Opportunities for 2008

January 2, 2008
Jill Wechsler
Pharmaceutical Technology

Volume 32, Issue 1

As FDA implements new drug-safety policies, manufacturers will focus on quality and pricing.

The new year begins on a note of optimism. A major breakthrough in stem-cell research promises to open the door to new biomedical research opportunities. The drawn-out Congressional debate over user-fee reauthorization and drug-safety regulation is over, and most parties are satisfied with the resulting compromises. The Medicare drug benefit moved into its third year showing signs of maturity and acceptance. The vaccine industry is experiencing a resurgence after years in the doldrums, with important new vaccines on the market and more under development. Unlike many previous years, the US Food and Drug Administration had a confirmed commissioner for all of 2007, making for relatively stable leadership.

Jill Wechsler

Manufacturers will be busy in the coming months dealing with continued scrutiny of safety signals, pressure to discover important new treatments, and resistance to high prices for medical products. This column will examine some of the leading policy issues on the table for 2008.

Implementing FDAAA

The legislative wrangling is over, and now the lawyers are in charge of deciphering what members of Congress really intended in many complex and contentious portions of the FDA Amendments Act (FDAAA). Considerable uncertainty remains about how and when manufacturers will have to file Risk Evaluation and Mitigation Strategies (REMS), especially for high-risk drugs already on the market. FDA must define a process for tracking and enforcing compliance with Phase IV study commitments. And new requirements for registering a greatly expanded range of clinical trials and trial results present a substantial challenge for FDA and the National Library of Medicine.

FDA Deputy Commissioner Janet Woodcock indicated that a REMS may not be required for all drugs when she discussed FDAAA at a Food and Drug Law Institute conference in November 2007. The agency will use its REMS authority "judiciously," she commented, noting that too many restricted drug-distribution programs could increase confusion, harm patients, and "decrease access to the therapy."

In Washington This Month

Woodcock is temporarily heading the Center for Drug Evaluation and Research (CDER), following the departure of former CDER director Steven Galson. She is thus responsible for issuing guidances, determining the need for revised regulations, and establishing the many policies FDAAA requires under tight timeframes.

A serious complication when Pharmaceutical Technology went to press last month was that FDA was not yet able to use the added revenues authorized under the Prescription Drug User Fee Act section of FDAAA. Although FDA could start collecting the higher fees, it cannot spend the money until Congress approves its 2008 appropriations bill, which has been delayed by partisan wrangling between Democrats and the Bush administration over all federal government expenditures. Because of these circumstances, efforts to modernize FDA's adverse-event reporting system and to expand access to outside safety information to fulfill new requirements may be slow to get off the ground, as required by FDAAA.

Slowing down for safety

While implementing new programs, FDA faces the challenge of demonstrating that it has not become gun-shy about approving new drugs for market. New drug approvals were down last year, including the number of new molecular entities (NMEs) coming to market. Manufacturers complain that the agency is issuing more "approvable" letters that demand additional trials and testing before final approval, and that many approvals carry narrower indications. Black-box warnings seem to be proliferating, as well as agency safety alerts and advisory committee reviews of safety issues for certain drugs and drug classes.

In just the last few months, for example, FDA has been examining safety issues related to asthma drugs, attention deficit hyperactivity disorder products, and cold remedies for children. The agency recently issued an alert that a smoking-cessation treatment may promote behavioral changes, and that an immunosuppressant drug carries added risks for pregnant women. The possibility that osteoporosis treatments may raise cardiac risks is under review.

FDA has launched a pilot program to reassess the risks and benefits of typical NMEs 18 months after approval. CDER has selected candidates from different new-drug review divisions and will be evaluating results in coming months. The aim is to identify ways to detect safety concerns earlier in the review process, which could speed up approvals and reduce problems later.

Meanwhile, delays in launching new products are throwing monkey wrenches into manufacturers' business plans. Also, the emergence of postmarket safety issues is proving disastrous for blockbuster products. FDAAA provides FDA with additional tools for assessing product safety before and after approval, but the political rhetoric about manufacturer malfeasance is sure to continue in this election year.

Scrutinizing imports

Drug-safety concerns, along with the crisis over contaminated food, pet food, and toys from China, has focused public attention on how well FDA can detect and halt the import of dangerous products. The Bush administration issued an Import Action Safety Plan in November, along with an FDA Food Protection Plan. Although the White House offered few new ideas and no specifics about funding these proposals, the document is expected to spur action on Capitol Hill to revise how the government polices imports. And while the focus has been on unsafe food products, the discussion has extended to the inspection and oversight of drugs and drug substances that increasingly come from China, India, and other countries.

Questions about the quality of foreign drug products will prompt more Congressional scrutiny of drug and food imports in the coming months. Legislators have cited FDA computer systems as inadequate for tracking foreign manufacturers and for the agency to inspect foreign manufacturers in a timely and efficient manner. The Government Accountability Office reports wide disparities in FDA estimates of the number of facilities exporting products to the US. This ambiguity adds to difficulties in developing new solutions. Foreign drug inspections have long been compromised by a lack of funding and resources, by language barriers, and by the need to announce site visits in advance. Most foreign plant audits involve preapproval inspections related to pending new-drug applications, and few ensure compliance with good manufacturing practices.

Congressional leaders have proposed legislation to collect user fees on imports to support a more efficient inspection system and to enhance FDA's authority to bar imports that lack appropriate production records. Some legislators want to form a single food regulatory agency that would combine FDA, the US Department of Agriculture, and other federal operations. Policymakers also seek more information about the scope of bulk-ingredient imports and the extent to which drug manufacturers conduct their own inspections to ensure the quality of foreign products. FDA Commissioner Andrew von Eschenbach has proposed that FDA establish satellite regulatory offices in China, India, and other countries as a way to improve the oversight of locally produced drugs.

Amid the outcry over inadequate foreign-drug oversight, FDA continues to struggle to meet requirements for inspecting drug facilities in the US. The agency's field force has declined because of limited resources, and recent internal reorganization plans have been derailed by opposition from agency staffers and Congress. Perhaps the focus on product safety will boost funding for domestic regulatory activities as well as imports.

Examining drug prices

Despite concerns about poor-quality medical products from overseas, some members of Congress continue to press for more liberal drug-reimporting policies to facilitate consumer access to low-cost medicines. The Medicare Part D drug benefit has significantly increased government payments for drugs, thus intensifying public scrutiny of prices. High Medicare expenditures for anemia-fighting erythropoietin, for example, sparked Congressional investigations and led to a curb on Medicare reimbursement for the drug. And recent changes in the formula for Medicaid reimbursement for prescription drugs is prompting pharmacists to seek changes in how the government calculates the average manufacturer price for medicines.

The desire to reduce the nation's prescription-drug bills also fits efforts to grant the government authority to negotiate drug prices for Medicare Part D plans, curb drug advertising to reduce inappropriate prescribing, mandate disclosure of manufacturer prices, and increase access to low-cost generic drugs. To further this last goal, Congress will continue to seek a pathway for FDA to approve follow-on biologics. Congress decided to drop that issue from FDAAA, but generics makers have not let up efforts to resolve the issue, and projections of big cost-savings from biosimilars are likely to keep it on the front burner in the coming year.

Pushing for comparative-effectiveness analysis

Efforts to determine the appropriate prescribing and pricing of prescription drugs stand to benefit from comparative-effectiveness reviews of medical procedures and products. Better information on what medical treatments work best for certain patients could reduce inappropriate drug use, avoid unnecessary or harmful procedures, and support a more efficient and less costly healthcare system. These possibilities are boosting support for a larger government role in assessing the effectiveness of medical treatment, while health plans and payers also are demanding more evidence that medical products are cost-effective as well as medically safe and effective.

An important issue is what kind of data will support studies comparing the effectiveness of different treatments. Experts anticipate a greater reliance on econometric analysis and observational data, in addition to randomized controlled clinical trials. Such a shift, though, will require clear standards and agreement on analytical approaches for assessing product value.

The challenge for drug and medical product manufacturers is to focus such analysis on how drugs compare to alternative medical and surgical procedures, and to avoid using comparative assessments to control costs or to deny coverage for innovative products. Even if a study indicates that a drug may be less effective for many patients, doctors should have room to prescribe that drug for a smaller patient population that may benefit.

Revising patent policy

Congressional leaders seek to enact sweeping patent-reform legislation that they believe will better protect intellectual property and bring US policy more in line with that of other nations. Software and computer firms support the legislation as likely to reduce their exposure to endless litigation. Biotechnology and pharmaceutical companies, however, fear a serious erosion of patent protections and reduced value for patent awards.

A main issue is a proposed postgrant review system that allows patents to be re-evaluated after they are awarded. High-tech companies believe this strategy could curb patent disputes, but pharmaceutical companies fear that leaving the door open to later challenges will create too much uncertainty about patent value and expose the system to abuse. The proposed bill also aims to prevent "forum shopping" for friendly judges to hear patent-infringement suits by requiring patent holders to file cases locally. Another change makes it harder to challenge a patent based on "inequitable conduct" (i.e., a manufacturer's failure to provide all valid information when filing a patent). This issue often figures into patent disputes between generic and innovator drug companies. Difficulties in reaching a compromise on these issues has delayed legislative action, but key members of Congress are working to finalize the bill this year.

Spurring innovation

To bring new drugs to market more efficiently and with less cost, FDA is collaborating with industry to develop methods for testing and assessing drug safety and efficacy. The agency's Critical Path Initiative encourages public–private partnerships to develop new biomarkers, assess drug-quality issues, and explore new approaches for ensuring product safety. An important project aims to improve methods for assessing liver toxicity in preclinical testing. FDA recently launched a collaboration with Duke University Medical Center to streamline clinical-trial operations through electronic data standards, updated review-board policies, and accreditation programs for clinical investigators and research sites. Other initiatives aim to improve the assessment of medical-product bioequivalence and complex drug-product characterization.

FDA also continues to promote new approaches for ensuring drug quality in the US and abroad. The International Conference on Harmonization is working to finalize guidelines to help manufacturers establish quality systems based on an integrated quality risk-management approach. CDER staffers have been attempting to streamline the manufacturing-supplement submission and review process to greatly reduce this burden on the agency as well as industry. Companies that choose to adopt quality-by-design approaches and good risk-management strategies stand to gain benefits. They could enjoy reduced postmarketing oversight of production changes and less intensive plant inspections as rewards for their efforts.

Curbing conflicts of interest

Some members of Congress and consumer advocates believe it is important to prevent scientists with industry ties from serving on FDA advisory boards. An important FDAAA compromise emphasized the need to reduce conflicts of interest (COIs) among advisors but allowed some waivers so that valuable experts will be able to provide advice when needed. FDA has issued new policies to make COI waiver policies more transparent. The agency is also taking steps to meet Congressional requirements for reducing waivers overall.

This underlying concern that drug manufacturers exercise too much control over FDA policies has emerged in connection with the role of the new Reagan–Udall Foundation. FDAAA created the group to support innovation and enhance safety for FDA-regulated products. FDA complied with the law's 30-day requirement to appoint the 14-member panel, which is chaired by former FDA commissioner Mark McClellan and includes representatives from industry, academia, consumer groups, and healthcare providers. But Rep. Rosa DeLauro (D-CT), who chairs the House Appropriations subcommittee in charge of FDA's budget, has raised objections. She says that the organization will be overly influenced by industry and may encourage the development of profitable, but not necessarily safe, drugs. DeLauro plans to hold hearings on the Reagan–Udall Foundation and other COI issues, a sign that FDA and pharmaceutical manufacturers will continue to face many challenges in the year ahead.

Whither FDA “revitalization?”

Through most of the debate about US Food and Drug Administration safety and user-fee legislation last year, the bill under discussion was called the FDA Revitalization Act, or FDARA. But the final measure has the unhappy acronym FDAAA, and no one knows what to call it. Names are important in Washington, where keeping track of acronyms can be a full-time job. FDA has benefited from many catchy ones over the years (i.e., FDAMA, PDUFA, PREA). But “Fdaaaah” does not measure up. FDA Chief of Staff Susan Winckler tried “FD-triple-A” at the Food and Drug Law Institute conference in November 2007, but that name is pretty cumbersome. And “FDA cubed” doesn’t fly, either. A Congressional staffer somewhere is responsible for this acronym crime, but so far no one has assumed responsibility.

Jill Wechsler is Pharmaceutical Technology's Washington editor, 7715 Rocton Ave., Chevy Chase, MD 20815, tel. 301.656.4634, jwechsler@advanstar.com