United States: FDA User Fee Reauthorization Legislation Enacted By Congress

On July 12, 2017, the House of Representatives passed H.R. 2430, the FDA Reauthorization Act of 2017 (FDARA), and on August 3, 2017, the Senate followed suit by passing FDARA without amendment by a vote of 94-1. The President is expected to sign the bill into law within days. This bipartisan legislation reauthorizes the various user fees that help fund the Food and Drug Administration's (FDA) review and oversight of prescription drugs, generic drugs, medical devices, and biosimilars. FDARA includes numerous policy riders that will impact a wide range of issues within FDA's jurisdiction. The riders are not as extensive as in years past, however, due to the recent passage of the 21st Century Cures Act. This Alert briefly summarizes the key provisions from FDARA, as well as other significant legislative proposals that failed to make the cut but are still being considered by Congress outside of the user fee reauthorization process.

Pediatric Product Development Reforms

  • Pediatric Cancer Drug Development: FDARA amends the Pediatric Research Equity Act (PREA) to give FDA the authority (beginning with applications submitted three years after enactment) to require that certain developers of new drugs intended to treat adult cancers conduct pediatric studies if the drug is directed at a molecular target that is substantially relevant to the growth or progression of a pediatric cancer. The new study requirements may be applied to developers of orphan drugs, which are ordinarily exempt from PREA study requirements. FDA will be required to publish and regularly update a list of molecular targets that may trigger the new study requirements, as well as a list of targets for which the study requirements will be automatically waived.
  • Pediatric Devices: FDARA reauthorizes until 2022 a statutory provision allowing manufacturers of pediatric devices approved through the humanitarian device exemption (HDE) pathway to sell such devices at prices that exceed their direct costs. Normally, manufacturers of HDE devices are limited to recovering the costs or research and development, manufacturing, and distribution of the device. FDARA also provides greater flexibility for HDE devices in general by allowing either an institutional review board or an "appropriate local committee" to review and approve the use of such devices. The bill also requires FDA to hold a public hearing on various issues related to pediatric device development, including the use of extrapolated data from clinical studies of adult patients, as well as the use of pediatric postmarketing registries, to enhance pediatric device labeling.
  • Pediatric Study Plans: FDARA requires FDA to meet early in the development process to discuss pediatric study plans with sponsors of drugs and biologics. For sponsors of drugs to treat serious or life-threatening diseases, such meetings will be required to be held no later than the end-of-phase 1 meeting. For other drugs, a meeting to discuss the sponsor's initial pediatric study plan must be held not later than 90 days after FDA's receipt of the plan.

Prescription Drug Reforms

  • Exclusivity for Single Enantiomers: FDARA extends through 2022 FDA's authority to grant five years of new chemical entity exclusivity to qualifying drugs containing single enantiomers.
  • Pediatric Labeling Carve-Outs: FDARA clarifies and expands the circumstances when pediatric labeling can be "carved out" to permit the approval of a generic drug for adult use. Currently, ANDA applicants can omit pediatric information from generic drug labeling when that information is protected by a patent or 3-year ("new clinical investigations") exclusivity. The labeling of the generic drug is required to include a disclaimer with respect to the omitted information. FDARA expands the provision to apply to 505(b)(2) drug applications as well as ANDAs, and expands the applicable categories of exclusivity to include orphan drug exclusivity, pediatric exclusivity, and qualified infectious disease product exclusivity.
  • Orphan Drugs: FDARA codifies FDA's existing regulatory interpretation that a sponsor must demonstrate the clinical superiority of an orphan drug that is otherwise the "same" as a previously approved drug for the same rare disease in order to receive orphan drug exclusivity, despite a court ruling to the contrary. In Depomed, Inc. v. HHS, 66 F. Supp. 3d 217 (D.D.C. 2014), the court held that the Orphan Drug Act "unambiguously requires" FDA to recognize an exclusivity period for any orphan-designated drug that is approved for marketing for the orphan disease, even if it is not shown to be clinically superior to a drug that is otherwise the same. FDARA clearly establishes FDA's clinical superiority interpretation as the law. Clinical superiority will be defined as having "a significant therapeutic advantage" with respect to efficacy or safety or by providing a "major contribution to patient care."
  • Expanded Access: As an alternative to "right to try" legislation, FDARA includes a number of provisions related to expanded access. First, it will require FDA to convene a public meeting within 270 days to discuss clinical trial inclusion and exclusion criteria and barriers to participation, as well as how changes to clinical trial designs and criteria could affect specific populations, enrollment, or the complexity and length of trials. Within a year of FDA releasing a report on the meeting, the Comptroller General shall assess the expanded access program and the extent to which FDA has expanded individual access to investigational drugs. In addition, FDARA requires FDA to issue guidance regarding steps sponsors can take to broaden eligibility criteria for clinical trials, as well as draft guidance or new regulations to streamline institutional review board review for individual expanded access protocols.
  • Tropical Disease Priority Review Voucher: FDARA will reform the tropical disease priority review voucher program by requiring applicants to demonstrate they conducted or sponsored at least one clinical investigation essential to the application and that such investigation was not used as part of an application for approval in various other countries prior to September 27, 2007.
  • Importation and Counterfeiting: FDARA clarifies that prescription drugs, except for those on FDA's shortage list or properly imported by individuals, may not be imported for commercial use if they were manufactured in a foreign country, unless they have been approved or are otherwise authorized to be marketed in the United States and are labeled accordingly. FDARA also increases the penalties for knowingly making, selling, or dispensing a counterfeit drug.

Medical Device Reforms

  • Over-the-Counter (OTC) Hearing Aids: FDARA establishes a category of OTC hearing aid devices intended for adult patients with mild to moderate hearing impairment. It requires FDA to issue regulations that would, among other things, provide reasonable assurances of the safety and effectiveness of OTC hearing aid devices and describe labeling requirements. FDARA also requires FDA to determine whether such products require a 510(k) and preempts any state or local laws that restrict access to OTC hearing aids.
  • Risk-Based Inspection Schedule: FDARA replaces the existing biennial inspection requirement for device establishments and establishes a risk-based schedule that mirrors the schedule for drug establishments. Risk factors that FDA will take into consideration include, among others, compliance history, prior recalls, inherent risk of the device, inspection history of the establishment, and inspections by foreign governments.
  • Other Inspection Improvements: FDARA requires FDA to adopt uniform processes and standards applicable to scheduled inspections of domestic and foreign device establishments that address, among other things, pre-inspection announcements and inspection-related communications with the establishment. The bill also reauthorizes the FDA's authority to conduct inspections via accredited organizations through October 1, 2022, and permits FDA to recognize auditing organizations used by foreign governmental organizations established to facilitate international harmonization.
  • Foreign Export Certificates: FDARA clarifies the process by which FDA issues foreign export certificates for domestic and foreign device establishments and provides a process for a manufacturer to appeal a denial and work with the agency to address any outstanding issues.
  • Risk-Based Classification of Accessories: Building on a device accessory provision included in last year's 21st Century Cures Act, FDARA establishes a process for classifying (or reclassifying) device accessories based on the risks associated with their intended use.

Generic Drug Access Reforms

  • "Sense of Congress" Regarding Drug Prices: A nonbinding "Sense of Congress" provision urges the administration to work with Congress on lowering prescription drug costs, while fostering innovation. This provision reflects widespread congressional interest in the topic of rising drug prices, a concern that likely motivated many of FDARA's provisions to expedite review of generic drug applications and expand competition.
  • Priority Review for Certain Generic Drugs: FDARA establishes a priority review track for certain generic drugs, requiring FDA to review within eight months any ANDA for a drug that either (1) has three or fewer approved drug products listed in the Orange Book and is no longer protected by any patent or regulatory exclusivity period, or (2) is on FDA's drug shortage list. To take advantage of this priority review provision, generic drug manufacturers will need to submit manufacturing facility information to FDA at least sixty days prior to submission of an ANDA.
  • Competitive Generic Therapies: FDARA authorizes FDA to expedite review of "competitive generic therapies," which refers to drugs with "inadequate generic competition" (i.e., no generic options are available or one generic drug has been approved, but the reference listed drug has been discontinued). The bill lists some of the actions FDA may take to expedite review, including holding meetings with or providing advice to the sponsor prior to submission of the application, involving senior managers and experienced review staff in cross-disciplinary review, or assigning a project lead for the FDA review team to facilitate an efficient review and serve as a liaison between the agency and the sponsor. Drugs that qualify as "competitive generic therapies" and for which there are no unexpired patents or exclusivities will also be eligible for a 180-day exclusivity period, subject to forfeiture if the applicant fails to market the drug within 75 days of approval.
  • Inspections: FDARA requires FDA to accelerate review of facility inspection responses and re-inspections in cases where facility issues pose the only remaining barrier to approval.
  • Enhanced Transparency to Facilitate Generic Drug Competition: Several FDARA provisions will enhance FDA transparency with respect to generic drugs. The bill requires the agency to update a public list of drugs with limited generic competition at least every six months, provide status updates upon request to ANDA applicants, and post quarterly reports regarding pending generic drug applications, the number of applications that are eligible for priority or expedited review pursuant to FDARA, and the average time frame for approval.
  • Manufacturer Reporting Regarding Marketing Status: Within 180 days of FDARA's enactment, all holders of approved drug applications will need to review the FDA list of approved drugs and file a one-time report noting whether any of the holder's drugs in the active section of the list have been withdrawn from sale or have never been available for sale. Going forward, manufacturers will have to notify the agency 180 days prior to withdrawing an approved drug from the market. For newly approved applications, manufacturers will have to notify FDA if the drug will not be available for sale within 180 days after approval.

Other Legislative Proposals Not in FDARA

FDARA omitted several significant legislative proposals that were discussed during committee markup hearings and that have previously been introduced in Congress via separate bills. In conjunction with the passage of FDARA on August 3, the Senate passed the following bills by unanimous consent, and they will now move to the House for consideration:

  • Right To Try: The Senate passed the Trickett Wendler Right to Try Act of 2017 (S. 204). The bill would establish exemptions from relevant provisions of the Food, Drug, and Cosmetic Act to permit an "eligible investigational drug" to be made available to a patient who has been diagnosed with a life-threatening disease or condition, has exhausted approved treatment options, and is unable to participate in a clinical trial of the drug. An eligible investigational drug would have to have been through a Phase 1 trial. Manufacturers providing eligible investigational drugs would be required to comply with certain labeling, promotion, and pricing requirements contained in existing FDA regulations. Despite the "Right to Try" title, the legislation expressly states that a sponsor or other entity cannot be held liable for failing to provide access to an eligible investigational drug.
  • Patient-Focused Drug Development Data: The Senate passed the BENEFIT Act of 2017 (S. 1052), which would require FDA to consider relevant patient-focused drug development data, such as data from patient preference studies, patient-reported outcome data, or patient experience data developed by the sponsor or a third party as part of the risk-benefit assessment framework in the new drug approval process.
  • Opioid Addiction: The Senate passed Jessie's Law (S. 581), which requires HHS to develop standards for hospitals and physicians to display a patient's history of opioid use disorder in medical records.

Other significant legislative proposals that may still be addressed outside the reauthorization process include:

  • OTC Drug Monograph Reform: For more than a year, FDA and OTC industry stakeholders have been discussing a potential user fee program for OTC monograph drugs that would be intended to expedite and reform the existing OTC monograph process. Legislative proposals also contemplate exclusivity incentives for drug developers that submit original clinical data in support of the safety and effectiveness of an OTC drug. On August 23, 2017, FDA will conduct a webinar to provide a status update on the process of FDA and industry discussions regarding the potential OTC user fee program, and according to news reports, the House Energy & Commerce Committee is expected to hold a hearing in September regarding potential legislation.
  • Manufacturer Communications: Provisions from the Medical Product Communications Act of 2017 (H.R. 1703) and the Pharmaceutical Information Exchange Act (H.R. 2026) previously introduced in the House were discussed during committee meetings but ultimately not included in FDARA. The Medical Product Communications Act would clarify the definition of "intended use," formally define "scientific exchange," and confirm that FDA does not have authority to regulate scientific exchange communications, while the Pharmaceutical Information Exchange Act would expand the scope of permissible communications of health care economic information and scientific information to payors, formulary committees, and similar entities. On July 12, 2017, the Health Subcommittee of the House Energy and Commerce Committee held a hearing to discuss both of these legislative proposals and manufacturer communications issues more generally, which suggests that Congress may still pursue communications reforms independent of FDARA.
  • Access to Branded Drugs for Generic Drug Developers: Legislation has been proposed in both the House (Fast Generics Act of 2017, H.R. 2051) and Senate (CREATES Act of 2017, S. 974) that would ensure generic drug developers have access to branded drug products for development purposes. The generics industry has previously expressed concern that branded drug manufacturers have inappropriately withheld access to drugs that are covered by restricted distribution programs as part of their FDA-approved risk evaluation and mitigation strategies (REMS).

Next Steps

As the House and Senate take their August recesses, President Trump is expected to sign FDARA, even though his administration's budget proposal had asked Congress to reopen user fee negotiations and fund FDA entirely through user fees. Ropes & Gray will continue to monitor legislative developments in this area.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.