Device Firms: What You Should Know About The 21st Century Cures Act

By Mason Weeda

Last month, legislation that would affect, among other things, FDA’s regulation of medical devices and the manufacturers of such devices took a considerable step forward when it was introduced and then unanimously approved by the House Energy and Commerce Committee by a vote of 51-0 on May 21.  Known as the 21st Century Cures Act (“Act”), the stated aim of the legislation is to modernize and personalize health care, encourage innovation, support research, and streamline the U.S. health care system to promote the delivery of better and faster “cures” to more patients.

In support of this goal, the Act would change the review of medical devices determined to be “breakthrough,” establish a third-party option for the inspection of medical device manufacturers, make changes to certain Humanitarian Device Exemption (“HDE“) requirements, institutionalize FDA’s ongoing efforts regarding the regulation of medical software applications, and loosen some clinical investigation requirements.  Significantly, the legislation also indicates an ongoing Congressional interest in the restrictions FDA has placed on the dissemination of truthful and nonmisleading off-label information.

Breakthrough Device Pathway

The Act would support faster “cures” by creating a “priority review” pathway for those devices that meet the definition of a “breakthrough device.”  These “breakthrough devices” include those that “represent breakthrough technologies… for which no approved alternative exist,” offer “significant advantages over existing approved or cleared alternative,” and are “otherwise in the best interest of patients.”

Upon a sponsor’s request, FDA would determine whether a device meets the “breakthrough device” designation using specified criteria.  If a device receives such designation, it would be eligible for expedited review by a team of staff that will interact with the device sponsor.  During this process, the Act would require FDA to “take steps to ensure that the design of clinical trials is as efficient as practicable, such as through adoption of shorter or smaller clinical trials, application of surrogate endpoints and use of adaptive trial designs and Bayesian statistics.”  Likewise, the agency would also be required to “facilitate … expedited and efficient development and review of the device through utilization of postmarket data collection.” Although these are laudable goals, the Act does not impose any specific timelines in which an “expedited review” must be completed or otherwise quantify how much existing review times will be reduced.

Third-Party Inspections of Device Manufacturers

The Act also contains provisions that could allow FDA to conserve its inspectional assets and speed up approval of modified versions of existing devices by allowing for the use of third party inspectors to conduct the necessary establishment inspections.  The theory being that creating a “quick” method to inspect facilities in these circumstances would promote the earlier availability of improved “cures.”

Under the provisions of the Act titled “Medical Device Regulatory Process Improvements,” Congress would require FDA to establish a “third-party quality system assessment” program, where accredited third parties would inspect manufacturers for compliance with the Quality System Regulation (“QSR”) (21 C.F.R. Part 820).  However, use of such third-party inspections would be limited only to QSR inspections necessary as the result of submissions involving “device related changes” and would not be available in other types of establishment inspections.

Changes to Humanitarian Device Exemptions

This section of the Act would double the number of patients that must suffer from a disease in order for FDA to consider it a “rare disease.”    Presently, the HDE pathway is intended to incentivize and encourage the development of devices to treat “rare” diseases or conditions affecting small patient populations when the device manufacturer`s research and development costs would otherwise exceed its market returns.  It does so by significantly reducing the clinical data that would be necessary for the manufacturer to generate to support the efficacy of the device that would otherwise be required by FDA in a traditional marketing application. To qualify for an HDE, the disease or condition must presently affect fewer than 4,000 individuals in the United States per year. The Act seeks to encourage additional development making “cures” more widely available by increasing this number to 8,000 individuals.

Medical Software

In an apparent effort to “modernize” the technology involved in health care, the Act would create a definition of “health software,” which generally would not be regulated unless it:

  • is intended for use to analyze information to provide patient-specific recommended options; or
  • FDA determines that it poses a significant risk to patient safety.

This provision continues to allow FDA some flexibility as to how it may regulate software.  The Act also would require the agency to review existing regulations and guidance regarding software, including the classification of software, standards of verification and validation, review of software, and quality system for software, among others.

Clinical Trials

The Act would also make it easier for sponsors conducting clinical investigations by requiring the Department of Health and Human Services (“HHS”) to harmonize its requirements applicable to clinical investigations with FDA’s own requirements. This supports the Act’s goals by significantly reducing the regulatory burden imposed on sponsors who must presently ensure that their clinical investigations meet the often duplicitous requirements imposed by both HHS and FDA controls.  The Act also would make it easier for sponsors to meet Institutional Review Board (“IRB”) requirements by allowing the use of non-local IRBs to review medical device trials, including Investigational Device Exemptions (“IDE”) and HDEs. Permitting the use of non-local IRBs support the Act’s goal of “quicker cures” by eliminating the “log jam” and delays sometimes associated with the use (and overuse) of local IRBs by giving sponsors additional options that are potentially faster than the traditional ones.


Lastly, and without limitation, the Act’s section on “Facilitating Responsible Communication of Scientific and Medical Developments,” provides that FDA “shall, within 18 months, issue draft guidance on facilitating the responsible dissemination of truthful and non-misleading scientific and medical information not included in the approved labeling of drugs and devices.”  This provision appears to be in response to the Coronia Case (U.S. v. Caronia, 703 F.3d 149 (2d Cir. 2012)), which holds that representatives of pharmaceutical manufacturers have a right under the First Amendment to make truthful statements regarding their products, even if such statements indirectly promote drugs for uses not approved by FDA.  The Act does not provide further direction on this topic, but Congress is clearly nudging FDA to update its position on off-label promotion which may affect medical device manufacturers.

It may be an uphill battle for Congress to agree on all topics involved in the 308 pages of 21st Century Cures Act.  However, as reported by the House Energy and Commerce Committee Press Releases, the bill appears to have support from industry and consumer groups, which may help bring Congress together.

FDA Provides Another Guidance Concerning FDA’s Use of Foreign Study Data

By Mason Weeda

FDA’s Center for Devices and Radiological Health (“CDRH”) and Center Biologics Evaluation and Research (“CBER”) recently published a new draft guidance entitled “Acceptance of Medical Device Clinical Data from Studies Conducted Outside the United States [(“OUS”)] (“Draft Guidance”) (available here). With this Draft Guidance, FDA aims to minimize the possibility for additional or duplicative U.S. studies, to harmonize global clinical trial standards, and to promote public health and innovation.

The Draft Guidance adds to a myriad of policies, statutory and regulatory provisions, and proposed rules on OUS studies, including:

  • FDCA § 569B (or 21 U.S.C. § 360bbb-8) which requires FDA to accept data from clinical investigations conducted OUS, in deciding whether to approve or clear a device. Pursuant to §569B, if FDA finds that such data are inadequate under applicable standards to support clearance or approval of the device, then FDA must provide the sponsor with written notice of the finding and FDA’s rationale.
  • 21 C.F.R. § 814.15 which provides that OUS clinical study data submitted in support of a Premarket Approval Application (“PMA”) and conducted under an Investigational Device Exemption (“IDE”) shall comply with Part 812. If an OUS study in support of a PMA is not conducted under an IDE, FDA will accept studies which have been conducted outside the United States and begun after November 18, 1986, “if the data are valid and the investigator has conducted the studies in conformance with the ‘Declaration of Helsinki’ or the laws and regulations of the country in which the research is conducted, whichever accords greater protection to the human subjects.” If relying on a study that started before November 19, 1986, FDA must be satisfied that “the data are scientifically valid and that the rights, safety, and welfare of human subjects have not been violated.” A PMA based solely on foreign clinical data and otherwise meeting the criteria for approval under this part may be approved if the foreign data are: “applicable to the U.S. population and U.S. medical practice;” “have been performed by clinical investigators of recognized competence;” and “considered valid without the need for an on-site inspection by FDA or… FDA can validate the data through an on-site inspection or other appropriate means.”
  • Proposed Rulemaking. Over two years ago, FDA published a proposed rule on “Human Subject Protection; Acceptance of Data from Clinical Studies for Medical Devices.” The proposed rule, when finalized, would require that foreign clinical studies in support of PMAs, IDEs, HDEs and 510(k)s be conducted in accordance with good clinical practice (“GCP”).
  • 2001 Guidance. In March 2001, FDA issued guidance on acceptance of foreign clinical studies titled “Guidance for Industry-Acceptance of Foreign Clinical Studies”, which describes the acceptance of foreign clinical studies in support of an application for marketing approval of human drugs, medical devices and biological products. This guidance merely clarifies that FDA incorporated the 1989 Declaration of Helsinki in its regulation governing investigational drug trials conducted in foreign countries and that it was not amending the regulation to incorporate the 2000 amendments to the Declaration.

The Draft Guidance elaborates on FDA’s regulation and provides some insight on what FDA may focus on when evaluating the adequacy of an OUS study. Not surprisingly, FDA makes it clear that sponsors should seek input from FDA prior to initiating an OUS device study to ensure that it will generate adequate and valid scientific data. The Draft Guidance essentially provides three primary considerations related to relying on OUS clinical data:

  • Differences in study populations. To the extent a device has disparate safety effects in different demographic groups, differences in the race, ethnicity, age, gender and sex of a foreign population can affect the applicability of the study to the intended U.S. population. Reporting on the representation of such groups in the device submission allows appropriate sub-group analyses. The foreign population and the intended U.S. patient populations may also differ in the prevalence of clinical factors that can affect risks of an intervention as well as clinical response.
  • Differences in clinical conditions. Differences in OUS clinical conditions versus those in the U.S. can affect the relevance of the data to the intended U.S. population. OUS countries may have different standards of care, clinical facilities, or levels of clinical skill which can cause OUS data to not be generalized to U.S. clinical practice and which can impact the data’s usefulness in supporting the safety and/or effectiveness of the device.
  • Differences in regulatory requirements. When studies conducted OUS are initiated to satisfy the requirements of foreign countries, the studies may not be designed to address the questions necessary to satisfy FDA requirements.

The Draft Guidance provides a number of useful examples that demonstrate the application of the above considerations. Although the proposed rulemaking on “Acceptance of Data from Clinical Studies for Medical Devices” is not yet final, the Draft Guidance concludes by highlighting the importance of GCP. It states that “showing compliance with GCP is one way sponsors of device applications may be able to show that their OUS data comply with applicable FDA requirements.” FDA’s requirements for IDE studies address GCPs through applicable regulations, such as 21 C.F.R. Part 50, 54, 56 and 812. The Draft Guidance also provides that FDA considers the following two standards to be GCP principles that articulate ethical and policy standards for OUS clinical trials:

  • ICH E6, “Good Clinical Practice: Consolidated Guidance,” and
  • ISO 14155 “Clinical Investigation Of Medical Devices For Human Subjects – [GCP]”

FDA is requesting comments on the Draft Guidance before it begins work on the final guidance. The Agency will be accepting comments until July 21, 2015.

Warning Letters Update

By Mason Weeda

This past week FDA made a number of Warning Letters available on its website, with issues ranging from Juice HACCP to cGMPs for finished pharmaceuticals. A Warning Letter is informal and advisory, with the aim to achieve voluntary compliance and to establish prior notice. It communicates the agency’s position on a matter, but it does not commit FDA to taking enforcement action. Basically, you should read Warning Letters relevant to your industry because they can provide you with examples of what not to do. Here’s a quick run-down of Warning Letters published this week that we thought merited a closer look:

  • FDA issued a March 31, 2015 Warning Letter to Hospira S.p.A. for alleged violations of current good manufacturing practice regulations (cGMP) for finished pharmaceuticals at a manufacturing plant in Italy. The Warning Letter provides that Hospira failed to:
    • establish procedures to prevent microbiological contamination of sterile drug products and include validation of sterilization processes;
    • thoroughly investigate any unexplained discrepancy or failure of any batch;
    • exercise appropriate controls over computer or related systems so that only authorized personnel institute changes in master production/controls records; and
    • ensure that laboratory records included complete data derived from all tests necessary to assure compliance with established specifications and standards.

The Warning Letter details Hospira’s failure to evaluate certain airflow studies, and its improper rejection of various vials during the manufacturing process without explanation. Ultimately, FDA stated that Hospira’s response to its inspectional observations lacked adequate corrective action.

  • FDA issued March 27, 2015 Warning Letters respectively to Avanti Health Care and Kings Pharmacy regarding deficiencies in their practices for producing sterile drug products. Both firms compound drugs and registered with FDA as outsourcing facilities and, therefore, were required to, among other things, comply with the Compounding Quality Act and cGMP requirements. Though Avanti was cited for six (6) cGMP violations and Kings was cited for three (3), the letters are very similar in many respects. During the inspections of both facilities, respectively, FDA observed that, among many violations, drug products were prepared under insanitary conditions, where operators failed to use proper aseptic technique in designated areas. Both firms also failed to include mandatory labeling for compounded products (i.e., “this is a compounded drug” and “not for resale”). These letters demonstrate FDA’s ongoing effort to more closely regulate and inspect outsourcing facilities. Avanti registered as an outsourcing facility on April 21, 2014, and FDA began its inspection only two (2) months later on June 23; Kings Pharmacy registered on December 23, 2013, and was inspected just three (3) months later.
  • FDA issued a March 25, 2015 Warning Letter to Skin Authority, LLC for making promotional claims on its website that indicate that its products, though labeled as cosmetics, were, in fact, promoted as drugs. The Warning Letter lists examples of drug claims for serums, scrubs and creams made on the website, including, for example, “help inhibit cellular breakdown,” “foster skin growth,” “help counteract infection,” “improve anti-inflammatory response,” and “increase cell growth.” The products were not generally recognized as safe and effective for the uses listed on the website, were not subject to any FDA-approved New Drug Application, and, therefore, were “new drugs” that required FDA approval prior to marketing.

The information that the agency communicates in a Warning Letter can be invaluable as it provides important, cautionary lessons for regulated industry and provides a view into the agency’s current thinking. You can keep tabs on Warning Letters by checking our blog periodically or by looking on FDA’s Warning Letters webpage.

Who Regulates the Advertising of Your App?

By Mason Weeda

We have blogged and hosted numerous webinars on FDA regulation of mobile medical apps (see here, here, here, here and here); but if you are an app developer, you should be aware that FDA is not the only agency looking at your app.  The Federal Trade Commission (FTC) may also be watching how you promote your app.  In fact, on February 23, 2015 the FTC announced that it reached settlements with two firms marketing melanoma detection apps.  The agency was unable to reach a settlement with a third developer and intends to pursue a judgment through litigation.  Both apps claimed to provide an “automated analysis of moles and skin lesions for symptoms of melanoma and increase consumers’ chances of detecting melanoma in its early stages.”  In sum, the FTC alleged in its complaints that the mobile app developers lacked adequate evidence to support such claims.

FTC authority coincides with other agencies in many respects, see e.g. here, and here.   And there is nothing really new with the FTC taking action against mobile app developers.  In 2011, the FTC filed complaints against developers of “acne cure” apps that claimed to treat acne through a light emitted from the device if you held it close to your face. The FTC alleged that those claims were unsubstantiated.

The FTC regulates many types of advertising and protects consumers by stopping unfair, deceptive or fraudulent practices in the marketplace. Under the Federal Food Drug and Cosmetic Act, the Food and Drug Administration (FDA) has regulatory authority over the labeling of all medical devices. Labeling includes any “written, printed, or graphic matter upon any article or any of its containers or wrappers, or accompanying such article…”   Sections 502(q) and 502(r) of the FD&C Act authorize FDA to regulate the advertising of certain devices, which are known as restricted devices.  Section 502(r) also states that restricted devices are not subject to FTC’s broad authority over advertising under 15 U.S.C. § 52-55.

Dr. Jeffery Shuren, Director of FDA’s Center for Devices and Radiological Health, summarized the FTC/FDA division of authority best: “FDA regulates the advertising of restricted medical devices while the FTC regulates the advertising of non-restricted devices.”   A device becomes a “restricted device” when:

  1. FDA by regulation restricts a device to sale, distribution or use only upon the authorization of a practitioner licensed by law to administer or use such device, or upon other conditions that FDA prescribes in the regulation, if FDA determines that there cannot otherwise be reasonable assurance of the device’s safety and effectiveness.  (Note that prescription devices may or may not be restricted devices).
  1. FDA requires, as a condition of approval of a Class III device, that its sale and distribution be restricted, but only to the extent that the sale and distribution of the device may be restricted by a regulation.
  1. FDA establishes, as part of a performance standard promulgated in accordance with section 514(b) of the FD&C Act, requirements that restrict  the sale and distribution of a device, but only to the extent that the sale and distribution of the device may be restricted by a regulation.

Based on FTC’s description of the melanoma detection apps, it appears that the app developers are likely required to obtain premarket approval (PMA).  FDA’s Mobile Medical Application Guidance provides that the Agency intends to actively regulate mobile apps that “use the mobile platform’s built in features, such as… a camera, to perform medical device functions.”  The melanoma apps use the device platform (i.e. the camera) to collect and review an image for use in providing a diagnosis.   Furthermore, this type of app appears to perform the same medical device functions of an “optical diagnostic device for melanoma detection” which FDA classifies as Class III under product code OYD, which requires a PMA.  In addition, FDA premarket approval letters indicate that “optical diagnostic devices for melanoma detection” are restricted devices pursuant to 21 C.F.R. § 801.109.

It appears that FDA would, upon premarket approval, treat these types of melanoma apps as restricted devices and therefore would have authority to regulate the app’s advertising.  However, it remains that these app developers never submitted a premarket application or received premarket approval from FDA.  Therefore, the Agency was not able to require, as a condition of approval, that their sale and distribution be restricted.  As such, FDA does not have the ability to regulate the advertising of these apps.

The instant FTC complaints and settlements appear relatively minor compared the potential FDA issues involving marketing a product without approval. More importantly, FDA is in no way foreclosed from taking action so we will see if and when FDA acts in the coming months against the app developers.

CDRH’s 2015 Weather Forecast Predicts A Storm of Guidance Documents

By Mason Weeda

Earlier this month, FDA’s Center for Devices and Radiological Health issued its FY 2015 Proposed Guidance Development and Focused Retrospective Review of Final Guidance.  CDRH lists 28 guidance documents in total.  The “A-list” includes both draft and final guidances that CDRH intends to publish by January 2016, and the “B-list” includes guidance documents that it intends to publish “as resources permit.”   CDRH is required by the Medical Device User Fee Amendments of 2012 to publish these lists.

The “A-list” includes the following final and draft guidances:

  1. Applying Human Factors & Usability Engineering to Optimize Medical Device Design (Final);
  2. 510(k) Submissions for Medical Devices that Include Antimicrobial Agents  (Final);
  3. Balancing Premarket and Postmarket Data Collection for Devices Subject to Premarket Approval (Final);
  4. Expedited Access for Premarket Approval of Medical Devices Intended for Unmet Needs for Life Threatening or Irreversibly Debilitating Diseases or Conditions (Final);
  5. Framework for Regulatory Oversight of Laboratory Developed Tests (Final);
  6. FDA Notification and Medical Device Reporting for Laboratory Developed Tests (Final);
  7. Coronary Drug Eluting Stents-Nonclinical and Clinical Studies (Final);
  8. Intent to Exempt Certain Class II and Class I Reserved Medical Devices From Premarket Notification Requirements (Final);
  9. Reprocessing Medical Devices in Health Care Settings: Validation Methods and Labeling (Final);
  10. Safety Considerations for 510(k) Submissions to Mitigate the Risks of Misconnections With Small-Bore Connectors Intended for Enteral Applications (Final);
  11. Submission and Review of Sterility Information in 510(k) Submissions for Devices Labeled as Sterile (Final);
  12. Use of ISO 10993-1, Biological Evaluation of Medical Devices Part I: Evaluation and Testing Biocompatibility (Final);
  13. General Wellness Products (now published in Draft);
  14. Medical Device Accessories (now published in Draft);
  15. Medical Device Decision Support Software (Draft);
  16. Benefit-Risk Factors to Consider When Reviewing IDE Submissions (Draft);
  17. UDI Direct Marking (Draft);
  18. Informed Consent: Policy for Observational Data Used to Fulfill Device Requirements (Draft);
  19. Adaptive Design for Medical Device Clinical Studies (Draft); and
  20. UDI FAQs (Draft).

The “B-list” includes the following:

  1. Finalizing various existing draft guidance documents;
  2. Medical Device Interoperability (Draft);
  3. Transfer of Ownership of a Premarket Notification: Questions & Answers (Draft);
  4. Direct Access Genetic In Vitro Diagnostics Testing (also known as Direct to Consumer Genetic Testing) (Draft);
  5. Patient Access to Information (Draft);
  6. 3D Printing (Technical) (Draft);
  7. Manufacturing Site Change Supplements (Draft); and
  8. Use of Symbols in Labeling (Draft).

Significantly, CDRH acknowledges that it is not realistic for FDA to publish all guidances on both the “A-list” and the “B-list” by January 2016 and that priorities may change throughout the year.

The Agency also published a third list, containing final guidance documents that were issued in 2005, 1995, and 1985 and are now subject to retrospective review.  CDRH will conduct “a staged review of previously issued final guidances in collaboration with stakeholders,” and it is seeking feedback on whether such guidance documents should be revised.  These guidance documents are:

1985 Final Guidances include:

  1. Medical Laser Delivery System Interlocks (Laser Notice 34) (PDF – 90KB) (1/20/1985);
  2. User Instruction Hazard Warnings (Laser Notice 35) (PDF – 63KB) (2/5/1985);
  3. Policy on Warning Label Required on Sunlamp Products (PDF – 71KB) (6/25/1985);
  4. Low Power Laser Exemption (Laser Notice 36) (PDF – 101KB) (8/23/1985); and
  5. Walk-In Workstations (Laser Notice 37) (PDF – 86KB) (10/21/1985).

1995 Final Guidances include:

  1. Guidance on Premarket Notification [510(K)] Submissions for Short-Term and Long-Term Intravascular Catheters (PDF – 896KB) (3/15/1995);
  2. Guidance for 510(k)s on Cholesterol Tests for Clinical Laboratory, Physicians’ Office Laboratory and Home Use (7-13-1995);
  3. Guidance Document for the Preparation of Premarket Notification [510(k)] Applications for Submerged (Underwater) Exercise Equipment (7/26/1995);
  4. Guidance Document for the Preparation of Premarket Notification [510(k)] Applications for Electromyograph Needle Electrodes (7/26/1995);
  5. Guidance Document for the Preparation of Premarket Notification [510k)] Applications for Mechanical and Powered Wheelchairs, and Motorized Three-Wheeled Vehicles (7/26/1995);
  6. Guidance Document for the Preparation of Premarket Notification [510(K)] Applications for Immersion Hydrobaths (7/26/1995);
  7. Guidance Document for the Preparation of Premarket Notification [510(k)] Applications for Powered Tables and Multifunctional Physical Therapy Tables(7/26/1995);
  8. Guidance Document for the Preparation of Premarket Notification [510(k)] Applications for Communications Systems (Powered and Non-Powered) and Powered Environmental Control Systems (7/26/1995);
  9. Guidance Document for the Preparation of Notification (510(k)) Applications for Therapeutic Massagers and Vibrators (7/26/1995);
  10. Guidance Document for the Preparation of Premarket Notification [510(k)] Applications for Heating and Cooling Devices (7/26/1995);
  11. User Instruction for Medical Products (Laser Notice 44) (PDF – 123KB) (8/11/1995);
  12. Labeling of Laser Products (Laser Notice 45) (PDF – 90KB) (8/15/1995); and
  13. Guidance On The Content Of Premarket Notification [510(k)] Submissions For Protective Restraints (Text Only) (12/1/1995).

2005 Final Guidances include:

  1. Guidance for Industry – Cybersecurity for Networked Medical Devices Containing Off-the-Shelf (OTS) Software (1/14/2005);
  2. Guidance for the Content of Premarket Submissions for Software Contained in Medical Devices (5/11/2005);
  3. Guidance for Industry and FDA Staff – Menstrual Tampons and Pads: Information for Premarket Notification Submissions (510(k)s) (7/27/2005);
  4. Guidance for Industry and FDA Staff: Medical Devices with Sharps Injury Prevention Features (8/9/2005);
  5. Guidance for Industry – Review Criteria for Assessment of C Reactive Protein (CRP), High Sensitivity C-Reactive Protein (hsCRP) and Cardiac C-Reactive Protein (cCRP) Assays (9/22/2005);
  6. Guidance for Industry and FDA Staff: Dental Composite Resin Devices – Premarket Notification [510(k)] Submissions (10/26/2005);
  7. Applicability of the Performance Standard for High-Intensity Mercury Vapor Discharge Lamps (21 C.F.R. § 1040.30) (11/6/2005);
  8. Guidance for Industry and FDA Staff: A Pilot Program to Evaluate a Proposed Globally Harmonized Alternative for Premarket Procedures (11/10/2005); and
  9. Guidance for Industry and FDA Staff: Format for Traditional and Abbreviated 510(k)s (11/17/2005).

FDA has established a docket for comments on any or all of the proposed FY2015 guidance documents or guidance documents subject to CDRH’s focused retrospective review.  FDA invites stakeholders to submit comments on the guidance documents listed, the relative priority of guidance documents for Agency attention and/or suggestions that CDRH revise or withdraw a final guidance document that issued previously in 2005, 1995 or 1985.

The Realized Benefits of User Fees 3

OFW Law Celebrates 35 Years of Successes in Drug/Healthcare Privacy Practices (Part III)

By Mason Weeda

In celebrating 35 years of practice, OFW Law’s Drugs, Biologics, and Controlled Substances and Healthcare Privacy practice groups are taking a look back to share some highlights throughout the years. Parts I and II focused on Hatch-Waxman and medical privacy laws, while today’s blog looks at how user fees transformed the FDA. Please stay tuned for Part IV, which will provide a review of the changes in prescription drug supply chain requirements.

One important shift at FDA over the past 35 years is the substantial decrease in FDA review time of new drug applications (NDAs), biologic license applications (BLAs), and abbreviated new drug applications (ANDAs). This improvement, of course, did not come cheap.

Since the 1950s, FDA entertained the mechanism of user fees to provide additional resources for rapid review of pending applications; but industry resisted. Over the years, FDA’s time to review NDAs stretched ever longer. By 1987, the average time for FDA to make a decision was a staggering 29 months. With applications stuck in never-ending review, industry began to see the potential benefit of user fees in order to get products through FDA and onto the market faster.

Congress also came to see the potential harm to public health in the lengthy NDA and BLA approval process that delayed the availability of life-saving therapies. In 1992, Congress passed the Prescription Drug User Fee Act (PDUFA) and so the bargain was struck. NDA sponsors would pay considerable fees to the agency and, in exchange, FDA committed to reviewing the applications on set timetables. By the time PDUFA was up for its first reauthorization in 1997, NDA median approval time for NDAs and BLAs dropped significantly to 12.5 months for standard applications and 7.8 months for priority applications.

PDUFA has been reauthorized four times since 1992, most recently in 2012 with PDUFA V. PDUFA V will sunset in October 2017. With each authorization, FDA has been required to provide annual reports on progress in meeting targeted review times.   The most recent reports indicate that the program continues to do well, meeting review time goals nearly 100% of the time.

Delays in the review of ANDAs began to creep up in the 1990s and 2000s, ultimately creating a significant back-log of pending applications for generic drugs. As of 2011, ANDA review took approximately 31 months (or 2.5 years) on average. Relying upon the same premise as PDUFA, Congress passed the Generic Drug User Fee Act (GDUFA) and Biosimilar User Fee Act (BSUFA) in 2012 to expedite the approval process for generic drugs and biosimilars. Though FDA has committed to reviewing 90% of ANDAs within 10 months, there remains a significant backlog of pending applications. In 2013 there remained a backlog of 2,866 original ANDAs and 1883 supplements. In year 2013, FDA was able to provide 45% of the backlog with first action.

User fees have resulted in a huge budget increase for FDA. By 2013, FDA had collected $729 million in user fees since the inception of PDUFA. Drugs are getting to market faster – FDA met its 2013 goal to review 90 percent of standard NDAs and BLAs within 10 months. FDA’s 2013-2017 user fee performance goals are very aggressive. By 2017, FDA aims to:

  • Review ninety percent (90%) of standard new molecular entities (which are the most complex NDA) within 10 months of filing acceptance and 90% of priority applications within 6 months of acceptance;
  • Review ninety percent (90%) of complete electronic ANDAs within 10 months; and
  • Review and act on ninety percent (90%) of biosimilar applications (applications under §351(a)) within 10 months.

Fees are set annually based upon the agency’s actual costs and vary by program. For fiscal year 2015, the application fee for NDAs with clinical data are $2,335,200, ANDAs are $58,730, and Biosimilar Product Application Fees are $110,370 (other user fees for supplements, reviews with and without clinical data, manufacturing sites, and products may also apply).

Despite the reduced backlogs and faster reviews of lifesaving drugs and their generic equivalents, the user fee programs have been roundly criticized as well. FDA is, after all, receiving direct and substantial financial support from the entities it regulates. While we can appreciate that critique, in our experience, it is unfounded. Over our 35 years of observing the drug approvals, user fees are making the process faster and more predictable but have definitely not impacted the quality and rigor of FDA’s review. Indeed, we have found that review standards have significantly tightened over the years and applications that would have slid through the review process 30 years might not even be accepted for review today.

In our view, user fees have helped industry and the agency, with benefits to patients who more expeditiously receive critical drug therapies.

Phil Olsson and Rick Frank on 35 Years of Life at OFW

By Philip C. Olsson and Richard L. Frank

Phil: Rick, it’s hard to believe that 35 years have passed since we started this firm as a two-lawyer shop in 1979.

OFW Logo 35th AnniversaryRick: It sure is. I remember working with you at the law firm I joined fresh out of the University of Michigan Law School, and which you had joined several years earlier out of the USDA, where you had been Deputy Assistant Secretary for Marketing and Consumer Services.

In 1979, I was 28, with little experience. You were 40, and a well-known fixture in the agriculture and FDA bar. We decided to take a giant leap of faith and started Olsson and Frank. We persuaded Anita Harris to join us as our all-purpose support staff.

Phil: Our initial clients were food and agriculture companies and trade associations, including American Feed Manufacturers Association [now American Feed Industry Association], National Turkey Federation, Pacific Coast Meat Association [now North American Meat Association], The Quaker Oats Company, and Pueblo International.

Rick: Amazingly, many of those clients from 35 years ago are all still our clients today. We appreciate their loyalty and support over the years.

Phil: Today, food and agriculture are still a major part of our practice. But our practice has evolved and grown to include a wide range of industries regulated by USDA and FDA. We are still primarily a regulatory and counseling practice, with litigation capability.

Rick: We have had some notable successes from the outset.

Phil: Our first big challenge involved the National Turkey Federation, defending recently adopted USDA labeling regulations for “turkey ham,” which was allowed as a product name as long as it was qualified by the phrase “cured turkey thigh meat.” Two meat industry associations challenged that regulation. Before the District Court in Norfolk, we had a particularly unsympathetic judge, who began his opinion with an excerpt from Lewis Carroll about “when pigs have wings.” Fortunately for our client, the Fourth Circuit agreed with us and upheld USDA’s regulation. That win showed that our small firm was a feisty advocate. No one has ever doubted that Rick can be feisty, but that victory showed that our small firm had been inoculated with his feisty DNA.

Rick: The “turkey ham” case was important for the food industry, because it allowed product innovation to proceed without artificial constraints on product names. Along the same vein, for years we successfully fought off efforts by the dairy industry to demonize “imitation cheese” used as an ingredient in a wide variety of refrigerated and frozen meat-topped pizzas regulated by USDA.

Two other victories come to mind. We successfully got “Fresh Choice” orange juice and “Fresh Italian” pasta sauce off the market. Those products, which were made from previously processed, heat-treated concentrates, were anything but “fresh.” We also helped get approvals for lean, finely textured beef, a highly innovative, nutritious, and lower cost meat component widely used in ground beef and related products. (Note: Unfortunately, a disgruntled USDA employee, a “mommy blog,” and a national TV network disparaged this wholesome product as “pink slime” several years ago.)

Phil: One of my favorite clients was an egg distributor. On a trip with him to Cuba, we got to spend about five hours with just Fidel Castro, Castro’s trade director, and Castro’s interpreter. We heard Castro talk at length about improvements in Cuban literacy and life expectancy that had taken place since he took power in 1958. I have a treasured photo of me with El Presidente in my office.

Rick: It’s been a great 35 years, with lots of interesting matters. From the beginning, we always worked hard, tried to develop “creative solutions to difficult problems,” and fought to win our cases. We charged fairly for our services and worked in a very collegial environment. We still follow those guiding principles, which have served us well.

Phil: Indeed, those principles have worked well for us, as we have grown and prospered over the years.

Rick: In our early days, I was usually the youngest person in the room; Phil, you were the tallest. Today, I am often the oldest person in the room, but you are still the tallest. Some things change; some things don’t.

Thirty-five years have sped by. You, Anita, and I are all grandparents. The firm has grown, slowly but steadily, from two lawyers to almost 40 lawyers and Policy Advisors today.

Phil: In the beginning, you and I quickly realized we needed someone with more FDA expertise. In 1981, we were extremely fortunate to be joined by David Weeda, who had worked in FDA’s Office of Chief Counsel. David’s practice focused on drugs and biologics.

Next, Dennis Johnson joined us in 1982 after completing a Food and Drug Law Institute internship with FDA’s Office of Chief Counsel. He rapidly developed a practice representing packing and processing firms on their individual issues with USDA’s Food Safety and Inspection Service. Despite government warnings on each cigarette package, DJ has never been able to give up his Lucky Strikes, and he developed close friendships with a number of FSIS decisionmakers while sharing their smoking breaks.

Rick: David was responsible for recruiting his former FDA Office of Chief Counsel colleagues, Arthur Tsien and Steve Terman, to join us. Both have fit in very nicely. Today, Arthur is the head of our drug practice and our animal food and animal drug practice, while Steve heads our medical device practice.

Phil: Marshall Matz and I have known each other since the days when he was counsel for Senate George McGovern’s Hunger Subcommittee and I was working on hunger issues for the Nixon Administration at USDA. Marshall joined us in 1992 and has built a world-class policy and lobbying practice.

Rick: Marshall’s practice fit in neatly with the non-lawyer Senior Policy Advisors that have joined us over the years. The first was John Block, President Reagan’s first Secretary of Agriculture and the youngest member of the Reagan Cabinet. Jack is to-this-day a corn and hog producer and before coming to Washington he had been the Illinois Secretary of Agriculture. We also have former Congressman Charles Stenholm. Charlie had been the leader of the Blue Dog Coalition in the House, a group of moderate Democrats who worked to build bipartisan consensus.

We are also pleased to have Dr. Barbara Masters, a veterinarian and a former (non‑smoking) Administrator of FSIS. Barb began working for USDA straight out of vet school and burst through several (age and gender) glass ceilings to become FSIS Administrator before she was 40.

Phil: And we’re privileged to have had many other talented individuals join us over the years.

Rick: Absolutely. We have the O’Flaherty Brothers from Chicago. Michael heads our food practice. Neil is a stalwart in our medical device practice. David Durkin and Tish Pahl are an important part of our drug practice. Brett Schwemer and Jolyda Swaim are part of our meat and poultry practice, while Evan Phelps works on medical device matters. Jon Weinrieb is our resident maven on medical privacy. We added Gary Baise and his team to work on agriculture-related litigation. Bob Hahn works on food matters. There are others, of course.

Phil: David Weeda is an “almost founder” of this firm. Unfortunately, David succumbed to lymphoma at an all-too-early age in 2001. We are now fortunate to have a next generation Weeda, David’s son Mason, as one of our up-and-coming associates.

Just as we were in the process of moving our offices to The Watergate in 2011, Marshall persuaded his old friend and mentor Senator McGovern to join us as a Senior Policy Advisor. Marshall liked to point out that we had brought Senator McGovern back to The Watergate. The Senator remained one of us until he passed away.

Rick: In 35 years, much has changed, but much remains the same. We are still a relatively small, quirky boutique, specializing in food, agriculture, drugs, devices, and related litigation.

Phil: Along the way, we’ve done many different kinds of things. Rick has been heavily involved in community activities as the founder of the Lawyers Have Heart 10K foot race and fundraiser, which has raised millions of dollars for the American Heart Association during the 25 years of its existence. He has also worked closely with a number of consumer organizations, building credibility to obtain consumer support for some of our client causes.

In the 35 years since 1979, our country has been led by six presidents. We have seen many of the national and international mega-law firms stumble and disappear. From the beginning, our firm has been fortunate to have had Rick’s prudent management skills, which I believe he absorbed while watching his parents and grandparents run a small family business. Thirty-five years at OFW has been a great ride with a great group of people, both those within the firm and those on the outside, the clients who have made it all possible.

Rick: It sure has been a great ride and it’s not over. We are in the process of grooming tomorrow’s leaders. I still love my view of the Potomac from my office in the Watergate Building – the planes and helicopters and boats coming and going. Our cases were and are challenging and interesting. Washington is a wonderful place to work and raise a family.

On to the future!

HIPAA, the TCPA and Robodialing

By Mason Weeda and Tish Eggleston Pahl

Over the past several months, we have received several questions regarding how HIPAA interacts with the FCC’s implementation of rules under the Telephone Consumer Protection Act (TCPA).  Specific questions center around when authorization may be required for calling cell phones or sending text messages to cell phones that include health-related content, such as a reminder to pick up or refill a prescription.

In relevant part, FCC’s preamble and final rule, 77 Fed. Reg. 34,233 (June 11, 2012), addresses “delivery restrictions” to limit the messages that may be delivered to cell phones/by text and to residential land lines.  47 C.F.R. 64.1200.

Messages to Cell Phones/Text Messages

The first part of the rule, regarding cell phones/text messages, provides that no person or entity may:

(2) Initiate, or cause to be initiated, any telephone call that includes or introduces an advertisement or constitutes telemarketing, using an automatic telephone dialing system or an artificial or prerecorded voice, to any of the lines or telephone numbers [assigned to a paging service, cellular telephone service], other than a call made with the prior express written consent of the called party or the prior express consent of the called party when the call is made by or on behalf of a tax-exempt nonprofit organization, or a call that delivers a “health care” message made by, or on behalf of, a “covered entity” or its “business associate,” as those terms are defined in the HIPAA Privacy Rule, 45 C.F.R. 160.103.

47 C.F.R. § 64.1200(a)(2).

The cell phone portion of the rule contains two important limitations.  First, if calls are not made by an automatic telephone dialing system or autodialer, the rule does not apply. The rule defines automatic telephone dialing system or autodialer as “equipment which has the capacity to store or produce telephone numbers to be called using a random or sequential number generator and to dial such numbers.”  47 C.F.R. § 64.1200(f)(2).

Second, if the message sent to a cell phone or by text is not advertising or telemarketing, the rule does not apply.  “Advertisement” is defined as “any material advertising the commercial availability or quality of any property, goods, or services” and “telemarketing” means the “initiation of a telephone call or message for the purpose of encouraging the purchase or rental of, or investment in, property, goods, or services, which is transmitted to any person.”  47 C.F.R. § 64.1200(f)(1) and (12).

Messages to Residential Phone

The rule also addresses calls to residential phone lines.  No person or entity may:

(3) Initiate any telephone call to any residential line using an artificial or prerecorded voice to deliver a message without the prior express written consent of the called party, unless the call;

(v) Delivers a ‘‘health care’’ message made by, or on behalf of, a ‘‘covered entity’’ or its ‘‘business associate,’’ as those terms are defined in the HIPAA Privacy Rule, 45 CFR 160.103.

47 C.F.R. § 64.1200(a)(3)(v) (emphasis added).  Thus similar to the restrictions for cell phones/text messages, the requirement of obtaining prior express written consent before calling a residential line only applies if the caller is using an artificial or prerecorded voice.

Exemption for Health Care Messages

The provisions addressing calls to residential lines and cell lines and text messages both contain the identical limitation – the rule does not apply to “a call that delivers a ‘health care’ message made by, or on behalf of, a ‘covered entity’ or its ‘business associate,’ as those terms are defined in the HIPAA Privacy Rule, 45 C.F.R. 160.103.”   47 C.F.R. § 64.1200(a)(2) (cell phones and texts); 47 C.F.R. § 64.1200(a)(3)(v) (residential lines).  The FCC does not otherwise define “health care message” except by reference to the HIPAA rule, which in turn defines “health care” as “care, services, or supplies related to the health of an individual” including, but not limited to, “[s]ale or dispensing of a drug, device, equipment, or other item in accordance with a prescription.”  45 C.F.R. § 160.103.

The FCC does extensively discuss this exemption to the TCPA rule in the preamble.  See 77 Fed. Reg. at 34,240, col. 1 – 34,241, col. 2.  In explaining its rationale for exempting all health care messages from the TCPA rule, the FCC states the following:

In the FTC’s TSR [Telemarketing Sales Rule] proceeding, concern was raised, in relevant part, whether immunization reminders, health screening reminders, medical supply renewal requests, and generic drug migration recommendations would constitute inducements to purchase goods or services. In the FCC’s proceeding, one commenter argues that a call “pushing” flu vaccines would be illegal under the TCPA. Without reaching the merits of this argument, the Commission does believe that an exemption for prerecorded health care-related calls to residential lines is warranted when such calls are subject to HIPAA. With respect to the privacy concerns that the TCPA was intended to protect, the Commission believes that prerecorded health care-related calls to residential lines, when subject to HIPAA, do not tread heavily upon the consumer privacy interests because these calls are placed by the consumer’s health care provider to the consumer and concern the consumers’ health. Moreover, the exemption the Commission adopts in document FCC 12-21 does not leave the consumer without protection. The protections provided by  HIPAA safeguard privacy concerns. Under the second prong of the TCPA exemption provision, which requires that such calls not include an unsolicited advertisement, the Commission finds the calls at issue here are intended to communicate health care-related information rather than to offer property, goods, or services and conclude that such calls are not unsolicited advertisements. Therefore, such calls would satisfy the TCPA standard for an exemption as provided in the Act and the FCC’s implementing rules.

77 Fed. Reg. at 34,241, cols. 1-2 (emphasis added).

This preamble explanation of the exemption for HIPAA-covered calls arises in the context of a discussion of the residential lines part of the rule, not cell phones.  However, as discussed above, the part of the rule regarding residential lines and the part of the rule regarding cell phones and text messages both contain an identical HIPAA exemption. As the final rule in 47 C.F.R. § 64.1200 uses the identical language to exempt HIPAA covered messages from both cell phone calls and residential calls, it is our view that it is reasonable to extend the preamble language to both types of calls as well.

In sum, absent any FCC pronouncements indicating otherwise, it appears that the FCC rule does not apply to health care messages that are regulated under HIPAA.  For phone communications, the HIPAA requirements apply.  This means that a message, such as a refill reminder, must comply with HIPAA and that the FCC TCPA rule would not apply to the communication.

And They’re Off! FDA Wastes No Time in Implementing its New Compounding Authority

By David L. DurkinTish Eggleston Pahl and Mason Weeda

Horse RaceIt appears that FDA, like many of us, anticipated the passage of the Drug Quality and Security Act (DQSA) (H.R. 3204).  We previously blogged about Title II of the DQSA here, which focused on drug supply chain security.  Title I, the Compounding Quality Act, clarifies and expands FDA’s authority over pharmacy compounding.  FDA wasted no time in celebrating the DQSA’s passage and on December 2, only one business day after the DQSA was signed into law, the agency announced the release of three guidance documents to explain how it would implement the new legislation.  FDA also published three other notices requesting comment regarding various lists of substances that may or may not be compounded.

FDA stated repeatedly over the past year that it needed additional authority to regulate compounding.   We’ve chronicled that activity in prior blog posts here, here and here.  FDA got what it wanted, to an extent.   Title I of the DQSA does two things.  First, it amends the current law governing traditional compounding, section 503A of the Food, Drug and Cosmetic Act (FDC Act), 21 U.S.C. § 353a, to delete an unconstitutional provision.  Second, the DQSA adds new section 503B to the FDC Act, 21 U.S.C. § 353b, to create a new regulatory classification for “outsourcing facilities,” which are to be overseen by FDA.

Traditional Compounding

It was necessary for Congress to remove a provision in section 503A prohibiting advertising of compounding services that was added to the FDC Act in the Food and Drug Administration Modernization Act of 1997 (FDAMA).  The U.S. Supreme Court held the advertising restrictions were unconstitutional in Thompson v. Western States Med. Ctr., 535 U.S. 357 (2002) and FDA found its authority to regulate compounders undermined by subsequent lower court decisions which split over whether 503A was unconstitutional in its entirety or in part.  The DQSA clarifies this issue by eliminating the controversial advertising prohibition in 21 U.S.C. § 353a(c) and renumbering the remaining provisions.

Section 503A otherwise remains unchanged, and continues to set out the requirements for traditional compounding created in FDAMA – the pharmacist must compound the drug for individual patients based on a valid prescription, using bulk drug substances or ingredients that comply with USP or other specified monographs.  In addition, a traditional compounding pharmacy may not compound a drug that appears on a list published by FDA in the Federal Register.  One of the FDA guidance documents addresses traditional compounding, and is clear that traditional compounding will generally remain under state oversight as long as the compounding facility meets the requirements of 503A.  A facility that meets the 503A requirements is exempt from cGMP requirements, adequate directions for use, and new drug approval requirements.

Outsourcing Facilities

The new part, 503B of the FDC Act, 21 U.S.C. §353b, creates “outsourcing facilities” and sets out the requirements for their operation.  Although technically voluntary, a compounder has only one of two options:  if it does not compound pursuant to 503A for individual patients based on prescription (or a prescription history of an individual or order history of a physician), then the compounder must register as an “outsourcing facility” under 503B.  An outsourcing facility is exempt from FDA approval requirements and adequate directions for use, but is subject to cGMP requirements.  FDA issued two guidance documents focusing on outsourcing facility registration and reporting.  The registration process is similar to the registration of drug facilities.

FDA, indicating that it is ready to enforce 503A and 503B, states that it “encourages companies wishing to compound as outsourcing facilities to register with FDA immediately.”  Those creating facility reports need to be familiar with Microsoft Excel – the guidance provides a list of required reporting information and directs firms to submit the data in “an excel spreadsheet” to a specified FDA email address.

Compounded Substances Lists and State MOUs

Sections 503A and 503B both require FDA to develop lists of drugs that may or may not be compounded and lists of bulk drug substances that may be used to compound.  To develop these lists, FDA issued the following in the Federal Register and comments are due on or before March 4, 2014:

  • Bulk Drug Substances That May Be Used To Compound Drug Products in Accordance With Section 503B of the Federal Food, Drug, and Cosmetic Act, Concerning Outsourcing Facilities; Request for Nominations, available here.
  • Drug Products That Present Demonstrable Difficulties for Compounding Under Sections 503A and 503B of the Federal Food, Drug, and Cosmetic Act; Request for Nominations, available here.
  • List of Bulk Drug Substances That May Be Used in Pharmacy Compounding; Bulk Drug Substances That May Be Used to Compound Drug Products in Accordance With Section 503A of the Federal Food, Drug, and Cosmetic Act; Request for Nominations, available here.

This nomination process raises interesting questions regarding how FDA would use these lists in the face of its traditional stance that the agency does not regulate the traditional practices of medicine or pharmacy.  In announcing the guidance, FDA noted that it “anticipates that state boards of pharmacy will continue their oversight and regulation of the practice of pharmacy, including traditional pharmacy compounding.”  On some levels, the listing process and the FDA assertions that the practice of pharmacy is a state regulatory matter appear to be at cross purposes.

FDA has maintained a list of drugs in 21 C.F.R. § 216.24 that may not be compounded because the drugs were withdrawn from the market for reasons of safety or effectiveness.  FDA intends to update this list and is accepting comments on drugs that should be included.

Lastly, the DQSA provides that a firm in a state that does not have a Memorandum of Understanding (MOU) with FDA may not compound drugs under 503A unless it meets various exceptions.  To expedite the MOU process FDA is developing a standard form, which will be published for comment.

The FDA’s guidance on DQSA implementation, albeit short, was published very quickly and has resolved many initial questions with more still to come.  Stakeholders will want to pay close attention and not miss the opportunity to comment.