Jill Wechsler is Pharmaceutical Technology's Washington Editor, jillwechsler7@gmail.com.

Jill Wechsler

	While labor and tariff reforms in the revised North American trade agreement may have more visible impacts on the United States economy, the final document levels a major blow to exclusivity and patent protections important to innovator biotech and pharma companies. Democrats heralded these changes in the final version of the US-Mexico-Canada Agreement (USMCA) as designed to reduce drug costs and generate savings for consumers, while industry predicted that patients will suffer as foreign entities “free ride” on American innovation.

	This late development involves dropping an earlier provision backed by the Trump administration that set a minimum 10-year exclusivity period for biologics in all three countries. Instead, the pact now leaves the current 12-year exclusivity as is in the US, but imposes no added protections in neighboring states. This modification appears a major victory for Democratic reformers, who hope to press for future reductions in US exclusivity protections for pricey biotech therapies.

	The final trade pact also took out language designed to extend patent protections by three years to sponsors developing new uses for existing products – a practice criticized as “patent evergreening.” Similarly, the agreement no longer requires three additional years of exclusivity for companies developing clinical information to support new uses of approved products, another strategy criticized for delaying generic drug competition. And to further promote “fair competition” in the prescription drug industry, the pact supports access to marketed products by generics firms looking to test copycat competitors prior to patent expiration of the brand [see 

House Ways & Means Committee summary of provisions

	Producers of generic drugs and biosimilars praised the deal as a “victory for patients” due to changes that promote competition and lower drug prices. Innovators predicted it would erode protections for American innovation, as it would encourage foreign entities to steal US intellectual property, according to the 

Pharmaceutical Research and Manufacturers of America (PhRMA)

. Although the pact leaves intact the current 12-year exclusivity period for biologics in the US, Democrats hope to be able to cut back that long period of protection in the future.

	While the House may ratify the trade pact quickly, the Senate is not expected to act until early 2020 due to its focus on impeachment proceedings. Changes, thus, are still possible, but President Trump wants to be able to tout the trade deal as a victory for his administration in the coming election campaign – as do Democrats eager to highlight their efforts to preserve jobs and cut drug prices.

Articles

While labor and tariff reforms in the revised North American trade agreement may have more visible impacts on the United States economy, the final document levels a major blow to exclusivity and patent protections important to innovator biotech and pharma companies. 

Trade Pact Hits Biopharma Exclusivity

	FDA has an official new leader, following a Senate vote to confirm Stephen Hahn as the agency’s next commissioner. Hahn comes to FDA from the MD Anderson Cancer Center in Houston, where he was chief medical officer. Despite his lack of experience in the federal government, he benefited from broad support from dozens of patient groups and research entities, as well as a strong list of five former FDA commissioners. Regulated entities and most stakeholders affected by FDA programs usually prefer that the agency have a clear leader, as opposed to less authoritative temporary directors. 

	Hahn lost some support in the Senate from Democrats due to a limited commitment to taking action to against teen vaping of flavored e-cigarettes, a controversial area that has suffered from unclear administration policy. At the same time, Hahn demonstrated his political skill by indicating strong interest in numerous hot policy issues during his Senate confirmation hearings, without making clear commitments to specific actions. 

	Although Hahn’s role at FDA may be short-lived if there is a change in administration next November, he faces a broad range of hot-button issues that require more immediate attention. FDA is under pressure to do more to address the deadly opioid epidemic, to weigh importation of less expensive drugs from other countries, to clarify polices for marketing cannabidiol products, and for supporting the development of new breakthrough therapies filling the new drug pipeline. A main task for the commissioner is to make the case to Congress and the administration for strong funding for FDA, despite partisan hostility on Capitol Hill and administration efforts to cut federal spending. And the high cost of new cutting-edge therapies will remain a high-profile issue, raising questions about FDA vetting of the long-term benefits and risks of new treatments.

FDA has an official new leader, following a Senate vote to confirm Stephen Hahn as the agency’s next commissioner. 

Hahn Confirmed as FDA Commissioner

	The Office of New Drugs (OND) in FDA’s Center for Drug Evaluation (CDER) is implementing its new structure, which features more operational support for review functions and closer alignment of review offices to therapeutic categories. The aim is to improve the consistency in review and approval decisions across OND by facilitating scientific exchange and information sharing among review professionals.

 The revamped office seeks to better handle rising requests for expedited development and review programs, along with demand for special meetings to discuss R&D approaches. A related goal is to maintain CDER’s strong record for accomplishing first cycle reviews. Agency leaders anticipate a more collaborative approach among medical scientists and more integrated and cross-disciplinary operations. In the future, CDER expects that OND operations will help establish a unified post-market safety surveillance framework. Important to all these efforts is for FDA to be able to recruit and retain highly skilled technical, scientific, and professional staffers, a long-time challenge for the agency.

	In addition, separate offices for new drug policy will manage the development of guidance documents and regulations, and an Office of Therapeutic Biologics and Biosimilars will handle those high-profile products. Most administrative and operational functions will be managed by new offices for program operations, administrative operations, and regulatory operations. The aim is to free medical reviewers and scientists from spending time on administrative, financial, and regulatory issues.

The new structure features eight clinical offices with two to six divisions in each. The Office of Oncologic Diseases is the largest, while separate offices for nonprescription drugs and for specialty medicine (ophthalmology, medical imaging) are smaller. The larger offices also have their own divisions for pharmacology/toxicology.  The OND review offices will be supported directly by a new Office of Drug Evaluation Sciences, which will provide support for conducting clinical outcomes assessments and for overseeing informatics and biomarker qualification.

	This information was shared at a recent presentation at the FDA/CMS Summit by Khushboo Sharma, OND deputy director for operations. The presentation, CDER New Drugs Program: 2019 Update, is available at 

https://www.fda.gov/media/133187/download

, Presentation at FDA/CMS Summit,  Dec. 3, 2019.

FDA’s Office of New Drugs restricting aims to improve scientific exchange and information sharing among review professionals.

FDA Readies Modernized New Drug Review Operation

	Greater cooperation among regulatory authorities (RAs) in all regions would advance public health by speeding access to new therapies, optimizing the use of human and financial resources, and better managing drug shortages and health emergencies. To this end, an expert committee formed by the National Academies of Sciences, Engineering and Medicine (NASEM) calls for more sharing of information through mutual recognition agreements (MRAs) that facilitate reliance on the work of other RAs to inform regulatory decisions.

	To advance such important goals, biopharma companies should agree to share unredacted inspection reports, rejection letters for specific products, and other documents containing what industry considers confidential commercial information, according to the report on 

“Regulating Medicines in a Globalized World”

. The panel calls for extending the current MRA between FDA and the European Medicines Agency (EMA) from its current focus on good manufacturing practice (GMP) inspections of drug facilities, which was fully implemented only last summer, to inspections for vaccines and biologics. In addition, US–EMA agreements could also apply to oversight of good clinical practices, laboratory testing, and pharmacovigilance.

	The NASEM report, which was published Nov. 21, 2019, was requested by FDA’s Office of Global Policy & Strategy to gain added perspectives on ways to further harmonize regulatory policies and to extend MRAs to additional activities and regions. It describes a broad range of MRAs and other agreements involving the EMA and regulators in Canada, Switzerland, Japan, and other nations. One aim is to establish such agreements with lower-resourced regulatory authorities in order to improve public health through earlier access to new therapies. A main point, though, is that all authorities, including those with limited resources, want access to complete information to be comfortable in relying on regulatory decisions by others.

	The panel, which was chaired by Alastair Wood of Vanderbilt University, notes that only a few years ago, biopharma companies were very reluctant to register planned clinical trials on the ClinicalTrials.gov website, but now regard that as standard procedure. The hope is that this experience with sharing clinical trial information will open the door for industry to disclose additional proprietary data. Greater information sharing among regulators, according to these experts, would make better use of limited scientific and technical expertise; support further harmonization of regulatory standards and policies; lead to more informed policy decisions; and avoid waste from redundant tests and reports.

A NASEM report stresses the importance of information sharing by biopharma companies and cooperation among regulatory authorities.

Expert Panel Promotes Global Information Sharing

	Manufacturers looking to develop and market competitive follow-on therapies have become dismayed with difficulties in testing products to meet regulatory requirements and in gaining acceptance and reimbursement from the US healthcare system. Ten years since legislation authorized this competitive pathway, FDA has approved 24 biosimilars, but only nine are on the market due to patent disputes and reimbursement challenges. The gap has generated calls for reducing current exclusivity terms for biotech therapies and for modifying clinical testing requirements to streamline development. Advocates of biosimilars consider it unethical to require unnecessary switching and crossover studies involving human subjects.

	FDA officials remain optimistic about the potential for biosimilars to expand patient access to important biotech therapies and blame complex patent disputes for delaying the process, as well as innovator rebate and pricing tactics designed to deter prescribing and coverage of competitors. Janet Woodcock, director of the Center for Drug Evaluation and Research (CDER), noted at the DIA Biosimilars conference in September 2019 that FDA supports more than 80 biosimilar development programs for 38 reference drugs, gains she attributes to the agency’s Biosimilar Action Plan to coordinate and advance biosimilar development activities at the agency. One sign of progress was FDA’s recent approval of a third biosimilar to pegfilgrastim last week, representing further competition for Amgen’s Neulasta. In addition, Teva and Celltrion announced the launch of a biosimilar to Roche’s Rituxan, a year after FDA approved the follow-on cancer treatment.

	Further growth in biosimilars in the United States and around the world requires greater “convergence” among regulatory authorities in policies governing product development, according to Suzette Kox, secretary general of the International Generic and Biosimilar Medicines Association (IGBA). She made a strong case at the recent GRx+Biosim conference sponsored by the Association for Accessible Medicines (AAM) for regulatory acceptance of foreign-sourced reference products in order to attain “truly global biosimilar development.” A viable international regulatory framework must include the use of global comparators, waiving of bridging studies, and acceptance of real-world evidence for biosimilar medicines, Kox stated. While the US leads in market penetration of generic medicines, she noted that it lags notably behind Europe in market competition from biosimilars, due partly to policies requiring bridging and switching studies that she said provide little important additional information.

	Gillian Woollett of Avalere Health noted that 53 follow-on therapies to 15 reference products have been approved in Europe since 2006, providing extensive experience in product safety and effectiveness to justify more streamlined biosimilar testing. Woollett urged acceptance of a global reference comparator to advance harmonization of biosimilar development programs worldwide. And she and others are hopeful that extending the World Health Organization’s Prequalification Procedure to biosimilars will support the acceptance of global reference products as comparators and advance a global biosimilar development framework.

	Analysts also propose that FDA do more to reduce delays in launching approved biosimilars in the US by expanding listings of patents and exclusivities in the agency’s “Purple Book,” and that Congress could improve the process by imposing penalties on innovator firms that fail to provide timely patent information. Woodcock and others noted that the transition in regulatory status for insulin in March 2020 will provide an important opportunity for biosimilar makers. “Patience and optimism” are warranted, Woodcock commented, as the science gets stronger for this growing industry. And as FDA learns more about reducing “residual uncertainty” and demonstrating product interchangeability, “there will be interchangeable products on the market,” she said, but full acceptance of follow-on products “will take time.”

Developers of biosimilars have become dismayed with difficulties in gaining acceptance and reimbursement from the US healthcare system. 

Biosimilars Struggle to Establish in US Market

	Continuing concerns about the quality and safety of prescription drugs, particularly APIs and products made overseas, has spurred efforts by FDA to modernize its drug manufacturing inspection programs at home and abroad to better detect potentially harmful and violative medicines, while streamlining oversight for reliable producers. The ongoing discovery of potential carcinogens in multiple formulations of medicines with ranitidine has prompted recalls, Congressional investigations, and a clamor for more effective oversight of drugs and their ingredients.

	To address these and other long-term concerns, FDA’s Office of Regulatory Affairs (ORA) is moving forward with efforts to roll out a much-discussed New Inspection Protocol Project (NIPP), a key component of its initiative to make field inspections more efficient, predictable, and informative (1). ORA is applying the new process first to sterile products in recognition that most serious manufacturing problems and related drug shortages involve contaminated or violative sterile injectables. ORA has conducted several pilot programs to test new methods for inspecting and evaluating manufacturing processes and facilities for sterile drugs and continues to fine tune the program with an eye to full implementation in the near future. Other dosage forms, including bulk powders, transdermal delivery systems, creams, solutions, metered-dose inhalers, terminally sterilized products, and APIs will fall under the NIPP in coming years.

	The NIPP is part of a major reorganization of the ORA field force over the past decade, which has established dedicated cadres of investigators for drugs, biologics, medical devices, and other regulated products (2). The aim is to shift the focus of inspections to practices and metrics related to achieving and maintaining a state of quality production, explained Rosa Motta, supervisory consumer safety officer in the Center for Drug Evaluation and Research (CDER), at the PDA/FDA Joint Regulatory Conference in September 2019.

	These changes have taken several years to implement, but now the NIPP appears to be near the starting gate. The ability of inspectors to collect data in a structured manner and to submit them in templated inspection reports will enable data analysis that can help focus future inspections on key areas and support informed and data-driven decisions on product and process quality, Motta noted. FDA also is beginning to construct surveillance and pre-approval protocols for inspections of non-sterile products, with plans to follow with similar approaches for API inspections.

	A related inspection initiative aims to address manufacturer complaints that investigators raise unexpected and sometimes unfounded issues during site visits, leading to noticeable variation in citations for violative actions. In response, FDA has launched an initiative to improve communications about and industry responses to Form 483 notices issued to companies at the conclusion of site inspections. Agency inspectors use this process to inform a manufacturer of the observations made during the inspection affecting product quality, including the scope of the issues, impact on other drugs, and whether the observations appear to be isolated incidents or global in nature, explained David Jaworski, senior policy advisor in the Office of Manufacturing Quality in CDER’s Office of Compliance, at the PDA/FDA conference.

	Manufacturers are expected to address Form 483 observations following an inspection through a comprehensive investigation and development of a corrective actions and preventive actions (CAPA) plan. To avoid delays and often inadequate industry responses, FDA officials seek to provide more details and advice on how companies should meet these obligations. The first step, Jaworski advised, is for the manufacturer to fully understand the Form 483 observations to investigate the issues and conduct a risk assessment on the relative severity of each observation for patient health and product quality. Such analysis then forms the basis of a CAPA plan that describes immediate short-term corrective actions and strategies for addressing root causes of larger or systemic issues. Jaworski also advised manufacturers to submit clear responses-preferably in English-that identify the facility involved and observations addressed.

	The larger objective is to facilitate corrective actions, while also enabling FDA to issue warning letters expeditiously when warranted. Clear communications between field inspectors and company officials aims to improve the process for identifying quality problems and making necessary changes leading to long-term improvements.

	In addition to updating FDA inspection practices, the ORA field force aims to reduce the need to visit capable and compliant manufacturing facilities in Europe and other regions through full implementation of the Mutual Recognition Agreement (MRA) for drugs with the European Union (3). Under development for a decade, the MRA capability assessment process was completed by FDA and EU regulatory officials in 2019. It is now being implemented so that regulatory authorities may share inspection and quality information and recognize and rely on GMP inspections in each other’s territory. This process is expected to provide a “significant” drop in inspections in both regions, noted David Churchward, deputy unit manager at the UK’s Medicines & Healthcare Products Regulatory Agency (MHRA), at the PDA/FDA conference, citing a 75% reduction in EU inspections in the United States.

	Churchward further pointed out that an important benefit for US manufacturers is an end to the requirement that products shipped to EU member states have to submit to EU quality control testing to be imported. While there is no obligation for regulators to accept an inspection report from another agency, all parties may do so, and also stand to benefit from mutual alerts to problems and shared database information on good manufacturing practice issues. Efforts are underway to build confidence further for relying on reports for pre-approval inspections and for third-country site visits. Also planned are efforts to negotiate a similar agreement for veterinary medicines and to extend the drug MRA program to vaccines by 2022. Differences in oversight of clinical trial operations, though, has put on hold for now plans to harmonize inspections in that area.

	1. FDA, “Statement from FDA Commissioner Scott Gottlieb, M.D., on New Steps to Strengthen and Modernize Agency’s Oversight and Reporting of Inspections for Sterile Injectable Drugs,” 


	Vol. 43, No. 11
	November 2019
	Pages: 14-15

	When referring to this article, please cite it as J. Wechsler, "More Consistent Drug Inspection System on Horizon," 

FDA readies more efficient oversight processes while advancing collaboration with Europe.