Life Sciences Alert. Follow-On Biologics Legislation: A Summary of the Access to Life-Saving Drugs Act of October 10, 2006

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1 Follow-On Biologics Legislation: A Summary of the Access to Life-Saving Drugs Act of 2006 October 10, 2006 On September 29, Congressman Henry Waxman (D-CA-30), the co-author of the 1984 Hatch-Waxman amendments, introduced H.R. 6257, The Access to Life-Saving Medicine Act the first major legislation authorizing a new abbreviated approval pathway for biological products licensed under the Public Health Service (PHS) Act. The Senate companion to the Waxman bill, S. 4016, was introduced by Senators Charles Schumer and Hillary Clinton (D-NY), Patrick Leahy (D-VT) and Debbie Stabenow (D-MI). Historically, biological products 1 such as cytokines and monoclonal antibodies, have been marketed through licensure under biologics license applications (BLAs) granted under section 351 of the Public Health Service Act (PHS Act). However, a number of biological products, such as insulin, human growth hormone, and menotropins, have been regulated as drugs and approved as new drugs 2 under New Drug Applications (NDA) under section 505 of the Food, Drug and Cosmetic Act (FD&C Act). While the latter products are subject to potential competition through abbreviated approval pathways for generic drugs under Abbreviated New Drug Applications (ANDAs) as well as NDAs under section 505(b)(2) of the FD&C Act, the PHS Act has no similar provision. 3 The bill sponsors intend the Access to Life-Saving Medicine Act to redress the absence of such an abbreviated approval pathway for biological products licensed under the PHS Act. This, they claim, will enable FDA to approve lower cost copies of biotech drugs. 4 Absent such a statutory pathway, the sponsors, generic drug industry, and a number of health care payors argue that manufacturers of biotech drugs can charge monopoly prices, indefinitely. The claim that substantial savings would accrue from the creation of an abbreviated approval pathway for BLA-licensed products is hotly contested by innovators, who believe that demonstrating comparability much less interchangeability of different biological products is not possible absent extensive clinical investigations and proof of suitable manufacturing capacities. Leading companies and scientists involved in the development and marketing of innovative biological products maintain that only a full complement of clinical evidence can suffice to demonstrate the safety and effectiveness of follow-on biotechnology products. While the legislation will not receive further consideration in the remaining days of the 109th Congress unless as an amendment offered in committee markup of unrelated legislation, such as patent reform or prescription drug safety bills it is certain to be the focus of intense activity in A biological product is defined under the PHS Act, as a virus, therapeutic serum, toxin, antitoxin, vaccine, blood, or blood component or derivative, allergenic product, or analogous product... applicable to the prevention, treatment or cure of a disease or condition of human beings. ( 351(i) of the PHS Act, 42 U.S.C. 262(i)). 2 Drugs under the FD&C Act are (A) articles intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease and (B) articles (other than food) intended to affect the structure or any function of the body of man or other animals. ( 201(g)(1) of the FD&C Act, 21 U.S.C. 321(g)(1)). 3 Statement of FDA Acting Commissioner Lester M. Crawford, U.S. Senate Committee on the Judiciary, Hearing on The Law Of Biologic Medicine, June 23, Further information on the legislation is available at

2 Section 1. Short Title. This Act may be cited as the Access to Life-Saving Medicine Act. Section 2. Definitions. Amends the definition of biological product in section 351 of the Public Health Services Act (PHS) to create a comparable biological product application (cbpa). A cbpa is an abbreviated application for license of a biological product containing the same, or similar, active ingredient as a [licensed] biological product. Paragraphs 2 and 7 designate cbpas as subject to the Prescription Drug User Fee Act (PDUFA). Paragraphs 4, 5, and 6 define the standards for licensure of a comparable biological product. Comparable is defined as the absence of clinically meaningful differences between the new biological product and the reference product in terms of the safety, purity and potency of the product based upon assays, non-clinical studies and data from any necessary clinical study or studies sufficient to confirm safety, purity, and potency. Thorough characterization is defined as the analysis of structural features based on appropriate testing sufficient to identify differences between the new and reference products relevant to safety, purity, and potency. Interchangeable products are defined as (i) a new product containing an active ingredient or ingredients with principal molecular structural features comparable to the reference product that (ii) can be expected to produce the same clinical result as the reference product in any given patient. Paragraphs 8 and 9 define relevant actions that may be taken on a cbpa. Final action means, with respect to a cbpa, the Secretary s issuance of a final action letter approving or rejecting the cbpa. The final action date is the earlier of eight months after submission of the cbpa or six months following the Secretary s notification to the sponsor that its cbpa has been accepted for filing. The final action date may be extended by agreement between the Secretary and the sponsor. Section 3. Regulation of Certain Biological Products. Submission of a cbpa ( 351(k)(1) applications ) Subsection (a) creates a new subsection (k) of section 351 of the PHS Act that establishes the conditions for submission and approval of a cbpa. Under section 351(k), a cbpa would contain eight forms of data that: demonstrates the product is comparable to the reference product ( 351(k)(1)(A)); demonstrates the product and comparable product contain comparable principal molecular structural features notwithstanding minor differences in heterogeneity profile, impurities, or degredation patterns demonstrated by thorough characterization and such data and other information determine[d] to be necessary ( 351(k)(1)(B)); This applies with detailed product qualifications to proteins, polysaccharide products, glycosylated proteins, polynucleotides, and closely related, complex partly definable biological products with similar therapeutic intent ( 351(k)(1)(B)(i)-(v)); demonstrates that the product and comparable product utilize the same mechanism or mechanisms of action for their conditions of use but only to the extent this is known for the reference product ( 351(k)(1)(C)); shows that the conditions of use have been previously approved for the reference product ( 351(k)(1)(D)); shows that the route of administration, the dosage form, and the strength are the same for the product and comparable product ( 351(k)(1)(E)); See section 505(j)(2)(A)(iii) of the FFDCA (21 U.S.C. 355(j)(2)(A)(iii)).

3 demonstrates that the manufacturing, processing, packing and storage facilities meets standards to assure safety, purity and potency ( 351(k)(1)(F)); at the applicant s choice, publicly available information on the approval or licensure of the reference product ( 351(k)(1)(G)); and includes any additional data and information in support of the application ( 351(k)(1)(H). Other applications ( 351(k)(2) applications ) Subsection (k)(2) of section 351 creates a route of application (analogous to 505(b)(2) NDAs) under which an applicant who has not conducted or does not have right of reference to studies relied upon in its application may seek approval of a cbpa for a product that differs from, or incorporates a change to the reference product regarding any characteristic specified under 351(k)(1)(A) through (E) above. Postmarketing studies Subsection 351(k)(3) authorizes the cbpa applicant, at its discretion, to agree with the Secretary to conduct a similar post-marketing safety study or studies where the reference product sponsor is conducting post-marketing safety study and there is a reasonable showing that the cbpa applicant s study or studies would provide relevant information not available from the reference product studies. FDA is prohibited from requiring, as a condition of approval, any additional post-marketing studies of the cbpa applicant. FDA review procedures for cbpas and 351(k)(2) applications FDA must issue guidance on the review of cbpas and 351(k)(2) applications and on reviewer qualifications, including promptness in conducting the review, technical excellence, lack of bias and conflict of interest, and knowledge of regulatory and scientific standards ( 351(k)(4)(A)). Subsection 351(k)(4)(B) requires FDA to meet with an IND sponsor, cbpa applicant or 351(k)(2) applicant upon a reasonable written request for purposes of agreeing upon study design and size needed for approval. Subsection (k)(4)(c) requires a written agreement which may be changed following study initiation only with the sponsor or applicant s consent, or on the basis of a substantial scientific issue. 8 An FDA review division director must determine a substantial scientific issue essential to determining safety, purity and potency in writing ( 351(k)(4)(D)) and afford a sponsor or applicant an opportunity to meet with FDA to discuss such determination. With limited exceptions, subsections (k)(4)(e) and (F) render the written decision binding on field and compliance personnel, and precludes delay in approval because of the unavailability of information from the field. 9 FDA review of cbpas and 351(k)(2) applications Subsection 3531(k)(5) requires FDA to review a cbpa or 351(k)(2) application and any other information available to the Secretary in licensing a product for all conditions of use of the reference product sharing the same mechanism of action for which the applicant has demonstrated comparability for a single condition of use (italics for emphasis added) or, in the case of a product with an unknown mechanism of action, for the condition or conditions of use for which the data submitted establishes comparability. The sponsors bill summary suggests that this author- See section 505(b)(2) of the FFDCA (21 U.S.C. 355(b)(2)). See section 505(b)(5)(A) of the FFDCA (21 U.S.C. 355(b)(5)(A)). 8 See section 505(b)(5)(C)(ii) of the FFDCA (21 U.S.C. 355(b)(5)(C)(ii)). 9 See section 505(b)(5)(E) and (F) of the FFDCA (21 U.S.C. 355(b)(5)(E) and (F)).

4 ity requires that the applicant must demonstrate comparability for at least one proposed condition of use related to a known mechanism of action. 10 FDA must issue regulations within two years of enactment for the efficient review, approval, suspension, and revocation of cbpas ( 351(k)(15)). Exceptions to licensure Exceptions to licensure shall apply when information submitted in the application or any other information available to the Secretary is insufficient to show: comparable principal molecular structural features as demonstrated by thorough characterization ( 351(k)(5)(A)); the products are comparable for the conditions of use proposed in the application ( 351(k)(5)(B)); the products utilize the same mechanism or mechanisms of action for the conditions of use proposed in the application ( 351(k)(5)(C)); the route of administration, the dosage form, and the strength are the same ( 351(k)(5)(D)); the condition or conditions of use in the proposed labeling are limited to one or more of the same use or uses approved for the reference product ( 351(k)(5)(E)); or that it shows (i) the inactive ingredients are unsafe for use under the proposed conditions of use, or (ii) the composition of the comparable product is unsafe because of the type or quantity of inactive ingredients included or the manner in which the inactive ingredients are included ( 351(k)(5)(F)); 11 or is insufficient to show that the manufacturing, processing, packing and storage facilities meets standards to assure safety, purity and potency ( 351(k)(5)(G)); the reference product license has been withdrawn or suspended for safety or effectiveness reasons ( 351(k)(5)(H)); 12 or the application contains an untrue statement of material fact ( 351(k)(5)(I). 13 Under subsection (k)(10) an applicant has an opportunity for a hearing upon disapproval. 14 Approval of 351(k)(2) applications notwithstanding reasons for disapproval Subsection 351(k)(6) requires FDA to approve a section 351(k)(2) application that would otherwise be disapproved under any of the reasons specified above in 351(k)(5)(A) through (E), if the application and any other information available to the Secretary contains sufficient information to establish the safety, purity, and potency of the new product. The sponsors bill summary suggests that this authority permits approval of an enhanced version of a reference product if the application contains sufficient information to establish safety and efficacy. 15 (Italics for emphasis added). 10 Office of Congressman Henry A. Waxman, Detailed Outline of the Access to Life-Saving Medicine Act, September 29, 2006, p. 2 at 11 See section 505(j)(4)(H) of the FFDCA (21 U.S.C. 355(j)(4)(H)). 12 See section 505(j)(4)(I) of the FFDCA (21 U.S.C. 355(j)(4)(I)). 13 See section 505(j)(4)(K) of the FFDCA (21 U.S.C. 355(j)(4)(K)). 14 See section 505(j)(5)(E) of the FFDCA (21 U.S.C. 355(j)(5)(E)). 15 Detailed Outline of the Access to Life-Saving Medicine Act, p. 3.

5 Interchangeability determinations and labeling Abbreviated biologic (cbpa or 351(k)(2)) applicants may request a determination of interchangeability of the new comparable product and the reference product (subsection (k)(7)). Upon approval, FDA shall publish a therapeutic comparability evaluation code indicating either interchangeability or that interchangeability has not been established. Subsection (k)(8) permits the labeling of a new comparable product to include a statement on interchangeability with the reference product. Exclusivity An interchangeable product approved under a cbpa or 351(k)(2) application is entitled to market exclusivity ( 351(k)(9)(A)) prohibiting FDA from approving a subsequent rebranded interchangeable biologic until: 180 days after its first commercial marketing; 16 a year after either a final court decision or dismissal with prejudice of all patent litigation filed under subsection (k)(16) [see below] against the application; months after its approval if litigation filed under subsection (k)(16) is still ongoing ; or a year after its approval if no action has been filed under subsection (k)(16). The sponsor of a subsequent interchangeable product may seek approval as a non-interchangeable product whose approval will not be delayed by the specified exclusivity. Clause 351(k)(9)(B) defines a rebranded interchangeable biologic as one marketed by the BLA holder of the reference product, excluding any product marketed sold or distributed by an entity eligible for exclusivity under subsection (k)(9) or any product for which exclusivity granted under subsection (k)(9) has expired. Under subsection 351(k)(11), FDA must approve or disapprove a cbpa or 351(k)(2) application within the earlier of eight months of its submission, or 180 days after the application is accepted for filing, unless the applicant and FDA agree to extend the date for final action. Subsections 351(k)(13) and (14) require reports to Congress and the President on extensions of final action dates and on specific and particularized reasons for any failures to take timely final action. Citizen petitions and civil actions Under subsection 351(k)(12), FDA is precluded from failing to take final action on an abbreviated biologic (cbpa or 351(k)(2)) application on the basis of a petition or other request or on the basis of anything short of a permanent injunction against final action issued on the basis of clear and convincing evidence of imminent and actual irreparable injury, constituting more than irrecoverable economic loss and a demonstrable interest that outweighs the overwhelming interest that the public has in obtaining prompt access to a comparable biological product. Subsection 351(k)(17) precludes FDA from taking action to delay approval of an abbreviated biologic application on the basis of a late-filed petition (within 180 days of the date on which the approval may first be made effective ) absent the petitioner s show of good cause for the late filing of the petition. The petition may not be reviewed unless it is signed and verified ( 351(k)(17)(A)). The FDA may not delay approval on the basis of a timely filed petition unless the agency publishes a public determination that a delay is necessary to protect the public health, it affords the applicant an opportunity to meet with the Commissioner, and its consideration of the petition is separate and apart from the review and approval of the application. If a delay in approval is necessary, the Secretary must make this information public on the FDA website, and meet with the cbpa applicant to discuss the delay ( 351(k)(17)(A)). 16 See section 505(j)(5)(B)(iv)(I) of the FFDCA (21 U.S.C. 355(j)(5)(B)(iv)(I)) as enacted under section 1102(a)(1), Title XI Access to Affordable Pharmaceuticals, Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA, Pub. L , enacted December 8, 2003). 17 See section 1102(b)(3) of MMA.

6 The FDA is further required to take final action on petitions within 180 days of its submission. Administrative remedies must be exhausted before a civil action may be filed with respect to any petition submitted ( 351(k)(17)(B)). The agency is also required to report to Congress on the annual number of approved abbreviated biologic applications and such applications delayed by petitions ( 351(k)(17)(D)). Patents The cbpa applicant may, at any time, request patent information from the holder of the approved application for the reference product( 351(k)(16)(A)). The reference product BLA holder must provide, within 60 days of request and for payment of up to $1,000, the applicant a list of all patents that the application holder in good faith believes relate to the reference product. The reference product holder must also send periodic updates on patent information to the cbpa applicant for a period of two years. At any time after submission of the cbpa, the applicant may provide a notice with respect to any of the patents provided by the reference product holder. The notice must include a statement of the factual and legal bases for the applicant s belief that the patents included in the notice are invalid, unenforceable, or will not be infringed by the comparable biological product. The notice must also identify in which judicial district(s) the cbpa applicant consents to be sued for infringement ( 351(k)(16)(B). The reference product holder must bring suit for infringement within 45 days of receipt of the notice and may only bring suit in the judicial districts identified in the notice ( 351(k)(16)(C)). No action for declaratory judgment of infringement, validity or enforceability may be brought on any patent that the cbpa applicant did not identify in the notice prior to commercial marketing of the comparable biological product ( 351(k)(16)(D)). Subsection 3(b)(1) of this Act amends 35 U.S.C. 271(e) to deem the above notice an act of infringement, and further limits the remedies available in any litigation brought after the above 45 day window on the basis of such a notice to reasonable royalties. No action for infringement may be brought for a patent not timely disclosed in the list of patents provided under section 351(k)(16)(A) of the PHS Act. Tax credit Subsection 3(b)(2) of this Act amends the Internal Revenue Code to establish the eligibility of clinical testing expenses to determine interchangeability of new comparable biologic products to reference products equal to 50 percent of the qualified clinical testing expenses in the taxable year. Clinical testing is defined as any human clinical testing which is carried out under an exemption for a drug being tested for interchangeability under section 351(k) of the Public Health Service Act. Non-U.S. clinical testing is only eligible when there is an insufficient testing population in the United States and it is conducted by a person not related to the taxpayer seeking the interchangeable designation. Corporations claiming a section 936 tax credit are ineligible for this tax credit.

7 For more information, please contact: Paul T. Kim Nick Littlefield Brian Carey Tom Grissom David Mohler Colin Zick Robin Toone James Flaherty Kalah Auchincloss Áron Boros Boston / Washington / This Update is for information purposes only and should not be as construed as legal advice or legal opinion on any specific facts or circumstances. You are urged to consult your own lawyer concerning your own situation and any specific legal questions you may have. Under the rules of the Supreme Judicial Court of Massachusetts, this material my be considered as advertising All rights reserved.