By Ricardo Carvajal –
The Smart Choices ProgramTM has announced “that it will voluntarily postpone active operations and not encourage wider use of the logo at this time by either new or currently enrolled companies.” The announcement cites FDA’s recent letter to industry announcing the agency’s intent to define nutritional criteria for front-of-package and shelf labeling claims (see our prior post here) and notes the Program's desire to support FDA's initiative
By Larry K. Houck –
In an effort to combat a new aspect of the methamphetamine epidemic, Congress has introduced yet amendment to the Controlled Substances Act (“CSA”). Representative John Boozman (R-AR) has introduced legislation in the House that would enhance criminal penalties for methamphetamine traffickers who target minors. H.R. 3702, known as the “Stop Marketing Illegal Drugs to Minors Act,” was introduced on October 1, 2009. Congress Boozman issued a news release stating that the bill “specifically targets flavored methamphetamine, a version of the drug specially colored, and specifically made to have a candy-like taste” noting that the Drug Enforcement Administration (“DEA”) has stated that traffickers are luring children with strawberry, chocolate and cola-flavored methamphetamine.
The bill would enhance criminal penalties for anyone who manufactures, creates, distributes, or possesses with intent to distribute, a flavored, colored, packaged or altered controlled substance to make it more appealing to minors. Penalties would also apply to those who attempt or conspire to engage in these activities.
The bill would subject first time offenders in cases involving 50 grams or more of methamphetamine or 500 grams of methamphetamine mixture with fines up to $8,000,000 for individuals and up to $20,000,000 for non-individuals and imprisonment of at least 20 years or life. For first time offenders in cases involving between 5 and 50 grams of methamphetamine or up to 50 grams of methamphetamine mixture, the bill would impose fines up to $4,000,000 on individuals, up to $10,000,000 on non-individuals and imprisonment of between 10 and 80 years. Penalties double for second offenses; fines quadruple for third or subsequent offenses and imprisonment increases to life.
H.R. 3702 has been referred to the Committee on the Judiciary and the Committee on Energy and Commerce.
By Larry K. Houck –
In a departure from US DOJ policy, Attorney General Eric Holder announced formal federal guidelines for U.S. Attorneys in states that have authorized marijuana for medical use. The guidelines, set out in an October 19, 2009 memorandum authored by Deputy Attorney General David Ogden, were sent to the U.S. Attorneys in the fourteen states that have enacted laws authorizing marijuana for medical treatment. Marijuana is a Schedule I controlled substance under the federal Controlled Substances Act. Schedule I drugs are those that lack a currently accepted medical use in treatment in the United States.
U.S. Attorneys will continue reviewing marijuana cases on an individual basis consistent with DOJ resource allocation and federal priorities set out in the guidelines. Investigation or prosecution of activities that are legal under state medical marijuana laws conflict with the federal resource allocation and priorities.
The guidelines mandate that the federal government not investigate or prosecute “individuals whose actions are in clear and unambiguous compliance with existing state laws providing for the medical use of marijuana.” This would include individuals using marijuana for medical treatment and their caregivers that provide marijuana to them. Prosecution of “commercial enterprises that unlawfully market and sell marijuana for profit,” including operations that hide behind local or state law, remain an enforcement priority.
While the guidelines preclude investigation and prosecution of activities clearly and unambiguously compliant with state law, the memorandum states that it is to serve only as a guide to investigative and prosecutorial discretion. The guidelines state that nothing precludes investigation or prosecution when there is reasonable basis that state law compliance is but a pretext for illegal activity or when it serves other important federal interests. The guidelines list the following indications of conduct not “in clear and unambiguous compliance with applicable state law that may indicate “illegal drug activity of potential federal interest”:
The guidelines state that the list is not exhaustive. So, the presence of these or other factors can trigger investigation and prosecution of activities legal under state law.
The Drug Enforcement Administration (“DEA”) announced on October 22 that the agency welcomes the guidelines, asserting that “[i]t is not the practice or policy of DEA to target individuals with serious medical conditions who comply with state laws authorizing the use of marijuana for medical purposes.” But what about the not-for-profit cooperatives or even the for-profit dispensaries that provide marijuana to ill individuals? DEA stated that consistent with DOJ’s guidelines, it “will continue to identify and investigate any criminal organization or individual who unlawfully grows, markets or traffics marijuana or other dangerous drugs.” But “criminal” or “unlawful” under which laws, the federal laws or individual state laws?
By Ricardo Carvajal –
FDA has issued a letter to industry stating that the agency intends to take enforcement action against front-of-package ("FOP") or shelf labeling that provides false or misleading information (including implied nutrient claims that don't comply with regulatory requirements). Further, the letter states that FDA is developing a proposed regulation to "define the nutritional criteria that would have to be met by manufacturers making broad FOP or shelf label claims concerning the nutritional quality of a food." If the regulation becomes final, manufacturers and retailers would remain free to develop and use their own labeling systems, but the systems would have to satisfy the nutritional criteria specified in the regulation. If that effort doesn't result in a "common, credible approach," FDA is signaling that it may establish a single, uniform system for FOP and shelf labeling.
In April, FDA and USDA jointly issued a letter directed to the Smart Choices ProgramTM, an FOP labeling system that features symbols and other information intended to “help guide consumers in making smarter food and beverage choices.” That letter stated that the agencies would be monitoring implementation of Smart Choices and would be “concerned if any FOP labeling systems used criteria that were not stringent enough to protect consumers against misleading claims; were inconsistent with the Dietary Guidelines for Americans; or had the effect of encouraging consumers to choose highly processed foods and refined grains instead of fruits, vegetables, and whole grains.” Since then, Smart Choices has come under attack from several quarters, most notably Connecticut’s Attorney General (see here).
It is too soon to know if this latest action by FDA is more bark than bite. However, the fact that the agency is prepared to wade into a controversial arena with a proposed rule suggests that whatever reticence there may have been at FDA about grappling with voluntary labeling issues is rapidly dissipating.
By Kurt R. Karst –
Earlier this week, the U.S. District Court for the Central District of California a filed by Mutual Pharmaceutical Company, Inc. (“Mutual”), and AR Scientific, Inc. and AR Holding Company, Inc. (“AR”) in a Lanham Act case concerning the continued marketing of unapproved oral dosage form drug products containing colchicine. The court also declined to address a filed by the defendants in the case, deciding instead to grant a Motion to Transfer the case to the District of New Jersey for the convenience of the witnesses and parties.
Colchicine is a near-200 year-old drug FDA approved NDAs for in July 2009 for Mutual and AR (here and here) for the treatment of gout flares (NDA No. 22-351, for which FDA granted 3-year exclusivity) and for the treatment of Familial Mediterranean Fever (“FMF”) (NDA No. 22-352, for which FDA granted 7-year orphan drug exclusivity). The drug products, marketed under the trade name COLCRYS (colchicine) Tablets, were also approved earlier this week for the prevention of gout flares. In February 2008, FDA took enforcement action against companies marketing unapproved injectable colchicine drug products, but the Agency noted that its action was limited to the injectable dosage form of the drug – “FDA is not taking any orally administered colchicine products off the market at this time, whether approved or unapproved.”
The Mutual/AR colchicine case stems from two complaints ( and ) Mutual and AR filed in August 2009 (later consolidated) – just days after FDA approved COLCRYS Tablets – seeking an injunction against both suppliers of colchicine Active Pharmaceutical Ingredient used in unapproved single-entity colchicine prescription drug products and manufacturers and marketers of unapproved single-entity colchicine prescription drug products. Mutual and AR allege in their complaints that the defendants violated the Lanham Act § 43(a) (15 U.S.C. § 1125(a)) the California Business and Professions Code §§ 17200 and 17500, and California unfair competition and misappropriation common law in that they “unlawfully and unfairly advertised, marketed, promoted, distributed, and/or sold in competition with Plaintiffs’ colchicine product (COLCRYS™).” Specifically, Mutual and AR allege that the inclusion of the defendants’ colchicine drug products on various integrated drug dispensing databases and pricing services (“Price Lists”) and drug ordering systems confuses pharmacists into incorrectly believing that the defendants’ products are FDA-approved, and that the labeling for the defendants’ colchicine drug products falsely imply that they are FDA-approved and safer than COLCRYS Tablets. (Mutual and AR did not allege that the defendants made any literally false statements.)
The defendants in the case argued that the injunctive relief sought by Mutual and AR is within FDA’s primary jurisdiction, and that certain “consumer surveys relied upon by [Mutual and AR] to support their false advertising claims do not establish that Defendants have made any false statements and that Plaintiffs’ requested relief is barred by the doctrine of unclean hands.”
Under Lanham Act § 43(a), a party may be held liable for placing into interstate commerce a “false or misleading description of fact, or false or misleading representation of fact” that “in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person’s goods, services, or commercial activities.” And to prevail on a false advertising claim under the Lanham Act, a plaintiff must meet six factors:
(1) the defendant made a false statement either about the plaintiff’s or its own product; (2) the statement was made in commercial advertisement or promotion; (3) the statement actually deceived or had the tendency to deceive a substantial segment of its audience; (4) the deception is material; (5) the defendant caused its false statement to enter interstate commerce; and (6) the plaintiff has been or is likely to be injured as a result of the false statement, either by direct diversion of sales from itself to the defendant, or by a lessening of goodwill associated with the plaintiff’s product. [(Jarrow Formulas, Inc. v. Nutrition Now, Inc., 304 F.3d 829, 835 n.4 (9th Cir. 2002).)]
In support of their Motion for Preliminary Injunction, Mutual and AR primarily rely on a 2006 decision by the U.S. District Court for the Central District of California (Mutual Pharm. Co. v. Ivax Pharm., Inc., 459 F. Supp. 2d 925 (C.D. Cal. 2006) in which Mutual brought a similar Lanham Act action against companies marketing unapproved quinine sulfate after FDA approved Mutual’s QUALAQUIN (quinine sulfate) Capsules. In that case, the court granted (in part) the requested preliminary injunction, and in so doing, rejected the defendants’ primary FDA jurisdiction argument and found that Mutual had established the requisite probability of success on the merits:
Accordingly, the Court finds that the FDCA does not stand as a bar against Mutual litigating its false labeling claim. As this is the only argument raised by defendants as to why Mutual lacks a probability of success on this claim, the Court finds that Mutual has shown a likelihood of success as to its false advertising claim to the extent that claim is based upon defendants’ false representations contained on its product labels.
The court in Mutual’s colchicine Lanham Act case, however, expressed its reluctance to “view the Lanham Act’s false advertising provisions as broadly as did the Ivax court.” The court also stated that:
Defendants have not just relied on the primary jurisdiction doctrine. They also attack the merits of Plaintiffs’ false advertising claim, the sufficiency of the evidence presented by Plaintiffs, and the equities of enjoining Defendants from engaging in the very same behavior that Plaintiffs were also engaged in until days before they commenced this litigation. Even assuming that some portion of Defendants’ marketing activities are [sic] not within the primary jurisdiction of the FDA, this Court still concludes that Plaintiffs have not established a likelihood of success on the merits. . . .
Here, the survey evidence relied upon by Plaintiffs largely establishes only that pharmacists are confused about what the inclusion of a drug on a Price List or drug ordering system means concerning the FDA approval status of a particular drug. As a preliminary matter, the Court is not convinced that having drugs listed on a Price List or drug ordering system maintained by a third party even constitutes a “false statement” in “commercial advertising or promotion” to fall within the scope of the Lanham Act’s false advertising provisions. Moreover, there is little evidence that Defendants have in any way created the confusion experienced by pharmacists, or that this confusion is limited to colchicine products. Plaintiffs’ contentions concerning the product labels and inserts are even weaker, both because the evidence of confusion is weaker and because disputes concerning the content of those labels and inserts falls even more squarely within the primary jurisdiction of the FDA.
Although the case has been transferred to the District of New Jersey, it seems unlikely that a New Jersey court will disagree with the California court’s decision that the matter lies within FDA’s primary jurisdiction. Whether FDA plans to take enforcement action against companies manufacturing and marketing unapproved colchicine tablets drug products is unclear. FDA’s 2006 compliance policy guide provides the Agency’s enforcement priorities with respect to marketed unapproved drugs and states that one of the circumstances in which FDA may take enforcement action is when marketed unapproved drugs “present direct challenges to [the drug approval system], as do unapproved drugs that directly compete with an approved drug, such as when a company obtains approval of a [NDA] for a product that other companies are marketing without approval . . . .” Interestingly, in late 2006, FDA took enforcement action with respect to marketed unapproved quinine sulfate drug products shortly after the Ivax decision. FDA generally allows a grace period for the distribution of unapproved competitive products to secure approval of a marketing application before taking enforcement action, unless FDA perceives the unapproved drugs to pose a health risk.
By Ricardo Carvajal –
The Chief Administrative Law Judge (“ALJ”) at the Federal Trade Commission (“FTC”) has issued a decision that, if upheld by the Commissioners of the FTC, would dismiss an FTC complaint which alleged that a marketer of dietary supplements “disseminated” or “caused to be disseminated” false advertisements on an internet website in violation of sections 5(a) and 12 of the Federal Trade Commission Act. The challenged advertisements were alleged to falsely represent that the supplement prevented, treated, or cured cancer. However, the ALJ did not reach the question of whether the advertisements were false or misleading because he ruled that the FTC staff lawyers prosecuting the case failed to meet their burden of demonstrating that the respondents “disseminated” or “caused to be disseminated” the advertisements. The ALJ found in part that (1) there was no evidence that respondents had created or played a role in creating the advertisements, (2) merely referring consumers to a website did not constitute “dissemination” of the advertisements on that website, and (3) neither unsupported assertions that respondents participated in the website nor assertions that they had a business relationship with the supplement manufacturer were sufficient to give rise to liability for false advertising on the website.
By Kurt R. Karst –
Consistent with recent wins concerning generic PROGRAF (tacrolimus) and generic ZOSYN (piperacillin sodium; tazobactam sodium) Injection (here and here), the U.S. District Court for the Central District of California recently ruled that FDA’s April 2008 denial of a citizen petition and decision to approve Spear Pharmaceuticals, Inc.’s (“Spear’s”) ANDA No. 77-524 for a generic version of Valeant Pharmaceuticals International’s (“Valeant’s”) EFUDEX (fluorouracil) Topical Cream, 5%, did not violate the Administrative Procedures Act (“APA”).
EFUDEX (also known as 5-FU) is a locally-acting antineoplastic drug product FDA first approved in July 1970 for the topical treatment of multiple actinic or solar keratoses (“AK”). In 1976, FDA approved the drug for a second indication – for the topical treatment of superficial basal cell carcinomas (“sBCC”) when conventional methods are impractical. As we previously reported, in December 2004, Valeant submitted a citizen petition to FDA requesting that the Agency not approve any ANDA for a generic version of EFUDEX Cream unless the application contains data from an adequately designed comparative clinical study conducted in sBCC subjects. Specifically, Valeant argued in the company’s petition that:
The inadequate treatment of sBCC can lead to serious complications for patients, including the growth of their cancer. In that light, . . . is critical that FDA not make assumptions about whether a proposed generic product will be safe and effective in treating sBCC, based on a showing of comparable efficacy in patients with AK. These two conditions occur at different sites of drug action and exhibit different growth patterns. Comparable absorption of a drug to one site of action does not demonstrate comparable absorption to another, more difficult to reach site of action. Similarly, comparable efficacy in an easier to treat condition does not demonstrate comparable efficacy in a more difficult to treat condition.
For these reasons, FDA must not allow onto the market generic versions of Efudex Cream until a demonstration of bioequivalence has been made, at a minimum, in patients with sBCC.
On April 11, 2008, FDA denied Valeant’s petition and approved Spear’s ANDA. Citing judicial precedent upholding FDA’s authority to determine the appropriate methods to determine bioequivalence, the Agency stated in its petition response that “even when clinical trials are needed, it has not been the Agency’s policy to require that bioequivalence be shown in every indication if drug release from the dosage form and appearance at the or sites of activity has been demonstrated.” Furthermore, FDA concluded that “an AK bioequivalence study is sufficient to establish that the generic topical 5-FU formulation will be available in the epidermis and the upper dermis to act on both AK and sBCC lesions to an extent that is comparable to Efudex Cream.”
Valeant promptly sued FDA in the U.S. District Court for the Central District of California for declaratory and injunctive relief pursuant to the APA. Spear intervened in the case. After discovering a “potential conflict of interest . . . that could cause it to revisit the approval status of the ANDA,” FDA issued an Administrative Reconsideration and Stay of Action to Spear staying the approval of ANDA No. 77-524. After resolving that issue, FDA reaffirmed the approval of the Spear ANDA. Valeant moved for summary judgment on the basis that FDA – specifically, the Office of Generic Drugs (“OGD”) – failed to defer to the views of scientists within the Division of Dermatology and Dental Products in FDA’s Office of New Drugs (“OND”), who had determined that a study in AK patients alone was insufficient to establish bioequivalence, but rather that “both AK and sBCC should be studied to yield independent confirmation of bioequivalence for these indications.” FDA and Spear also moved for summary judgment (here and here) on the basis that FDA’s approval action was proper under the APA, in that “the authorized decision maker in connection with Spear’s original approval was [OGD], not the dermatologists in [OND] . . . .”
In granting FDA’s and Spear’s summary judgment motions, the court commented that:
Valeant has offered no evidence that the FDA actually ignored the opinions of its dermatology experts. The FDA simply did not defer to those opinions. . . . [D]eference is owed to the decisionmaker authorized to speak on behalf of the agency, not to each individual agency employee. . . . In this case, the authorized decision maker in connection with Spear’s original approval was the Office of Generic Drugs, not the dermatologists in the Office of New Drugs . . . . [(internal quotation and citation omitted)]
The district court’s decision leaves intact FDA’s stellar batting average in bioequivalence decision court challenges. Courts have uniformly held that FDA’s bioequivalence determinations fall squarely within the broad discretion of the Agency – see, e.g., Glaxo Group v. Leavitt, AMD 06-469 (D. Md., Mar. 6, 2006) (Davis, J.) (unpublished opinion); Schering Corp. v. FDA, 51 F.3d 390 (3d Cir. 1995); Schering Corp. v. Sullivan, 782 F. Supp. 645 (D.D.C. 1992), vacated as moot sub nom. Schering Corp. v. Shalala, 995 F.2d 1103 (D.C. Cir. 1993); Somerset Pharms., Inc. v. Shalala, 973 F. Supp. 443 (D. Del. 1997); Bristol-Myers Squibb Co. v. Shalala, 923 F. Supp. 212 (D.D.C. 1996); Fisons Corp. v. Shalala, 860 F. Supp. 859 (D.D.C. 1994).
Interestingly, FDA has been asked to rule on another bioequivalence issue similar to that raised by Valeant in its citizen petition, but this time in the context of ALDARA (imiquimod) Cream, 5%, which is approved for AK, sBCC, and External Genital Warts (“EGW”). Earlier this year, Graceway Pharmaceuticals, LLC ("Graceway") submitted a citizen petition to FDA requesting that the Agency refrain from approving any ANDAs for a generic version of ALDARA Cream unless an ANDA contains data from bioequivalence studies conducted in patients with each of ALDARA’s approved conditions, including sBCC and EWG, and pharmacokinetic studies under maximal use conditions in patients with EGW and AK. Graceway states in its petition that “[t]he straightforward application of FDA’s reasoning in the Efudex matter mandates that an ANDA for a generic version of Aldara contain data from a bioequivalence study in patients with EGW and a separate study in patients with sBCC.”
By Ricardo Carvajal –
In an unusual step, FDA and FTC have issued a joint warning letter to the internet marketer of a dietary supplement promoted as helpful in preventing swine flu, seasonal flu, and colds. According to the letter, the product “has not been approved, cleared, or otherwise authorized by FDA for use in the diagnosis, mitigation, prevention, treatment, or cure of the H1N1 Flu Virus,” and is both adulterated and misbranded. In addition to threatening seizure and injunction, the letter threatens a referral for criminal prosecution if there is a failure to take corrective action. Following a determination by the Secretary of Health and Human services that swine flu poses a public health emergency that “has the significant potential to affect national security,” FDA provided Emergency Use Authorization for certain unapproved or uncleared swine flu related products – but not for the product at issue.
The letter further states that the FTC Act requires claims that a product prevents H1N1 infection to be supported by “well-controlled human clinical studies,” and prohibits health claims that are not supported by “rigorous scientific evidence.” The letter notes that violations can result in an injunction or Administrative Order that can require restitution for consumers.
The 48-hour time frame afforded for a response to a joint agency action is a standard part of recent warning letters to companies selling illegal products for prevention of swine flu, and shows that there is a high level of concern surrounding the marketing of these products at both FDA and FTC (also see FDA's recent press release regarding illegal H1N1 drugs marketed on the internet here). Marketers of products high on the agencies’ priority lists had better take note.
By John R. Fleder –
Numerous states have filed lawsuits across the country alleging that pharmaceutical companies have defrauded the Medicaid system by “publishing” inflated prices, namely “AWP” and “WAC” prices, that do not accurately reflect the prices at which those companies actually sell their products. The cases generally allege that the states have over-reimbursed pharmacists and others because those states relied on “false” AWP and WAC prices for Medicaid reimbursement purposes. The defendants have presented numerous arguments to defend these cases. (Hyman, Phelps & McNamara, P.C. is actively involved in that defense.)
On October 16, 2009, the Supreme Court of Alabama dealt a fatal blow to the cases that the State of Alabama commenced against AstraZeneca, GSK, and Novartis. It ruled that the lower court had erred in denying the defendants’ post-trial motions seeking a verdict in their favor. The appellate court ruled that judgment should have been rendered in favor of the defendants, thus apparently ending the cases in that state against these defendants. The Court ruled that the State failed to produce evidence that it reasonably relied on the alleged misrepresentations by the defendants with regard to their prices. There was also a concurring opinion and a dissenting opinion.
Beginning on October 20, Stoel Rives LLP will present a three-part webinar on “business and legal issues related to the development of environmentally sustainable food products.” The titles and dates for the sessions are:
Session 1: Where to Start? Developing and Financing Sustainable Food Products (Tuesday, October 20, 2009)
Session 2: Making Good Marketing Claims: Product Labeling Pitfalls, Third-Party Certification, and "Green Washing" (Tuesday, November 3, 2009)
Session 3: Sustainable Foods Increase Litigation Risks: Developing Strategies to Minimize Exposure (Tuesday, November 17, 2009)
Hyman, Phelps & McNamara, P.C.’s Ricardo Carvajal will discuss FDA, USDA, and FTC approaches to sustainability claims during Session 2. You can register for the webinar free of charge here.
By Kurt R. Karst –
On October 14, 2009, Sens. Jeanne Shaheen (D-NH) and David Vitter (R-LA) announced the introduction of S. 1778, the Access to Affordable Medicines Act. The bill would amend the FDC Act’s ANDA provisions at § 505(j) to add a new subsection stating that:
If the proposed labeling of a drug that is the subject of an application under this subsection is different from the labeling of the listed drug at the time the Secretary evaluates the application under this subsection, the drug that is the subject of such application shall, notwithstanding any other provision of this Act, be eligible for approval and shall not be considered misbranded under section 502 if –
(A) a revision to the labeling of the listed drug has been approved by the Secretary within 60 days of the expiration of the patent or exclusivity period that otherwise prohibited the approval of the drug under this subsection;
(B) the Secretary has not determined the applicable text of the labeling for the drug that is the subject the application under this subsection at the time of expiration of such patent or exclusivity period;
(C) the labeling revision described under subparagraph (A) does not include a change to the ‘Warnings’ section of the labeling;
(D) the Secretary does not deem that the continued presence in commerce of the labeling of the listed drug (as in effect before the revision described under subparagraph (A)) adversely impacts the safe use of the drug;
(E) the sponsor of the application under this subsection agrees to submit revised labeling of the drug that is the subject of such application not later than 60 days after the notification of any changes to such labeling required by the Secretary; and
(F) such application otherwise meets the applicable requirements for approval under this subsection.
The bill, dubbed the “Generic Loophole Bill,” is intended to “increase access to lower cost generic drugs by closing a loophole some brand name drug companies exploit that needlessly and unfairly delays the entry of safe, lower-cost generic drugs to the consumer market,” according to Sen. Shaheen. Specifically, Sen. Shaheen commented that:
As the law currently stands, when brand name manufacturers make labeling changes, generic drug labeling must reflect this change prior to the drug being approved and introduced in the market. . . . [L]ast minute [labeling] changes are often used by brand name pharmaceutical companies to purposefully delay the introduction of cost-saving generic drugs by weeks or months. . . . . My bill would stop these costly practices by providing a 60-day grace period for the generic drug company to submit the new labeling for approval and marketplace distribution, while preserving safeguards if the new labeling truly presents a safety issue.
It appears that a recent change to the labeling of CASODEX (bicalutamide) Tablets led the Senators to introduce the bill. According to Sen. Shaheen, “consumer access to the generic version of this drug was delayed by more than 3 months due to a last minute pediatric labeling change . . . .”
Meanwhile, in the House of Representatives, Rep. Alcee Hastings (D-FL) has introduced H.R. 3777, the Drug Price Competition Act of 2009. This is a companion bill to S. 1315, which was introduced in the Senate earlier this year by Sen. Bill Nelson (D-FL). As we previously reported, the bill would amend the definition of “first applicant” at FDC Act § 505(j)(5)(B)(iv)(II)(bb) with respect to 180-day exclusivity eligibility so that certain subsequent ANDA applicants could trigger exclusivity.
Upon introducing H.R. 3777, Rep. Hastings commented that the bill would “help achieve some of the goals that are essential to health care reform: ensuring fair market competition and increasing access to affordable drugs.” In particular, Rep. Hastings commented that the bill:
allows generic companies that win patent challenges to share the 180-day exclusivity period with the generic companies that first submitted an application to the FDA. However, no subsequent challenger would be eligible to share in the exclusivity reward once the generic drug has been launched.
If enacted, first-to-file generic manufactures would be less likely to accept a late entry date because this would mean that another generic manufacturer could win a patent challenge and share the 180-day exclusivity period.
The amendments proposed in the Drug Price Competition Act of 2009 appear to be consistent with a paper Apotex, Inc. issued earlier this year. In that paper, Apotex recommends that Congress work for legislation “that gives shared (if not sole) exclusivity to a generic challenger who, although not first to file a paragraph iv certification, is first to succeed in addressing the listed patents.”
The Access to Affordable Medicines Act and Drug Price Competition Act are just two pieces of legislation Congress is considering with the backdrop of health care reform that could affect the generic drug industry. On October 15th, the Senate Judiciary Committee held an Executive Business Session to discuss, among other things, a substitute amendment to S. 369, the Preserve Access to Affordable Generics Act, concerning so-called “reverse payment” settlements. The amendment passed by a 12-7 vote with minor revisions. (Another amendment proposed by Sen. Tom Coburn (R-OK) that would have changed the evidentiary standard in the Kohl substitute amendment when considering settlements was withdrawn). Federal Trade Commission Chairman Jon Leibowitz commended the Judiciary Committee on its passage of the bill. Also, as we previously reported, Sen. John Cornyn (R-TX) is pushing for legislation that would preempt tort suits against generic drug makers.
By Douglas B. Farquhar –
In the second day of the Enforcement and Litigation Conference sponsored by the Food and Drug Law Institute (“FDLI”), speakers from FDA and private industry discussed the trends in international trade in FDA-regulated products, and debated when companies are required to disclose potential financial conflicts of interest.
David Elder, Director of FDA’s Office of Regional Operations, described how FDA has ramped up its efforts to inspect imported drugs, foods, and medical devices, and how FDA is increasing its overseas inspections of facilities regulated by FDA. The PREDICT system (he was at pains to remember what the acronym stands for) has been inaugurated in one District of FDA, he said, and will be rolled out shortly to all 20 districts. He said that the system, which addresses FDA-regulated products offered for import, enables inspectors to determine which import entries should be reviewed further by looking at the company and country of origin, type of product, and compliance history of recipient, among other criteria. He said that he expects the system to enable FDA to automatically release for importation (rather than requiring that the product to be held, returned to the country of origin, or inspected) much more than the 20 percent of imported FDA-regulated products that are already automatically released. He also said that he anticipates that FDA inspections overseas will increasingly be conducted in conjunction with regulatory authorities in those countries.
Katie McDermott, a partner at the law firm Morgan, Lewis & Bockius in Washington, D.C., referred to recent Corporate Integrity Agreements entered into by medical device or drug companies, and noted that the CIAs are beginning to require reporting to the government any in-kind contributions to physicians or their offices. She noted that, for example, if representatives of a company provide training on the use of a drug or device to a physician or other medical personnel, the company may be required to report that type of activity. Corporate Integrity Agreements, which are generally required when a mainstream drug or medical device company enters into a settlement with the federal government because of allegations of kickback or off-label promotion violations, have been executed and are in effect for dozens of companies.
Bradley Thompson, an attorney with Epstein, Becker & Green in Washington, D.C., argued that FDA needs to demonstrate increased transparency. He noted that his firm has determined that FDA’s Center for Drug Evaluation and Research had promulgated 64 draft Guidances more than five years ago that have not been finalized or withdrawn. He also stated that his clients are increasingly frustrated by filing comments on draft or proposed rules or guidances, and the comments are not addressed when the final rules or guidances are addressed.
In an additional update about the Conference, we should also report that Dan Miller of the Delaware Medicaid Fraud Control Unit ("MFCU"), yesterday reported that MFCU units around the country now have access to a centralized databank that can aggregate data from different Medicaid programs around the country, and match up diagnosis codes for Medicaid beneficiaries with drugs dispensed. This enables investigators to determine, on a national basis, the amount of Medicaid reimbursements for a drug used by patients in off-label indications that may have been induced by a company’s off-label marketing. The database can also be used to show increased prescriptions by specific physicians that government agents believe have received kickbacks. Dan also mentioned, in response to a question, that some MFCU units around the country receive a percentage of the recoveries (much like a contingency fee for attorneys) when they successfully achieve a settlement with a targeted company, although his unit does not.
Further information about the conference, including audiotapes, will be available from FDLI.
Doug Farquhar co-chairs the FDLI Enforcement and Litigation Conference.
By Douglas B. Farquhar –
At the FDA Enforcement and Litigation Conference sponsored by the Food and Drug Law Institute ("FDLI"), the Compliance Directors of three of FDA's Centers, representatives of other components of the Food and Drug Administration, and a Justice Department official today forecast where FDA will concentrate its enforcement efforts under the new FDA Commissioner, Dr. Margaret Hamburg.
Aside from discussing Commissioner Hamburg’s initiatives, announced in a speech before FDLI on August 6, 2009, the common threads announced by the Compliance Directors were that FDA inspections and compliance efforts will be risk-based, meaning that the agency will focus on inspecting firms and products that have histories of noncompliance and where problems with the products could cause serious health consequences for consumers. The Compliance Directors also emphasized the use of concentrated enforcement techniques to block imports of violative products from overseas, using, especially, Import Alerts, a technique which permits the agency, in cooperation with the United States Customs and Border Protection, to block products from entering the country without any prior involvement of a court or the United States Department of Justice.
More specifically,
More information about the conference is available through FDLI.
Doug Farquhar co-chairs the FDLI Enforcement and Litigation Conference.
On October 27, 2009, the European Food Law Association (“EFLA”) will hold its first international EU-US Food Law Conference at the Brussels Sofitel, Place Jourdan 1 – 1000, Brussels. EFLA is an international scientific association whose primary goal is to study and to promote Food Law. The title of the conference is “Placing Products on the Market.” A copy of the conference brochure is available here. According to EFLA:
This first EFLA Conference, specifically devoted to International Relations in the Food Law Sector, will foster the exchange of ideas and experiences between European and American practitioners. This exchange will focus on the respective substantive laws and their practical effects as seen by practitioners over the years and at present. The speakers will present general outlines of the topics, and the audience will be invited to actively participate in the debates and contribute their own views and insights.
Hyman, Phelps & McNamara, P.C.’s Diane B. McColl will chair a session at the conference comparing the main aspects of the substantive EU and US food laws, which will include a presentation from Wim Debeuckelaera of the European Commission Directorate General for Health and Consumer Affairs.
By Ricardo Carvajal –
FDA has issued a draft guidance document that addresses FDCA section 201(rr)(4), which prohibits a tobacco product from being “marketed” in combination with any other FDA-regulated product. The guidance provides the following as an example of prohibited conduct: "Nicotine that is derived from tobacco is added to water, juice, or soda (which are foods under the FDCA) and the water, juice, or soda is identified as containing a tobacco product."
This example suggests that, if a food is not “identified” as containing a tobacco product, then the prohibition in section 201(rr)(4) does not apply because the tobacco product has not been “marketed.” This result is consistent with FDA’s interpretation of the term “marketed” as used in FDCA section 201(ff)(3)(B), otherwise known as the dietary supplement exclusionary clause. In part, the exclusionary clause excludes from the definition of a dietary supplement an article that is approved as a new drug unless it is first “marketed” as a dietary supplement (or as another type of food). In applying the exclusionary clause, FDA has taken the position that an article is not “marketed” as a supplement when it is merely present in a supplement that is offered for sale; rather, the article must have been sold or offered for sale as a supplement, or as a component of a supplement where the labeling or advertising for the supplement identified the presence of the article.
What FDA’s draft guidance leaves unsaid is that one can circumvent the prohibition in section 201(rr)(4) by not “identifying” a food as containing a tobacco product, but still run afoul of several adulteration and misbranding provisions of the FDCA.
