Filed under: Clinical Research, Drugs & Devices, Food and Drug Administration (FDA)
Cross-Posted at Bill of Health
Lately it seems that each passing day brings another article about the cost of orphan drugs. Earlier this week at FiercePharma, Tracy Staton reported that the United Kingdom’s National Institute for Health and Clinical Excellence (NICE) has asked Alexion Pharmaceuticals to justify the price of its drug Soliris which is, per Staton, “the most expensive drug in the world” at around $569,000 a year. Specifically, NICE seeks “‘clarification from the company on aspects of the manufacturing, research and development costs’” of the drug. According to Staton, this latest development in a review process characterized by “halting progress” is “a departure from NICE’s usual calculations, which typically focus on quality-of-life years and the like.”
Pushback by NICE and other payers notwithstanding, the orphan drug market is growing. As I blogged about here, in 2013 EvaluatePharma estimated that “the worldwide orphan drug market is set to grow to $127 [billion], a compound annual growth rate of +7.4% per year between 2012 and 2018[,]” which “is double that of the overall prescription drug market, excluding generics, which is set to grow at +3.7% per year.” In a recent article in the New England Journal of Medicine, venture-capital investors Robert Kocher and Bryan Roberts note that “more than half of the 139 drugs approved by the FDA since 2009 are for orphan diseases” and suggest that there is a risk of “systematically underinvesting in other important areas of medicine.”
Kocher and Roberts’ explain that one reason that orphan drugs attract investment is that their development costs are low. The problem or potential problem of underinvestment in diseases like depression and diabetes could therefore be addressed, they contend, by bringing the cost of developing treatments for these common conditions in line with the cost of developing treatments for rare diseases. And, they argue, one promising approach to doing so is to reduce clinical trial costs by reducing the size of clinical trials. In the report I cited above, EvaluatePharma estimated that for orphan drugs regulators require a median phase III trial size of 528 patients, at an estimated average cost of $85 million, whereas for non-orphan drugs they require 2,234 patients, at an estimated average cost of $186 million.
Kocher and Roberts believe that “most clinical development programs go far past the point of diminishing returns for frequent safety events, but they do not go far enough to permit detection of rare events.” They therefore advocate for a package of reforms, including (1) “[r]edesigning trials to include fewer patients,” (2) “providing conditional approval of drugs,” and (3) “requiring postmarketing surveillance[.]” The last two proposals are relatively uncontroversial; the first is much more so. In a 2011 article in JAMA, for example, Aaron Kesselheim and colleagues found that “although both newly approved orphan and nonorphan cancer drugs in [their] sample were tested in relatively small numbers of patients prior to approval,” there was a higher rate of adverse events associated with the orphan drugs, suggesting safety concerns. Kesselheim and colleagues argued that rather than extending the flexibility on clinical trial size that is currently afforded to orphan drugs, Congress should consider restricting it, to “first-in-class drugs or those that treat a condition for which no other treatments are available[.]”
Legislation or a change in the Food and Drug Administration’s position to allow for an across-the-board reduction in clinical trial size seems highly unlikely. That said, both Congress and the FDA have demonstrated a willingness to work to reduce development costs, including by allowing for surrogate outcomes where appropriate and by speeding the agency’s approval process. Moreover, in certain cases, governments have reduced sponsors’ development costs directly. As Hester Plumridge reported in the Wall Street Journal in January, the “unfavorable economics” of antibiotics development are changing, in part because “[r]esearch funding is beginning to flow[.]”
Filed under: Bioethics, Clinical Research, Drugs & Devices, Intellectual Property, Privacy, Transparency
We are very pleased to welcome Dana Darst, a Master of Science in Jurisprudence candidate in Health Law and Intellectual Property Law here at Seton Hall, to the blog today.
In recent years, biopharmaceutical research and development organizations have established partnerships with academic institutions and start-up biotechnology companies to drive external innovation, complementary to their own in-house advancements in life sciences. Companies such as Pfizer, Johnson & Johnson and Bayer have opened innovation centers of excellence globally, in start-up biotechnology- and academia-rich hubs such as Boston, San Francisco and Shanghai, as part of an effort to accelerate new product development and commercialization.
More recently, the industry has commenced driving innovation via sharing clinical study protocols and patient-level treatment information at the request of qualified external researchers. An objective of this undertaking is to enhance public health via data transparency. This may increase efficiencies by helping researchers avoid unnecessary use of resources for new studies, when relevant clinical outcomes data exists from previous studies. In addition, it may reduce risks for future research subjects.
On January 30, 2014, Janssen Research and Development, LLC (a Johnson & Johnson subsidiary) and The Yale School of Medicine’s Open Data Access Project (YODA) announced a pioneering partnership model for sharing clinical trial data. Under their agreement, YODA will review all clinical trial data requests on Janssen’s behalf, as an independent third-party. In a press release, J&J’s Chief Medical Officer, Joanne Waldstreicher, MD, stated that their collaboration will “[e]nsure that each and every request for access to [their] pharmaceutical clinical data is reviewed objectively and independently.” She further stated that “[t]his represents a new standard for responsible, independent clinical data sharing.” Other biopharmaceutical companies sharing clinical trial data do so by reviewing data requests directly as they are received from qualified external researchers. Also, some have voluntarily adopted the Principles For Responsible Clinical Trial Data Sharing, jointly published by the Pharmaceutical Research Manufacturers of America (PhRMA) and European Federation of Pharmaceutical Industries and Associations (EFPIA), and implemented on January 1, 2014.
Under the PhRMA-EFPIA guidelines, “Biopharmaceutical companies are committed to enhancing public health through responsible sharing of clinical trial data in a manner that is consistent with the following Principles”: (1) Safeguarding the privacy of patients, (2) Respecting the integrity of national regulatory systems, and (3) Maintaining incentives for biomedical research. The guidelines provide a framework for life sciences companies to request patient-level data and study protocols. Additionally, the U.S. Food and Drug Administration (FDA) and European Medicines Agency (EMA) have proposed policies to increase transparency of clinical trial data. As Carl Coleman discussed here, both agencies have addressed the importance of patient and study de-identification.
So, what potential implications might clinical trial data sharing have on biopharmaceutical innovation? The Institute of Medicine (IOM) et al. recently published a report, Discussion Framework for Clinical Trial Data Sharing: Guiding Principles, Elements and Activities, as a framework for further discussion and public comment on how data from clinical trials might best be shared. It provides four guiding principles for consideration which include (1) respecting individual participants, (2) maximizing benefits to participants in clinical trials and to society, while minimizing harm, (3) increasing public trust in clinical trials, and (4) carrying out sharing of clinical trial data in a manner that enhances fairness.
The report does not provide conclusions or recommendations, which are expected to be developed and published approximately 17-months from the project’s start in August 2013. However, the IOM Committee, which includes a diverse group of representatives from government, charitable foundations, academia, healthcare institutions and private industry, has posed several potential implications of trial data sharing for consideration.
From a societal perspective, sharing clinical trial data could increase accuracy, reduce bias and provide a more comprehensive picture of a drug’s benefits and risks. In addition, data sharing could potentially improve efficiency and safety of the clinical research process. For example, it could reduce potential duplication of efforts and costs of future studies, and help to avoid unnecessary harm to patients. Furthermore, it may provide additional information to healthcare professionals and patients that can be utilized to make better informed decisions.
Alternatively, data sharing could lead to invasions of patient privacy or breaches of confidentiality, which may ultimately harm participants, either socially or economically. Moreover, it could reduce incentives for study sponsors to invest their limited resources (e.g. time, budget, FTEs) on additional trials, which could ultimately inhibit innovation. As the IOM Committee explains:
For example, data sharing might allow confidential commercial information (CCI) to be discerned from the data. Competitors might use shared data to seek regulatory approval of competing products in countries that do not recognize data exclusivity periods or that do not grant patents for certain types of research.
Sharing clinical study protocols and patient-level trial data could have benefits for society and healthcare, which outweigh the risks. The IOM is planning to include an analysis of risks and benefits in their final report. As academic, life sciences and start-up biotech entities increasingly share industry-driven trial data, a prudential approach should be taken to protect the confidentiality and intellectual property of all stakeholders involved. Specifically, data should be adequately redacted prior to disclosure to eliminate confidential information—as recommended by the EMA and U.S. FDA. Biopharmaceutical Innovation is driven by authors and inventors that rely on exclusive, protected rights granted for limited times. As the IOM committee works toward establishing guidelines, adherence to their guiding principles to address these protected rights will be vital.
To obtain additional information or provide public comments on the IOM project, visit their website at: http://www8.nationalacademies.org/cp/projectview.aspx?key=49578.
Filed under: Drugs & Devices, Food and Drug Administration (FDA), Litigation and Liability
Debate continues regarding the Food and Drug Administration (FDA) proposed rule that would allow generic drug manufacturers to independently make changes to a drug label on the basis of newly acquired safety information. The proposed rule trails a trilogy of Supreme Court decisions tackling questions of federal preemption in the pharmaceutical realm: Wyeth v. Levine (2009), PLIVA v. Mensing (2011), and Bartlett v. Mutual Pharmaceutical (2013). In Wyeth v. Levine (2009), the Supreme Court held that the federal Food, Drug, and Cosmetic Act (FDCA) does not preempt failure to warn claims for brand name, also called reference listed drugs (RLD). Taken together, PLIVA and Bartlett establish that the FDCA does, however, impliedly preempt both state tort law failure to warn and design defect claims against generic pharmaceutical manufacturers.
Why such seemingly opposite results regarding preemption? It’s the result of FDA regulations and the statute. The regulations provide that RLD manufacturers are able to update product labeling prior to FDA review of the change in a changes-being-effected (“CBE-0”) supplement. This mechanism originated from a 1965 enforcement discretion policy in which the FDA recognized that some labeling changes ought to be implemented as soon as possible in order to adequately protect consumers. The procedure is now contained in 21 C.F.R. 314.70, allowing RLD manufacturers to makes such labeling changes upon submission of a CBE-0 supplement in several circumstances, including the addition or strengthening of a contraindication, adverse reaction, warning, or precaution shown by newly-acquired or discovered scientific evidence.
As for the statute, the Hatch-Waxman Act of 1984 amended the FDCA to create the abbreviated new drug application (ANDA), or generic drug approval process. Approval of a generic drug product is based on the concept of bioequivalence, which means the generic is identical to the RLD for purposes of safety and efficacy. The legislation explicitly requires that generic drug applicants must submit “information to show that the labeling proposed for the new drug is the same as the labeling approved for the listed drug…” FDCA §505(j)(2)(A)(v); 21 U.S.C. 355(j)(2)(A)(v). Congress included this provision to facilitate the acceptance of these products by physicians, pharmacists, and patients, as well as ensure uniformity for bioequivalent products. Identical labels also helped bolster substitution of generic drugs for brand name drugs as a means to impart cost-savings onto both the government and consumers. Until the publication of the recent proposed rule, the FDA has maintained the position that the statute prohibits generic manufacturers from deviating from a label identical to that of the RLD, expressed in 57 Fed. Reg. 17950, 17961 (1992).
The FDA now proposes to add a provision to the regulation to bring parity to the RLD and generic realm in terms of the availability of the CBE-0 supplement for labeling changes. The FDA acknowledges that the proposed rule would alter the long-standing policy that the labeling of generics must be identical to the RLD. As support for the change in position, the FDA cites changed circumstances:
[A]s the generic drug industry has matured and captured an increasing share of the market, tension has grown between the requirement that a generic drug have the same labeling as its RLD, which facilitates substitution of a generic drug for the prescribed product, and the need for an ANDA holder to be able to independently update its labeling as part of its independent responsibility to ensure that the labeling is up-to-date.
An FDA press release further emphasizes that the generic share of the market is currently over 80% of U.S. prescriptions. The proposed rule discusses Wyeth, PLIVA, and Bartlett, noticeably understating that the rule “may” eliminate preemption for generic drugs.
Two years ago, legislators attempted such a change at the statutory level. Companion bills, both entitled Patient Safety and Generic Labeling Improvement Act, were introduced in the House (HB 4384) and Senate (S 2295), which would have amended the FDCA to make the CBE-0 supplement available to generic manufacturers by law. Both died. The bill language read as follows:
(A) Notwithstanding any other provision of this Act, the holder of an approved application under this subsection may change the labeling of a drug so approved in the same manner authorized by regulation for the holder of an approved new drug application under subsection (b).
(B) In the event of a labeling change made under subparagraph (A), the Secretary may order conforming changes to the labeling of the equivalent listed drug and each drug approved under this subsection that corresponds to such listed drug.
Now, another group of legislators is taking a different stance. On January 22, nearly 30 members of Congress signed a letter addressed to the Commissioner of the FDA, Dr. Margaret Hamburg, expressing “grave concerns” about the proposed regulation. The letter questions the authority to promulgate such a rule given the statutory language and urges that it would lead to inconsistency in drug messages to consumers and physicians alike. The letter states that the proposed rule would “conflict directly with the statute, thwart the law’s purposes and objectives, and impose significant costs on the drug industry and healthcare consumers.” The letter directs the Commissioner to answer 11 enumerated questions by February 5 in order to “assist the Committee(s) in better understanding the decision making process.” Related press releases can be found here and here.
Many more are expected to chime in. Originally scheduled to close mid-January, the FDA has extended the comment period until March 13, 2014.
Filed under: Bioethics, Drugs & Devices, Food and Drug Administration (FDA)
This month marks the effective date of new joint Principles for Responsible Clinical Trial Data Sharing issued by the European Federation of Pharmaceutical Industries and Manufacturers (EFPIA) and the Pharmaceutical Research and Manufacturers of America (PhRMA). The Principles commit the organizations’ members to “sharing upon request from qualified scientific and medical researchers patient-level clinical trial data, study-level clinical trial data, and protocols from clinical trials” of approved medications.
The Principles were developed in response to growing concerns about the difficulty of evaluating manufacturers’ safety and efficacy claims without access to the underlying data from clinical trials. For example, last year, following an intensive campaign by scientists skeptical about the claimed benefits of the antiviral medication Tamiflu, the company Roche agreed to provide access to clinical study reports on all of its Tamiflu studies. Under the new Principles, companies will presumptively be expected to comply with similar requests in the future.
Yet, the Principles do not go nearly as far as some transparency advocates might have hoped. First, all requests for disclosure will be evaluated by scientific review boards made up of experts not employed by the company, who will be charged with assessing the “qualifications of the requestor and the legitimacy of the research purpose.” Second, in order to avoid “free-riding or degradation of incentives for companies to invest in biomedical research,” the statement provides that companies have the right “to refuse to share proprietary information with their competitors.”
In a draft rule circulated last summer, the European Medicines Agency proposed a more extensive system of data sharing under which de-identified research data would be published proactively, without the need for a request, as soon as a positive or negative decision on a marketing application has been made or the application has been withdrawn. The proposal would also allow for the sharing of documents containing personal information, but only if the requestor is a natural or legal person established in the European Union and agrees to enter into a data-sharing agreement containing limits on the use and disclosure of the data.
The US FDA has also entered into the discussion, although far more cautiously than its European counterpart. In 2013, it issued a request for public comments on a proposal to make available data that is not only “de-identified” but also “masked,” a term defined to mean “data with information removed that could link it to a specific product or application.” Strategies to mask data could include “making available certain data from a random sample or appropriately chosen subset of subjects, restricting the data fields made available or pooling data where possible from studies of multiple members of a product class, without identifying the specific product.”
As European and American regulators consider these proposals, it will be important to monitor how companies respond to requests for disclosure made pursuant to the voluntary EFPIA-PhRMA policy. If a voluntary disclosure system does not appear to be resulting in the free flow of scientific information, regulators may conclude that the only alternative is to implement a mandatory approach.
Filed under: Drugs & Devices, Health Insurance, Patient Protection and Affordable Care Act
The Affordable Care Act created a distinctly American health finance system, largely built on the foundation of employment-based insurance. The list of controversies the statute has created is a long one; most recently, the Supreme Court has granted cert. in two cases challenging the “contraception mandate” on religious exercise/RFRA grounds. There has been a lot of interesting writing on the RFRA issue, which is sure to be central in arguments before the Court. Eugene Volokh has voluminously and thoughtfully posted on the RFRA issue, and Marty Lederman has also tackled these interesting issues. As I’m an insurance and not a Con Law/First Amendment guy, the recent post that grabbed my attention was one by Joey Fishkin.
Fishkin argues that the ACA in effect converts Hobby Lobby (and other private firms contesting the “contraception mandate”) into a “federal agent” for purposes of providing access to health insurance. He describes the effect of a Hobby Lobby victory on a lower or middle income Hobby Lobby employee. He points out that the employee would be unable to obtain a subsidy in an exchange for insurance covering contraception, because Hobby Lobby would (presumably) be providing ACA-compliant, affordable coverage. And the employee would be unable to afford unsubsidized coverage unless she earned a relatively high income. So, the employee would be obliged to purchase coverage, but functionally be left with only the coverage without contraception coverage, because Hobby Lobby (the “agent” of the federal government for the provision of coverage) has religious beliefs that have received an official imprimatur. This, Fishkin argues, raises Establishment Clause problems to rival the Free Exercise Clause problems advanced by Hobby Lobby.
The constitutional/RFRA issues aside, Fiskin nicely frames a health policy/health insurance issue: are employers such as Hobby Lobby unfaithful agents to their employees for health insurance purposes? The ACA is a compromise in many ways. Most relevant to the issue at hand, it reflected a compromise by which most Americans continued to receive their coverage through employment – and not through a single payer system or a disintermediated individual marketplace. The compromise was not built on entirely solid ground, however, and Hobby Lobby adds additional cracks to that foundation.
Does a Hobby Lobby victory threaten our continued reliance on employers as central players in the American health finance system? Maybe not; but the problem Fishkin points out at least calls into question the continued usefulness of the acceptance of the employer as fiscal agent for employees for health insurance purposes.
As many have noted, including David Hyman and Mark Hall, and Kathryn Moore, employers, while not qualifying as agents under common law agency principles, nevertheless perform many agency functions and are frequently regarded as agents in connection with their employees’ insurance coverage. Employers do good things for their employees in this role. Their selection of coverage reduces search and transaction costs, and they can provide expertise in resolving disputes and bargaining for more favorable prices. Studies have reported that many employees are satisfied with their employers’ choices – although such surveys are always suspect as they may be skewed by the fact that only a small percentage of employees are likely to have serious illnesses such that they can test the appropriateness of the trade-offs their employers have made.
And, as Hyman & Hall have thoroughly described, the employment-based system is entitled to no more than “two cheers,” due in large part to the structural conflicts of interest between the employer’s and employees interests in the coverage selected.
The ACA’s mandate to cover preventive services with no cost-sharing, including some contraceptive drugs and devices, serves purposes similar to those in the ACA’s broader essential health benefits provision. First, these coverage mandates give federal legal content to the term “health insurance,” providing some assurance that coverage will be meaningful. Second, the uniformity of comprehensive coverage increases purchasers’ ability to compare “apples to apples” when selecting health insurance, driving improvements in quality and cost. In short, the contraception mandate and the broader EHB mandate are pro-consumer and pro-competition provisions.
Religious employers, however, have significant arguments that the contraception mandate, as interpreted, is offensive to their religious observance, perhaps in violation of RFRA. But to permit the religious exercise rights of employers to impair consumers’ access to coverage is inconsistent with the employer-as-agent metaphor so central to the American health finance system. As Marty Lederman has noted, Judge Rovner’s dissent in the 7th Circuit’s recent contraception mandate case demonstrates that allowing employers to pick and choose which services are permissible for their employees threatens to create a “crazy quilt” of coverage – some covered by employers and some offered, if at all, through some patched-together governmental wrap-around coverage.
How to escape this dilemma? Hobby Lobby may mark the beginning of the end of a big part of our social and economic history. It may be that respecting religious employers’ interests while advancing employees’ rights to equal access to federally supported and mandated coverage signals the need for a final parting of the ways between America and the sometimes convenient, never loved, employment-based insurance system.