FDA Leader Targets Drug Companies’ Abuse of Approval System

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By Dana A. Elfin

FDA Commissioner Scott Gottlieb said drug companies are gaming the drug approval system and he wants to stop it.

At a July 18 public Food and Drug Administration meeting on competition under the Hatch-Waxman Act, Gottlieb announced new initiatives designed to deter drugmakers from blocking access to cheaper generic drugs as well as initiatives to streamline the FDA’s generic drug review process. The Hatch-Waxman Act of 1984 established the expedited approval pathway for generic drugs.

Gottlieb, who started as commissioner earlier this year, has been criticized for being too cozy with the pharmaceutical industry, but he has been outspoken on lowering obstacles to competition to ensure access to less expensive generic drugs. Gottlieb’s remarks also reflect President Donald Trump’s stated goal of attacking high drug prices and getting drugs approved more quickly.

“FDA doesn’t have a direct role in how drugs are priced,” Gottlieb said, “But at FDA, we do play a key, if indirect, role in the eventual cost of medicines.”

Gottlieb also said the agency is considering ways to deter branded drug companies from using risk evaluation and mitigation strategies (REMS) to delay generic drug launches by refusing to provide generic companies with drug samples needed for bioequivalence testing. REMS are plans used to ensure the safety of some pharmaceuticals.

Making Letters Public

Currently, generics can request letters from the agency confirming that their use of a sample of a branded drug for purposes of demonstrating bioequivalence wouldn’t violate the branded drug’s REMS requirements.

The FDA is considering publicly releasing the letters it sends to generic drug companies. “Do we make these letters public to show generics are having trouble getting access to samples?” Gottlieb asked.

“These letters could contain important information that can help inform broader discussions about access and competition,” he said. “Their public release could be one step to help ensure that unnecessary hurdles to generic drug development are removed.”

Releasing the letters might shame the drug companies refusing to provide samples into providing them, law professor Michael A. Carrier told Bloomberg BNA July 19. Carrier is a professor at Rutgers Law School and co-director of the Rutgers Institute for Information Policy and Law in Camden, N.J.

Although making the letters public may not be enough by itself to curb the abuses, it “can’t hurt,” said Carrier, who testified at the agency’s hearing.

Streamlining Reviews

Gottlieb also announced the agency was taking steps to remove unpredictability and inefficiency from the drug review process. Increasing regulatory efficiency can help to lower drug prices, Gottlieb said.

The FDA will be streamlining the generic drug review process to eliminate duplicative processes and help generic drug applicants avoid common application deficiencies, he said.

By the end of the year, he said the agency will issue two key documents explaining its efforts to improve review processes and enhance communication between applicant companies and FDA staff reviewing the applications.

Janet Woodcock, director of the FDA’s Center for Drug Evaluation and Research, described two more steps the agency is taking to speed generics to market and to lower drug costs.

The FDA posted a list of off-patent drugs facing little or no generic competition, and the agency will expedite reviews for applicants seeking to make generic versions of those products, she said. The FDA will also expedite the review of generic drug applications until there are three approved generics for a given drug product, she said.

FDA Praised

Gottlieb’s efforts are generally drawing plaudits.

The Association for Accessible Medicines (AAM), the generic drug industry’s trade association, praised Gottlieb’s efforts to address regulatory issues impeding competition.

Chip Davis, AAM’s chief executive officer, commended Gottlieb in the group’s July 18 testimony for his “commitment to maintaining a balance between encouraging innovation in drug development and accelerating the availability of lower cost generic alternatives to America’s patients.”

The “Hatch-Waxman balance has veered away from generic competition because of anticompetitive abuses by brand pharma companies,” Carrier said. “It is heartening that FDA is considering using the tools in its power to right the balance.”

“To the FDA’s credit, this is a great first step,” David Balto, an antitrust lawyer in private practice in Washington, told Bloomberg BNA in a July 19 phone interview. Gottlieb is “appropriately getting the agency to engage in self-scrutiny about how the regulatory process can be abused.”

“There’s been a tsunami of concern expressed about the REMS program,” Balto, a former policy director at the Federal Trade Commission, said. “For Republican antitrust enforcers, there’s nothing more egregious than the abuse of regulatory processes.”

When regulatory processes are abused, “no market force can displace you, and that’s why Republicans are very good at policing the regulatory process to make sure it’s not abused by firms seeking monopoly power,” he said. Balto also testified at the meeting.

PhRMA, the brand-name drug industry’s lobbying arm, told Bloomberg BNA July 19 it was in the process of reviewing the agency’s proposals and would be providing comments to the FDA. PhRMA also testified at the meeting.

Others testifying included patient and consumer advocates, pharmaceutical companies and representatives from the insurance, health-care distribution and pharmaceutical benefit management industries.

The FDA will be accepting public comments on the meeting topic until Sept. 18. The docket number is FDA-2017-N-3615.

To contact the reporter on this story: Dana A. Elfin in Washington at delfin@bna.com

To contact the editor responsible for this story: Brian Broderick at bbroderick@bna.com

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

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