Life Science Compliance Update

March 27, 2017

Arizona Enacts Law: Pharmaceutical Companies to Legally Communicate Off-Label Treatment to Medical Professionals


As many of our readers know all too well, pharmaceutical companies are not permitted to discuss off-label, legal, alternative uses for an approved drug with physicians and other healthcare professionals as regulated by the FDA. However, a bill in Arizona, HB 2382 that passed unanimously (The Free Speech in Medicine Act) has changed that in Arizona. On March 21, 2017, Governor Doug Ducey signed the bill into law, lifting the aforementioned off-label promotion restriction and allowing drug companies to communicate with doctors and other healthcare providers about safe and effective alternative uses for approved prescription drugs.

The law, effective in ninety days, safeguards the free speech rights of pharmaceutical industry members to share truthful research and information about FDA-approved medicines.

“Curbing the exchange of information about off-label treatments by those with the most knowledge about the drug’s uses, risks, and side effects not only prevents patients from receiving the best possible care; it violates the constitutional right to free speech,” said Christina Sandefur, the executive vice president of the Goldwater Institute, and author of the model language upon which HB 2382 is based.

The Goldwater Institute has campaigned for “Right to Try” laws and the Free Speech in Medicine Act follows on the heels of the campaign, with thirty-three states adopting “Right to Try” laws.

“With HB 2382, Arizona is leading the way in protecting free speech in medicine. When doctors are fully informed about the lawful treatment options available to them, they can best serve their patients’ individual needs,” said Sandefur.

Roughly twenty percent of written prescriptions are “off-label,” meaning that the medicine is FDA-approved, but is prescribed for a use or dosage different from the FDA-approval. While doctors can already legally prescribe off-label, federal law prohibits pharmaceutical companies from sharing information about off-label uses with doctors. As a result, doctors and patients may be unaware of alternative treatment options lawfully available them.

The off-label use of cancer drugs is even more common than typical prescriptions. A recent study found that among the ten most prescribed cancer drugs in 2010, approximately thirty percent were prescribed off-label. Even with those facts and statistics, pharmaceutical companies face criminal penalties (and have been prosecuted) for communicating information about lawful off-label uses for approved treatments to doctors and other healthcare professionals. 

HB 2382 is a relatively modest reform. It only protects the sharing of information that is “not misleading, not contrary to fact, and consistent with generally accepted scientific principles;” and it only applies to communication between pharmaceutical manufacturers and licensed healthcare professionals. The bill does not permit pharmaceutical manufacturers to advertise off-label uses directly to the public.

Since Arizona enacted this protection for industry, it is likely to expand options in doctors’ toolkits, enhance patient autonomy, and increase access to healthcare. It will be interesting to see if any other states will follow suit and implement similar laws.   We will watch carefully to see if this law, which aligns with several recent legal cases, prompts the FDA to finally adjusts their guidance on off-label communications.

The Goldwater Institute is pursuing other healthcare policies, all in an attempt to remove barriers that prevent healthcare professionals from providing the care they are trained to give.

January 26, 2017

FDA Releases Draft Guidance on Manufacturer Communications with Payors, Formulary Committees, and Similar Entities


In mid-January 2017, the United States Food and Drug Administration (FDA) released a guidance document, entitled Drug and Device Manufacturer Communications with Payors, Formulary Committees and Similar Entities – Questions and Answers,” explaining FDA’s current thinking regarding communications by medical product manufacturers, packers and distributors of health care economic information (HCEI) about approved prescription drugs to payors and formulary committees.  The draft guidance also provides answers to common questions about dissemination of information by firms regarding investigational drugs and devices to payors before FDA clearance or approval of those products.

HCEI is defined in the document as “any analysis (including the clinical data, inputs, clinical or other assumptions, methods, results, and other components underlying or compromising the analysis) that identifies, measures, or describes the economic consequences of the represented health outcomes, of the use of a drug.” HCEI pertains to the economic consequences related to the clinical outcomes of treating a disease (or specific aspect of a disease) or of preventing or diagnosing a disease. According to the FDA, HCEI may be presented in a variety of ways that can include, but are not limited to, an evidence dossier, a reprint of a publication from a peer-reviewed journal, a software package comprising a model with user manual, or a budget-impact model.

HCEI is not to be considered false or misleading if, among other things, it “relates to an [approved] indication.” To be considered related to an approved indication, HCEI analyses should relate to the disease or condition, manifestation of the disease or condition, or symptoms associated with the disease or condition in the patient population for which the drug is indicated in the FDA-approved labeling. Pages six through eight of the guidance have a table of HCEI analyses that relate to the approved indication.

In the guidance document, FDA defines “payors” as including payors, formulary committees, or other similar entities responsible for making drug selection, formulary management and/or coverage and reimbursement decisions regarding drugs and/or devices for health care organizations, including integrated health care delivery networks, hospitals and hospital systems.  In the guidance, FDA notes that if a firm disseminates HCEI about an approved drug consistent with the guidance, when finalized, FDA does not intent to consider such information false or misleading or as providing evidence of a new intended use.

In an accompanying Federal Register notice, FDA announced that it is reopening the comment period related to a previous public hearing concerning manufacturer communications regarding unapproved uses of approved or cleared medical products. This comment period will be reopened for 90 days, beginning January 19, 2017.

October 20, 2016

CMS Releases MA and Part D Landscape Information for 2017


On September 22, 2016, the Centers for Medicare and Medicaid Services (CMS) announced information on premiums and costs for Medicare Advantage (MA) and stand-alone prescription drug plans (PDPs) for calendar year 2017.

CMS stated that 2017 Medicare Advantage premiums will “remain stable [and even decrease] and more enrollees will have access to higher quality plans while, for the seventh straight year, enrollment is projected to increase to a new all-time high.” For calendar year 2017, CMS has estimated that the average Medicare Advantage monthly premium will decrease by roughly $1.19 (about a 4% decrease), from $32.59 to $31.40. Approximately two-thirds of Medicare Advantage enrollees will experience no premium increase. 

CMS also reports that ninety-nine percent of Medicare beneficiaries will have access to a Medicare Advantage plan in 2017 and that more of those plans will offer additional supplemental benefits, such as dental, vision, and hearing benefits.

CMS is expecting an increase in enrollment, to 18.5 million enrollees next year, an increase of sixty percent since 2010. Enrollment in Medicare Advantage plans is projected to increase to thirty-two percent of all Medicare enrollees in 2017, an increase from just twenty-four percent in 2010.

It is estimated that average premiums for the Medicare Part D prescription drug program will also remain stable, saving beneficiaries billions on prescription drugs. In July 2016, CMS announced that the average premium for a basic Medicare prescription drug plan is projected to be $34 a month in 2017. Recent projections show that access to a prescription drug plan will remain strong in 2017, with 100% access to a plan in the individual market, and improved access to employer plans. The average number of Medicare Advantage plan choices per county is relatively unchanged from 2016, and access to supplemental benefits will continue to grow.

Andy Slavitt, CMS Acting Administrator, said “Medicare Advantage and the prescription drug benefit continue to be a great option for seniors and people living with disabilities. Medicare enrollees will continue to have access to predictable premiums and high quality care.”

It is estimated that due to the Affordable Care Act, Medicare beneficiaries are seeing reduced costs through: (1) savings on covered brand-name and generic prescription drugs and (2) access to certain preventive services with no co-pay or other cost sharing. More than 11 million seniors and people with disabilities have received savings and discounts in the coverage gap, since the enactment of the Affordable Care Act.

Open Enrollment for 2017 Medicare health and drug plans starts October 15, 2016, and ends on December 7, 2016.

Information on premiums and costs of 2017 Medicare health and drug plans can be found here.

A fact sheet on Medicare Advantage and Part D can be found here.

Information on Medicare Open Enrollment, including state-by-state fact sheets, can be found here.

State-by-state information on discounts in the “donut hole” can be found here.

State-by-state information on utilization of preventive services at no cost sharing to beneficiaries in Medicare can be found here.


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