Pharmaspective

FDA May Change Regulations to Allow Generics to Change their Product Warnings

By Frank Fazio and Genevieve Spires

@frankfaziopls    @gmspires

A single footnote in a brief filed by the Department of Justice has garnered a lot of attention this week, and understandably so.  The footnotes states: “This office has been informed that FDA is considering a regulatory change that would allow generic manufacturers, like brand-name manufacturers, to change their labeling in appropriate circumstances. If such a regulatory change is adopted, it could eliminate preemption of failure-to-warn claims against generic-drug manufacturers.”

The background of this statement is complex, but briefly, the United States Supreme Court ruled last year that plaintiffs claiming injuries as a result of their use of generic drugs may not sue generic manufacturers for their failure to warn of an alleged drug-related danger.  In deciding this, the Court found that these claims are preempted – and therefore barred – by federal law, largely because generic manufacturers are not permitted to make changes to their product labels under the current regulatory scheme (even in cases where they think stronger warnings are needed).

Under current FDA regulations, generic manufacturers cannot unilaterally update their product labeling.  Only brand-name manufacturers have the ability to update warnings on product labeling and must get FDA approval to make those changes.  Generic manufacturers are required to adopt the warnings of their  brand-name counterpart.

Any change in regulations to allow generics to change their labels will undoubtedly reopen the litigation floodgates and result in a slew of failure to warn cases being brought against generic drug manufacturers.   Likewise, such a rule can result in inconsistencies in warning information on the same drug which can certainly result in increased liabilities for those companies who fall behind in regard to labeling updates adopted by competitors.  And while we do not know the source of the information referenced in the DOJ brief, we will definitely stay tuned to see if Congress takes steps to alter the generic drug label regulatory scheme.

Sunshine Act: Reporting Food, CME, and Research…Oh My!

By Sarah Canberg

 

As the life sciences industry continues to prepare to begin collecting data on payments and transfers of value to physicians and teaching hospitals on August 1, 2013, applicable manufacturers look for clarity and guidance on the scope of information to be reported. The final Sunshine Act regulations and lengthy preamble include numerous revisions to the draft regulation.  Here, we focus on a few key special rules for reporting food and beverage in a group setting, payments or transfers of value to accredited continuing education providers, and payments for research.

 

Allocating Food and Beverage in Group Setting

The final regulations modified how applicable manufacturers are to capture and report food and beverages provided to covered recipients in a group setting.  Applicable manufacturers are to report the cost of the group meal by allocating the cost per person, not the cost per covered recipient, to each covered recipient “who partook in the meal,” which is a substantial change from the draft regulations.  For example, if an applicable manufacturer brings a platter of sandwiches to a doctor’s office that costs $150 and 5 physicians and 5 office staff members participate in the meal, the applicable manufacturer  must report the cost per person ($150/10 = $15) for each of the 5 participating physicians. This is a common sense approach to reporting meals in a group setting.

 

Exclusion of Speaker Payments for Qualifying CME Programs

In recognition of the unique and important role of industry support for accredited or certified continuing education, CMS excluded payments to speakers participating in qualifying continuing medical education (CME) programs from reporting requirements.  For speaker compensation to be excluded from Sunshine Act reporting requirements, all of the following conditions must be met:

 

(1)    the program meets the accreditation or certification requirements for continuing education of one of five specifically listed organizations (e.g., the Accreditation Council for Continuing Medical Education (ACCME));

(2)    the applicable manufacturer does not select the covered recipient speaker or even provide a distinct list of potential speakers to be considered by the CME provider; and

(3)    the applicable manufacturer does not pay the covered recipient directly.

 

If all of the above conditions are met, the payment to the covered recipient to serve as a speaker at the qualifying CME program will not be subject to reporting.  On the other hand, if the above conditions are not met, such payment must be reported under the either of the appropriate nature of payment categories:

 

• “Compensation for serving as faculty or as speaker for an accredited or certified continuing education program,” or

• “Compensation for serving as a faculty or as a speaker for a unaccredited non-certified continuing education program.” 

 

Special Rules for Reporting Research

Following the publication of the draft Sunshine Act regulations in December 2011, the lack of clarity surrounding the reporting of research payments caused confusion and concern throughout the life sciences industry.  With the release of the final regulations, CMS’ substantial modification of reporting requirements for research-related payments reflected thoughtful revisions aimed at capturing the actual payment stream for research. 

 

In the final regulations, CMS removed the requirement for the applicable manufacturer to indicate whether the payment was direct or indirect, which was a source of much of the confusion in the draft regulations and concern that many payments would be double reported.  Instead, the final regulations require that research payments be reported separately from other reportable payments and transfers of value.  Further, research payments are to be reported as a single payment including the name of the individual or entity that actually received the payment for the research services and indicating the principal investigator(s) of the applicable research payment.  For example, if an applicable manufacturer provides payment to a CRO, and the CRO provides the payment to the academic institution conducting the research that involves Dr. John Smith as the principal investigator, the applicable manufacturer will report the payment as a single payment to the academic institution and include Dr. John Smith as the Principal Investigator in that single reportable interaction.  The final regulations require specific information to reported regarding the research payment, such as the name of the research study and the names of the related covered product (and National Drug Code if a drug or a biological), but also provides the option for the applicable manufacturer to provide context for the research payment.

 

While the regulations set forth the data elements that must be collected and reported for each of the above interactions, we look forward to reviewing the report layout, especially as related to the section for research-related payments.

 

For additional information on the Sunshine Act and to view a copy of the final regulations as released by CMS on February 1, 2013, please see visit the Federal Register website. 

 

Don't forget to check out yesterday's post for The Who and the What of the Sunshine Act Regulations.

The Who and the What of the Sunshine Act Regulations

By Sarah Canberg

With the long awaited Sunshine Act final regulations in hand, members of the life sciences industry continue to sift through the 285 page regulatory tome to parse out the regulatory reporting requirements that resulted from Centers for Medicare & Medicaid Services’ (CMS) consideration of over 373 comments from medical professionals and organizations, industry members and organizations, consumers, and others. While we do not attempt to summarize the entirety of the final regulations here, we highlight a few key changes to definitions and modifications to reporting requirements.

 

The Who

The first step for many in the life sciences industry is an evaluation of whether their company has an obligation to comply with the Sunshine Act.  In making this determination, the company must determine if their operations fall within the definition of an “applicable manufacturer” of a “covered drug, device, biological, or medical supply” which is operating in the United States.  The final regulations provide clarification and details regarding these two key definitions.

 

“Applicable Manufacturer”

Here, we highlight a few noteworthy clarifications included in the preamble regarding the scope of who is included and excluded within the definition of “applicable manufacturer.”  The regulatory definition of applicable manufacturer includes distributors and wholesalers that take title to a covered drug, device, biological or medical supply.  As a result, these entities are subject to the reporting requirements.  While distributors that do not take title to covered products do not fall within the definition of applicable manufacturer and are not subject to reporting.  It is important to note that distributors that qualify as “applicable manufacturers” have an independent obligation to submit reports pursuant to the Sunshine Act. 

 

The final regulations confirm the “all in” concept that requires a company that falls within the definition of an applicable manufacturer to report all payments or transfers of value to covered recipients regardless of whether the payments are related to covered products.  Yet, the final regulations provide that if an applicable manufacturer has less than 10% of its total (gross) revenue from covered drugs, devices, biologicals or medical supplies during the previous fiscal year, then the applicable manufacturer may report payments or other transfers of value related only to its covered products.

 

Further, if an applicable manufacturer has separate operating divisions that do not produce covered products (the example provided is an animal health division), the final regulations state that such divisions will only be required to report payments or other transfers of value related to the company’s covered products.

 

“Covered Drug, Device, Biological or Medical Supply”

The definition of “covered drug, device, biological or medical supply” includes two parts: (1) a drug, device biological or medical supply for which payment is available under Medicare, Medicaid, or CHIP, either separately or a bundled payment), and, if a drug or biological, requires a prescription, or, if a device, requires premarket approval or premarket notification to the FDA.  To  qualify as a “covered drug, device, biological or medical supply,” the product must satisfy both parts of this definition.

 

The What

“Indirect Payments or Other Transfers of Value”

In response to comments seeking clarification on which indirect payments or transfers of value are subject to the exclusion and which must be reported, CMS confirms that some indirect payments will be subject to reporting.  Specifically, the statutory exclusion of indirect payments turns upon the whether or not the applicable manufacturer is aware of the covered recipient of such payment.  If the applicable manufacturer is aware of the identify of the covered recipient, then the payment or transfer of value must be reported. In the preamble to the final regulations, CMS notes that excluding from the reporting requirements all payments made through a third party would create a  significant loophole by allowing manufacturers to funnel payments through a third party and not report them; such a loophole would significantly undermine the intent of the reporting requirements.  (pg. 28)

 

CMS further clarifies that if a covered recipient requests that an applicable manufacturer make a payment to a third party, and the third party then provides the payment to the covered recipient, the applicable manufacturer has an obligation to report such indirect payment or transfer of value against the covered recipient. This example of a reportable indirect payment differs from the situation where an applicable manufacturer provides a payment to a third party, and the third party provides a payment to a covered recipient without the applicable manufacturer’s knowledge or direction, which would fall within the indirect payment exclusion. For example, if an applicable manufacturer makes a payment to a consulting firm and, unbeknownst to and without direction from the applicable manufacturer, the consulting firm employs and pays a physician to work on the project, the applicable manufacturer would have no obligation to report such indirect payment from a third party to a covered recipient.

 

Be sure to visit our blog later this week for further analysis and discussion highlighting key provisions in the final regulations.

 

For additional information on the Sunshine Act and to view a copy of the final regulations as released by CMS on February 1, 2013, please see visit the Federal Register website. 

Vermont Attorney General’s Office Posts Final “Guide to Vermont’s Prescribed Products Gift Ban and Disclosure Law for 2013 Disclosures”

By Hiramella Deonarine and Danielle Burke

In an effort to help manufacturers comply with the requirements of Vermont's Prescribed Products Gift Ban and Disclosure Law (Law) and to provide additional guidance for expenditure reports due on April 1, 2014 (the 2013 calendar year), the Vermont Attorney General's Office (AG’s Office) has posted on its website the final “Guide to Vermont’s Prescribed Products Gift Ban and Disclosure Law for 2013 Disclosures” (Guide).  Additionally, the AG’s Office posted the 2013 Expenditures Disclosure Form for 2013, and the Samples Disclosure Form for 2013.

Pursuant to the Law, manufacturers of prescription drugs, biological products, and medical devices are required to disclose to the AG's Office the value, nature, purpose, and recipient of any allowable expenditure or permitted gift. Manufacturers are also required to submit samples disclosure reports that include the product, recipient, number of units, dosage, and other information for all samples provided to health care providers.

In addition to the Guide, the AG’s Office also released a memorandum entitled “Common Errors in Compliance with Vermont’s Prescribed Products Gift Ban and Disclosure Law That May Result in Enforcement Action” (Common Errors).  This memorandum lists common errors made by manufacturers in previous disclosure reports submitted to the AG’s Office.  The Common Errors memo states that the AG’s Office “expects to take enforcement action against manufacturers with unjustified, obviously and egregiously incomplete or incorrect submissions.”

To view a copy of the Guide, the forms, and the Common Errors memo, please see the links above or visit the Vermont AG’s Office’s website. 

Pharma Companies Beware: Alameda County, California Will Soon Require You to Foot the Cost of Drug Disposal

On July 24, 2012, California’s Alameda County Board of Supervisors (Board) unanimously passed the Safe Drug Disposal Ordinance (Ordinance), the first of its kind in the country. In general, the new Ordinance requires producers of all prescription and nonprescription drugs sold in the county to “participate in a product stewardship program to collect and dispose of unwanted products from residential generators.” The Ordinance offers two options on how producers may comply with this requirement:
 
1. Producers may operate a product stewardship program approved by the Alameda County Department of Environmental Health (Department)either individually or jointly with other producers; or

2. Producers may enter into an agreement with a stewardship organization, which will operate the approved product stewardship program on the producer’s behalf.

Proposed Legislation in Massachusetts Allowing Pharmaceutical and Medical Device Manufacturers to Provide Modest Meals to Practitioners Has Been Sent to the Governor (Updated)

Last week, the Massachusetts Senate and House of Representatives both passed House Bill 4200. Currently, Massachusetts’s Pharmaceutical and Medical Device Manufacturer Conduct Law, requires the Department of Public Health to “adopt a standard marketing code of conduct for all pharmaceutical or medical device manufacturing companies that employ a person to sell or market prescription drugs or medical devices in the commonwealth.”  This section of the law also specifies certain activities that the adopted marketing code of conduct shall not allow, including the provision of certain meals to health care practitioners and direct payment for meals at a CME event, scientific or educational conference, or professional meeting.  

 

HB 4200 would amend this section of the Law, and allow the adopted marketing code of conduct to permit pharmaceutical and medical device manufacturers to provide “modest meals and refreshments in connection with non-CME educational presentations for the purpose of educating and informing health care practitioners about the benefits, risks and appropriate uses of prescription drugs or medical devices, disease states or other scientific information.”  The presentation must occur “in a venue and manner conducive to informational communication.”  Additionally, pharmaceutical and medical device manufacturers who provide these meals must file quarterly reports detailing all non-CME educational presentations in which they provide such meals or refreshments.

 

HB 4200 has been sent to the Governor of Massachusetts for consideration.

Update: On July 8, 2012, the Governor of Massachusetts signed HB 4200. According to HB 4200, the amendments to the portion of the law discussed in this post became efffective on July 1, 2012.

 

New Jersey Court Rejects "Innovator Liability" for Brand-Name Drug Manufacturers

New Jersey Superior Court Judge Carol E. Higbee issued a ruling yesterday in the New Jersey state Reglan®/metoclopramide litigation in which she refused to adopt a novel theory of liability termed "innovator liability."  Under this theory, manufacturers of brand-name drugs (the so-called innovators) can be held liable for the claims of plaintiffs who only ingested generic versions of their drugs. In other words, innovator liability requires brand-name manufacturers to answer for injuries allegedly caused by drugs they did not manufacture.

 

The brand-name defendants, Wyeth LLC, Wyeth Pharmaceuticals, Inc., Wyeth Holdings Corporation, Schwarz Pharma, Inc., and Alaven Pharmaceutical LLC (the "defendants"), filed motions to dismiss plaintiffs' claims, which included claims for conscious misrepresentation, negligent misrepresentation, negligence. The parties agreed that New Jersey law applied, as the cases involved in the motions were filed by New Jersey resident plaintiffs.  The main dispute between the parties was whether the plaintiffs' claims were product liability claims governed by the New Jersey Products Liability Act ("PLA"). The defendants argued that under New Jersey law, brand-name drug manufacturers could not be held liable for injuries allegedly caused by the use of a generic drug manufactured by another company. The plaintiffs asserted that their claims were not governed by the PLA and were instead negligence claims governed by common law, and that the defendants owed a duty to exercise reasonable care to adequately warn doctors and users about the risks of metoclopramide and disseminate accurate information about metoclopramide.

 

The court observed that the PLA broadly defines product liability actions to include any claim brought by a plaintiff due to harm caused by a product. The court concluded that the PLA governed the plaintiffs' claims, observing that the focus of plaintiffs' claims was the defendants' failure to warn about metoclopramide's dangers and that the New Jersey Legislature clearly intended such claims to be controlled by the PLA. Noting that it is well-established that product identification (proof that the product that allegedly harmed the plaintiff is actually the defendant's product) is an essential element of a plaintiff's prima facie product liability action, the court held that the plaintiffs' claims must fail under New Jersey law to the extent that the plaintiffs never ingested products sold or manufactured by the brand-name manufacturers.

 

The ruling appears to be limited to the handful of cases in which the defendants filed motions to dismiss, though there may be additional cases involving New Jersey resident plaintiffs to which the ruling may apply. There may be choice of law issues that impact any future similar motions relating to other plaintiffs. Yesterday's ruling was preceded by Judge Higbee's opinion and order in May dismissing all counts of the Reglan®/metoclopramide plaintiffs' complaints as to the generic metoclopramide manufacturers pursuant to the U.S. Supreme Court's holding last summer in Pliva v. Mensing, which held that negligent failure to warn tort actions against generic drug manufacturers are preempted by the Food, Drug and Cosmetic Act, effectively barring state law failure to warn claims against generic drug manufacturers.

By:

Stephen C. Matthews, Esq., Principal, Porzio, Bromberg and Newman, PC

Kenneth R. Meyer, Esq., Principal, Porzio, Bromberg and Newman, PC

Genevieve M. Spires, Esq., Counsel, Porzio, Bromberg and Newman, PC

The Prescription Drug User Fee Act…In a Nutshell

The Prescription Drug User Fee Act (PDUFA) was originally enacted in 1992, and authorizes the federal Food and Drug Administration (FDA) to collect fees from pharmaceutical companies seeking FDA approval of new drugs and biologics.  In return for collecting fees, the PDUFA requires the FDA to meet performance benchmarks with the overall intention of making the New Drug Application review process more efficient. Since 1992, user fees collected by the FDA under the PDUFA have permitted the agency to expand its NDA review staff and considerably reduce a product’s review time while still assuring the safety of human drugs. Congress is required to reauthorize the PDUFA every 5 years by September 30^th in order to ensure the continuity of the user fee programs.

 

To this end, the United States House of Representatives has introduced House Bill 5651, which would, among other things, reauthorize the PDUFA. House Bill 5651 also provides for the reauthorization of the Medical Device User Fee Act (MDUFA), which authorizes the FDA to collect fees from medical device manufacturers seeking its approval on new medical devices. Further, House Bill 5651 would authorize two new user fee programs: the Generic Drug User Fee Act (GDUFA) to facilitate the review process for generic drugs, and the Biosimilars User Fee Act (BSUFA) to facilitate the abbreviated review of products shown to be biosimilars to an FDA-approved biologic.

 

In an effort to reauthorize the PDUFA well before the September 30, 2012, deadline, House Bill 5651 has been moving quickly through the usual legislative hurdles. To date, both the House Energy and Commerce Subcommittee on Health, and the House Energy and Commerce Committee have unanimously approved the bill. House Bill 5651 will now move to the entire House for a vote.

 

Congress’ expediency in reviewing House Bill 5651 may be attributed to its desire to reauthorize the PDUFA well before the statutory deadline.  The current version of the PDUFA was signed into law on September 27, 2007, just three days before the deadline. As the reauthorization deadline drew near without the PDUFA being reenacted, the FDA left many of its positions vacant in the event that that user fee charges were not available at beginning of the fiscal year on October 1, 2007. With thoughts of 2007 looming over their heads, supporters of the PDUFA are hoping to have House Bill 5651 enacted before the start of the upcoming fiscal year, which begins on October 1, 2012.  

 

For more information on the PDUFA, please Click Here!

 

Vermont Attorney General’s Office Will Provide Updates to Its "2012 Guide to Vermont’s Prescribed Product Gift Ban and Disclosure Law” on June 1, 2012

Pursuant to Vermont's Prescribed Products Gift Ban and Disclosure Law, manufacturers of prescription drugs, biological products and medical devices are required to disclose to the Vermont Attorney General's Office the value, nature, purpose, and recipient of any allowable expenditure or permitted gift. Manufacturers are also required to submit samples reports that include the product, recipient, number of units, dosage and other information for all samples provided to health care providers.

 

The AG’s Office recently indicated in a memorandum that it made updates to the 2012 Guide to Vermont’s Prescribed Product Gift Ban and Disclosure Law, which it will incorporate into an amended Guide by June 1, 2012. Among other updates, the amended Guide will include the following:

 

-         With respect to reporting of information on over-the-counter drugs, nonprescription medical devices, and items of nonprescription durable medical equipment, manufacturers are only required to report the product, dosage, number of units, and recipient information of these products. Because these are the same categories of information required to be reported for samples of prescription products, manufacturers should disclose the distribution of such over-the-counter products using the samples form and the sample database.

 

-         Regarding the permissibility of distribution of over the counter products, the AG’s Office will not enforce the gift ban  for lotions, eye drops, and like products in 2012. Any distribution of these products that occurs on or after January 1, 2013, will be treated as unlawful. This is a departure from the AG’s Office’s previous position that these products were permissible under the exception to the gift ban allowing for the distribution of reasonable amounts of over-the-counter drugs, nonprescription medical devices, or nonprescription durable medical equipment to health care practitioners for free distribution to patients.

 

-         As for capital equipment and related consumables for medical devices, the AG’s Office clarifies that manufacturers may place capital with a recipient to use without payment based on an agreement that the recipient will purchase a related consumable. Manufacturers are also permitted to provide a recipient with consumables for usage without payment as part of a contracted-for use or purchase of a related medical device. The placement of such capital or the provision of such consumables need not be reported. 

 

Click HERE to view a copy of the 2012 Guide to Vermont’s Prescribed Product Gift Ban and Disclosure Law.

 

Click HERE to view a copy of the memorandum regarding updates to the 2012 Guide.

Happy New Year! The FDA provides guidance on responding to “public” unsolicited requests for off-label information.

By: Frank Fazio

While the pharmaceutical and device industries are enjoying the Holiday break, the Food and Drug Administration (“FDA”) released a draft guidance for comment that will soon be published in the Federal Register.  The document, entitled “Responding to Unsolicited Requests for Off-Label Information About Prescription Drugs and Medical Devices” (“Guidance”) provides much needed insight into FDA’s current thinking about those pesky “public” requests posted on web sites or in social media.

 The Guidance applies to unsolicited requests for information about unapproved uses of prescription drugs and biological products.  It also applies to medical devices marketed for a specific use without  product approval or clearance.  In regard to such devices, the FDA notes that a request for off-label information would include any use for which approval or clearance would be required.

 Through the use of various examples, the Guidance attempts to establish the boundary between solicited and unsolicited requests for off-label information.   Making that determination has always been the first step in deciding whether a response is appropriate.  The FDA concedes that internet and social media have provided new outlets whereby companies might be confronted with an unsolicited request for off-label information.  The Guidance classifies such requests as either non-public or public.  Non-public requests are those that are privately directed to the firm and are not visible to the public at large.  We all know what to do with those requests, although the Guidance reiterates and reaffirms the standard principles.  More interesting are the public requests.  The FDA defines these as “an unsolicited request in a public forum, whether directed to a firm specifically, or to a forum at large.”  The FDA notes that such requests can occur on company sponsored sites as well as on sites run by third-parties.  The FDA recognizes that it is in the interest of the public to permit the company to respond to such requests rather than relying on speculation and the misinformation that might be provided by other lay people on a thread.

 So how can the company respond in a compliant manner?  The FDA has determined that a response to a public request, whether on a company or third-party site, should be answered in a private manner.  The FDA cited concerns about the dissemination  of information to other individuals who did not make the unsolicited request as well as the enduring nature of a posted response.  The Guidance notes that a firm’s public response to a public request should clearly convey that the question pertains to an off-label use along with specific contact information for the medical or scientific personnel (e-mail, phone, etc.), so that the individual can follow up for additional information.  The individual providing such information must clearly disclose their involvement with the firm, and the response may not be promotional in any regard.  The public response should also include a direct link to the FDA approved labeling, but may not include links to any other information (e.g. firm or product websites, third-party websites, or other promotional materials).  Likewise, the URL for the labeling should not itself be promotional in any way.  By way of example, the Guidance notes that www.bestcancercure.com would not be an appropriate URL for the product label.  If the individual that made the public request then contacts the medical or scientific personnel, the request is then treated as any other non-public request.    

 The Guidance is well thought out and makes sense.  It permits firms to provide appropriate information in response to public requests without fear that such responses will lead to claims of off-label promotion.  The full text can be found at http://www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/UCM285145

Happy New Year!