Life Science Compliance Update

March 31, 2017

CDER 2017 Guidance Agenda

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In January, FDA’s Center for Drug Evaluation and Research (CDER) released its annual guidance agenda, announcing the new and revised draft guidances that the Center plans to publish during the 2017 calendar year. CDER’s 102-part agenda is organized by category and touches on a variety of topics, giving us a glimpse of what to expect throughout the year. This year’s agenda follows a similar pattern to the Center’s 2016 agenda, placing an emphasis on the clinical aspects of drug development, pharmaceutical quality, generics, and procedural activities. However, CDER is not bound by this list of topics, required to issue a guidance on every topic included in the list, or precluded from developing guidance on topics not included in the list. According to Regulatory Focus, several items on the 2017 list were also listed in 2016.

Delayed by Trump Executive Order?

Maybe, but it is not entirely clear. Additionally, the items in CDER’s announcement reflect only draft and revised draft guidances under development as of the date of FDA's posting. So there is still the potential for modifications, even more potential guidances.

Recent reporting from Regulatory Focus indicates the “Two Out, One In” Executive Order may have been clarified through OMB guidance to offer “wiggle room” for the FDA in issuing guidances. OMB notes that “significant guidance or interpretive documents will be addressed on a case-by-case basis.” Rachel Sachs, an associate law professor at Washington University in St. Louis, argues the OMB document "significantly restricts" and "walks back" the reach of the EO because it exempts classes of regulations required by law and appreciates that regulations may be deregulatory in nature so the costs and issuance of such regulations will be considered accordingly.

“Emergencies addressing critical health, safety, or financial matters, or for some other compelling reason, may qualify for a waiver from some or all of the requirements of Section 2,” the guidance also notes, which may further allow the FDA room to move on these issues.

The 2017 Agenda

A few interesting items that stood out:

Advertising:

  • Drug and Device Manufacturer Communications with Payors, Formulary Committees and Similar Entities

Biopharmaceutics:

  • Assessing the Effects of Food on Drugs in INDs and NDAs – Clinical Pharmacology Considerations; Revised Draft

Biosimilarity:

  • Considerations in Demonstrating Interchangeability With a Reference Product
  • Statistical Approaches to Evaluation of Analytical Similarity Data to Support a Demonstration of Biosimilarity

Clinical/Medical:

  • Guidance for clinical Investigators and Sponsors Natural History Studies for Rare Disease Drug Development
  • Pediatric Oncology Product Development; Revised Draft
  • Rare Diseases: Drug Development Safety Data Considerations

Clinical Pharmacology:

  • Clinical Drug Interactions Studies: Study, Design, Data Analysis, Implications for Dosing and Labeling Recommendations, Revised Draft
  • Clinical Lactation Trials – Trial Design, Data Analysis and Recommendations for Labeling; Revised Draft
  • Exposure-Response Relationships – Study Design, Data Analysis, and Regulatory Applications; Revised Draft
  • Population Pharmacokinetics; Revised Draft

Clinical/Statistical:

  • Adaptive Design Clinical Trials for Drugs and Biologics; Revised Draft
  • Meta-Analysis of Randomized Controlled Clinical Trials to Evaluate the Safety of Human Drugs or Biologic Products

Drug Safety:

  • Format and Content of a REMS Document, Revised Draft
  • Postmarketing Safety Reporting for Human Drugs and Biological Products Including Vaccines, Revised Draft

Electronic Submissions:

  • Standardized Format for Electronic Submissions of NDA and BLA Content and Planning and Conduct of Bioresearch Monitoring Inspections for Submissions to CDER
  • Providing Regulatory Submissions in Electronic Format – Submission of Manufacturing Establishment Information
  • Providing Regulatory Submissions in Electronic Format – Bioanalytical Methods Data Standards
  • Providing Regulatory Submissions in Electronic Format – Standardized Bioanalytical Data

Generics:

  • 180-Day Exclusivity: Questions and Answers
  • ANDA Submissions – Amendments to Abbreviated New Drug Applications Under GDUFA
  • ANDA Submissions – Content and Format of Abbreviated New Drug Applications; Revised Draft
  • ANDA Submissions Refuse to Receive Standards: Questions and Answers
  • Controlled Correspondence Related to Generic Drug Development; Revised Draft
  • Changes That May Be Included in a Single Prior Approval Supplement for an ANDA
  • Determining Whether To Submit an Application Under 505(b)(2) or 505(j)
  • Issuance of ANDA Complete Response Letters Before Completion of Review by One or More Disciplines
  • Meetings With Applicants of Complex Generic Drug Products
  • Pre Submission Facility Correspondence for Priority ANDAs in GDUFA II
  • Three-Year Exclusivity Determinations for Drug Products
  • Variations in Drug Products (ANDAs) Guidance

Labeling:

  • Drug Abuse and Dependence Section of Labeling for Human Prescription Drug and Biological Products – Content and Format
  • Indications and Usage Section of Labeling for Human Prescription Drugs and Biological Products – Content and Format

Pharmaceutical Quality/CMC:

  • GDUFA II Priority ANDA Pre-Submission Communications
  • Harmonizing Compendial Standards with Drug Application CMC Approval Requirements Using the USP Pending Monograph Process

Pharmaceutical Quality/Manufacturing Standards (CGMP):

  • Current Good Manufacturing Practice for Medical Gases; Revised Draft
  • Expiration Dating of Unit-Dose Repackaged Solid Oral Dosage Form Drug Products; Revised Draft

Procedural:

  • Annual Reporting by Prescription Drug Wholesale Distributors and Third-Party Logistics Providers: Questions and Answers
  • Civil Monetary Penalties for Failure to Meet Accelerated Post marketing Requirements
  • Compliance Policy Guide: Marketed Unapproved Drugs Section 440.100; Revised Draft
  • Content of Human Factors Submissions for Evaluation
  • Designated Delivery Services for 505(b)(2) or ANDA Applicants Sending Notices of Paragraph IV Patent Certification
  • Enforcement Policy Regarding Ingredients Nominated for Inclusion on the Bulk Drug Substances List Pursuant to Section 503B
  • Formal Meetings Between the FDA and Sponsors or Applicants of PDUFA Products
  • National Drug Code (NDC) Assignment of CDER-Regulated Products
  • Pediatric Drug Development Under the Pediatric Research Equity Act and the Best Pharmaceuticals for Children Act: Scientific Considerations; Revised Draft
  • Pediatric Drug Development Under the Pediatric Research Equity Act and the Best Pharmaceuticals for Children Act: Regulatory Considerations; Revised Draft
  • Public Disclosure of FDA-Sponsored Studies
  • Refuse to File: NDA and BLA Submissions
  • REMS Assessment: Planning and Reporting
  • Standardization of Data and Documentation Practices for Product Tracing
  • Survey Methodologies to Assess Risk Evaluation and Mitigation Strategies (REMS) Goal Related to Knowledge
  • Use of a Drug Master File for Shared System Risk Evaluation and Mitigation Strategies (REMS)
  • Verification Systems Under the Drug Supply Chain Security Act for Certain Prescription Drugs

User Fees:

  • User Fee Waivers, Reductions, and Refunds for Drug and Biological Products
  • Fees Incurred Under the Drug Supply Chain Security Act

February 28, 2017

Trump Executive Order Targets Regulations

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On one of his first few days on the job, President Donald Trump signed an executive order that would require all government agencies to eliminate two regulations for every one new regulation instituted.

The order was characterized by the Administration as a plan to help benefit small businesses. However, it is likely to have an impact on the United States Food and Drug Administration (FDA) as it applies to every agency (other than those related to military or national security), or any other agencies exempted by the Office of Management and Budget (OMB).

How this plan will work for an agency like the FDA is hard to comprehend: most of the regulations are intertwined with one another. As the EO is written, if the agency needed to put in place a new regulation, it would then have to presumably cut out two other, unrelated regulations that are linked to public health.

Another problem is that, according to the text of the EO, the directions apply to FDA guidance documents as well. This will be a large problem for pharmaceutical and medical device companies that rely on such guidances to understand FDA’s interpretations of the law. The EO defines the term ‘regulation’ or ‘rule’ to mean “an agency statement of general or particular applicability and future effect designed to implement, interpret, or prescribe law or policy or to describe the procedure or practice requirements of an agency.

The way this EO is implemented across the federal government is going to come largely from the OMB director, who will provide the heads of agencies with guidance addressing, among other things, “processes for standardizing the measurement and estimation of regulatory costs; standards for determining what qualifies as new and offsetting regulations; standards for determining the costs of existing regulations that are considered for elimination; processes for accounting for costs in different fiscal years; methods to oversee the issuance of rules with costs offset by savings at different times or different agencies; and emergencies and other circumstances that might justify individual waivers of the requirements.” 

Prior to releasing this EO, President Trump said, “This will be the biggest such act that our country has ever seen. There will be regulation. There will be control. But it will be normalized control where you can open your business and expand your business easily.”

"If you have a regulation you want, No. 1, we're not going to approve it because it's already been approved, probably, in 17 different forms," Trump said from the White House. "But if we do, the only way you have a chance is we have to knock out two regulations for every new regulation."

Although many of Trump's other executive orders have been met with criticism, this latest policy is not unfounded. Back in 2010, the United Kingdom adopted a similar policy, though its implementation did not apply to taxes, certain European Union legislation, non-business regulations and "regulation for civil emergencies," according to the U.K. government.

OMB Issues Guidance

On February 2, 2017, the OMB did issue guidance to the Agencies, highlighting what to expect and how to handle this executive order. The Q&A offers some clarity and boundaries for the EO signed last Monday, noting: “The EO’s requirements for Fiscal Year 2017 apply only to those significant regulatory actions, as defined in Section 3(f) of Executive Order 12866, an agency issues between noon on January 20 and September 30, 2017.”

But the OMB guidance does offer some wiggle room for FDA in terms of issuing draft or final guidance (2017 guidance plans for FDA's Center for Drug Evaluation and Research are here) noting that “significant guidance or interpretive documents will be addressed on a case-by-case basis.”

As far as what existing regulations if repealed would be considered part of the “two out” part of the EO, OMB notes, “Any existing regulatory action that imposes costs and the repeal or revision of which will produce verifiable savings may qualify.”

The guidance also offers FDA, which is an agency that deals with public health and safety, some ways to waive the “two out, one in” requirements of the EO. “Emergencies addressing critical health, safety, or financial matters, or for some other compelling reason, may qualify for a waiver from some or all of the requirements of Section 2,” the guidance notes.

But if a new regulation is implementing a new law from Congress (for instance, with FDA’s pending implementation of the 21st Century Cures Act), OMB clarifies that agencies should still “identify additional regulatory actions to be repealed in order to offset the cost of the new significant regulatory action, even if such action is required by law.”

December 30, 2016

OIG Issues Semiannual Report to Congress

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The Department of Health and Human Services (HHS) issued its Semiannual Report to Congress, covering April 1, 2016 to September 30, 2016, on November 30, 2016. The Report summarizes the activities of the HHS Office of Inspector General (OIG) for the six-month period that ended September 30, 2016. OIG provides independent, objective oversight for HHS programs. OIG is a multidisciplinary organization principally comprising auditors, investigators, and evaluators who work in concert to protect the integrity of HHS programs, as well as the health and welfare of the people they serve.

During this reporting period, OIG expanded its focus on the quality and safety of care provided to vulnerable populations, including those in non-institutional settings. Programs that deliver health care in non-institutional settings are increasingly popular choices that help beneficiaries live in their homes and communities while avoiding costly and potentially disruptive facility-based care. Over half of all spending on Medicaid long-term services and supports is now for home and community based services (HCBS), exceeding Medicaid spending on institutional services.

OIG’s examinations of HCBS programs have revealed gaps in policies and controls to protect patients. For example, during this reporting period, OIG identified troubling compliance issues with requirements for monitoring and reporting critical incidents involving developmentally disabled Medicaid beneficiaries at group homes in Massachusetts and Connecticut.

This Report outlines many areas of improvement requiring sustained HHS attention. Program integrity must be a top priority as HHS programs continue to grow in size and complexity and incorporate new paradigms focused on value, quality, and patient-centered care. Since its 1976 establishment, OIG has worked collaboratively with its partners to protect and oversee HHS’s vital health and human services programs. The achievements of this office would not be possible without the dedication and professionalism of OIG’s employees. Once again, I would like to express my appreciation to Congress and to the Department for their sustained commitment to the important work of our office.

Numbers At-A-Glance

For FY 2016, OIG reported expected recoveries of more than $5.66 billion consisting of nearly $1.2 billion in audit receivables and about $4.46 billion in investigative receivables. The investigative receivables include about $953 million in non-HHS investigative receivables, resulting from work in areas such as the States’ shares of Medicaid restitution.

Also during FY 2016, OIG reported 844 criminal actions against individuals or entities that engaged in crimes against HHS programs. OIG reported 708 civil actions, which include false claims and unjust-enrichment lawsuits filed in Federal district court, CMP settlements, and administrative recoveries related to provider self-disclosure matters. The CMP recoveries have increased almost five-fold over the past 3 years.

Health Care Fraud Strike Force Teams and Other Enforcement Actions

The Health Care Fraud Prevention and Enforcement Action Team (HEAT) was started in 2009 by HHS and DOJ to strengthen programs and invest in new resources and technologies aimed at preventing and combating health care fraud, waste, and abuse. Health Care Fraud Strike Force teams, a key component of HEAT, coordinate law enforcement operations conducted jointly by Federal, State, and local law enforcement entities.

The Strike Force model operates in Miami, Florida; Los Angeles, California; Detroit, Michigan; southern Texas; Brooklyn, New York; southern Louisiana; Tampa, Florida; Chicago, Illinois; and Dallas, Texas. During FY 2016, Strike Force efforts resulted in the filing of charges against 255 individuals or entities, 207 criminal actions, and $321 million in investigative receivables.

One example of Strike Force action is the unprecedented nationwide sweep in 36 Federal districts, with the assistance of 24 State Medicaid Fraud Control Units (MFCU). The sweep resulted in criminal and civil charges against 301 individuals, including 61 doctors, nurses, and other licensed medical professionals, for their alleged participation in health care fraud schemes involving approximately $900 million in false billings.

Prescription Drugs

Part D is the fastest growing component of the Medicare program, and Medicaid expenditures for prescription drugs are also increasing, influenced by Medicaid expansion and increasing expenditures for expensive specialty drug costs. HHS’ oversight of prescription drug programs face numerous challenges, affecting beneficiary and community safety and the integrity of the benefit itself.

High Part D Spending on Opioids & Growth in Compounding Drugs Raise Concerns Medicare Part D spending for commonly abused opioids exceeded $4 billion in 2015, and spending for compounded topical drugs increased more than 3,400 percent since 2006. This data brief builds on OIG’s June 2015 data brief, which described trends in Part D spending and identified questionable billing by pharmacies. It updates information on spending for commonly abused opioids and provides data on the dramatic growth in spending for compounded drugs.

OIG will continue to conduct investigations and reviews to address the ongoing problems created by opioid abuse and the emerging problems linked to compounded drugs. The Centers for Medicare & Medicaid Services (CMS) has taken steps to combat the problems associated with commonly abused opioids, such as identifying outlier prescribers. CMS also needs to assess the implications of the compounded drug trends identified in this data brief and take action where needed to protect the integrity of the program.

CMS Should Address Medicare’s Flawed Payment System for DME Infusion Drugs

This review, following up on an earlier recommendation, investigated the impact of the current Part B payment methodology on provider reimbursement rates for two vital drugs: pump administered insulin and milrinone lactate. We found that in 2015, Medicare paid suppliers 65 percent less than their cost for pump-administered insulin, which hindered beneficiary access to the drug. Using the same reimbursement methodology, Medicare paid suppliers of milrinone lactate, an infusion drug used to treat congestive heart failure, 20 times the drug’s cost, thereby creating incentives for overutilization and improper billing. Therefore, OIG continued to recommend that CMS take action to ensure that payment amounts for infusion drugs more accurately reflect provider acquisition costs.

Conclusion
As written in a January 2017 article in Life Science Compliance Update, it is too soon to tell the effect the Trump Administration will have on the pharmaceutical industry. This report and the recommendations contained therein highlight some of the focuses of OIG, but those have the propensity to change, depending on the incoming Administration. 

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