On July 9, 2012, President Obama signed into law the Food and Drug Administration Safety and Innovation Act (FDASIA), which gives FDA the authority to collect user fees from industry to fund reviews of innovator drugs, medical devices, generic drugs and biosimilar biologics. It also reauthorizes two programs that encourage pediatric drug development.
“Support for FDA user fees is a testament to the important role FDA plays in America’s healthcare continuum. FDA’s medical product decisions sit at the intersection of public health, innovation, and commerce and touch the lives of nearly every American every day,” said FDA Commissioner Margaret A. Hamburg, M.D.
This is the fifth reauthorization of the Prescription Drug User Fee Act or PDUFA, first enacted in 1992, and the third reauthorization of the Medical Device User Fee Act, or MDUFA, first enacted in 2002. Both programs have provided steady and reliable funding to maintain and support a staff of trained reviewers who must determine whether a proposed new product is safe and effective for patients and do so within a certain time period. The new user fee programs for generic drugs and biosimilar biologics build on the successes of these two established user fee programs.
One of the most important provisions in FDASIA is Title X, which addresses the issues associated with drug shortages. A recent reference guide published by the law firm Arnold & Porter, LLP, provides in depth analysis of FDASIA, including Title X. Many of the provisions that made it into the final bill remained the same from the initial drug shortage legislation that was proposed back in April.
As we have noted several times over the last year, the number of drug shortages has been rising steadily over the last five years, nearly tripling from 61 in 2005 to 178 in 2010. In 2011, FDA tracked over 250 drug shortages. Drug shortages can create significant public health concerns. Causes of drug shortages may include:
- product quality concerns,
- manufacturing problems,
- difficulty in acquiring component parts or active pharmaceutical ingredients (API),
- increases in demand, and
- shipping delays, among other things.
On October 31, 2011, FDA sent a letter to manufacturers of prescription products reminding them of their mandatory reporting requirements under section 506C and encouraging them to voluntarily report to the Agency any disruptions in supply that could lead to a product shortage, even beyond those situations covered by mandatory reporting. On the same day, the President issued Executive Order 13588 directing FDA to use all available administrative tools to expand the Agency’s efforts to combat the problem of drug shortages.
In addition to these steps, FDA released draft Guidance to Industry on “Notification to FDA of Issues that May Result in a Prescription Drug or Biological Product Shortage.” The Guidance to industry explains requirements for notification to FDA of a discontinuance of certain drug products under section 506C of the Federal Food, Drug, and Cosmetic Act (FD&C Act), as implemented by 21 C.F.R. §§ 314.81(b)(3)(iii) and 314.91. The guidance reflects amendments to the implementing regulations published as an interim final rule on December 19, 2011 (effective January 18, 2012). The guidance is only for drugs, regulated by CDER, and biologics, the Center for Biologics Evaluation and Research (CBER).
Since FDA and the Obama Administration has taken action, FDA has been able to prevent 128 drug shortages, and FDA is seeing fewer numbers of shortages occur – 42 new drugs in shortage reported in 2012, compared to 90 new shortages at this time last year, according to FDA Commissioner Margaret Hamburg, M.D., who recently gave the public a “Six Month Check-Up on FDA’s Work on Drug Shortages.”
Most recently, however, the U.S. House of Representatives Committee on Oversight and Government Reform issued a report, which documents a critical shortage of generic injectable medications that has occurred following enforcement activity by the Food and Drug Administration (FDA) at companies and facilities where the drugs are made. In addition to this report, there has been media coverage showing that another cause for drug shortages is the government’s price controls.
FDASIA – Title X
Title X of FDASIA substantially amends the existing Federal Food, Drug & Cosmetic Act (FFDCA) drug shortage provisions. FDASIA eliminates the requirement that a manufacturer be the sole manufacturer of a drug to be subject to the drug shortage notice requirements. Additionally, FDASIA explicitly makes drugs used in emergency medical care or during surgery subject to drug shortage notice requirements. Previously, only drugs that were life-supporting, life-sustaining, or intended for use in the prevention of a debilitating disease or condition were subject to these requirements. New exclusions from the notice requirements include radiopharmaceutical drug products or any other product as designated by FDA.
Manufacturers covered by the FDASIA notice requirements must notify FDA of either “a permanent discontinuance in the manufacture of the drug or an interruption of the manufacture of the drug that is likely to lead to a meaningful disruption in the supply of that drug in the United States, and the reasons for such discontinuance or interruption.” Prior to these amendments, the exclusion only applied to products originally derived from human tissue and replaced by a recombinant product.
Previously, the FFDCA only required notification for discontinuance in the manufacture of a drug. Under FDASIA, manufacturers must notify FDA at least six months before the date of the discontinuance or interruption, or as soon as practicable if the six-month minimum is not possible. Previously, the FFDCA only specified that manufacturers must notify FDA at least six months prior to the date of discontinuance.
To the maximum extent practicable, FDA must inform appropriate organizations -- including physician, health provider, and patient organizations -- of drug shortages. Within 30 days of receiving notice of a drug shortage pertaining to a controlled substance subject to a production quota, FDA will notify the Attorney General and request that the Attorney General increase the production quotas if FDA deems it necessary to address the shortage.
If a manufacturer fails to submit information about a drug shortage as required, FDA must issue a letter informing it of the failure. Within 30 days of the issuance of the letter, the manufacturer must submit to FDA a written response setting forth the basis for noncompliance and providing the required drug shortage information. Within 45 days of the issuance of the letter, FDA must publish the letter and any response on the FDA’s website, unless FDA issued the letter in error or the manufacturer’s response shows that there was a reasonable basis for not notifying as required.
FDASIA authorizes FDA to respond to a drug shortage by expediting the review of an ANDA or a supplement to an ANDA or NDA that could help mitigate or prevent the shortage. FDA may also expedite an inspection or re-inspection of an establishment that could help mitigate or prevent the shortage.
Within 18 months of the enactment of FDASIA, FDA must adopt a final regulation implementing these drug shortage requirements. FDA may also apply these requirements by regulation to biological products if FDA “determines such inclusion would benefit the public health.”
Annual Reporting on Drug Shortages (FDASIA § 1002)
By the end of calendar year 2013, and no later than the end of each calendar year thereafter, FDA must submit a report to Congress on drug shortage statistics, communication within FDA on addressing shortages, and actions taken by FDA to prevent or mitigate shortages.
Coordination; Task Force and Strategic Plan (FDASIA § 1003)
As soon as practicable after the enactment of FDASIA, FDA must establish a task force to develop and implement a strategic plan for enhancing FDA’s response to preventing and mitigating drug shortages. Among other issues, the plan must examine whether to establish a “qualified manufacturing partner program.”
A qualified manufacturer would need to have the capability and capacity to supply products determined or anticipated to be in shortage within a rapid timeframe. FDA must also consider whether incentives are necessary to encourage participation in a qualified manufacturing program. Within one year of the enactment of FDASIA, the task force must publish the strategic plan and submit it to Congress.
Prior to any enforcement action or issuance of a warning letter that could reasonably lead to a meaningful disruption in the supply of a drug as described above, FDA must ensure that there is communication with the appropriate FDA office with expertise in drug shortages. If after the communication, FDA determines that an enforcement action or warning letter “could reasonably cause or exacerbate a shortage of a drug,” then FDA must evaluate the risks associated with the shortage and the risks associated with the violation before taking action or issuing a letter, “unless there is imminent risk of serious adverse health consequences or death to humans.”
The task force, strategic plan, communication, and risk evaluation requirements of section 1003 described above expire five years after the enactment of FDASIA. To allow healthcare providers and other third-party organizations an opportunity to report evidence of drug shortages, FDA must identify or establish a reporting mechanism.
Drug Shortage List (FDASIA § 1004)
FDA must maintain an up-to-date list of drugs determined by FDA to be in shortage in the United States. For each drug on the list, FDA must include the following: the name of the drug, the name of the manufacturer, the reason for the shortage, and the estimated duration of the shortage as determined by FDA. The information in the list must be publicly available, unless the information involves trade secrets or confidential information, or if FDA “determines that disclosure of such information would adversely affect the public health (such as by increasing the possibility of hoarding or other disruption of the availability of drug products to patients).”
Quotas Applicable to Drugs in Shortage (FDASIA § 1005)
Section 1005 amends the Controlled Substances Act to allow manufacturers of a schedule II controlled substance that is on FDA’s list of drugs in shortage to request an increase in production quotas from the Attorney General. Within 30 days of such a request, the Attorney General must review the request and decide whether increasing production quotas is necessary to address a shortage of a controlled substance. If the Attorney General determines that the level requested is not necessary to address a shortage of a controlled substance, the Attorney General must provide a written response detailing the basis for the determination and publish the response on FDA’s website.
Attorney General Report on Drug Shortages (FDASIA § 1006)
Within six months of the enactment of FDASIA, the Attorney General must submit to Congress a report on drug shortages that:
- identifies the number of requests received under section 1005, the average review time for such requests, the number of requests granted and denied, and, for each of the requests denied, the basis for such denial;
- describes the coordination between the Drug Enforcement Administration and FDA on efforts to prevent or alleviate drug shortages; and
- identifies drugs containing a controlled substance subject to section 1005 when FDA determines such a drug is in shortage.
Hospital Repackaging of Drugs in Shortage (FDASIA § 1007)
A hospital may repackage a drug (excluding controlled substances) for transfer to another hospital within the same health system and need not register as a repackager if:
- the drug is listed on FDA’s drug shortage list, or it is during the 60-day period following a period when the drug was on the list;
- the drug is not sold or otherwise distributed by the health system or a hospital within the system to an entity or individual that is not a hospital within such health system; and
- repackaging completed in compliance with applicable State requirements.
This exception does not apply starting on the date on which FDA “issues final guidance that clarifies the policy of the Food and Drug Administration regarding hospital pharmacies repackaging and safely transferring repackaged drugs to other hospitals within the same health system during a drug shortage.”
Study on Drug Shortages (FDASIA § 1008)
Within 18 months of the enactment of FDASIA, GAO must submit a report to Congress on the cause of drug shortages and on recommendations on how to prevent or alleviate shortages.