Business Services v. FTC was distributed for discussion at conference on January 10, 2020.

    As always, we will continue to monitor these cases and keep our readers updated of new developments.

    Categories: Enforcement

    HP&M Releases 2019 Enforcement Briefing

    Hyman, Phelps & McNamara, P.C. (“HP&M”) is pleased to present its annual report highlighting the leading enforcement actions from 2019 that affect the FDA- and DEA-regulated industries.  As the largest boutique law firm dedicated to serving clients in this field, we are keenly aware of the hot button issues our clients are watching, and we carefully selected the cases highlighted in this report due to their potential broad implications.  We have first-hand involvement in several of these matters and are pleased to share our insights and successes with you.

    We hope this report proves useful and interesting.

    Categories: Enforcement

    Fostering Oncology Product Development for Kids with Cancer

    Too often, children are not included in clinical trials for new drugs, even though children may eventually be prescribed those very same drugs. This forces physicians who treat children to try and extrapolate information collected from adult trials to determine if and how to use that medicine in kids. Children deserve better than that. To help address this issue, the Food and Drug Administration (“FDA”) recently published a draft guidance titled: “FDARA Implementation Guidance for Pediatric Studies of Molecularly Targeted Oncology Drugs: Amendments to Sec. 505B of the FD&C Act Guidance for Industry.”

    The purpose of this guidance is to facilitate the development of molecularly targeted therapies for the treatment of pediatric cancers. The guidance addresses the early planning needed for the eventual submission of New Drug Applications (NDAs) and Biologics License Applications (BLAs) expected to be submitted to the FDA on or after August 18, 2020 (and in accordance with section 505B of the Federal Food, Drug, and Cosmetic Act (FD&C Act) (also referred to as the Pediatric Research Equity Act, or PREA) as amended by the FDA Reauthorization Act of 2017 (FDARA)).

    There are now requirements for pediatric investigations to be conducted for certain targeted cancer drugs with new active ingredients, based on the molecular mechanism of action rather than clinical indication. In other words, products being developed that are directed towards a specific molecule in the cancer cells that may be involved in the growth, progression, or spread of the cancer.  These molecular targets may be related to numerous cancers rather than only a specific type of cancer. Original NDAs or BLAs for treatment of adult cancers and directed at a molecular target that is relevant to the growth or progression of a pediatric cancer must now include reports on the investigations of the molecularly targeted pediatric cancer.

    The intent of this change is to accelerate early pediatric evaluation of these new products and help get these new products to market for kids with cancer. Many cancers that occur in children and adolescents may have the same molecular abnormalities that are seen in adult cancers. The guidance states:

    Up to 50% of pediatric cancers have been reported to harbor a potentially druggable event, i.e. a molecular abnormality which can be potentially addressed by a targeted drug already approved for use in adults.

    Gröbner SN, et al. The landscape of genomic alterations across childhood cancers. 2018. Nature, Mar 15;555(7696):321-327

    The guidance defines several terms for regulatory purposes.  A molecular target is a “molecule in human cells (normal or cancer cells) that is intrinsically associated with a particular malignant disease process such as etiology, progression, and/or drug resistance.”  Relevance refers to the determination if a molecular target is substantially related to the growth or progression of pediatric cancer. The guidance outlines some of the criteria to determine if a molecular target is relevant. Categories include the following:

    • Targets Related to Specific Gene Abnormalities
    • Targets Associated with Cell Lineage Determinants
    • Targets on Normal Immune Cells and Cellular Components of the Tumor Microenvironment
    • Other Targets Associated with Specific Pathways or Functional Mechanisms of Normal and/or Malignant Cells

    Additionally, FDA maintains two molecular target lists (relevant and non-relevant) for pediatric cancers.

    The Pediatric Research Equity Act (PREA) had required that initial pediatric study plans (iPSP) were required prior to submission of an NDA or BLA. For oncology products, the iPSPs were frequently proposals to request waivers for pediatric assessments due to the type of cancer not occurring, or rarely occurring in children, which would make conducting pediatric studies impossible or highly impractical to conduct. After August 18, 2020 iPSPs, however, will require reports of pediatric cancer investigations if an adult cancer indication is directed at a molecular target relevant to pediatric cancer.  The guidance goes into detail about the content of an IPSP. Sponsors of these products can request a meeting with the Oncology COE Pediatric Oncology Program and Oncology Subcommittee of PeRC to assist with development of the iPSP.

    The guidance offers additional considerations for Rare Cancers. These include considering including a pediatric cohort in adult trials. This can prevent the need for developing and conducting a separate pediatric trial. Another consideration is to imbed pediatric trials in an adult trial, especially if the molecular target is rare in the pediatric population. Increasing the enrollment of adolescent patients can be augmented by lowering the enrollment age for the trial. Tissue agnostic studies can help in development of treatment for multiple pediatric cancers that share the same genetic aberrations (e.g., MSI-H/dMMR tumors, NTRK-fusion positive tumors). Finally, master protocols (basket or umbrella trials) may be considered to minimize the number of pediatric patients exposed to therapies. These types of protocols will usually require a lot of planning and coordination.

    Deferrals and waivers of doing pediatric studies are still appropriate in some cases such as when there is suspected serious toxicity in pediatric patients, when it may be prudent to wait until a clinical effect (in adults) is demonstrated, or if there are challenges in developing a pediatric formulation.

    The guidance closes with a section on global implications and international collaboration which encourages drug developers to take a global approach when developing oncology treatments for pediatric patients.

    Children with cancer may face additional risks when treated with drugs that were never specifically studied in pediatric clinical trials. Kids are way more complicated than being just small adults, and many things need to be considered when treating children e.g. age, rate of development and different metabolism. This new guidance is a great step in helping to see that new oncology drugs with molecular targets will be studied in children.

    The docket for comments is open until February 20, 2020.

    Just before the Compliance Date, FDA Issues Final Guidance on Serving Size-Related and Miscellaneous Issues Regarding the “New” Nutrition Labeling Regulations

    As we previously reported, in 2016, FDA issued significantly revised nutrition labeling regulations for foods and dietary supplements.  The compliance date is January 1, 2020 for all entities except those with less than 10 million dollars in annual sales.

    The updated regulations resulted in many questions which FDA addressed in various guidances issued since 2016.  The development of guidance has been slow.  In fact, on December 30, two days before the compliance date, FDA issued the final guidance titled “Food Labeling: Serving Sizes of Foods That Can Reasonably Be Consumed at One Eating Occasion, Reference Amounts Customarily Consumed, Serving Size-Related Issues, Dual-Column Labeling, and Miscellaneous Topics.”  The final guidance differs from the draft guidance in only two substantive respects:

    1. FDA modified the question and response regarding whether products sold in small packages eligible for the simplified nutrition facts may use the truncated statement “Not a significant source of other nutrients,” or must list all nutrient that are present in insignificant amounts to clarify that the statement “Not a significant source of other nutrients” is not limited to sugar free chewing gum but may be used on all products for which the package size may render it impracticable to include the long statement.
    2. FDA modified the response to a question regarding the placement of the nutrition facts to clarify that it may not be placed on the bottom of packages (such as the bottom of boxes, cans, and bottles), unless they are visible during normal retail display and consumer handling.

    FDA had issued the draft guidance in November 2018.  Even though the Agency received only forty comments, FDA took more than one year to finalize the guidance.  Fortunately, as we reported here, in October 2019, FDA announced that it intends “to work cooperatively with manufacturers” and “will not focus on enforcement actions” regarding the new nutrition labeling requirements until July 1, 2020, giving companies time to review this final guidance and adjust their labels accordingly.

    The update to the nutrition labeling regulations has many consequences that have yet to be addressed, e.g., the impact on nutrient content claims and disqualifying nutrient levels.  We will continue monitoring FDA actions on this topic in 2020 (and beyond).

    PhRMA Challenges Oregon Drug Pricing Transparency Laws

    On December 9, 2019, the Pharmaceutical Research and Manufacturers of America (PhRMA) filed a civil action in the United States District Court for the District of Oregon seeking declaratory and injunctive relief against the Acting Director of the Oregon Department of Consumer and Business Services (OR DCBS) to prevent enforcement of two Oregon laws aimed at containing drug prices: H.B. 4005, which was enacted on March 12, 2018, and H.B. 2658, which was enacted on June 20, 2019.

    As discussed in our prior post (see here), H.B. 4005 requires drug manufacturers to submit an annual report containing extensive pricing and cost information for each prescription drug that has a price (defined as the wholesale acquisition cost, or WAC) of $100 of more for a one-month supply or for a course of treatment lasting less than one month, and that had a net increase of 10% or more in the price over the course of the previous calendar year.  H.B. 4005 also requires drug manufacturers to report pricing and cost information for new prescription drugs within 30 days after introducing a drug for sale in the United States at a price that exceeds the threshold for specialty drugs set in the Medicare Part D program ($670 in 2020).  Information provided to OR DCBS by manufacturers will be posted on the OR DCBS website.  H.B. 4005 states that trade secrets may not be posted on the website if “the public interest does not require disclosure of the information.”  OR DCBS regulations set forth exacting requirements for demonstrating that a designated trade secret is entitled to protection from disclosure, and, in our experience, the agency has not hesitated to question, and request additional information in support of, a manufacturer’s trade secret designation.

    Oregon’s more recent law, H.B. 2658, imposes an additional requirement for drug manufacturers to report price increases to OR DCBS at least 60 days before an increase in (1) the price of a brand-name drug that will result in a cumulative increase of 10% or more, or an increase of $10,000 or more, in the price of the brand-name drug within a 12-month period; or (2) the price of a generic drug that will result in a cumulative increase of 25% or more and an increase of $300 or more in the price of the generic drug within a 12-month period.  The report must include the date and dollar amount of the increase, and a statement of whether the increase is necessitated by a change or improvement in the drug, and, if so, a description of the change or improvement.  There is an exception for a generic drug that is manufactured by four or more companies and is either (1) marketed and distributed pursuant to an abbreviated new drug application; (2) an authorized generic drug; or (3) entered the market before 1962 and was not originally marketed under a new drug application.

    Similar to the complaints PhRMA filed challenging similar laws in California and Nevada (see our coverage here, here, and here), PhRMA’s latest complaint alleges that HB 4005 and HB 2568 violate federal law on four separate grounds.  First, PhRMA asserts that both laws violate the dormant Commerce Clause by restricting drug prices nationwide.  (Readers may recall that the dormant Commerce Clause was used to strike down Maryland’s price gouging law in 2018.)  Second, PhRMA asserts that both laws violate the First Amendment by compelling speech.  Third, PhRMA asserts that both laws are preempted by federal law governing trade secrets, including the Defend Trade Secrets Act (codified at 18 U.S.C. § 1836(b)).  Fourth, PhRMA asserts that Oregon’s “threatened abrogation of trade secret protection also effects an unconstitutional taking of property without any compensation” in violation of the Fifth Amendment’s Takings Clause.

    PhRMA’s lawsuit seeks a declaration that H.B. 4005 and H.B. 2658 violate federal law as well as an injunction prohibiting OR DCBS from implementing or enforcing either law.  However, drug manufacturers have already had to submit information to OR DCBS under H.B. 4005; the reporting requirement for new drugs went into effect on March 15, 2019 and drug manufacturers with price increases were required to submit reports by July 1, 2019.  H.B. 2658 is set to take effect on January 1, 2020.  The District Court judge recently granted Oregon’s motion to extend the time for the state’s response; Oregon’s response to PhRMA’s complaint is now due by February 14, 2020.  We will continue to monitor this case and other state efforts to constrain drug prices.

    New Proposed Rule and Draft Guidance Issued to Allow for the Importation of Prescription Drugs

    On December 18, 2019, the Department of Health and Human Services (HHS) and the Food and Drug Administration (FDA) issued a Notice of Proposed Rulemaking (NPRM) and a Draft Guidance for the importation of certain prescription drugs.  The NPRM and Draft Guidance provide further details for the two pathways initially described in the Safe Importation Action Plan that was announced in July 2019 (see our coverage here).  The NPRM describes “Pathway 1” which will allow for the importation of certain prescription drugs from Canada.  The Draft Guidance sets forth “Pathway 2” which will allow manufacturers to import FDA-approved prescription drugs that were originally manufactured and intended to be marketed for sale in a foreign country.

    I.  Overview of the NPRM

    Section 804 of the Federal Food, Drug, and Cosmetic Act (FDC Act), 21 U.S.C. § 384, allows HHS to promulgate regulations that allow for the importation of certain FDA-approved prescription drugs from Canada.  However, Congress conditioned the implementation of § 804 on a certification by the Secretary of HHS that implementation (1) will pose no additional risk to public health and safety and (2) will result in a significant reduction in the cost of drugs to the American consumer.  Since the current version of § 804 became effective in 2003, no HHS Secretary has made such a certification. The NPRM states that the HHS Secretary intends to make this certification when the final rule is issued. The certification will be conditioned on each authorized Section 804 Importation Programs (SIP) meeting the requirements of § 804 and the final rule.  The NPRM explains that the rule is not severable; if any provision in the rule becomes invalid, the entire rule will become invalid and the Secretary’s certification will be null and void.

    The NPRM sets forth a potential pathway to implement FDC Act § 804(b)–(h), for a State, tribal, or territorial government entity (SIP Sponsor) to import certain prescription drugs from Canada through time limited SIPs.  The NPRM proposes to approve SIPs for two years, with the possibility of extensions for additional two year periods. HHS proposes that every SIP be sponsored by a State, tribal, or territorial government entity, with possible co-sponsorship by a pharmacist, wholesaler, or another State or non-federal government entity.  The NPRM says that FDA is specifically seeking comments about whether the definition of a SIP Sponsor should be expanded to allow for a pharmacy, wholesaler, or pharmacist to sponsor a SIP without a State, tribal or territorial government co-sponsor.

    A SIP Sponsor will need to submit a SIP proposal to FDA for review and authorization.  In the proposal, the SIP Sponsor must identify a foreign seller (licensed by Health Canada as a wholesaler and registered with FDA as a foreign seller) that will purchase eligible prescription drugs directly from the manufacturer, and an importer (a licensed wholesaler or pharmacist) in the United States that will buy the drugs directly from the foreign seller.  In order to be eligible for importation, the drug must be approved by Health Canada’s Health Products and Food Branch and, other than the labeling, also meet the conditions in an FDA-approved new drug application (NDA) or abbreviated new drug application (ANDA). Controlled substances, biological products, infused drugs (including peritoneal dialysis solutions), intravenously injected drugs, drugs inhaled during surgery, intrathecally or intraocularly injected drugs, and drugs subject to Risk Evaluation and Management Strategies (REMS) are excluded from potential importation.

    The SIP proposal must show that importation will pose no additional risk to the public’s health and safety and will result in a significant reduction in cost to the American consumer for the prescription drug that the SIP Sponsor seeks to import.  The cost savings explanation will be reviewed by another, still-to-be identified, component of HHS. FDA may elect not to authorize a SIP proposal if, for example, there are potential safety concerns, there is relatively low likelihood that the program would result in significant cost savings, or FDA needs to limit the number of authorized programs to effectively monitor the program.

    The NPRM sets forth the requirements for importing eligible prescription drugs if FDA approves a SIP proposal.  The importer must submit a Pre-Import Request to FDA at least 30 days prior to the scheduled date of entry; the request must include a testing plan describing how the imported drugs will be tested for authenticity, degradation, and compliance with established specifications and standards.  This testing may be performed by the manufacturer or the importer, but must be completed at a qualifying laboratory in the United States. Shipments of imported drugs will be limited to certain ports of entry authorized by FDA. The drugs can either be admitted to a foreign trade zone for entry into the United States once the product is in compliance with the FDC Act, or the importer can file an entry for consumption and request to recondition to bring the drugs into compliance with the FDC Act.  Before the drug can be sold in the United States, the FDA must review and find the testing results acceptable, and the product must meet FDC Act labeling requirements. The NPRM proposes that a drug imported under a SIP will need a new National Drug Code (NDC) and will need to be listed. The NPRM also proposes that the labeling on or within the imported drug’s package include the statement: “This drug was imported from Canada under the [Name of State or Other Governmental Entity and of Its Co-Sponsors, If Any] Section 804 Importation Program to reduce its cost to the American consumer.”

    The NPRM includes a number of other requirements for drugs imported under a SIP.  Most products imported under a SIP must comply with the Drug Supply Chain Security Act (DSCSA), however, the NPRM exempts certain transactions from the DSCSA requirements.  The importer will be responsible for receiving and reporting adverse events, medication errors, field alerts, and other reports to the drug manufacturer and FDA. Among other things, the SIP Sponsor will need to comply with post-importation requirements, including providing FDA with data and information about the SIP, including the SIP’s cost savings to American consumers.  

    II.  Overview of the Draft Guidance

    The Draft Guidance sets forth a potential pathway manufacturers may use to import FDA-approved prescription drugs that were originally manufactured and intended to be marketed for sale in a foreign country, referred to as “multi-market approved products” or “MMA products”.  The Draft Guidance explains FDA’s recommended procedures for manufacturers to obtain an additional NDC for MMA products; for submitting documentation to demonstrate that the MMA products are FDA-approved drugs that meet the specifications of the products’ NDA or biologics license application (BLA); and the recommended labeling changes for the MMA products.  Drugs offered under an ANDA are not eligible for importation under the Draft Guidance.

    Under FDC Act § 801(d)(1)(B), 21 U.S.C. § 381(d)(1)(B), a prescription drug manufactured outside of the United States may only be imported into the United States for commercial use if the manufacturer has authorized and labeled the drug to be marketed in the United States.  As such, manufacturers that wish to take advantage of this pathway will need to authorize the importation these products. The MMA products must be accompanied by the FDA-approved labeling. To avoid confusion between product packages, and so pharmacists can distinguish the MMA product, the Draft Guidance suggests that manufacturers add a statement to differentiate the MMA product on the product container and outside package.

    The Draft Guidance explains that a manufacturer must obtain marketing approval from FDA through the submission of an NDA or BLA supplement.  The supplement should include information to demonstrate that the MMA product is the FDA-approved product and is manufactured in accordance with the FDA-approved NDA or BLA.  Among other things, the information in the supplement should demonstrate that the MMA product meets all of the chemistry, manufacturing, and controls specifications in the NDA or BLA.  Manufacturers are also encouraged to submit an attestation stating that the MMA product conforms to the information described in the approved application regarding the quality of drug substances, drug products, intermediates, raw materials, reagents, components, in-process materials, container closure systems, and other materials used in the production of the product.  The supplement should also include executed batch records for the product to be imported.

    Manufacturers that import MMA products must comply with the DSCSA requirements for product identification, tracing, and verification.  To help identify these products, FDA proposes to add a new “multi-market approved products” marketing category to the registration and listing system.  The Draft Guidance also suggests that manufacturers submit import entries to help FDA verify that the manufacturer has authorized and labeled the MMA product to be marketed in the United States.

    In the Federal Register Notice of Availability for the Draft Guidance, FDA specifically asks for comments on a number of questions, including whether generic drug manufacturers would be interested in a similar importation pathway.  FDA is also interested in understanding how this proposal will impact the development and market entry of generic drug and biosimilar products.  

    * * *

    The issuance of the NPRM and Draft Guidance indicate that the federal government has taken steps to allow for the importation of drug products.  However, the potential utility and impact of the two proposed pathways it is still uncertain. Although the NPRM states that the Secretary of HHS will make the certification required under FDC Act § 804 when the final rule is issued, it is still unclear whether any SIPs will be able to satisfy the requirement that the importation of prescription drugs results in a “significant reduction in the cost of covered products to the American consumer.”  It is also unclear whether any manufacturers will seek to use Pathway 2.

    Comments on the Draft Guidance will be accepted until February 21, 2020.  Comments on the NPRM will be accepted until March 9, 2020. We will continue to monitor and report on federal and state efforts to address drug pricing issues.

    Court Upholds FDA’s Authority Over Genetic Modification of Animals, But Defers Question of Whether Drug Safety Encompasses Environmental Risks

    In ongoing litigation over the FDA’s approval of AquAdvantage bioengineered salmon, the District Court for the Northern District of California issued an order upholding FDA’s authority to regulate as a new animal drug genetic material that is used to modify an animal (for background on the case, see our prior posting here). Although the Court discussed a number of factors supporting its decision, the Court seemed to have little difficulty concluding that FDA’s authority derives directly from the plain language of the Federal Food, Drug, and Cosmetic Act (FDCA):

    The text of the FDCA settles this dispute: AquaBounty’s rDNA construct is a drug under the plain language of the statute. The definition in section 321(g)(1)(C) can be broken down into two elements: (1) an article (other than food) (2) that is intended to affect the structure and function of an animal. The discrete and identifiable rDNA construct is an “article,” which “is just ‘a particular thing.’” The article of genetic material is not “food,” which is defined “as articles used for food or drink for man or other animals,” or “used for components of any such article.” And that article is intended to affect the structure and function of the Atlantic salmon by stimulating faster growth. Therefore, the rDNA construct in this case is a “drug” and (with an added layer of precision) a “new animal drug”—that is, “any drug intended for use for animals other than man.”

    (Citations omitted.) The Court also sided with the government in turning aside plaintiffs’ challenge to FDA’s Guidance for Industry 187 (Guidance 187), which sets out the Agency’s view of how the statutory provisions and regulations that govern new animal drug approval apply to animal bioengineering. The Court concluded that Guidance 187 is “best characterized not as a legislative rule (as the plaintiffs insist) but instead as an interpretive rule addressing the drug definition and a policy statement with respect to the new-animal-drug application process.” The court held that neither the interpretive rule nor policy statement aspects of Guidance 187 constitute final agency action subject to judicial review, in that they don’t mark the consummation of the agency’s decisionmaking process and also determine legal rights or obligations.

    The Court opted to delay resolution of plaintiffs’ claim that the FDCA precludes approval of a drug that is not safe for the environment.  The Court acknowledged that “some aspects of the statutory scheme suggest that the FDA’s substantive decision should turn solely on the safety of the genetically engineered animals and the humans who come into contact with those animals,” and that “the statute could be read to suggest that safety is linked to health rather than some broader conception of harm.”  However, the Court noted that “the term ‘safe’ is certainly capacious enough to reach environmental risks, and Congress carved out space for ‘other relevant factors.’ Thus, the FDA might be permitted to treat the environment as a relevant factor so long as there is ‘a rational connection between the facts found and the choice made.’  And perhaps in compelling circumstances, environmental harm would be among the ‘other relevant factors’ the FDA would be required to consider when evaluating a drug’s safety.”  Noting that the parties had not adequately briefed the questions raised by the Court, the Court delayed resolution of this issue until the next stage of the case.  Also deferred for a later date are plaintiffs’ claims challenging specific aspects of FDA’s approval of AquAdvantage (as opposed to plaintiffs’ broader attack on FDA’s authority over bioengineered animals).

    HP&M Attorney Co-Authors Nature Reviews Article with NIH, FDA, and EMA on the Progress and Challenges of Drug Development for Rare Diseases

    On December 13, 2019, Nature Reviews Drug Discovery published an article that reviews the landscape of the development of drugs for rare diseases, both the progress and challenges.  The article was authored by HP&M Attorney James E. Valentine along with co-authors from the BioPontis Alliance for Rare Diseases and representatives from NIH, FDA, and EMA, among others.

    The article discusses the technological basis and rare disease applicability of today’s main therapeutic modalities, including small molecules, monoclonal antibodies, protein replacement therapies, oligonucleotides and gene and cell therapies, as well as drug repurposing. The article also discusses selected overarching topics in the development of therapies for rare diseases, such as approval statistics, engagement of patients in the process, regulatory pathways and digital tools (topics commonly covered on this blog, e.g. on gene therapies clinical trials here).  This article serves as an important resource for anyone interested in the research and development of therapies for rare diseases, inspiring interest in funding and nurturing a culture that will lead to innovations that will alleviate the suffering of the very large number of patients affected by rare diseases in the U.S. and globally.

    HP&M has a long legacy of thought leadership in rare disease product development, particularly in the application of the FDA regulatory framework to the review and approval of these products.  For example, HP&M’s Frank J. Sasinowski authored the 2012 seminal report on FDA’s flexibility in orphan drug approvals, and he and James co-authored the 2015 update (see coverage here).

    Frank, James, and colleagues are currently drafting a second update, so our blog readers should stay tuned!

    The Court of Appeals for the D.C. Circuit Upholds FDA’s Deeming Rule

    For those following the war between the Food and Drug Administration (“FDA”) and industry over the regulation of vaping products, last week’s opinion by the United States Court of Appeals for the District of Columbia Circuit upholding FDA’s so-called Deeming Rule is yet another battle won by FDA.  The unanimous three-judge panel held that FDA’s application of its regulations governing tobacco products to e-cigarettes is reasonable because such products are “indisputably highly addictive and pose health risks, especially to youth, that are not well understood.”

    By way of background, the Family Smoking Prevention and Tobacco Control Act (“Tobacco Control Act”), originally signed into law in 2009, gave FDA the immediate authority to regulate cigarettes, cigarette tobacco, roll-your-own tobacco, and smokeless tobacco.  At the time, however, any other “tobacco product” could be regulated by FDA only if the agency issued regulations “deeming” such other products to be subject to the Tobacco Control Act.  On May 10, 2016, FDA issued a final rule deeming electronic cigarettes (“e-cigarettes”), cigars, pipe tobacco, nicotine gels, waterpipe (or hookah) tobacco, and dissolvable tobacco products, among other products (collectively referred to for purposes of this blog post as “e-cigarettes”), to be within FDA’s regulatory authority under the Tobacco Control Act.  See FDA Final Rule “Deeming Tobacco Products to Be Subject to the Federal Food, Drug, and Cosmetic Act, as Amended by the Family Smoking Prevention and Tobacco Control Act; Restrictions on the Sale and Distribution of Tobacco Products and Required Warning Statements for Tobacco Products,” No. FDA-2014-N-0189, 81 Fed. Reg. 28,973 (May 10, 2016).  This subjected e-cigarettes to regulation by FDA through premarket review requirements, heightened standards for products claiming to be safer than other tobacco products (“modified risk products”), review of smoking cessation products as either drugs or medical devices, and a ban on the distribution of free samples.

    As we previously blogged here, on the same day FDA issued this final deeming rule, Nicopure Labs, Inc. (“Nicopure”) filed a complaint in the D.C. District Court seeking to set aside the purportedly unlawful rule as contrary to the Administrative Procedure Act and a violation of the First Amendment.  After reviewing the parties’ cross-motions for summary judgment, the District Court sustained the Tobacco Control Act and FDA’s Deeming Rule.  See Nicopure Labs, LLC v. FDA, 266 F. Supp. 3d 360 (D.D.C. 2017).  Nicopure appealed this decision.

    Last week, on December 10, 2019, the U.S. Court of Appeals for the District of Columbia affirmed the District Court’s judgement sustaining the Tobacco Control Act and its application to e-cigarettes.  Nicopure limited its appeal to three issues:

    1. FDA violated the Tobacco Control Act and the Administrative Procedure Act by not providing a less rigorous premarket authorization pathway for e-cigarettes.
    2. FDA’s premarket review standards for modified risk products violate the First Amendment.
    3. FDA’s ban on the distribution of free samples of tobacco products, including e-cigarettes, violates the First Amendment by suppressing constitutionally protected expressive conduct.

    In upholding the district court’s decision, the Court of Appeals found it “entirely rational and nonarbitrary to apply to e-cigarettes the [Tobacco Control] Act’s baseline requirement that, before any new tobacco product may be marketed, its manufacturer show the FDA that selling it is consistent with public health.”  With respect to Nicopure’s First Amendment challenges, the Court of Appeals concluded that the First Amendment affords manufacturers no protection against FDA preventing the sale of e-cigarettes as safer than existing tobacco products absent a showing that they are, in fact, safer.  As for FDA’s ban on free samples, the Court of Appeals held that free samples are not expressive conduct and “the government’s interest in preventing their distribution is unrelated to the suppression of expression.”

    As of the date of this blog, it is unclear whether Nicopure will seek review by the Supreme Court.  However, even if this battle has ended unsuccessfully for industry, there are many more battles being waged across the country and the war is not yet over.  As we previously reported, vape shops in several states have challenged the constitutionality of the Deeming Rule under the Appointments Clause.

    We will continue to keep our readers apprised of the results of these lawsuits as they unfold.

    Categories: Tobacco

    Testimony About FDA’s Foreign Drug Establishment Inspection Program: GAO and FDA See Things Differently but Both Would Like to See a Fuller Glass

    Subcommittees of the House Committee on Energy and Commerce heard testimony last week from the Government Accountability Office’s Mary Denigan-Macauley and from Janet Woodcock, Director of FDA’s Center of Drug Evaluation and Research, about the state of FDA’s foreign drug establishment inspection program.

    FDA generally conducts three types of drug manufacturing establishment inspections:  preapproval inspections; surveillance inspections; and, for-cause inspections.  Both domestic and foreign establishments are subject to the same types of inspections and same manufacturing requirements.

    By way of background, Dr. Denigan-Macauley noted that the GAO has had long-standing concerns about FDA’s ability to oversee the increasingly global drug supply chain.  In written testimony, she said that in 2018 more than 60 percent of establishments manufacturing drugs for the U.S. market were located overseas, and as of March 2019, 40 percent of foreign establishments were located in India or China.   In 2008, FDA inspected only about 8 percent of the foreign establishments eligible for inspection.  In 2010 and 2016, GAO observed increases in foreign inspections, but reported that some foreign establishments had not ever been inspected.

    Dr. Denigan-Macaulay described GAO’s preliminary observations from its ongoing work in three areas:  the number of foreign inspections; inspection staffing levels; and, challenges unique to foreign inspections.

    Based on its preliminary analysis of FDA data, GAO reports that the number of FDA inspections of foreign drug manufacturing establishments increased, and that in fiscal year 2015, the number of foreign inspections surpassed the number of domestic inspections.  After 2016, however, the number began to decline, and from 2016-2018, both foreign and domestic inspections decreased – by approximately 10 and 13 percent respectively.

    Dr. Woodcock noted in her testimony that prior to 2012, FDA was required to inspect domestic establishments every two years, but there was no similar requirement for foreign inspections.  Passage of the Food and Drug Administration Safety and Innovation Act (FDASIA) in 2012 removed the requirement for the Agency to inspect domestic sites every two years and allowed FDA to use the risk-based approach it had developed to prioritize inspections of facilities according to risk.  Dr. Woodcock also noted that the Generic Drug User Fee Act of 2012 and its reauthorization in 2017 (GDUFA) provided additional resources for inspections of foreign facilities.

    Dr. Woodcock’s testimony on this subject provided additional details about the numbers.  Specifically, she stated that CDER’s records showed that as of July 2016, 965 foreign manufacturing facilities had never been inspected by FDA.  By the end of FY2019, 495 or 51% of these had been inspected, 359 or 37% had been removed from CDER’s list for a variety of reasons and were no longer part of FDA’s inspection obligation (e.g., they had gone out of business or were not serving the U.S. market).  An additional 52 or 6% had refused inspection, 37 or 4% were “inaccessible” because FDA inspectors could not travel to the location (e.g., because of travel warnings), and 22 or 2% had no drug shipments.

    Dr. Woodcock noted that although FDA’s inspections of foreign establishments, particularly those that had not been inspected as frequently as domestic facilities, had uncovered deficiencies, as of August 2019, 90 percent or more of the final outcomes of inspections were acceptable with either no action indicated (NAI) or voluntary action indicated (VAI) in all countries or regions except India.  GAO’s written testimony noted that some investigators who conduct foreign inspections expressed concern that reviewers reclassify an inspector’s original classification recommendations of official action indicated OAI to VAI.  GAO intends to look into this issue further as part of its ongoing work.  Finally, Dr. Woodcock’s testimony states that concurrence rates on foreign drug inspections designated OAI went from 50% in 1998 to 73% in 2019.

    GAO’s concerns about understaffing and high vacancy rates of foreign inspectors and translators were also described by Dr. Denigan-Macaulay.  FDA relies on inspectors from three groups to perform foreign inspections:  investigators based in the U.S. who perform domestic and occasional foreign inspections; investigators based in the U.S. who are dedicated to foreign inspections; and, investigators based in countries where FDA has foreign offices.

    High vacancy rates in foreign offices are reported by both GAO and FDA.  The number of qualified foreign office-based inspectors in FY2019 was 12.   An additional 12 individuals are based in the U.S. and conduct exclusively foreign inspections.  Among the challenges faced in recruiting for these positions are the fact that such investigators must already possess experience in conducting foreign inspections because the foreign offices do not have the ability to train new investigators.  Consequently, recruitment is limited to FDA’s existing inspectors in the U.S.  Dr. Woodcock also noted that it takes 1.5 to 2 years of training to bring a new hire to a fully proficient skill level.  She also stated that beyond the usual challenges of achieving optimum staffing levels, the number of individuals who can be permanently attached to a foreign office is limited by some host countries.  The GAO also stated that an FDA official had told them that it can take between one and over two years for a new investigator to receive the security training and complete the background check needed before they can begin a foreign-based assignment.  These requirements are reported as being handled by the embassy and agencies other than FDA.

    The language barrier and lack of FDA translators was identified as a potentially significant issue.  GAO stated that FDA often relies on translators provided by the company being inspected or an external translator or consultant hired by the company.  GAO stated that this practice adds time to inspections and raises questions about the information FDA receives.  This, too, can be seen as an inequality between domestic and foreign inspections.

    The third issue raised in the testimony was the amount of notice usually provided by FDA to foreign establishments prior to inspection.  Specifically, the GAO written testimony states that although FDA is not required to provide advance notice of inspections, it generally provides 12 weeks’ notice.  Some unannounced or short-notice inspections are performed by inspectors in China and India.  GAO stated that the amount of notice provided foreign establishments raises questions about the equivalence of domestic and foreign inspections because the long lead time provides the facilities with the ability to address issues before the inspectors arrive.  Among the reasons for the long lead time is that FDA reportedly wants to ensure that the establishment being inspected will be operational while they are there.

    OTC monograph drugs and active pharmaceutical ingredients (APIs) used in compounding were called out in Dr. Woodcock’s testimony for being able to ship to the U.S. without their manufacturing facilities being inspected.  She did not suggest how to bring these facilities under FDA’s inspection purview, but perhaps the groundwork is being laid.

    Is Congress Poised to Deal a Significant Blow to Hatch-Waxman and the Generic Drug Industry?

    Earlier this week, House Energy and Commerce Committee Chairman Frank Pallone, Jr. (D-NJ), Ranking Member Greg Walden (R-OR) and Senate Health Committee Chairman Lamar Alexander (R-TN) announced that they reached agreement on a bipartisan, bicameral drug pricing bill, called The Lower Health Care Costs Act of 2019.  According to a 16-page overview we obtained, the bill includes several FDA-related provisions – from Orange Book and Purple Book modernization, to orphan drugs, to biosimilars . . . to this description of Section 407 of the bill:

    Sec. 407. Change conditions of first-to-file generic applicants’ 180-day exclusivity to spur access and competition.

    • Prevents first-to-file generic drug applicants from blocking, beyond a 180-day exclusivity period, the entrance of subsequent generic drugs to the market.
    • Triggers the start of first-to-file generic drug applicants’ 180-day exclusivity when no first-to­-file applicant has received final approval within 30 months of submission of its application, and a subsequent applicant has been tentatively approved.

    If this short description looks familiar to you, that’s probably because it is!  It’s a description of H.R. 938, the “Bringing Low-cost Options and Competition while Keeping Incentives for New Generics Act of 2019” or the “BLOCKING Act of 2019” (House Report here).

    The BLOCKING Act, which was introduced in the U.S. House of Representatives on January 31, 2019 by Representatives Kurt Schrader (D-OR) and Earl L. “Buddy” Carter (R-GA), stems from a proposal in the Trump Administration’s proposed Fiscal Year 2019 Budget.  The bill has drawn this blogger’s ire in blog posts (here and here) and in Congressional testimony as antithetical to a primary goal of the Hatch-Waxman Amendments: getting high quality, low-cost generic drugs into the hands of consumers – fast.

    As we’ve noted before (here and here), the BLOCKING Act would significantly alter – and not in a good way – the FDC Act’s 180-day exclusivity provisions and the 180-day exclusivity incentive itself.  The BLOCKING Act would punish ANDA applicants eligible for 180-day who are diligently pursuing final application approval and would further dilute and cheapen the 180-day exclusivity incentive Congress created in the 1984 Hatch-Waxman Amendments.  In particular, the BLOCKING Act could trigger a loss of 180-day exclusivity – even when the generic drug applicant is diligently seeking final approval – based on a failure of FDA to grant final approval to a first applicant within 30 months of application submission for any reason.

    The version of the BLOCKING Act included in Section 407 of the The Lower Health Care Costs Act of 2019 is reportedly identical to the version of the bill introduced as H.R. 938.  This means that all of the efforts and resources expended over the past year to protect the cornerstone of the generic drug provisions of the Hatch-Waxman Amendments by modifying the BLOCKING Act have thus far fallen on deaf ears.  Indeed, over the past year we’ve seen multiple proposed modifications to blunt the potentially catastrophic effects of the bill, such as a provision that would require a subsequent ANDA applicant blocked by a first applicant’s eligibility for 180-day exclusivity to certify that the company will promptly market its drug product after ANDA approval.  Such a proposal certainly seems to make sense.  If the intent of the BLOCKING Act is to promote generic drug competition – that is, actual launch of generic drug products and not just ANDA approval numbers – then a guarantee that launch will occur before obliterating a first applicant’s 180-day exclusivity eligibility seems to be good public policy.

    Just as concerning is the possibility that the BLOCKING Act may lead to higher drug prices.  According to a press release from the Association for Accessible Medicines, Matrix Global Advisors (“MGA”) will soon release an analysis of the BLOCKING Act that “finds that the BLOCKING Act, by creating the risk that first filers could lose their 180 days of exclusivity through no fault of their own, would reduce generic firms’ incentives to pursue patent challenges, thereby delaying generic entry and savings.”  In addition, “MGA concludes that if even one generic launches later as a result of these changed incentives, it would, on average, cost the U.S. health care system $1.7 billion.”  Here’s a summary of the MGA analysis we were able to obtain detailing the unintended costs of the BLOCKING Act:

    It’s crunch time folks!  And while much of the attention of the country and Congress is focused on other matters these days, we should not forget the need to protect the integrity of the Hatch-Waxman Amendments.  After all, the Congressional Budget Office’s cost estimate of the BLOCKING Act makes it an attractive pay-for candidate to add to drug pricing legislation, or even a last minute add-on to a continuing resolution to fund the government past December 20, 2019.