Opinion ID: 736503
Heading Depth: 3
Heading Rank: 1

Heading: Coversheet drugs

Text: 3 In March 1985, FDA investigators discovered that the company was manufacturing a number of generic drugs by formulas or processes not approved by the FDA. Once the FDA has approved the manufacture and marketing of a generic drug according to a certain formula, a manufacturer is required to seek FDA approval before making any modification to that formula, regardless of how insignificant the modification may be. See 21 C.F.R. § 314.70 (1996). Accordingly, the FDA required Bolar to halt the distribution of, and perform expensive bioequivalence studies 2 on, several generic drugs. 4 As a result of that expensive and disruptive episode, Shulman instructed Bolar employees to document future deviations from FDAapproved formulas or processes on coversheets. When problems were encountered with making a product by the FDA-approved master formula, Shulman instructed Bolar employees to make changes in the ingredients or manufacturing process and then record the changes on the coversheet. Bolar's production department maintained a copy of the coversheets to facilitate future production of the product, but the coversheets were hidden from FDA investigators. The batch production records kept pursuant to FDA regulations and made available to FDA investigators were completed by Bolar employees as if the approved master formula, rather than the coversheet formula, had been followed. 5 Bolar filed supplemental abbreviated new drug applications (ANDAs) requesting approval of the changes and, as respective FDA approvals were received, discontinued the coversheet practice on a product-by-product basis. Six supplemental ANDAs (relating to six coversheet drugs) were never approved by the FDA, and formed the basis for the indictment and the guilty plea. The Government contends, and on appeal Shulman apparently concedes, that Bolar received approximately $70 million in revenue from the six remaining drugs manufactured under the coversheet scheme.