Attorney East Hampton

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the Content of Premarket Submissions for Software Contained in Medical Devices issued May 11, 2005, FDA issued a new draft guidance document on November 4, 2021 that describes the recommended documentation that a sponsor should include in their premarket submissions.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This new draft guidance document applies to “device software functions” that meet the definition of a device under section 201(h) of the Federal Food, Drug, and Cosmetic Act (FD&C 17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The new draft guidance applies to both Software in a Medical Device (SiMD) which would be your traditional hardware with embedded software and Software as a Medical Device (SaMD). The scope of the new draft guidance is basically the same as the 2005 guidance which includes: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 Like the 2005 guidance, this new draft guidance applies to all types of premarket submissions, but now the Agency has specifically added De Novo Classification Requests and Biologics License Applications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The most obvious update to the new draft guidance is the shift from three to two categories for determining what software documentation to include in a premarket submission.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.

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.

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.

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:

• De Novo Classification Process (Evaluation of Automatic Class III Designation)
• FDA and Industry Actions on De Novo Classification Requests: Effect on FDA Review Clock and Goals
• Acceptance Review for De Novo Classification Requests

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.

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.’”

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.

By Karin F.R. Moore —

The FDA announced last week that it intends to withdraw its guidance documents issued in March 2020 outlining temporary policies regarding the manufacture of hand sanitizers. Effective December 31, 2021, companies manufacturing hand sanitizers and alcohol for use in hand sanitizer under the temporary policies must cease production of these products. Hand sanitizers manufactured before or on December 31, 2021, and produced under the temporary policies by can no longer be sold or distributed by manufacturers after March 31, 2022.  Those who wish to continue to manufacture hand sanitizer after December 31, 2021 must comply with the tentative final monograph for over-the-counter topical antiseptics and other applicable requirements, including the FDA’s Current Good Manufacturing Practice requirements.

As you may remember, at the outset of the pandemic, there was a shortage of hand sanitizer, and many different types of companies, like distilleries and breweries, sought to step into the breach and manufacture hand sanitizer.  Because of this, the FDA issued a Temporary Policy for Preparation of Certain Alcohol-Based Hand Sanitizer Products During the Public Health Emergency (COVID-19), and policies for the manufacture of alcohol to be used in hand sanitizer.  The FDA is now withdrawing these policies because consumers and health care professionals are no longer experiencing difficulties finding hand sanitizer products, and these temporary policies are no longer needed to help meet demand.

The FDA has posted a helpful Q & A to assist those who have been manufacturing under the temporary policies.

By Deborah L. Livornese —

Many of us have been waiting not-so patiently for FDA to begin implementing the over-the-counter (OTC) monograph reform provisions of the 2020 Coronavirus Aid, Relief, and Economic Security Act (CARES Act) (see our blog post here).  While we are aware that behind the scenes the Office of Nonprescription Drugs has been busy hiring, training, reorganizing and otherwise working on implementation, apart from setting the amount of the new fees and related actions (see our blog post here), until very recently, little had been officially forthcoming from FDA under these provisions.  Now FDA has taken several actions in the past few weeks that we describe below.

Deemed Final Administrative Orders

As part of the process of moving from the old rule-based monograph system to an administrative order framework, the CARES Act provides that in most cases a final monograph or tentative final monograph that establishes conditions of use for a drug described in section 505G(a)(1) or (2) of the FD&C Act is “deemed to be a final order”. These deemed final orders provide the current OTC drug monograph conditions that are in effect for each therapeutic category addressed by them.

As a first step in implementing this provision of the CARES Act, FDA issued a Federal Register notice on September 21, 2021, announcing the availability of the first group of deemed final administrative orders.  In that notice, FDA also announced the establishment of a web portal, OTC Monographs@FDA, which provides access to the repository of final orders.  FDA intends to make the deemed final orders available in batches on a rolling basis until all 32 orders are available in the repository.  Their availability will be announced on the FDA website and FDA will not make additional announcements in the Federal Register.  As of this writing, 12 final orders can be found in the repository.

For each OTC monograph title (e.g., nighttime sleep aid drug products), the repository provides an OTC Monograph ID (e.g., M002) and an Order ID (e.g., OTC000001) and an Order Title.  Perhaps one day those numbers will be as familiar as references to the various parts of the CFR containing the monographs (maybe).

What is not found in the repository (as far as we can tell) is an easy way to access the rulemaking history for each order (the various tentative final monographs and amendments, and the advance notice of proposed rulemaking). The preambles to the rulemaking notices provide essential insights into FDA’s intent in adopting the original rules.  The final administrative orders include the same citations to the relevant Federal Register notices that have always been found in the Code of Federal Regulations, but no links.  We here at HPM hope that FDA will continue to maintain the webpage Status of OTC Rulemakings which contains easily accessed historical information and links. Even taking into consideration the webpage’s well-known shortcomings that resulted from a lack of funding for its upkeep over the years, it is a handy research tool.  Better yet, the addition of links for the rulemaking/administrative order history for each administrative order in the repository would be quite welcome.

Sunscreen Orders

As described in our blog post here, in 2019 FDA issued a proposed rule for sunscreens under the OTC drug review as required implicitly by the Sunscreen Innovation Act (a deadline for a final rule, but not the requisite proposed rule was included in the SIA).  By operation of its terms, the CARES Act, however, established a deemed final order for sunscreens, among other therapeutic categories as discussed above.  The CARES Act also mandated that FDA issue a proposed order to amend and revise the deemed final order for sunscreens by September 27, 2021.  FDA  posted both the sunscreen deemed final order and the new proposed order before this deadline.

The provisions of the sunscreen deemed final order essentially maintain the status quo, including requirements related to active ingredients from the 1999 final monograph, which was stayed and did not go into effect, and the labeling and effectiveness requirements from the 2011 final labeling and testing rule codified at 21 CFR § 201.327.  The deemed final order establishes the current monograph for OTC sunscreen products.  Consequently, there is no longer a need for the guidance Enforcement Policy – OTC Sunscreen Drug Products Marketed Without an Approved Application and it has been withdrawn.

The sunscreen proposed order is substantively consistent with the 2019 proposed rule.  Like the 2019 proposed rule, the new proposed order includes a maximum SPF value of 60+ and a requirement that all sunscreens with an SPF of 15 or higher meet the requirements for broad spectrum protection.  As to active ingredients, again consistent with the 2019 proposed rule, the new proposed order proposes only zinc oxide and titanium oxide sunscreens as generally recognized as safe and effective (GRASE) and identifies the others as not GRASE either because of safety concerns (aminobenzoic acid and trolamine salicylate) or because of inadequate data to support safety (for the remaining ingredients).

A 45-day public comment period on the proposed order ends November 12, 2021.  FDA will consider comments received on the proposed order in concert with those previously submitted for the 2019 proposed rule in developing a final administrative order.  Interestingly, FDA has stated in FDA’s Questions and Answers  and elsewhere that if at the close of the comments for the proposed order, available data do not resolve the outstanding questions about an ingredient, but FDA has received “satisfactory indication of timely and diligent progress on the necessary studies for a specific ingredient,” it would be prepared to initially defer issuance of a revised final order regarding the status of sunscreens containing that ingredient.  If that sounds familiar, it’s because it is the approach FDA has taken with antiseptic monograph ingredients.  For more information on the effects of these sunscreen orders, see FDA’s Questions and Answers webpage.

The Forecast

One of the commitments FDA made in the OMUFA goals letter was to publish by October 1^st of each year a nonbinding list of monograph issues FDA intends to address in the coming three years.  What issues would appear on the first list has been a subject of speculation since long before the CARES Act became law.  We expected to see monographs related to drugs that have been the subject of drug safety communications from FDA such as benzocaine-containing products and codeine-containing cough medicines and also expected FDA would want to tackle pediatric dosing of acetaminophen. Others appearing on the list are more surprising.  Here’s the list issued October 1, 2021 (in no particular order per FDA):

Planned Proposed Safety Orders

• Risks Associated with Codeine-Containing Cough Medicine
• Pediatric Acetaminophen Dosing
• Risks Associated with Propylhexedrine Abuse and Misuse
• Nonsteroidal Anti-inflammatory Drugs (NSAIDs) and Oligohydramnios
• Oral Healthcare in Infants and Children (addressing benzocaine and phenol preparations)
• Serious Skin Reactions Associated with Acetaminophen

Also included on the list is a planned proposed order on the anticaries test method to address test methods.

FDA indicates in the forecast that it is not seeking additional data at this time in advance of issuing a proposed order and notes that each proposed order will specify a comment period during which data and comments can be submitted.

By Jeffrey K. Shapiro & Allyson B. Mullen —

In recent years, for novel robot assisted surgery (RAS) devices, FDA’s Center for Devices and Radiological Health (CDRH) has taken the approach of clearing RAS devices for specific indications for use.  Gone are the days of tool type indications for this type of device.  Rather, FDA seems intent on regulating RAS devices almost as if they were therapeutics responsible for long term clinical outcomes.

This view was highlighted, recently, in a safety warning issued by FDA regarding surgical robots for treatment of cancer (here).  In this safety communication, FDA states:

The U.S. Food and Drug Administration (FDA) is reminding patients and health care providers that the safety and effectiveness of robotically-assisted surgical (RAS) devices for use in mastectomy procedures or in the prevention or treatment of breast cancer have not been established. ***

RAS devices have been cleared for use in certain types of surgical procedures commonly performed in patients with cancer, such as hysterectomy, prostatectomy, and colectomy. These clearances are based on short-term (30 day) patient follow up. The FDA has not evaluated the safety or effectiveness of RAS devices for the prevention or treatment of cancer, based on cancer-related outcomes such as overall survival, recurrence, and disease-free survival.

This view of FDA’s role in regulating RAS devices is strange.  The essence of RAS devices is to aid surgeons in conducting surgery.  Therefore, it makes sense that FDA would review data on intra‑operative performance and perhaps acute outcomes.  But these devices are not independent cancer therapeutics.  It is well out of bounds for FDA to regulate them as if they were a determinant of long term clinical outcomes.

As a scientific/medical matter, there are many variables beside the RAS device that are responsible for clinical outcomes.  Will FDA now begin reviewing various types of manual surgical tools based on their long term clinical outcomes?  The question answers itself.  Although RAS devices do introduce some novelty in how the surgery is performed, they should not be treated as if they were intended to confer a specific therapeutic benefit any more than manual surgical tools would be.

FDA issued the same type of warning regarding RAS devices and mastectomy back in February 2019 suggesting that FDA believes the problem has persisted.  Notably, the 2021 safety warning makes no mention of FDA actually be aware of patients having been injured or adverse health outcomes related to RAS devices being used for mastectomy or other cancer-related procedures, and the 2019 safety warning mentions only “limited, preliminary evidence that the use of robotically-assisted surgical devices for treatment or prevention of cancers that primarily (breast) or exclusively (cervical) affect women may be associated with diminished long-term survival.”

The recent safety warning also highlights that FDA expects an investigational device exemption (IDE) for studies of RAS devices for new indications for use.  FDA states that such studies should include long-term patient follow-up regarding the prevent and treatment of cancer, and safeguards such as study stopping rules and periodic reporting to FDA.  Given these onerous requirements, it is not a surprise that RAS device manufacturers have not sought clearance for RAS devices for oncology procedures.  It would also be beyond the scope of what RAS device manufacturers are intending to offer, which is a better surgical tool, not a therapeutic for cancer.

For many years, Intuitive surgical had the sole FDA clearances for surgical robotic systems.  The original clearances were largely for a tool-type indication, even if examples of specific procedures were provided.  Subsequently, more companies have entered this space with full or partially roboticized devices.  Examples include the Medrobotics Flex System and the Hominis Surgical System.

FDA has taken a hard line that each new surgical robot, as compared to Intuitive’s original robot, are not tools and each one presents new issues of safety and effectiveness due to their complex design and construction and specific indications.  This approach has the perverse effect of slowing innovation in RAS devices, helping to further entrench Intuitive’s 20 year old technology.

Again, this situation raises the question of where FDA’s role ends and the surgeons’ role begins with regard to use of RAS devices in the field of medicine.  The Federal Food, Drug, and Cosmetic Act states that nothing in the Act shall “limit or interfere with” the authority of a clinician to utilize any legally marketed device on a patient “for any condition or disease within a legitimate health care practitioner patient relationship.”  21 U.S.C. § 395.

With FDA’s push for more specific indications for use for RAS devices, healthcare providers cannot be limited only to those indications for use, especially if a device could be useful for an unapproved procedure/patient.  Thus, this part of the Act becomes that much more important to healthcare providers innovating in the field of medicine.  Healthcare providers must assess and make use of legally marketed devices in whatever way they see fit to treat their patients appropriately.

Equally, how can FDA issue a specific warning, like its recent cancer warning, regarding use of a legally marketed device if a surgeon believes it is appropriate for his/her patient, especially when, at best, FDA has cited “limited, preliminary evidence” of adverse outcomes?  If limited evidence is the bar for putting patients and healthcare providers on notice that an alleged off-label use of a medical device is dangerous, it seems that FDA should be warning about all sorts of issues.

We support FDA’s general efforts to inform healthcare providers and protect patient safety.  In the case of RAS devices, however, it seems to have may be going too far with policing practice of medicine and surgeons’ ability to choose which tool is right for a patient’s procedure.  To further innovation, FDA should limit itself to a review of whether a novel surgical platform is safe and effective for use in performing surgery and perhaps out to 30 days’ follow up.  Anything more is unwarranted mission creep.  FDA’s focus on long term clinical outcomes in surgical procedures performed with RAS devices invades a space that should be left to the practice of medicine.

By David B. Clissold —

It seems that although FDA giveth, the ITC taketh away.

IQOS is a tobacco heating system in which “heatsticks” (reconstituted tobacco blended with glycerin) are electrically heated to release nicotine-containing aerosol, but the tobacco is not combusted.  Because IQOS was classified as a cigarette by FDA, it was required to have FDA marketing authorization before it could be marketed.  Accordingly, the IQOS premarket tobacco applications (PMTAs) were submitted to the FDA Center for Tobacco Products (CTP) on May 15, 2017.  On April 30, 2019 CTP issued PMTA marketing orders for IQOS  to Phillip Morris S.A., Marketing Order from Matthew R. Holman, Ph.D., Office of Science Director, Center for Tobacco Products, U.S. Food and Drug Admin., to Philip Morris Products S.A. (Apr. 30, 2019), which became the second company of only three companies to date ever to receive such an order.  Accordingly, the CTP’s 122-page “Decision Summary” for IQOS, U.S. Food and Drug Admin., Premarket Tobacco Product Marketing Order Decision Summary for IQOS System Holder and Charger, PM0000479 (Apr. 30, 2019), became something of a guidepost for companies seeking a PMTA marketing order, particularly for those products such as e-cigarettes and the other deemed tobacco products that were required to submit a PMTA by the September 9, 2020 deadline (the uncertain fate of these PMTAs will be discussed in a later post).

However, in a patent case filed by R.J. Reynolds, the U.S. International Trade Commission ruled on September 30, 2021 that Philip Morris International and Altria must stop the sale and import of the IQOS tobacco product. Certain Tobacco Heating Articles and Components Thereof; Commission’s Final Determination Finding a Violation of Section 337, 86 Fed. Reg. 54,998 (USITC Oct. 5, 2021) (notice).  The trade agency found that IQOS infringed two of Reynolds’ patents.  The import and sales ban will take effect in two months after an administrative review that requires President Joe Biden’s signature.  While an appeal or settlement is always a possibility, it appears that for now consumers will not be able to obtain IQOS in the United States.