Source: http://www.fdalawblog.net/fda_law_blog_hyman_phelps/2016/09/index.html
Timestamp: 2017-05-27 06:17:45
Document Index: 716080980

Matched Legal Cases: ['§ 1320', '§ 331', '§ 351', '§ 396', '§ 351', '§ 207', '§ 207', '§ 201', '§ 207', '§ 207']

FDA Law Blog: September 2016
Even though Judge Zobel did not discuss the specifics of the discount arrangement between Coloplast and CCS in her Opinion, the government’s Statement of Interest explicitly stated the government’s view that “a price reduction conditioned on promotional or conversion campaign activities is not a ‘discount’ within the meaning of the discount exception at 42 U.S.C. § 1320a-7b(b)(3).” The government argued that “this exception is narrow and ‘covers only reductions in the product’s price.’” The government further stated that “[r]emunerations to health care providers for switching patients from one product to another, and for other efforts to increase a product’s utilization do not qualify as protected price reductions, even if the parties label the remuneration as ‘rebates’ or ‘discounts.’” The utility of the statutory discount exemption and the regulatory safe harbor for discounts is currently under attack in Judge Zobel’s court. Similar to Omnicare, CCS has filed a motion requesting that the Court reconsider Judge Zobel’s Order or alternatively certify the matter for immediate review by the First Circuit. CCS has also joined Omnicare’s request for certification for interlocutory appeal on the discount issues. Interest in “proper, consistent, and fair enforcement” led the Pharmaceutical Research and Manufacturers of America (PhRMA) to file an amicus brief on September 23, 2016 in support of CCS’ motion. In addition to objecting to Judge Zobel’s perplexing interpretation of the disclosure elements of the discount exemption and safe harbor, PhRMA raised significant constitutional concerns about the government’s attempt to “regulate through a statement of interest in litigation.” PhRMA explained that “[d]ue process considerations prohibit the Government from adding new terms to the safe harbor – or from carving out certain types of discounts arrangements from the safe harbor – in a litigation brief when the defendants did not have advance notice of the Government’s position and an opportunity to respond.” We will continue to monitor the Omnicare and Coloplast cases and to keep our readers informed about this litigation and its implications on the future use of the discount exemption and safe harbor.
By Anne K. Walsh & Andrew J. Hull – A problematic decision from the Ninth Circuit appears to impermissibly grant FDA authority to regulate the practice of medicine, and to further muddy the regulatory morass governing off-label use of products. We hope other courts recognize this decision for what it is: a bad set of facts that led to bad law.
Section 301(k) of the FDC Act prohibits “the doing of any . . . act with respect to . . . [a] drug [or] device . . . if such act is done while such article is held for sale . . . after shipment in interstate commerce and results in such article being adulterated.” 21 U.S.C. § 331(k). A product is adulterated if, inter alia, it “has been prepared, packed, or held under insanitary conditions whereby it may have been contaminated with filth, or whereby it may have been rendered injurious to health.” 21 U.S.C. § 351(a)(2)(A). At trial, Kaplan argued that the needle guides were not “held for sale” because he never transferred their ownership to the patients, but merely used them in the treatment of a patient. The district court rejected this argument. On appeal, Dr. Kaplan renewed his objection to the “held for sale” provision, and also contended that his reuse of single-use needle guides constituted the allowable off-label use of a device under the FDC Act. While noting that the “held for sale” argument Kaplan posed was “an issue of first impression,” rather than taking the opportunity to draft a well-reasoned opinion in an area where case law is scarce, the Ninth Circuit simply affirmed the lower court’s decision citing the handful of cases broadly touching the issue. Decision at 13 (citing United States v. Evers, 643 F.2d 1043, 1050 (5th Cir. 1981); United States v. Diapulse Corp. of Am., 514 F.2d 1097, 1098 (2d Cir. 1975); United States v. Rhody Dairy, LLC, 812 F. Supp. 2d 1239, 1244 (W.D. Wash. 2011); United States v. Device Labeled “Cameron Spitler Amblyo-Syntonizer,” 261 F. Supp. 243, 246 (D. Neb. 1966)). The court attempted to distinguish the single case from the Ninth Circuit that held the opposite, United States v. Geborde, 278 F.3d 926 (9th Cir. 2002), by explaining that Dr. Geborde engaged in noncommercial transactions when he distributed his homemade recreational drugs free of charge to patients.
Id. at 16. Although the outcome for Dr. Kaplan may have been based on the nature of his conduct, the decision unfortunately clouds, rather than clarifies, important issues. There can be no dispute that Congress did not intend FDA to regulate the practice of medicine via the FDC Act: “Nothing in this Act shall be construed to limit or interfere with the authority of a health care practitioner to prescribe or administer any legally marketed device to a patient for any condition or disease within a legitimate health care practitioner-patient relationship.” 21 U.S.C. § 396. One of the reasons for this carve out was to recognize there are robust traditional means to redress harms caused by physicians, either through state medical boards or medical malpractice suits. Here, the matter was appropriately referred to the Nevada State Board of Medical Examiners, which took action to suspend Dr. Kaplan’s license to practice medicine (the license was later reinstated by stipulation, but a new amended complaint is pending).
This less-than-clear explanation carries a strong risk of being taken out of context. The court’s “bright-line” rule prohibiting the use of adulterated products fails to consider the nuances of the FDC Act, which considers a device adulterated if it has a new intended use for which it is required to, but lacks, pre-market approval. See 21 U.S.C. § 351(f). What the Kaplan court should have clarified is that its holding is limited to products that are adulterated under section 351(a)(2)(B) because they were held under insanitary conditions, which is what was charged here, and not because they were adulterated under section 352(f) for being used off-label use (i.e., single use versus reuse). This distinction was discussed at oral argument (watch the spirited debate between the court and Dr. Kaplan’s counsel on this issue - starting at minute 6:30), but did not work its way into the published opinion. Presumably if Dr. Kaplan had shown that his protocol worked to sanitize the needle guides, it may not have met the standard for adulteration. Unfortunately, the court’s holding may be used by less-discerning audiences to hold a doctor guilty of violating the FDC Act if she uses a device for an off-label purpose.
One final point: FDA’s Office of Criminal Investigations recently has come under renewed scrutiny by the media and Congress over its questionable use of resources and investigative practices. Query whether OCI’s involvement in this matter, which may have been more appropriately adjudicated by the state medical board and medical malpractice suits, is another example of OCI’s misplaced attention. Posted at 06:39 PM in Medical Devices, Prescription Drugs and Biologics | Permalink
The final guidance includes a new section describing how patient input can impact decision making. The guidance explains that patient input can be useful for improving understanding of a disease or condition, defining design inputs to meet patient needs, and assessing the outcomes that are most important to patients. This section references a new appendix and flowchart with suggestions for how sponsors and FDA can incorporate PPI and other patient input into the total product lifecycle (i.e., nonclinical, clinical, and postmarket stages). The appendix includes a lengthy discussion of how PPI can be used in the earliest stages of development (the “discovery and ideation phase”) to inform study design, product development, and ultimately, FDA’s assessment of product benefit versus risk. The draft guidance did not contemplate the use of PPI in the public decision summaries that FDA posts on its website when it approves a PMA, approves an HDE application, or grants a de novo request; it only discussed the inclusion of PPI in device labeling. The final guidance references the use of PPI in decision summaries throughout the document. The guidance notes that “[i]nclusion of PPI in FDA’s public decision summaries can be helpful to healthcare professionals and patients in making healthcare decisions involving difficult benefit-risk tradeoffs or novel treatments.” This information also has the potential to be useful for sponsors in deciding whether and how to incorporate PPI in their premarket applications.
Posted at 08:17 PM in Drug Development, Prescription Drugs and Biologics | Permalink
Posted at 05:19 AM in Drug Development, Prescription Drugs and Biologics | Permalink
Posted at 07:28 PM in Enforcement | Permalink
Ten years and two days after FDA issued the proposed rule, the Agency published the final rule - Requirements for Foreign and Domestic Establishment Registration and Listing for Human Drugs, Including Drugs That Are Regulated Under a Biologics License Application, and Animal Drugs - on August 31, 2016. The rule codifies the requirement to electronically submit drug establishment registration and listing information, (unless waived under certain circumstances), a functional requirement since June 2009 when FDA implemented the electronic system to comply with the statutory provisions of the Food and Drug Administration Amendments Act (FDAAA).
The final rule has few surprises for those that have been involved with drug establishment registration and drug listing over the past 7 years. Of note, two significant proposals were ultimately not included in the final rule: “(1) [a] requirement that FDA, not registrants, develop national drug codes (NDCs) for assignment to listed drugs, and (2) a requirement that the NDC appear in human-readable form on the label of each listed drug and provisions that would have defined the appropriate NDC for that purpose.” While the rule applies to persons who manufacture, repack, relabel, or salvage human drugs, drugs that are also biological products, and animal drugs, it also applies, to a degree, to private label distributors (PLDs). Private label distribution, which is defined in the final rule, “means, with respect to a particular drug, a person who did not manufacture, repack, relabel, or salvage the drug but under whose label or trade name the drug is commercially distributed.” The final rule clarifies that PLDs are required to obtain labeler codes. This is significant as it codifies FDA’s current practice, which has been somewhat controversial. More on that in a bit.
National Drug Codes. New 21 C.F.R. § 207.33 allows for an 11 digit NDC number to accommodate an anticipated increase in the number of digits used to identify labelers. FDA anticipates that 5-digit labeler codes will be exhausted, and the agency will need to move to 6-digit labeler codes. The new provision allows for configurations of labeler codes, drug product codes, and package codes of 5-4-1 or 6-4-1, or 5-3-2 or 6-3-2. If a labeler code is 4 digits, it may only be combined with a 4 digit product code and 2 digit package code (4-4-2). The rule requires that once a product-package configuration is assigned by a company in association with a particular labeler code, all NDCs that include the given labeler code must include the same product-package configuration. For example, if the first drug listed by a company is assigned the NDC 12345-678-90, all subsequent drugs listed with labeler code 12345 will need to have a 3 digit drug product code and 2 digit package code. The rule allows registrants to reserve an NDC for a drug under development. This is a significant benefit to registrants that previously may have printed packaging/labeling “at risk” with an NDC number that may ultimately be rejected by FDA at the time of listing.
New 21 C.F.R. § 207.35 provides greater clarity on the changes that may require a new NDC – including a new name, a new API or strength of API, change to dosage form, a change in drug’s status between Rx and OTC, change in use between human and animal, or any distinguishing characteristics (e.g., size, shape, color, code imprint, flavor, and scoring). Specifically, the provision does not require a new NDC when changes are made to inactive ingredients or there is a new supplier of API. Further, the final rule does not include the proposal that “any material change” to a drug’s labeling or package insert necessitates a new NDC. The preamble to the final rule clarifies that “labeling [content] changes themselves do not trigger the need for a new NDC under this final rule.” Bar Codes. The final rule revises the bar code provisions in 21 C.F.R. § 201.25 to allow for alternatively formatted NDCs in bar codes if approved by the relevant FDA Center Director.
Importers, Persons Who Import or Offer for Import, and Imported Drugs. The final rule requires foreign establishments, when registering, to provide names and contact information for each importer in the United States of drugs manufactured, repacked, relabeled, or salvaged at the establishment that is known to the establishment. Further, the rule also requires that these registrants provide the names and contact information for each person who imports or offers for import these drugs. FDA considers “person who imports or offers for import” in this context to mean the owner or exporter of a drug who consigns and ships a drug from a foreign country to the United States. In addition, the final rule clarifies that the provisions included in the rule apply to foreign establishments unless the drugs that they manufacture, repack, relabel or salvage are only brought into a U.S. foreign trade zone or are otherwise subject to the import for export provisions of the Federal Food, Drug, and Cosmetic Act section 801(d)(3).
Establishment Registration Number and Unique Facility Identifier. Establishment registration numbers were historically assigned by FDA and known as FDA Establishment Identifiers (FEIs). Following implementation of the electronic system, FDA required utilization of the Data Universal Numbering System (DUNS) numbers (business identifiers assigned and managed by Dun & Bradstreet) for entities submitting registration information or requesting a labeler code but continued to assign FEIs. The final rule requires registrants to use a Unique Facility Identifier (UFI), which FDA prefers to be the DUNS number. The UFI and FEI number are distinct numbers. In the preamble, FDA states that , “[f]or now, FDA will continue to assign an FEI as the establishment registration number after an establishment is registered for the first time.” In the future, we expect that FDA will eliminate use of FEIs, and transition to solely using UFIs. Use of NDCs on Non-Drug Products. New 21 C.F.R. § 207.37 provides that the use of an NDC on the labeling of a product that is not a drug, such as a dietary supplement, may render the product misbranded. Despite this, we note that “dietary supplement” as well as other non-drug descriptors including “cosmetic” and “medical food” are included as “marketing category” options when listing products with FDA. Private Label Distributors. As stated above, under the final rule, PLDs are required to obtain labeler codes and are otherwise not required to register and list (unless they are also engaged in activities that qualify as those that require registration). That said, PLDs may be subject to additional requirements pertaining to maintaining NDC numbers and responding to FDA inquiries.
PLDs of over-the-counter (OTC) drugs likely are the group that has been impacted the most by the implementation of the electronic listing system in 2009, as it created a requirement that was not otherwise articulated in the Federal Food, Drug, and Cosmetic Act or the regulations pertaining to drug establishment registration and listing. When the electronic system was rolled out, it required PLDs to obtain labeler codes and maintain NDCs for products despite regulatory language to the contrary. 21 C.F.R. § 207.20(b) was clear that obtaining a labeler code would be voluntary, in that PLDs “that distribute under their own label or trade name a drug manufactured or processed by a registered establishment may elect to submit listing information directly to FDA and to obtain a Labeler Code . . . If a distributor does not elect to submit drug listing information directly to FDA and to obtain a Labeler Code, the registered establishment shall submit the drug listing information.” Prior to 2009 and the implementation of the electronic system, PLDs relied on manufacturers to list the drugs they manufactured for the PLDs and include a list of distributors to FDA. With the implementation of the electronic system, PLDs now needed to obtain their own labeler codes, and manufacturers were expected to list drugs for PLDs using those PLD labeler codes.
The effective date of the rule is November 29, 2016. Posted at 07:36 PM in Prescription Drugs and Biologics | Permalink
Posted at 12:16 AM in Foods, Foods and Dietary Supplements | Permalink
By JP Ellison & Wes Siegner –
There are 12 pages of FDA forms on the FDA website covering everything from product topics (foods, drugs, cosmetics, etc.) to safety forms and FDA field operations forms. Unless we missed it, one of FDA’s newest forms isn’t on its website. It’s a form that FDA’s Office of Criminal Investigation (OCI) has apparently begun using in connection with investigations of drug sales and distribution in the U.S. As we understand it, OCI’s new “Acknowledgment” form is presented by OCI special agents who personally visit establishments, advise the operators to immediately stop allegedly illegal conduct and request that a responsible person sign the form, which is then co-signed by the special agent.
It is not clear how or why FDA OCI agents are using this form; and to date, our attempts to learn more have not been successful. Nor do we have any sense of how this form relates to FDA’s Regulatory Procedures Manual, Investigations Operations Manual, or its unapproved drug guidance. We speculate that OCI may be using this form in an attempt to quickly shut down distribution of allegedly illegal drug sales by drug establishments in situations where OCI does not believe that the persons or entities at the establishment are distributing the products with knowledge that they are “illegal.” Our advice to anyone presented with this form, or any other FDA form; such as “FDA Affidavits,” which are routinely presented in the context of FDA inspections, is to consult with counsel. By way of example only, the Acknowledgment form asserts that entities and individuals that received adulterated and misbranded drugs, or delivered such drugs violate the laws, can face criminal penalties. The form omits any discussion of Section 303(c) of the Act (21 U.S.C. 333(c)), which specifically states that the penalties of section 303(a)(1) of the Act (21 U.S.C. 333(a)(1)) do not apply in certain circumstances. While one can understand why OCI might want to utilize such a form to achieve “voluntary” compliance, regulated persons and entities should think carefully about the consequences of signing this form.
Posted at 06:57 PM in Enforcement | Permalink