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Cover Story

December 3, 2007
Volume 85, Number 49
pp. 33-35

Empowering FDA

A new law gives more powers to the regulatory agency and will impact the drug industry for years

Bette Hileman

The Food & Drug Administration overhaul bill signed into law in September is one of the most wide-ranging revisions of the federal Food, Drug & Cosmetic Act passed in 40 years and is likely to affect the pharmaceutical industry for decades to come.

The huge measure—the Food & Drug Administration Amendments Act of 2007 (FDAAA)—grants sweeping new powers to FDA. It raises the annual user fees the industry pays to the agency for new drug reviews from $303 million to $393 million and doubles the resources available to FDA's Office of Drug Safety from about $40 million to about $80 million. It also gives FDA the power to require drugmakers to do postmarketing clinical trials. Most of the law's provisions went into effect on Oct. 1.

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In addition, the new law gives the agency authority to mandate changes in drug labels and expands the government's clinical-trial database. It places new restrictions on direct-to-consumer advertising and raises the penalties for false or misleading ads to a maximum of $500,000 per violation. In short, the measure addresses most of the drug-related problems that have been in the headlines over the past few years, says Christopher-Paul Milne, associate director of the Tufts Center for the Study of Drug Development.

Before the enactment of FDAAA, pharmaceutical companies had to post clinical trials for drugs to treat life-threatening diseases on a database administered by the National Institutes of Health. FDAAA expands this registry to include trials for all drugs (clinicaltrials.gov). The expanded listing will allow patients and physicians to easily identify studies that could offer promising experimental treatments.

FDAAA also requires that the results of pivotal studies FDA used in approving a drug, as well as results of postmarket studies, be included in the database, Milne says. "Drug companies can't pick and choose which trial results they want to make public," says Rep. Edward J. Markey (D-Mass.), who as a member of the House Committee on Energy & Commerce has led efforts to reform FDA.

Within three years, FDA must publish a regulation requiring companies to provide a detailed summary—that the public can understand—of the results of each trial listed on the NIH database, says Daniel A. Kracov, an attorney at Arnold & Porter. This is a controversial provision that had been opposed by the White House. The Bush Administration had argued that "such summaries would present a high likelihood for misinterpretation and bias," he says.

Chris Milne Courtesy of Chris Milne
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Along with granting FDA new authority to require companies to perform postmarketing studies, FDAAA requires the agency to establish a database of postmarketing adverse drug reactions. To do this, FDA will use adverse events and other data from private health insurers, Medicare, and other organizations to create a comprehensive risk-identification database, Milne says. FDA must greatly improve its technological capabilities to be able to analyze the adverse events reports within the database and then identify and assess potential safety problems, Kracov says.

For some drugs, FDAAA gives the agency new authority to demand that the manufacturer create a risk evaluation mitigation strategy (REMS). A REMS is a risk map that lays out exactly how a drug is to be prescribed and how physicians and patients will be warned of its dangers. Previously, drug companies had created risk strategies for products that pose obvious and severe risks to patients or their offspring. These strategies had been created for just 30 drugs, including the teratogen thalidomide (now used for multiple myeloma) and the acne medicine Accutane. Now, if FDA believes a medicine may present a risk, it can demand that the manufacturer devise a REMS to make sure that the benefits of the pharmaceutical outweigh the risks. "A lot more drugmakers will probably be asked to do these risk maps," Milne says. "It will require a fair amount of work on the sponsor's part."

The new law creates a voluntary system for FDA review of direct-to-consumer television advertisements for prescription drugs by which a pharmaceutical manufacturer can pay the agency a fee to review an ad. The rationale for a company to do this would be that if FDA approves the ad before it is aired, it is unlikely to decide later that the ad is false and misleading. According to Milne, the new system will give companies predictability and save them the money they might waste in producing and then having to cancel an advertisement.

One FDAAA provision is aimed at counterfeiting. It gives FDA two-and-a-half years to develop a standardized numerical identifier for drugs that can be applied at the point of manufacture and used on containers and packages throughout the supply chain to guard against the introduction of counterfeit drugs. Radio-frequency identification tags and encryption technologies could be used to track and trace medicines.

FDAAA also offers companies incentives to develop treatments for so-called neglected diseases. These include infectious and parasitic diseases-such as sleeping sickness, malaria, hookworm, and dengue fever—that rarely occur in the U.S. but sicken millions in Africa, Asia, and the Americas. According to the World Health Organization, nearly one in six people worldwide suffers from at least one neglected disease.

"Too many people in the developing world suffer and die from diseases that for the most part are both preventable and curable," says Sen. Sam Brownback (R-Kan.), who sponsored the provision. "The main obstacle to responding to the needs of those suffering is insufficient incentive for companies to produce drugs that treat and prevent neglected tropical diseases."

In exchange for developing a new or superior treatment for a neglected disease, a pharmaceutical company would be rewarded with a voucher for priority (six month) review of another drug of its choosing. An expedited review could shave one year off FDA's review time and could earn the company up to $1.6 million per day in extra revenues if the drug turns out to be a blockbuster, Milne says.

Conflict-of-interest issues are also part of the new law. For years, health safety groups, such as Public Citizen, have alleged that FDA science advisory committees include too many experts with conflicts of interest, especially experts with ties to the drug industry. As a consequence, Public Citizen says, the panels have sometimes recommended approval of dangerous drugs, such as Vioxx, that were eventually withdrawn from the market.

FDAAA attempts to reduce the potential for approval of risky drugs by placing strict limits on the percentage of experts appointed to advisory panels with conflict-of-interest waivers. It requires FDA to assess the aggregate percentage of waivers it granted in 2007 and decrease that number by 5% annually between 2008 and 2012. A question has been whether enough experts without conflicts of interest can fill the committees, Milne says. "We'll know in a few years whether FDA is having problems maintaining the memberships of these panels."

Alan Goldhammer, deputy vice president for scientific and regulatory affairs at the Pharmaceutical Research & Manufacturers of America, has a different view. "It is not a good idea to keep experts off advisory committees simply because they have conflicts of interest," he says.

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One contentious issue FDAAA does not address is generic biotech drugs, or what industry calls biogenerics or follow-on biologics. These are generic versions of drugs produced by living organisms.

Even though seven generic biotech drugs have been approved in Europe, FDA has not yet worked out a legal basis for approving such medicines. A bill (S. 1695) that would create a pathway for the approval of biogenerics, however, was introduced in the Senate this year. It is supported by about 70 organizations, including the Generic Pharmaceutical Association. GPhA spokeswoman Andrea Hofelich expects the House to work on a similar bill early next year.

One issue that was not completely resolved by FDAAA is "pediatric exclusivity." Under a law that was set to expire this year, if a drugmaker tests a brand-name medicine for use in children, its marketing monopoly for that product is extended by six months. FDAAA renewed that law.

GPhA supported an amendment, however, that would have reduced that monopoly to three months for blockbuster drugs and kept it at six months for others. "The idea was to get smaller companies involved in pediatric research by providing six months of exclusivity for their products," Hofelich says. But that measure was defeated and did not become a part of FDAAA.

Overall, FDAAA may increase industry's initial costs for drug development and approval. But in the long run, FDA's expanded Office of Drug Safety and its risk identification database may reduce costs by helping firms recognize drug risks sooner and avoid expensive litigation.

Cover Story

  • Pharma Adapts
  • Firms invent new strategies to deflect generic competition and stem growing safety concerns
  • Drug Companies Cut Costs
  • In the midst of rapidly changing global markets, firms aggressively reduce spending to protect profitability.
  • Empowering FDA
  • A new law gives more powers to the regulatory agency and will impact the drug industry for years.

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Chemical & Engineering News
ISSN 0009-2347
Copyright © 2009 American Chemical Society

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Cover Story

  • Pharma Adapts
  • Firms invent new strategies to deflect generic competition and stem growing safety concerns
  • Drug Companies Cut Costs
  • In the midst of rapidly changing global markets, firms aggressively reduce spending to protect profitability.
  • Empowering FDA
  • A new law gives more powers to the regulatory agency and will impact the drug industry for years.