YOUR GO-TO SOURCE FOR ANALYSIS OF ISSUES AFFECTING THE PHARMA & BIOTECH SECTORS

The Centers for Medicare and Medicaid Services (CMS) issued proposed regulations in February targeting manufacturer arrangements with pharmacy benefit managers (PBMs). These proposed regulations are a direct outgrowth of the administration’s drug pricing blueprint, and if finalized, would revise the Anti-Kickback Statute discount safe harbors that have protected drug manufacturer rebates from potential criminal liability, and affect their agreements with PBMs. However, what many may not realize is that even if the proposed regulations are not finalized, they warrant special attention, as the preamble elucidates CMS’s view on applicability of the current safe harbors to current contracting practices.

A handful of bills that comprised a healthcare reform package championed by Florida House Republicans are on their way to the governor’s desk where they’ll likely be signed into law. The result of an ambitious effort by lawmakers to overhaul how Florida regulates healthcare, the bills represent a striking departure from the current regulatory environment. Passed during the last week of the legislative session with a July 1, 2019, general effective date, providers will want to begin reviewing their policies in anticipation of the coming change.

The Drug Enforcement Administration (DEA) recently announced an enhancement to the Automation of Reports and Consolidated Orders System (ARCOS) to allow DEA-registered drug manufacturers and distributors to access anonymized information concerning their customers’ orders of certain controlled substances. Manufacturers and distributors of Schedule I and II and certain other Schedule III controlled substances are required to submit quarterly reports to ARCOS of controlled substance purchases and sales. With this enhancement, registrants will be able to view ARCOS data submitted by other manufacturers and distributors. Specifically, registrants will be able to see and download data on a customer’s (e.g., pharmacy’s) controlled substance purchases, in terms of both the amount of purchased controlled substances and the number of distributors from which controlled substances were procured. While this enhancement will help controlled substance manufacturers and distributors fulfill their suspicious order monitoring obligations, it also raises questions regarding the steps that distributors and manufacturers will be required to take if suspicious order patterns are detected.

The US Food and Drug Administration (FDA) issued an updated draft guidance on March 7 on the nonproprietary naming of biologics, titled Nonproprietary Naming of Biological Products: Update. This update is FDA’s second attempt at guidance concerning nonproprietary name suffixes for biologic products. It also highlights the perceived tension between FDA’s pharmacovigilance role and goal of increasing the availability of biosimilars. At least for this round, FDA’s interest in tracking pharmacovigilance data seems to have received priority.

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The US Food and Drug Administration (FDA or Agency) on January 30 signaled what could be an about-face with regard to its role administering the List of Approved Drug Products with Therapeutic Equivalence Evaluation (referred to as the Orange Book). Historically, FDA’s Orange Book role has been solely ministerial. However, over the next year, FDA may begin taking a more active approach to the Orange Book.

The New York State Drug Take Back Act (Act), which was signed into law on July 10, 2018, went into effect on January 6, 2019. However, due to statutory timelines, enforcement actions are unlikely to start until after October 2019. Nonetheless, drug manufacturers should continue to diligently work toward the various Act deadlines, as development of a drug take-back program will require an investment of manufacturer time and money.

In FDA’s latest Director’s Corner podcast, Dr. Janet Woodcock, director of the Center for Drug Evaluation and Research (CDER or Center), reflects on the Center’s accomplishments of the past year and priorities for 2019. As expected, parts of CDER were affected by the government shutdown, which has caused a delay in the development of some of the Center’s policy activities and accomplishments to start the year. However, despite the delay, Dr. Woodcock provided updates on several initiatives coming up in 2019. Below is a summary of the major initiatives to expect in 2019. Overall, it looks like CDER is gearing up for a busy and productive year. Industry stakeholders should be on the lookout for many new developments coming out of the Center.

Human cell and gene therapy research has advanced dramatically in recent years and opened the door to potential treatments for diseases once considered incurable. On January 15, FDA Commissioner Scott Gottlieb, M.D., and Peter Marks, M.D., Ph.D., director of the Center for Biologics Evaluation and Research (CBER), issued a joint statement announcing plans to keep pace with the rapidly growing and evolving field through new policy guidance and other assistance. According to the statement, FDA is turning its attention and additional resources toward these therapies in 2019 due to a “large upswing” in the number of cell and gene therapy investigational new drug (IND) applications. Based on an assessment of the more than 800 cell-based and gene therapy INDs current on file with the agency, FDA projects that it will receive more than 200 cell and gene therapy INDs per year by 2020, and will approve 10 to 20 such products per year by 2025.

To accommodate the uptick and to ensure regulation of firms that may be operating outside of regulatory compliance, the statement sets forth FDA’s planned actions to support cell and gene therapy product development in 2019:

After several delays, the revised US Federal Policy for the Protection of Human Subjects (also known as the Common Rule) went into effect on January 21. The Common Rule is generally applicable to research conducted or supported by one of the federal departments or agencies that has integrated the rule into its own regulations (e.g., US Department of Health and Human Services (including the National Institutes of Health), US Department of Agriculture, US Department of Defense). Some clinical trial sites may also apply the Common Rule across all clinical research projects, regardless of funding source, through a US Office for Human Research Protections Federal Wide Assurance.

Despite the mandate under the 21st Century Cures Act to harmonize FDA regulations with the Common Rule to the extent practicable and allowable under existing legislative provisions, FDA has yet to propose aligning regulations. Rather, FDA issued guidance titled Impact of Certain Provisions of the Revised Common Rule on FDA-Regulated Clinical Investigations. As of right now, while FDA is aware of new inconsistencies between its human subject regulations and the revised Common Rule, the agency has advised that when a given study is subject to both sets of regulations, the rule that offers greater human subject protection should be applied. The guidance sets forth FDA’s position on the following areas of potential discrepancies between the Common Rule and FDA regulations:

FDA recently signaled that it plans to be more involved in facilitating expanded access to investigational new drugs. This follows the agency’s announcement of its efforts to improve and clarify the expanded access program (EAP), as well as state and federal legislation intended to simplify the process to use investigational drugs for treatment purposes.