Author: Matthew Nelson

Anne Walsh to Moderate FDLI Compliance and Enforcement Panel

Anne Walsh to Moderate FDLI Compliance and Enforcement Panel

Hyman, Phelps & McNamara, P.C.’s Anne Walsh will be moderating “Updates in Litigation Risks: Product Liability, Private Litigation, and Consumer Class Actions,” at the upcoming Food and Drug Law Institute’s Enforcement, Litigation, and Compliance Conference on December 9-10.  As we move out of the COVID-19 pandemic, come hear from your peers about how they are staying compliance- and inspection-ready as FDA ramps up inspections, what companies need to do to plan for and manage enforcement risk, trends in criminal and civil litigation, and government priorities for the new year. Sign up with the discount code SAVE15 for 15% off registration.  Learn more here.

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HP&M’s Review of New CDRH Submission Tracker

HP&M’s Review of New CDRH Submission Tracker

By Allyson B. Mullen

Earlier this fall, in accordance with its MDUFA IV commitments, CDRH launched an online platform that allows sponsors to track the status of its submissions.  The platform is called the Customer Collaboration Portal (CCP) and is “a secure, web-based tracker that displays the CDRH progress in reviewing traditional 510(k) submissions.”  See announcement here.  The CCP is currently only available for Traditional 510(k)s.

Now that sponsors have had the opportunity to use the system for a couple of months, we thought we would share our thoughts on it.  Unsurprisingly, we think it’s great.  It includes all the necessary information for each submission under review including the reviewer and all relevant dates in a concise format.  A sample is shown below.

This summary also appears to remain available even once a final decision is made on the 510(k).  To date, completed 510(k) submissions are still showing in the CCP.  This historical reference may also be useful to sponsors in the future.

While sponsors have always had all of these dates, they have had to keep track of them manually and then calculate when the next interaction will/should occur.  It is, certainly, convenient to have it all in one place.  Also, at the top of the page, there is a helpful tracking bar that shows how long until the next major date; for example, when the sponsor’s response to a hold letter is due or when FDA expects to render its decision on the 510(k).  Examples of the tracking bar are shown below.

Again, sponsors could always calculate these dates but having a location where they are easily accessible is expedient and ensures that there is a clear and consistent understanding between the sponsor and the Center.  We applaud the Center’s efforts to make this system available.  Sponsors who have not previously used the system will automatically be sent login credentials shortly after CDRH begins its review of the submission.

In terms of improvements – the system provides all the basic information for Traditional 510(k)s.  Given that this is only one type of submission that sponsors will file, it would be helpful to have all submission types included in the CCP going forward.  Also, in the future, it would also be nice if copies of the relevant correspondence to the sponsor were also linked to in the submission for ease of reference.  But, for now, in our view, the CCP is a welcomed tool for sponsors.

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DEA Proposes to Permit the Electronic Transfer of Initial Electronic Prescriptions for Schedules II-V Controlled Substances: Comment Period Ends January 18, 2022

DEA Proposes to Permit the Electronic Transfer of Initial Electronic Prescriptions for Schedules II-V Controlled Substances: Comment Period Ends January 18, 2022

By Karla L. Palmer

DEA is proposing to amend its regulations to expressly permit the transfer between pharmacies of an initial controlled substance prescription.  Currently, DEA regulations do not address transfer of controlled substance prescriptions — whether paper or electronic — between pharmacies for the initial filling of the prescription.  Historically, if a patient presented a paper prescription to a pharmacy and the pharmacy was unable to fill it, the pharmacist would simply return the prescription paper to the patient and the patient would carry the prescription to a second pharmacy.  There really was no need to “transfer” the paper prescription between pharmacies; paper prescriptions are “portable” by the nature of their paper format.

However, the growing use of electronic prescriptions (DEA notes that more than half of all states mandate electronic prescription opioids, all controls, or all prescriptions) requires DEA to rethink its position on initial prescription transfers.  This is especially important given that the SUPPORT Act of 2018 (section 2003) requires EPCS (with few exceptions) for those prescriptions covered under Medicare Part D beginning in January 2021.

The proposed rule also just makes sense.  More specifically, if a pharmacy receives an electronic prescription for a controlled substance that it cannot fill, the pharmacy simply cannot “return” the prescription (which now is likely an electronic data file) to the patient to take to another pharmacy.  DEA regulations currently do not include any provision for a pharmacy to transfer an EPCS to another pharmacy.  The regulations also do not describe how a pharmacy should handle an EPCS that it receives but cannot fill. At present, a pharmacy that receives an EPCS that it is unable to fill can only notify the patient that the prescription cannot be filled. In this scenario, the patient could then call the prescribing practitioner to request that a new EPCS be sent to a different pharmacy. DEA realizes that this scenario creates the potential for a duplication of prescriptions if, for example, the practitioner transmits a new EPCS to a different pharmacy and does not cancel or void the original EPCS that was sent to the first pharmacy. DEA also recognizes the inability to transfer prescriptions creates an additional burden for patients, who must get back in touch with the original prescribing doctor and request a new prescription.

DEA’s proposal states that, upon request, a registered retail pharmacy may transfer an EPCS in schedules II-V to another registered retail pharmacy for initial filling. This rule will also specify the procedures that retail pharmacies must follow, and the information they must document and maintain when transferring EPCS.

The following recordkeeping requirements will apply to the EPCS transfers:

  • The transferring pharmacist must update the patient’s prescription record with the following information: name, address, and DEA registration of the pharmacy to which the prescription was transferred; the pharmacist receiving the transfer; the name of the transferring pharmacist; and the date of the transfer.
  • The receiving pharmacist must record the transferring pharmacist’s name, address and DEA registration number, the name of the transferring pharmacist, the date of the transfer, and the name of the pharmacist receiving the transfer.

As with other DEA recordkeeping requirements, the electronic record must be maintained for two years.  DEA estimates that the annual cost savings from the transfer rule would be $22.0 million.  The anticipated savings are based on calculations related to the pharmacists, patients, and prescribers’ time communicating concerning the need to generate and send a new EPCS instead of having the ability to electronically transfer the prescription to another pharmacy.   Comments from industry are due January 18, 2022 (Docket No. DEA-637).

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HHS Revokes Trump-Administration LDT Policy

HHS Revokes Trump-Administration LDT Policy

By Allyson B. Mullen & Jeffrey N. Gibbs & Gail H. Javitt

On November 15, HHS announced that it was withdrawing the prior administration’s policy that prevented FDA from requiring premarket review of laboratory developed tests (LDTs) without notice and comment rule making.  See the prior post on this policy here.  This statement comes at least six months after the policy was removed from the HHS website without any public notice (a copy of the prior policy is available here for reference).  Although we were surprised to learn that the prior policy had vanished from the HHS website at least six months ago, we were not surprised that the Biden Administration had reversed the prior policy.

The announcement is light on details, simply stating that the policy was withdrawn and that “HHS no longer has a policy on LDTs that is separate from FDA’s longstanding approach in this area.”  This suggests that the LDT status quo ante has been restored. As our readers know, our firm has long been critical of this status quo (see our prior posts herehereherehere, and here, just to name a few).

The rationale for withdrawal appears to have been that the prior policy allowed LDTs with “poor performance” to enter the market without prior FDA review.  This rationale is weak, at best.  In the past, when pushed to provide examples, FDA has struggled to provide examples or evidence of poorly performing LDTs.  Nevertheless, FDA has said that in its review of 125 EUAs applications for COVID-19 LDTs, 82 contained design or validation issues that the agency believed needed to be resolved before an EUA could be authorized.[1]  Further, the prior HHS policy was supported by a legal analysis concluding that FDA could regulate LDTs only after notice and comment rulemaking. (legal memo available here).  It is unclear whether HHS revised this analysis prior to reversing the August 2020 policy.

The HHS announcement was accompanied by a corresponding statement from FDA as to how this change will affect its review of LDTs.  In relevant part, the FDA announcement states, “the FDA now generally expects newly offered COVID-19 tests, including LDTs, to have an EUA or traditional marketing authorization such as a granted De Novo or cleared 510(k), prior to clinical use.” (emphasis added).  The announcement goes on to say that the notification pathway available for certain tests intended for use in CLIA high-complexity laboratories had led to “some poorly performing testing being offered prior to FDA review.”  See our prior post on the notification pathway here.  Thus, the FDA states that it is “ending those notification policies going forward” and revised its COVID testing guidance, available here, and added new Q&As to its FAQs for SARS-CoV-2 Testing.

No doubt many questions will be raised regarding the rationale, legality, and impact of HHS and FDA’s actions, but two threshold questions for clinical laboratories are: what does this mean for COVID-19 LDTs they are currently offering or may seek to offer going forward?; and what impact will HHS’ removal of constraints on FDA’s oversight of LDTs mean for laboratories performing non-COVID LDTs? We discuss each of these key questions below.

What do these announcements mean for Labs performing COVID-19 LDTs?

If the lab has obtained an EUA for its COVID-19 LDT, which many did because of the PREP Act protections afforded by the authorization, there is nothing more for the lab to do because the only change introduced by the policy is the need for an EUA.  Certain modifications to the LDT could, however, require the submission of an amendment to the EUA.

If a lab is performing a COVID-19 LDT that is not subject to an authorized or pending EUA and that is not included in one of FDA’s notification lists (see our discussion of the notification list below), the Guidance states that the laboratory should either submit an EUA within 60 calendar days of November 15, 2021 (i.e., Friday, January 14, 2022) or cease marketing on or before this date.  FDA notes that it plans to review all LDT EUA submissions.  If FDA declines to issue an EUA after such review, a lab will need to cease offering the test within 15 calendar days of being notified by FDA.

FDA’s decision to again require EUAs for COVID-19 LDTs raises a serious question of capacity. OHT7 is already unable to perform its normal functions, such as reviewing pre-submissions for non-COVID diagnostic devices.  It is unclear why FDA would choose to devote resources to reviewing COVID-19 LDTs that are on the market instead of providing feedback to companies that have new types of diagnostic devices or reviewing IVD submissions in a timely manner.

It is also unclear why FDA would take steps that could reduce the availability of COVID-19 testing.  Even if the Agency believes that there is sufficient access nationwide, LDTs have played an important role in filling local needs.  The sudden loss of access to a laboratory is bound to be disruptive to institutions, physicians, patients, employers, and schools, among others, who have relied upon testing at that facility.

What does the withdrawal of the notification pathway mean for COVID-19 tests?

If a lab is performing a COVID-19 LDT that was added to the notification list and for which an EUA submission is pending, then the consequences depend on whether the EUA was submitted before or after February 1, 2021.  If the EUA was submitted after February 1, 2021, there is nothing for the lab to do as FDA does not intend to object to offering of such tests while the EUA is under review.  If the EUA was submitted prior to February 1, 2021, a lab must notify FDA on or before December 30, 2021, as described in the Guidance, letting FDA know that:

  1. the developer wants FDA to continue reviewing its EUA request;
  2. the EUA request is for the current version of the test; and
  3. either the developer does not have additional data to add, or the developer submits updated information to FDA within that same timeframe including, if not previously provided, validation with clinical specimens using an appropriate comparator.

The Guidance indicates that if a lab needs to submit additional information under item 3, it should also explain how the test falls within the test priorities for the “current stage of the public health emergency and the tests for which FDA will be prioritizing review.”

As many on the notification list know, FDA review of certain EUAs has been slow, with many ultimately being “deprioritized.”  FDA’s revised guidance states that, for tests on the notification list, “FDA intends to notify test developers by email if FDA declines to issue or otherwise decides not to authorize a test for any reason,” (emphasis added) and the test manufacturer will be required to cease marketing within 15 calendar days of such declination.  The language “for any reason” raises significant questions, e.g., what if FDA declines to review an EUA because it is deprioritized?  Will these tests need to be taken off the market?  There is a difference, after all, between FDA determining that a test may not perform well and deciding that a test is low priority.  It is unclear how the deprioritization process affects the new call for EUAs. The lack of clarity here underscores, once again, the uncertainty surrounding various aspects of the LDT process.

What do these announcements mean for non-COVID LDTs?

FDA’s press release and guidance give no hint as to the FDA’s intentions with respect to the hundreds of thousands of LDTs being performed for conditions other than COVID-19.  As we noted above, HHS appears to have restored the status quo ante for LDTs – in other words, a general policy of enforcement discretion with exceptions (e.g., for companion diagnostics, direct-to-consumer tests).  But certain actions taken by HHS during the last administration arguably create “facts on the ground” that may have implications for FDA’s next steps.  For example, the prior HHS policy revoked all LDT guidance documents.  The latest notice makes no mention of the status of such guidance documents.  Furthermore, as noted above, the previous General Counsel prepared a memorandum for then FDA Commissioner Hahn that called into question the scope of FDA’s authority over LDTs and unequivocally concluded that FDA is legally required to engage in rulemaking before regulating LDTs. How, if at all, will the current administration respond to the legal arguments laid out in this memorandum?

HHS’ policy reversal and FDA’s guidance updates raise numerous practical questions that laboratories offering, or contemplating whether to offer, COVID-19 LDTs are now scrambling to address. These laboratories must decide whether to withdraw, submit, or update their LDTs, taking into account whether additional data will be needed to supplement their EUAs and whether their tests are likely to be authorized given FDA’s new test priorities.  The impact of FDA’s resumption of COVID-19 LDT regulation on laboratories and the public remains to be seen.

[1] COVID-19 Tests Highlight Need for Strengthened FDA Oversight and Diagnostics Legislation, PEW Charitable Trusts (May 19, 2021), [].

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FDA Issues a Draft Guidance for Content of Premarket Submissions for Device Software Functions

FDA Issues a Draft Guidance for Content of Premarket Submissions for Device Software Functions

By Lisa M. Baumhardt, Senior Medical Device Regulation Expert & Philip Won

Sixteen years after the publication of the Guidance for the Content of Premarket Submissions for Software Contained in Medical Devices issued May 11, 2005, FDA issued a new draft guidance document on November 4, 2021 that describes the recommended documentation that a sponsor should include in their premarket submissions. To put the age of the existing guidance into perspective, it was published two years before the first iPhone was released. Over the past 16 years, there have been numerous advances in healthcare technology, particularly with respect to the use of software in and as a medical device. Please see our previous blog postings on various software regulatory developments (here, here, and here).

This new draft guidance document applies to “device software functions” that meet the definition of a device under section 201(h) of the Federal Food, Drug, and Cosmetic Act (FD&C 17 Act).

If you’re interested in software products that do not enjoy any of the 21st Century Cures exemptions and require premarket submissions, please continue to read this blog. Summaries of the impact of the 21st Century Cures Acts on software and the definition of a medical device are available here, here, here, and here.

The new draft guidance applies to both Software in a Medical Device (SiMD) which would be your traditional hardware with embedded software and Software as a Medical Device (SaMD). The scope of the new draft guidance is basically the same as the 2005 guidance which includes:

(1) firmware and other means for software-based control of medical devices, (2) stand-alone software applications, (3) software intended to be operated on general-purpose computing platforms, (4) dedicated hardware/software medical devices, and (5) accessories to medical devices when those accessories contain or are composed of software. It does not apply to software-related documentation that may be needed to evaluate post market software device issues (e.g., corrections and removals). Like the 2005 guidance, this new draft guidance applies to all types of premarket submissions, but now the Agency has specifically added De Novo Classification Requests and Biologics License Applications (BLA).

The most obvious update to the new draft guidance is the shift from three to two categories for determining what software documentation to include in a premarket submission. According to the 2005 software guidance document, FDA used Major, Moderate, or Minor Level of Concern to determine the recommended documentation for software. In the new draft guidance document, FDA introduced four risk-based factors to help determine the device’s documentation level—either Basic Documentation level or Enhanced Documentation level.

Basic Documentation is necessary for all device premarket submissions that include software functions. But if the device (i) is a constituent part of a combination product, (ii) is intended to test blood donations, or to determine donor and recipient compatibility, or a blood establishment computer software, (iii) is categorized as a Class III device, or (iv) presents a probable risk of death or serious injury upon failure, then such device software functions are categorized as Enhanced Documentation level. Note that, unlike the 2005 software guidance, the new guidance only references serious injury, which is an injury or illness that is life threatening, results in

permanent impairment of a body function or permanent damage to a body structure, or necessitates medical or surgical intervention to preclude permanent impairment of a body function or permanent damage to a body structure. Both the draft guidance and the 2005 guidance require the assessment of the risk to be evaluated prior to the implementation of risk control measures. Interesting to note, FDA specifically called out the use of the word “probable” versus purely hypothetical, when determining the risk of death or serious injury. However, “probable” risks also include the likelihood that the device could be compromised due to cybersecurity risks.

Below is an overview of the software documentation sponsors would need to provide for Basic and Enhanced levels:

Software Documentation Basic Documentation Level Enhanced Documentation Level
Documentation Level Evaluation
Software Description
System and Software Architecture Design Chart
Risk Management File
Software Requirements Specification (SRS)
Software Design Specification (SDS) ×
Software Development and Maintenance Practices
Software Testing as Part of Verification and Validation
Revision Level History
Unresolved Anomalies

The major difference between the two is that Basic Documentation Level does not need to submit the Software Design Specification. However, there are differences in the level of detail expected for some of the deliverables. For example, Software Development and Maintenance Practices allows a declaration of conformity to IEC 62304 to work for both categories.

However, if the sponsor does not provide a declaration of conformity, Basic level devices would only need to provide a summary of configuration management and maintenance activities while sponsors of devices in the Enhanced level would need to provide the summary as well as complete configuration management and maintenance plan documents.

For software testing as part of verification and validation, only a summary description of the testing activities at the unit, integration, and system levels is required for devices categorized as Basic level, but for sponsors of devices in the Enhanced level, they need to also provide unit and integration level test protocols and results. The Agency added details that clarify their expectations around test results, specifically that it would not only include the pass/fail determinations, but additionally include expected results and observed results.

Under the proposed framework, the amount and type of software documentation may increase or decrease for existing software devices when a sponsor files its next premarket submission.

“Minor” level of concern software devices, under the 2005 guidance, were defined as failures or latent design flaws that were unlikely to cause any injury to the patient or operator. If the draft guidance is finalized, the next time a sponsor submits for a formerly “Minor” level of concern software, it will need to provide documentation similar to what had been previously required of a “Moderate” level of concern device. “Moderate” level of concern was defined as failures, malfunctions or latent design flaws in the software that could directly or indirectly likely lead to minor injury to the patient or operator. (Refer to Table below).

Software Documentation 2005 Guidance Minor Level of Concern 2021 Draft Guidance Basic Documentation Level
Documentation Level Evaluation
Software Description
System and Software Architecture Design Chart ×
Risk Management File
Software Requirements Specification (SRS)

Now you need to provide the complete SRS that was previously required for Moderate level of concern device

Software Design Specification (SDS) × ×
Software Development and Maintenance Practices ×
Software Testing as Part of Verification and Validation

Now you need to provide the level of V&V that was previously required for Moderate level of concern device

Revision Level History
Unresolved Anomalies ×

Under the 2005 guidance, if a sponsor’s software was a “Moderate” level of concern device the required documentation would decrease under the draft guidance. The software device would now be categorized as Basic Documentation Level and the Software Design Specification would not need to be submitted.

Other significant changes include the FDA’s details around what is expected for System and Software Architecture and Risk Management. FDA has devoted an entire Appendix to providing sponsor’s examples of architecture charts. With respect to Risk Management, now in addition to submitting your Risk Analysis (previously referred to as a hazard analysis), sponsors also need to

submit their Risk Management Plan and Risk Management Report, which should address methods for collection of relevant production and post-production information. For those of you who thought Traceability Analysis went away, it did not. Traceability was simply included in the description of the Software Requirement Specification document.

FDA has also taken steps to update the guidance for Artificial Intelligence/Machine Learning software devices. This is a welcome change given that AI/ML software is becoming much more widely used in medical devices, as evidenced by the list of AI/ML-enabled medical devices recently published by FDA (here). For AI/ML software, specifically, the draft guidance indicates that the software description should include the populations or samples informed your model(s) and what steps were taken to identify and address potential biases and limitations of your model(s). Interestingly, the draft guidance does not reference other AI/ML-specific considerations, like, Predetermined Change Control Plan, which has been contemplated in FDA’s AI/ML action plan (see our prior post on the action plan here). We would encourage FDA to consider aligning the final guidance with the AI/ML action plan so the expectations for AI/ML software documentation is clear and comprehensive.

When final, this new document will replace the 2005 guidance document. Interested parties have until February 22, 2022 to comment on the new guidance at this link.

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California Goes Above and Beyond the FTC’s Green Guides, Creates a New Standard for Recyclable

California Goes Above and Beyond the FTC’s Green Guides, Creates a New Standard for Recyclable

By Karin F.R. Moore & Riëtte van Laack

On October 5, 2021, California signed SB 343 “Truth in Labeling for Recyclable Materials” into law, amending the state’s law relating to environmental advertising. The result is a California law that is significantly more narrow than the  Federal Trade Commission Guides for the Use of Environmental Marketing Claims (“Green Guides”), In addition to significantly narrowing the categories and types of items that may be labeled as recyclable, the new law includes significant substantiation and record-keeping requirements for companies.

Until the law was enacted, California law allowed a recyclable claim, and required those claims to be substantiated by competent and reliable evidence. Any Company making such claims needed to keep records supporting the validity of those representations, including evidence that the claims conformed with the Green Guides.

SB 343 adds additional requirements; it requires that California’s Department of Resources Recycling and Recovery (CalRecycle) update regulations that require disposal facilities to provide information on recycling data.  Based on these data, CalRecycle must conduct and publish a report of material types and forms that are collected by solid waste facilities.  The results of that study (which must be updated every five years) will determine if a product or packaging is considered recyclable; only if the product or packaging is collected for recycling by programs in jurisdictions that collectively encompass at least 60% of the population of the state will it be considered “recyclable.”  Furthermore, under the new law, the use of the chasing arrow symbol itself will be a misleading environmental marketing claim in advertising or on a product label unless the product meets the standard of “recyclable.”

Under SB 343, a product or packaging is not recyclable in California if:

  1. It includes components, inks, dyes, adhesives, or labels that prevent its recyclability;
  2. It contains intentionally added chemicals identified pursuant to regulations implementing section 42370.2(g)(4) of the California Public Resources Code; or
  3. It is made from plastic or fiber containing PFAS that have been intentionally added with a functional or technical effect or that measure above 100 parts per million total organic fluorine.

Notwithstanding the above, a product or packaging is recyclable if:

  1. The product or packaging has a demonstrated recycling rate in California of at least 75% (note this is a different metric from the 60% population target above);
  2. The product or packaging is not collected pursuant to a curbside program, but the non-curbside collection program recovers a certain portion of the product or packaging and it has sufficient commercial value; or
  3. The product or packaging is part of, and in compliance with, a program established on or after January 1, 2022, governing the recyclability of that product or packaging and the director of CalRecycle determines that it will not increase contamination of curbside recycling or deceive consumers.

Finally, SB 343 provides that resin identification code numbers (e.g., #1 PETE, #2 HDPE), cannot be placed inside a chasing arrows symbol unless the rigid plastic bottle or container meets the new statewide recyclability criteria discussed above. There are exemptions, though, including for consumer goods that display a chasing arrow symbol or instruct consumers to recycle a product as directed by the California Beverage Container Recycling and Litter Reduction Act or any other federal or California law.

For companies selling products in California, it is not enough to simply follow the FTC Green Guides. Instead, companies must be aware of the specific nuances and requirements in California and developments in other states.  The FTC intends to begin an update of its Green Guides in 2022, and with growing conflicts at the state level like this new California law, we anticipate seeing some significant revisions with this update.

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Ensuring the ACA Contraceptive Mandate Meets the Original Intention of Congress

Ensuring the ACA Contraceptive Mandate Meets the Original Intention of Congress

By Michelle L. Butler

Having a hand in the FDA approval of important new prescription drugs is one of the things that makes our work at HPM so gratifying.  FDA approval is a significant hurdle to overcome, occurring only after scrupulous review of data collected over many years confirm to the satisfaction of seasoned FDA personnel that a drug is safe and effective.  In some instances, however, this is only the first hurdle to make innovative products available to patients.  The imposition of insurance-related hurdles beyond FDA approval, such as time-consuming prior authorizations or costly co-payments, can impede access to critical health care, such as contraceptives.

In 2010, the Patient Protection and Affordable Care Act (ACA) established a mandate requiring coverage for women’s preventive services including contraceptives.  Specifically, the ACA added a section to the Public Health Service Act to require all group health plans and all issuers of group or individual health insurance coverage (other than grandfathered plans, a rapidly shrinking category) to cover without cost-sharing women’s preventive services “provided for in comprehensive guidelines supported by the Health Resources and Services Administration” (HRSA).  42 U.S.C. § 300gg-13(a)(4).  HRSA’s current comprehensive guidelines “recommend[] that adolescent and adult women have access to the full range of female-controlled contraceptives to prevent unintended pregnancy and improve birth outcomes.”  HRSA, Women’s Preventive Services Guidelines, Contraception (emphasis added).  According to the guidelines, “[t]he full range of contraceptive methods for women currently identified by the [FDA] include[s]” 18 methods of contraception “and additional methods identified by the FDA.”  Id.  The 18 methods of contraception listed in the guidelines are derived from a Birth Control Guide (Guide) that the FDA developed in the late 1990s to provide education around relative rates of efficacy across types of contraceptives.  The Guide, which provides consumers with “high-level information about different birth control options,” is “not meant to be a complete list of all available birth control options.”  More importantly, it was never intended to be used as a basis for determining health insurance coverage or reimbursement as it is not fit for that purpose.

While the Guide has 18 categories, some of those categories are so broad that they can encompass contraceptives that are very different from one another.  Moreover, as noted, the Guide was designed to highlight the differences in efficacy of various contraceptive methods but does not address the many other considerations that are taken into account by a woman and her provider when determining the best contraceptive to meet family planning needs.  Other considerations might include the specific hormones in the product, the levels of hormones, the side effect profile, ease of use, and the ability to comply with the labeled regimen.  As to the last point, compliance with a contraceptive method is critical to achieving the desired efficacy.

The federal agencies responsible for enforcing the contraceptive coverage requirement of the ACA (the Departments of Labor, Health and Human Services, and Treasury, collectively, the Departments) have issued regulations and guidance that have served to permit plans to limit the coverage they provide for contraception, despite HRSA’s recommendation that the full range of approved contraceptive methods be covered.  As a result of inconsistent implementation of the ACA coverage requirements, the Departments issued guidance that plans and issuers must cover “without cost sharing at least one form of contraception in each of the methods (currently 18) that the FDA has identified for women in its current Birth Control Guide.”  In addition, the Department guidance states that plans and issuers must cover at no cost any FDA-approved form of contraception if recommended by an individual’s prescriber based on a determination of medical necessity (i.e., the plan or issuer must defer to the determination of the prescriber) and that for any reasonable medical management techniques utilized within a specified method of contraception, “plans and issuers must have an easily accessible, transparent, and sufficiently expedient exceptions process that is not unduly burdensome on the individual or provider.”  However, as recently described in a report issued by the National Women’s Law Center, this guidance is often not followed. When plans and issuers fail to cover the full range of contraceptives within each of the Guide’s categories or fail to defer to a prescriber’s determination of medical necessity, the form of contraception that a woman has found to be best for her (and therefore most likely to be effective) may not be covered without cost-sharing, forcing her to make the choice between effective contraception and the contraceptive that her insurance will pay for, in contravention of the ACA.

In that vein, a recent letter from congressional leaders to the Biden Administration responded to reports of coverage denials and extensive medical management requirements by health plans limiting access to contraceptives and asked the Administration to “ensure that the progress made by the [ACA] to provide individuals with coverage for the full range of [FDA] approved contraceptives continues to be protected and enforced.” The letter requested the Departments’ assistance in ensuring access “to the full range of FDA-approved contraceptives as required by law.”

The Guide, which was never intended to serve as a basis for reimbursement policy, serves an important purpose – educating women on the potential efficacy of various methods – and it should continue to be utilized for that purpose.  However, based on the many factors that come into the decision-making process for each individual regarding their contraceptive, the Guide should not be utilized to limit choice.  For a woman to receive access to the contraceptive option that is best for her, the ACA must be implemented as intended.  Plans and issuers should be required to cover all FDA-approved contraceptive methods without a therapeutic equivalent without cost sharing – not just one or two per category in a list that was never intended by the FDA to be used for this purpose.  This would implement the ACA as intended, and FDA approval of contraceptives would coincide with access for women.

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FDA Publishes De Novo Classification Final Rule with Few Changes from the Proposed Rule

FDA Publishes De Novo Classification Final Rule with Few Changes from the Proposed Rule

By McKenzie E. Cato & Jeffrey K. Shapiro

After 23 years, de novo classification review finally has an implementing regulation!

The other major review processes have had their regulations in place for many decades.  The Medical Device Amendments of 1976 created the initial premarket application (PMA) review and 510(k) substantial equivalence review processes.  Only a year later, in 1977, FDA promulgated regulations governing 510(k) reviews (21 C.F.R. Part 807, Subpart E).  In 1986, FDA followed up with the PMA regulations (21 C.F.R. Part 814).

In 1997, the de novo classification process was added to the Federal Food, Drug, and Cosmetic Act (FDCA) by the Food and Drug Administration Modernization Act of 1997.  The de novo process was later amended by the Food and Drug Administration Safety and Innovation Act and the 21st Century Cures Act.  Yet, all this time, this process lacked implementing regulations governing the process and the criteria for approval.  The regulatory uncertainty has ill‑befitted a very important pathway to market for novel medical devices.

The rule became final on October 5, 2021 via publication in the Federal Register.  The new rule will be codified in 21 C.F.R. Part 860.  It was published approximately three years after the December 7, 2018 release of the proposed rule (see blog post on the proposed rule here).  The de novo rule is structurally similar to the 510(k) regulations (21 C.F.R. Part 807, Subpart E) and the PMA regulations (21 C.F.R. Part 814), and consistent with existing guidance documents on de novo request content and review:

As discussed in detail in our post on the proposed rule, there are certain features of the de novo regulations that will increase the burden on de novo requesters, and may exceed FDA’s statutory authority.

The final rule is largely unchanged from the proposed rule.  Perhaps the most controversial provision in the de novo rule is the inspectional authority FDA grants itself:  “[the Agency] may inspect relevant facilities to help determine” (1) that both nonclinical and clinical data were collected in a manner that ensures the data accurately represents device benefits and risks, and (2) that implementation of the Quality System Regulation (QSR), along with general and special controls, provide adequate assurance of safety and effectiveness.

In our post on the proposed rule, we pointed out that with certain 510(k)s and generally all PMAs, the FDCA affirmatively grants pre‑approval inspection authority.  Specifically, for 510(k)s, QSR inspections are prohibited unless FDA finds that “there is a substantial likelihood that the failure to comply with such regulations will potentially present a serious risk to human health.”  FDCA § 513(f)(5).  In the PMA context, the statute permits FDA to withhold approval if manufacturing facilities do not conform to QSR requirements.  Id. § 515(d)(2)(C).  In contrast, the FDCA is silent regarding pre-classification inspections for de novo requests.  Some commenters, including AdvaMed, noted this apparent lack of inspectional statutory authority when it comes to de novo classification.

In the preamble, FDA insists that the inspectional authority claimed in the final rule is narrowly drawn and will not be much used.  FDA says inspections may be necessary if a device has “critical and/or novel manufacturing processes that may impact the safety and effectiveness of the device.”  86 Fed. Reg. 54,826, 54,832 (Oct. 5, 2021).  FDA clarifies that, unlike pre-approval inspections conducted during a PMA review, the purpose of an inspection of a manufacturing facility for a de novo review is “not for the purpose of reviewing for compliance with the QSR.”  Id.  Rather, it is to “determine whether the proposed special controls are sufficient to reasonably assure safety and effectiveness or if additional controls are needed under section 513(f)(2)” of the FDCA.  Id.  FDA forecasts that the circumstances where an inspection is necessary “should arise with a small percentage of De Novo requests.”  Id.

As to nonclinical and clinical testing facilities, FDA asserts authority to inspect comes from section 513(a)(1)(C), which defines Class III devices and subjects them to premarket approval under section 515.  FDA states that such inspections are necessary in order to “ensure[] the data accurately represents the risks and benefits of the device.”  Id.

It remains to be seen whether FDA will be successful in justifying the new inspectional authority.  As discussed in our blog post on the proposed rule, the statutory provision that authorizes classification proceedings (FDCA § 513) does not authorize manufacturing inspections, except for a limited exception in the 510(k) context.  Since a de novo review is at bottom the promulgation of a new classification regulation under authority of § 513, it seems a stretch to say that it authorizes FDA to undertake inspections in connection with such classification proceedings.  As to the testing facility inspections, without more explanation than was provided in the preamble, it is not clear how section 513(a)(1)(C) provides authority.

On the timing of de novo reviews, both the proposed and final rule state that FDA will grant or deny a de novo classification request within 120 days after receipt, with the exception of a pause in FDA’s review clock for up to 180 days while a requester responds to deficiencies identified by FDA.  The 120-day deadline is already in the statute, so FDA had no choice but to adopt this deadline in the final rule.

Of course, despite the statutory deadline, pursuant to the MDUFA IV commitment letter, FDA currently has a goal to review 70% of de novo requests received in FY 2022 within 150 days.  The final rule theoretically shaves the current review timeline down by 30 days, and it applies to all de novo requests (not just 70% of requests).

It will be interesting to see if and how FDA will be able to meet the new, shorter timeline.  It is possible that this shortened timeline will motivate FDA to be selective in its decisions to conduct pre‑classification inspections.  Alternatively, perhaps FDA will simply fail to meet the timeline or will continue to make to agreements with Congress that override both the statutory and regulatory timeline.

The final rule requires, among other things, that the requestor submit a copy of representative advertisements for the device.  FDA disagreed with a comment that advertisements are outside the scope of a Class I and Class II device review, stating that “such information is necessary to determine the device’s intended use and its safety and effectiveness for the purposes of classification.”  86 Fed. Reg. at 54,839.  FDA does not have authority over the advertising of Class I and II devices (which was given to the Federal Trade Commission), so the Agency justifies this request based on its authority to consider intended use when determining safety and effectiveness.  21 C.F.R. § 860.7(b)(2).

The final rule becomes operative on January 3, 2022.  As FDA begins to implement these provisions, we will be particularly interested in seeing how frequently FDA chooses to conduct pre‑classification inspections and whether they keep such inspections within the narrow scope described in the preamble.

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R.J. Reynolds Vapor Company First to Receive E-Cigarette PMTA Authorization

R.J. Reynolds Vapor Company First to Receive E-Cigarette PMTA Authorization

By David B. Clissold

On October 12, 2021, FDA authorized the marketing of R.J. Reynolds (RJR) Vapor Company’s Vuse Solo electronic nicotine delivery system (ENDS) device and accompanying tobacco-flavored e-liquid pods, specifically, Vuse Solo Power Unit, Vuse Replacement Cartridge Original 4.8% G1, and Vuse Replacement Cartridge Original 4.8% G2. This marks the first e-cigarette ever to be authorized by the FDA through the Premarket Tobacco Product Application (PMTA) pathway.  In a press release announcing the orders, Mitch Zeller, J.D., director of the FDA’s Center for Tobacco Products stated that the RJR data “demonstrates its tobacco-flavored products could benefit addicted adult smokers who switch to these products – either completely or with a significant reduction in cigarette consumption – by reducing their exposure to harmful chemicals.

As we have previously discussed, under the PMTA pathway, manufacturers must demonstrate that, among other things, marketing of the new tobacco product would be appropriate for the protection of the public health. According to the FDA press release, the Vuse e-cigarette products were found to meet this standard:

because, among several key considerations, the agency determined that study participants who used only the authorized products were exposed to fewer harmful and potentially harmful constituents (HPHCs) from aerosols compared to users of combusted cigarettes. . . .  Additionally, the FDA considered the risks and benefits to the population as a whole, including users and non-users of tobacco products, and importantly, youth. This included review of available data on the likelihood of use of the product by young people.  For these products, the FDA determined that the potential benefit to smokers who switch completely or significantly reduce their cigarette use, would outweigh the risk to youth, provided the applicant follows post-marketing requirements aimed at reducing youth exposure and access to the products.

FDA also issued 10 marketing denial orders (MDOs) for flavored ENDS products submitted under the Vuse Solo brand by RJR.  FDA stated that the agency is still evaluating the company’s application for menthol-flavored products under the Vuse Solo brand.

FDA Provides Update on Pending PMTAs

FDA faced a crush of PMTA submissions in August–September 2020, largely for ENDS products.  To understand why that crush occurred, recall that for the “deemed” tobacco products that are subject to FDA regulation under the 2016 deeming rule, including ENDS products, FDA established certain “compliance periods.” The original deadline for submission of PMTAs for products subject to the deeming rule such as ENDS products was August 8, 2018.  The PMTA submission deadline was extended several times by FDA, and the agency ultimately decided that for combustible products such as cigars, pipe tobacco, and hookah tobacco, the submission deadline would be August 8, 2021, while for non-combustible products such as e-cigarettes and other ENDS products, the submission deadline would be August 8, 2022.

After the last FDA extension of time, several public health organizations including the American Academy of Pediatrics sued FDA to force shorter deadlines.  In July 2019, the court shortened the deadlines for submission of premarket review applications for the “deemed” tobacco products from August 8, 2022 (for non-combustible products) to May 11, 2020 (see our post here).  The order also provided that a product subject to a timely submitted PMTA could remain on the market for up to one year from the date of application while FDA considered the application.  In April 2020, the court extended the submission deadline for non-combustible products to September 9, 2020 due to the effects of the COVID-19 pandemic.  FDA reported that it received thousands of submissions representing more than 6.5 million products, mostly ENDS products, by the deadline of Sept. 9, 2020.

In the October 12, 2021 press release, FDA reported that it had “taken action” on over 98% of the applications submitted by that deadline.  This includes issuing MDOs for more than one million flavored ENDS products.  It should be noted that RJR submitted its Vuse Solo PMTAs on October 10, 2019, about 10 months before the PMTA submission crush, and it still took FDA two full years to review the Vuse Solo PMTAs.  FDA said that would “continue to issue decisions on applications, as appropriate, and is committed to working to transition the current marketplace to one in which all ENDS products available for sale have demonstrated that marketing of the product is ‘appropriate for the protection of the public health.’”

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The FTC Resurrects Its Penalty Offense Authority in a Big Way

The FTC Resurrects Its Penalty Offense Authority in a Big Way

By Karin F.R. Moore & Riëtte van Laack

Last fall, when AMG Capital Management, LLC v. FTC was pending before the Supreme Court, former Federal Trade Commission (FTC) Commissioner Rohit Chopra (now Director of the Consumer Financial Protection Bureau) and Samuel Levine (recently appointed Director of the FTC’s Bureau of Consumer Protection) coauthored an article proposing resurrecting the FTC Act’s penalty offense authority. Rohit Chopra & Samuel A.A. Levine, The Case for Resurrecting the FTC Act’s Penalty Offense Authority, U. Pa. L. Rev. (forthcoming). If you haven’t heard of the Penalty Offense Authority found in Section 5 of the FTC Act, 15 U.S.C. § 45(m)(1)(B), you aren’t alone – it was added to the FTC Act in 1975, and it was apparently highly successful for some time, but then largely abandoned during the 1980s when the FTC’s leadership saw markets as “self-correcting” and sought to rid itself of the “national nanny” moniker.  Chopra and Levine urged:

Using this authority, the Commission can substantially increase deterrence and reduce litigation risk by noticing whole industries of Penalty Offenses, exposing violators to significant civil penalties, while helping to ensure fairness for honest firms. This would dramatically improve the FTC’s effectiveness relative to our current approach, which relies almost entirely on another authority, Section 13(b). Section 13(b) does not allow the Commission to seek penalties against wrongdoers, and it is now under threat in the Supreme Court. Chopra & Levine, supra.

Under this authority, the FTC can send companies a “Notice of Penalty Offenses,” also referred to as a “Section 205 Synopsis.”  These Notices list certain types of conduct that the FTC has determined, in prior administrative orders, violate the FTC Act.  Once a company receives the Notice, it then “knows” about the conduct the FTC prohibits and if the company subsequently engages in the prohibited conduct, it can be subject to civil penalties of up to $43,792 per violation.

As we reported here, the U.S. Supreme Court in AMG Capital Management, LLC v. FTC, No. 19-508 (Apr. 22, 2021), unanimously held that Section 13(b) of the FTC Act does not authorize the Commission to seek, or a court to award, equitable monetary relief such as restitution or disgorgement.  In response, the FTC has done what Chopra and Levine urged, and “resurrected” its Penalty Offense Authority.

The Commission’s first such Notices under the resurrection went out on October 6, 2021 to 70 for-profit educational institutions.  And in what seems to be an effort to send Notices to every entity who might arguably be covered by a prior order, the FTC sent Notices to more than 700 companies on October 13, 2021, including many consumer product, pharmaceutical, and food manufacturers, focused on the misleading use of endorsements and testimonials.  The FTC’s Penalty Offenses Concerning Endorsements website lists the cases the FTC relied on, which date between 1941 – 1984, and includes a sample Notice and letter and a list of recipients.

While the application of this authority seems fairly cut and dried, the FTC has only used this authority once in the last decade.  There may be reasons for that including the necessity of proving that the defendant committed the same conduct and did so with actual knowledge that the conduct was unfair or deceptive.  Any litigation in this area could be complex and protracted – defendants can challenge the FTC’s original determination of unfairness or deception, and the standard for actual knowledge is high (and has been recently litigated at the Supreme Court in the ERISA context in Intel Corporation Investment Policy Committee v. Sulyma, 140 S. Ct. 768 (2020)).

The FTC assures the companies – and the public – “the fact that a company is on the list is NOT an indication that it has done anything wrong,” and that the Notices are not based on a review of a company’s advertising.  FTC, List of October 2021 Recipients of the FTC’s Notice of Penalty Offenses Concerning Deceptive or Unfair Conduct around Endorsements and Testimonials (last updated Oct. 15, 2021).  However, there is no indication from the FTC about the determination of who should receive a Notice.

What does this shift to the Penalty Offense Authority portend?  The first thing is that the FTC is clearly signaling more aggressive enforcement.  This shouldn’t come as a big surprise if you have been following the FTC, its new Chairman, Lina Khan, and its actions in the past nine months.  The second more surprising thing is that the votes of the Commission to authorize sending these Notices was 5-0: the Commission is unanimous in its support of the use of these Notices.  It will be interesting to see if the votes to seek civil penalties are similarly unanimous and whether the increased enforcement crosses party lines as well.  And finally, the FTC is giving companies the warning up front.  There will not be any second chances or cease and desist orders as in the past – if you violate the law after being warned, the FTC is likely to seek civil penalties.

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