FDA Meets Pushback on Product Jurisdiction

The FDA may have intended the draft rule for product jurisdiction for combination products to clarify the agency’s approach to how it will deal with such products, but the draft has proven unpopular so far, suggesting the agency has its work cut out for it.

The draft rule, which was prompted in part by the 21st Century Cures Act, proposed to eliminate a step in the appeals process, a step the agency suggested was superfluous. As previously discussed, the FDA also oddly cited the prospect that the proposed rule would save lives, but stakeholder see a lot of problems in the draft. For instance, the Washington Legal Foundation said stakeholders might have expected the draft to explain how the agency would “place the dividing line between drugs and devices,” but that the draft fails to do so.

WLF’s Richard Samp and Corey Andrews, respectively the organization’s chief counsel and senior litigation counsel, said the draft rule deviates from the statute with regard to determining a product’s primary mode of action. Samp and Andrews said the statute defines PMOA as “the single mode of action of a combination product expected to make the greatest contribution to the overall intended therapeutic effects of the combination product.” In contrast, they said, the draft rule proposed to evalute the primary mode of action for each of the constituent parts rather than determining the PMOA of the product as a whole, an approach they said “improperly skews” those determinations toward a determination that the product should be reviewed as a drug application.

Several organizations recommended that the FDA allow requests for designation to run to 30 pages rather than the current 15-page limit, but attorneys with the D.C.-based law firm Hyman Phelps & McNamara had other critiques of the draft rule as well. HPM’s Jeffrey Gibbs and Jennifer Thomas said the agency’s position appears to be that a combination product “is a drug or biologic rather than a device if it exhibits any chemical action that contributes to the therapeutic effect.” Thomas and Gibbs said FDA regulations pertaining to combo products dictate that any component of a combination product may have only one mode of action, and that the net effect of these two conditions is to “bias FDA’s jurisdictional evaluations significantly in favor of determining that products composed of multiple distinct components should be regulated as drugs or biologics, rather than [as] devices”

Thomas and Gibbs cited the well-known conflict between the FDA and Prevor of Valmondois, France, over the diphoterine application – which led to a lawsuit that twice appeared in the District Court for the District of Columbia – as an example of the FDA’s propensity for determining that a combination product is a drug despite “very minimal chemical action.” They stated also that the agency’s requirement that the applicant prove the combination is primarily a device within 15 pages is further evidence of a bias against a determination that the product operates principally as a medical device.

Another FDA draft document pertaining to medical devices has provoked concerns among those in industry, the multiple function draft guidance released by the agency in mid-April. The intent in developing the draft was to clarify how FDA staff would deal with applications that embody components that meet the regulatory definition of a device along with components that do not meet that definition, but stakeholders expressed concerns over what seems to have come across as a regulatory slippery slope.

Fears of Regulatory Mission Creep

In that draft, the agency coined the term “device-function-under-review” to distinguish between the regulated and non-regulated functions, and the FDA said the term “function” means “a distinct purpose of the product.” Definitional issues aside, some who commented for the docket indicated that the draft could be applied to combination products, possibly leading to regulatory mischief. Another concern is that any function fulfilled by a component that qualifies as a device that is under enforcement discretion might nonetheless fall under premarket scrutiny if the agency determines that the component in question could provoke questions regarding the safety and/or effectiveness of the entire product.

Another point of consideration is how the FDA’s field investigators would handle inspections of a facility when these non-device components are involved in a product, but there are also lingering questions revolving around recalls and field corrections. Those in the field of in vitro diagnostics may be concerned that controls and calibrators might be swept up in a premarket review if the agency fails to make explicit that these components would not be seen as subject to review despite that the agency has explicitly exempted them from such scrutiny.

Staking Claims: PTO Saving Patents, FDA Saving Lives

The world suffers no shortage of hyperbole, and sometimes those in the U.S. government get in on the act, too. Following are two stories of government agencies taking action in the month of May, with one agency easing up on a purportedly lethal administrative mechanism while the other asserts that its regulatory proposal would be quite the opposite of lethal.

PTO Revisits ‘Broadest Reasonable’ Standard

Those who saw the inter partes review process as an illegitimate shortcut to destruction of legitimate patents may have been cheered to see the U.S. Patent and Trademark Office declare that it would revisit its standard for interpreting claims that are the subject of an IPR, a welcome piece of news for patent holders.

Much of the criticism of the IPR process revolves around the notion that the process is a highly efficient patent-killing machine, and the use of broadest reasonable standard for interpreting the claims contested in an IPR was part of the problem. The difficulty for litigants was that matters appearing in an IPR or other PTO procedures might also be at play in the courts, thus setting up the prospect for differential outcomes due to PTO’s use of the broadest reasonable interpretation (BRI) standard.

Andrei Iancu, director of the PTO, said in remarks to a patent policy conference in April that the agency was taking a close look at various patent-related proceedings and the standards employed throughout those proceedings. The overall objective would be to increase the predictability of “appropriately scoped claims,” Iancu said, explaining that one of the agency’s tasks will be to close the gap between the prior art uncovered during the original patent examination and the prior art unearthed in litigation.

The PTO notice acknowledges that the BRI standard differs from the standards used in federal district courts and the International Trade Commission, and that nearly 87 percent of the patents caught up in proceedings instituted by the America Invents Act were also in play in the courts. This high rate of overlap, the agency said, suggests a need to use the same standard for claims interpretation. PTO also pointed to the outcome in the 2005 en banc hearing at the Federal Circuit for Phillips v. AWH Corp. as a stimulus to take a closer look at the viability of the BRI standard.

The agency said its views of the matter have also been shaped by a rethinking of the relative merits of extrinsic and intrinsic evidence. This portion of the PTO’s notice of proposed rulemaking states that the need to comport with Phillips means that the verbiage found in a claim will be interpreted by the “ordinary and customary meaning” of the words found in those claims. The PTO states that extrinsic evidence, such as expert testimony, may be useful, but not moreso than intrinsic evidence, and that the proposed rule would apply not only to IPR proceedings, but also to post-grant reviews and to proceedings for covered business method patents.

FDA Floats Life-Saving Combo Appeal process

The FDA has proposed to revise the process for appealing a determination regarding a combination product application, but the net effect of the proposed rule is anything but certain. One of the provisions of the proposed rule would eliminate what the agency characterized as a redundancy from the appeals process, but there are other feature of the proposed rule that invite closer scrutiny, such as the argument that one of the values of the rule is that it may save lives.

Up to now, the Part 3 appeals process for combination products has allowed a sponsor to appeal to the Office of Combination Products when the sponsor is unhappy with the OCP’s initial determination as to whether the product is primarily a drug, a device or a biologic. The FDA said it would delete section 3.8 from Part 3 altogether simply because appeals to the OCP cannot include information that was not part of the initial filing, and thus the outcome is likely to be unchanged. The notice also says that this part of the process led to some confusion regarding whether the sponsor can take the matter over the OCP’s head in the event of an adverse determination.

While the draft rule makes several claims on the subject of a net savings to industry after the first year, one of the more interesting observations on the part of the FDA is that if adopted, the rule would provide a public health benefit in the form of “illnesses and deaths avoided as a result of finalizing the proposed rule,” a curious observation to say the least. Conversely, one clear-cut benefit of the proposed rule is that it makes explicit that a sponsor need not contact the OCP if the product’s primary mode of action is clear.

One of the interesting parts of the rule in procedural terms is that only a sponsor would be allowed to file a request for designation for a particular combination of drug and device products. This would seem to foreclose any prospect of an industry collaboration, but another question in this context is whether the confidentiality of premarket submissions would disallow the disclosure of the status of a particular combination upon approval of that application.

Another proposed change to the regulation, yet another response to Section 3038 of the 21st Century Cures Act, is that the FDA would review a combination product under a single application when appropriate, although the Cures Act did not foreclose the possibility of a component-by-component review. As currently written, the regulation states that the agency can require that an application’s components be reviewed separately, but the FDA said it may simply delete this language from the regulation “to avoid confusion.”

The difficulty for regulated industries is that the FDA would only belatedly issue guidance or rulemaking as the agency’s staff gain experience implementing the changes imposed by the Cures Act. It might be assumed that the combination of legislatively imposed changes, and the proposal to excise language not directly required by that legislation, will in the near term engender more confusion rather than less.

Hits and Misses for May 2018

Given the volume of news affecting the life sciences, there are always some favorable outcomes and some that trend in the opposite direction. Following are a few recent developments of note, including one that provided good news for the companies in question, and another that is still unfolding.

Fifth Circuit Blasts Pinnacle Hip Decision

In the area of liability law, the big miss over the past couple of weeks for litigants was the decision by the Fifth Circuit Court of Appeals regarding the Pinnacle hip multi-district litigation. The outcome is of course a significant win for DePuy Orthopedics and its parent, Johnson & Johnson, but the case was remanded to a lower court for reconsideration, and so the device makers are not off the hook just yet.

The court expressed quite a bit of ire over the handling of the case at the trial court, particularly regarding allegations the companies bribed the regime of Saddam Hussein in Iraq, but there were a few issues with paid witnesses that plaintiff’s attorneys had indicated were testifying without compensation. The outcome relieves the companies of a $151 million liability, which was itself a fraction of the $502 million originally arrived at in this case. The principle message to be learned from this outcome is that attorneys for plaintiffs can’t indulge in every whimsical allegation that comes to mind if they want these lawsuits to stay on an even keel.

FDA floats digital precert model

The precertification pilot program for software as a medical device drew raves from stakeholders when the FDA announced the program in September 2017, and the agency has now delivered on a draft working model of a full program. Whether developers see this as a hit or a miss might be conditional on several things, including whether the vendor has prior experience with device applications. The draft states that developers with previous experience in the device business will be subject to less scrutiny, something that information technology companies may see as discriminatory.

The precert concept relies on an organization’s demonstrated commitment to a culture of quality, but the agency said in a statement accompanying the draft working model that such a designation would mean that the organization in question “could potentially submit less information” on the product prior to going to market. The FDA addressed the question of third-party precertification with another response that amounts to “definitely maybe.” This uncertainty also underscored the agency’s remarks regarding whether certified sponsors will be subject to inspections, another conspicuous deviation from the precert pilot.

Opinions vary regarding whether this new paradigm for regulated software is as painless as some believe, given all the optimism surrounding the pilot. One regulatory attorney told a media outlet recently that the FDA document seems an implicit trade of faster times to market in exchange for more regulation. Regulatory attorney Bradley Merrill Thompson of Epstein Becker Green also said, “industry has to review this proposal with eyes wide open.”

In a somewhat related development, the FDA published a draft guidance for multiple function device products, and the Federal Register notice states that the FDA’s Bakul Patel is the contact point for the draft, making clear that this is principally about software devices and software functions that are secondary to the device primary function. Patel is the associate director for digital health at the agency’s device center, hence the authorship makes clear the focus of the draft despite that a device with no software at all could be a multi-function device.

The draft defines the term “function” as “a distinct purpose of the product,” but that distinct purpose could be a mere subset of the intended use or could make up the entire intended use. The most interesting part of the draft, which was made necessary by Section 3060 of the 21st Century Cures Act, is that it states that the “device function-under-review” will be the principle point of interest, although the agency will assess the impact of these other functions on the function under review, even when those other functions would otherwise enjoy enforcement discretion or would not be subject to regulation.

Sponsors will have to conduct a risk analysis of the potential impact of these non-reviewed functions on the function under review, but these non-reviewed functional aspects of the device won’t be subject to post-market surveillance activities. Still, device makers will have to document design considerations for non-reviewed functions, such as software architecture, as well as any relationships between the reviewed and non-reviewed functions, such as shared computational resources.

While the draft may be an improvement on regulatory silence on the matter, it would seem to raise the question of why the entirety of the Quality Systems Regulation is not applicable to a device function that is nonetheless subject to risk analyses and some of the more labor-intensive documentation requirements that fall under the QSR.