September a Guidance Drop Month for FDA

September was an unusually busy month for the FDA’s device center, which released more than 20 draft and final guidances in the final 30 days of fiscal 2019. Several of these documents are related to the de novo device program, but the agency also updated its approach to the humanitarian device program as required by recent legislation.

Humanitarian Use Guidance Updated
The final guidance for the FDA’s humanitarian device exemption (HDE) program explains how the agency determines whether the sponsor has demonstrated a probable benefit, although the final encodes the new limit for humanitarian use devices of 8,000 per year as seen in the 21st Century Cures Act. Another change due to statutory mandates, in this case the Food and Drug Administration Reauthorization Act of 2017, is that the sponsor need not rely on a local institutional board, a change intended to offer some efficiencies in the conduct of multi-site clinical investigations.

The HDE guidance is applicable to devices reviewed by both the Center for Devices and Radiological Health and the Center for Biologics Evaluation and Research. HDE applications will be reviewed within 75 days under this policy, a much quicker turn-around than is available to PMA devices at 180 days. Device makers are now allowed to make a profit on these devices unless the volume sold exceeds the annual distribution number limit of 8,000, and manufacturers are required to file an annual report on profitability only if the price charged for the device exceeds $250.

De Novo Program Rates Three Guidances
The agency also released three guidances pertaining to the de novo premarket program, including the final guidance spelling out the actions both device makers and the agency can take in relation to these applications. Also topical for the agency’s purposes is how those actions might affect review goals under the current user fee program.

The FDA said the clock will stop on a de novo application should the agency have questions that cannot be answered in a reasonable amount of time, although the guidance does not provide any metrics for “reasonable.” The hold goes into effect when the FDA issues the request, and the guidance states that a request for additional information stops the review clock and “marks the end of an FDA review cycle.” The clock will resume once the agency is in receipt of a complete response from the sponsor.

De novo submissions are now subject to user fees, and the target turn-around time for de novo petitions is 150 days, although the percentage of applications that must meet that deadline varies by year. For fiscal 2018, the target ratio of applications that met the 150-day target was 50%, but that goes up to 70% in the final fiscal year of this user fee schedule, which is FY 2022. The review staff assigned to that application will be available to discuss any problems with the sponsor if it is still outstanding at 180 days, at which point the reviewers will discuss next steps, including the deadlines for completion of those next steps.

The final guidance for acceptance review of de novo applications employs the same refuse-to-accept (RTA) principles that govern RTA policies for 510(k) and PMA applications. One important difference for the de novo version is that the sponsor has to document that there is no cleared predicate on the market, assuming the device in question is not a class III device. The FDA staff is tasked with determining whether any 510(k) or PMA applications are in process for devices with the same technology and same indication for use.

There are a number of considerations for de novo applications that are combination products, including whether the drug component for a drug-device combination product is the subject of a patent. The guidance includes a checklist which the sponsor is advised to complete prior to filing the application with the FDA. The checklist starts with four questions regarding whether the device in question is a combination product, highlighting the agency’s interest in resolution of any combination product questions before the de novo reaches the FDA.

BIO, PhRMA Not Opposed to AKS Proposal

Makers of drugs and biotech therapeutics might have been expected to resist the Trump administration’s proposal regarding the anti-kickback statute, but that proves not to be the case. Two leading trade associations have voiced their support for the proposal, although they each indicated they would take a closer look at the proposal before lending it their full-throated support.

It has been argued on more than one occasion that rebates paid to pharmaceutical benefits managers are rebates rather than kickbacks, a point made by at least one observer. There have been instances in which drug makers paid fines to deal with allegations they used rebates to gain exclusive listings in PBM formularies, but that is not the usual run of business where these rebates to PBMs are concerned.

The latest proposal by the Department of Health and Human Services includes a removal of the safe harbor for rebates paid to several entities, including PBMs, although PBM service fees would enjoy a safe harbor along with rebates provided directly to beneficiaries enrolled in federal government health programs. HHS Secretary Alex Azar said in a statement the proposal is “a major departure from a broken status quo that serves special interests,” and which “moves toward a new system that puts American patients first.” The proposal would further provide more transparency about such transactions, and Azar seemed to taunt Congress on this point, stating that members of both parties who have sought to lower prescription drug costs “have criticized this opaque system for years, and they could pass our proposal into law immediately.”

Despite the seeming promise of disruption of the existing system, both the Biotechnology Innovation Organization and the Pharmaceutical Research and Manufacturers of America issued statements that were generally supportive of the proposal. BIO President/CEO Jim Greenwood said in a Jan. 31 statement that the association “strongly supports the goal” of the proposal, but advised that BIO is taking a close look at the proposal. Greenwood said the current system creates some perverse incentives that feed the drug pricing problem, urging HHS to adopt a system that provides affordable access.

PhRMA emphasized a need to ensure that the $150 billion in annual rebates and discounts are used to lower costs for patients at the pharmacy. PhRMA President/CEO Steve Ubl stated that the existing approach favors products with high list prices, but he also pointed to the pressing problem of price hikes associated with drug products used for diabetes, which has been a significant flashpoint in recent months. Despite the supportive tone, Ubl said PhRMA would also take a close look at the proposal before offering specific comments.

FDA Rewrites Title of Abbreviated 510(k) Draft

The FDA’s device center managed to wrap up a 2018 draft guidance dealing with abbreviated 510(k) applications, but ended up renaming the document in the process. The net effect is seemingly to put another nail in the substantial equivalence coffin, which some might argue has been a policy priority for the Center for Devices and Radiological Health dating back to 2011.

The 2018 draft guidance bore a title that explicitly mentioned the abbreviated 510(k) program and suggested that a determination of substantial equivalence would be more easily obtained by demonstrating conformance with performance criteria. The final guidance is dubbed the Safety and Performance-Based Pathway, which advises that third party reviewers can be invoked for these devices, which was not acknowledged in the draft.

One of the more notable differences between the draft and the final is that the latter suggests that the performance criteria requirements for Declarations of Conformity might be more explicitly product-specific than perhaps was understood upon the emergence of the draft. The final guidance says a DoC ought to suffice to support a finding of substantial equivalence “unless noted otherwise in the relevant Safety and Performance Based Pathway guidance.” While there is a seemingly related provision in the draft – which states that the FDA may “establish performance criteria through guidance and/or special controls” – the revision appearing in the final seems to lend more teeth to the notion that at least some procodes will be the subjects of product-specific performance criteria.

Precisely when the agency might promulgate such guidance is not explained, but the implications of this and other recent policy changes at CDRH include that the historical understanding of the role of substantial equivalence is no longer in vogue at the Office of Device Evaluation. Only time will tell whether reviewers at ODE can resist the urge to use performance criteria as a means of imposing more regulatory hurdles for class II devices