FDA Modernization and Accountability Act of 1997: A Blueprint for Reform
Intellectual Property Practice Group Newsletter - Volume 2, Issue 2, Summer 1998
August 1, 1998Nick Littlefield, Sharon Webb
On the afternoon of Sunday, November 9, 1997, in the middle of the long Veterans Day Weekend and only two days before Congress adjourned to end the 1997 legislative session, the United States Senate approved the landmark Food and Drug Modernization Act of 1997 (FDAMA) by unanimous vote. This vote was followed on the same day by a similar unanimous vote of approval in the United States House of Representatives. Not a single dissenting vote was cast in either the House or the Senate. Twelve days later on November 21, 1997, Senator Edward M. Kennedy of Massachusetts, an active participant in the debates on FDA reform and in forging the compromises that led to the unanimous vote of approval and winning the support of the Administration, hosted a breakfast for industry leaders at the Hay-Adams Hotel across the street from the White House to celebrate the enactment of the legislation and the remarkable achievement of so many people. Hours later, President Clinton signed the bill into law at a ceremony at the White House attended by members of Congress of both parties and by industry, FDA staff and public health advocates as well.
In January, 1995, when the FDA reform effort in Congress began, no one would ever have predicted that such unanimity could be achieved. For almost three years, beginning in January, 1995, FDA reform had been one of the most contentious legislative issues in the Congress. A vast chasm seemed to separate proponents and opponents of FDA reform on many of the central issues, and there were dozens of subtle and complex technical proposals that had been included in various legislative proposals that had to be hammered out if a bill were to be enacted. For thirty-two months, in endless meetings, among hundreds of players inside Congress and out, in committee, on the floor of the House and of the Senate, and in conference, discussion and debate raged on. Remarkably, at the end of the day the system worked. Members of Congress stated their positions firmly, listened to each other, and then sought a proper balance between the need to bring new innovations and breakthroughs in drugs and medical devices to market and the FDA's obligation to protect the public by approving only safe and effective products. Vital to the success of the effort was that all parties understood that without agreement, there would be no reform bill at all and no extension of the User Fee Act. As importantly, most appreciated that implementation of the new law would never work unless the key parties, particularly the FDA and industry, accepted it, and were committed to making it work in practice. In no one's memory had so difficult and contentious a debate produced a legislative product that was unanimously endorsed.
Today, as the FDAMA implementation process is under way at the FDA, it must be underscored that enactment of the legislation was only a beginning, not an end to FDA reform. Ultimately, how the Act is implemented will determine whether the reform effort has succeeded.
Having observed the crafting of the compromises by members of Congress included in the final legislation, and the constructive participation of representatives of the FDA, industry, and the public health community in the process, we believe it is vitally important that the commitment to constructive compromise and dialogue that ultimately led to the success of the legislative effort continue in the implementation stage. We have been privileged to have had the opportunity to serve on an industry working group for the Massachusetts Biotechnology Council which met biweekly between February and May to develop recommendations on implementation of the Act for submission to the FDA. Our recommendations come from dedicated professionals in the biotech companies in Massachusetts who are actually involved, day to day, in working with the FDA. These professionals know the shortcomings of the FDA approval system from their own personal experience, and have a clear understanding of what changes could be made to that system to improve it.
The FDA was required in FDAMA to issue numerous reports and guidance documents to implement the Act, and the FDA has begun doing so on schedule earlier this year. Although questions have been raised by industry about some of the details of the FDA's initial recommendations, we believe the FDA has taken implementation very seriously. Individual staff members of the FDA have been assigned principal responsibility for each of the reports and other documents required to be issued by the FDA. These FDA staff members have been identified on the FDA website, and have been open to dialogue with industry and public health groups about their assignments. The Pharmaceutical Research and Manufacturers of America (PHRMA), among other groups, has provided materials in the form of draft guidance documents to the FDA for assistance in the implementation process.
There are many technical issues addressed in the legislation, but the basic reforms to FDA law in FDAMA, for the most part, fall into five general categories:
- Reauthorization of the Prescription Drug User Fee Act of 1992 (PDUFA) and the establishment of new performance goals for the FDA;
- Improved collaboration between manufacturers and the FDA throughout the approval process;
- Expanded categories and means to expedite drug and device approvals;
- Enhancement of manufacturing economy and efficiency; and
- Improved access to information for practitioners, health care organizations and consumers.
This article contains (I) a brief comment on the new FDAMA mission statement for the FDA, (II) a summary for each of the five categories of changes to FDA law in FDAMA, and (III) conclusions as to the longer term implications of FDAMA.
I. FDAMA and the Mission of the FDA
Building on the FDA's traditional commitment to safeguarding the public health, FDAMA states at the outset that prompt approval of safe and effective new drugs and other treatments is critical to the improvement of the public health, so that patients may quickly take advantage of these new therapies to prevent and fight disease. Traditionally, the FDA has understood its mission to be that of a gatekeeper, protecting the public health by restricting the distribution of drugs and devices. This new law recognizes that it is an important public health concern to approve useful and safe new products expeditiously as well as to prevent the distribution of what is unsafe or ineffective.
The mission statement provided in FDAMA codifies this recognition, charging the FDA with facilitating product approval. The Senate Committee on Labor and Human Resources, in its report accompanying the legislation when it was passed by the Committee, described the purposes of FDAMA as follows: 1) to ensure the timely availability of safe and effective new products that will benefit the public, and 2) to ensure that the United States continues to lead the
world in new product innovation and development. FDAMA codifies these purposes, first requiring that the FDA act promptly and efficiently, so that its actions on the marketing of regulated products does not unduly impede innovation or product availability, and further requiring that the FDA work with foreign countries to reduce regulatory burdens and to harmonize regulatory requirements.
II. Five Categories of Reform
Reforms specified by FDAMA fall into five general categories, as described above.
In carrying out these reforms, the FDA is charged with formulating rules, regulations and guidance documents that are consistent with the statutory requirements. For example, FDAMA requires no fewer than 38 actions to be carried out by the Agency regarding drug and biologics regulation, many within 1998. Similar detailed directives exist for medical device regulatory actions. With these action directives, the statute specifies some of the ways in which the FDA must carry out the Act's blueprint for reform.
- A. PDUFA Reauthorized
Under PDUFA of 1992, manufacturers agreed to pay the FDA user fees in return for expedited review of drugs. The bargain PDUFA struck in 1992 was highly successful. With the user fees, the FDA hired as many as 800 new reviewers in order to speed up regulatory processes. The dramatic effect of PDUFA can be appreciated by comparing the time to approval for New Drug Approvals (NDA's) before and after PDUFA was enacted. Prior to PDUFA, in 1987, the average approval time for an NDA was 33 months. By contrast, in 1995, three years after PDUFA goal setting, the median approval time was 16.5 months for regular NDAs and 6 months for priority drugs.
FDAMA reauthorizes PDUFA through 2002. In 1996, the FDA and industry agreed on revised time frames to be incorporated when PDUFA was re-enacted. It is estimated that these changes under FDAMA will reduce drug development times by 10 - 16 months. FDAMA includes additional provisions to ensure this streamlining. For example, performance provisions are specified that provide for faster review of applications and faster notification of deficiencies. Additionally, meetings between the FDA and sponsors are to be arranged and conducted more efficiently, with prompt feedback. To cover the cost of performance enhancements that these new programs require of the FDA, user fees will increase approximately 21% during the period covered by FDAMA.
- B. Improved Collaboration between FDA and Industry
By streamlining FDA procedures and expediting the approval process, FDAMA reflects the Congress' intention to commit the FDA to working with industry in expanding public access to safe and effective medical products. In keeping with its expanded role as facilitator, the FDA and the sponsor of new drugs or devices will be able to collaborate in developing and agreeing upon design and size of clinical trials intended to form the primary basis of an effectiveness claim. The FDA is directed to respond to manufacturers proposals on the design of their clinical protocols to demonstrate product efficacy within 30 days, or the investigation may begin. If data are collected in keeping with the agreed-upon protocols, it will be deemed adequate to satisfy approval requirements. Collaboration requirements are similar for both drugs and medical devices. To facilitate Collaboration and to streamline the approval process further for devices, the FDA will also expand the availability of third-party review.
- C. Expanded categories and means for expediting approvals established
Particular attention is paid under FDAMA to products identified as important breakthroughs. A statutory mechanism is established to provide guidance in identifying such products in the early phases of development. A manufacturer can request a "fast track" designation upon filing an Investigational New Drug application (IND) for those drugs that are intended to treat serious or life-threatening conditions and that demonstrate the potential to meet an unmet medical need for such a condition. Sponsors of a "fast track" product will have early access to the FDA for guidance in navigating the developmental and approval procedures expeditiously. Medical devices that offer more effective treatment or diagnosis of life-threatening or debilitating diseases can also be "fast-tracked," especially those that represent breakthrough technologies or that offer significant advantages over competitors. For NDAs, rolling review will be permitted, so that incomplete applications can be filed and reviewed before all data are submitted. Approval for fast track drugs can be based upon either clinical or surrogate endpoints. For all products one clinical study by itself may provide adequate data for efficacy evaluation. Summary data may be submitted under certain circumstances instead of actual data. When a fast track drug is approved, it may be subjected to post-approval requirements for further (Phase IV) studies, but its approval will be complete despite the Phase IV requirement, and it will not be considered to be experimental or investigational after fast track approval. Medical devices, similarly, can be subjected to post-market studies while remaining available for clinical use and for data collection. These provisions are all intended to get promising and important new products to market quickly.
- D. Enhanced manufacturing economy and efficiency
FDAMA seeks to streamline the administrative requirements imposed upon drug and biologics manufacturers. Foremost among these streamlining measures is the elimination of the Establishment License Application (ELA) requirement for biologics. FDAMA requires FDA approval of a biologics license application on demonstration that the product is safe, pure and potent, and manufactured in a facility that meets standards designed to assure that the product continues to be safe, pure and potent.
Overall, FDAMA requires less detailed documentation from manufacturers who carry out other than "major" changes in production methods that are unlikely to affect the identity, quality, strength, purity or potency of a particular drug, or the safety and efficacy of a particular device. For medical devices, the FDA can rely upon appropriate standards recognized in the industry, using these standards to serve as benchmarks in judging the safety and efficacy of a product on the basis of its conformity to these standards. The PDA furthermore may not withhold initial classification of a device because of Good Manufacturing Practices violations unless the violation is likely to present a serious risk to human health. For both drugs and devices, supplemental applications or data summaries can at times be submitted in place of more extensive raw data, thereby lessening the sponsor's burden of providing extra documentation.
- E. Access to information is increased
Under FDAMA, informing the public remains an FDA priority. The new law specifically calls for enhancing information for practitioners, health care organizations and consumers. For example, liberalized labeling regulations allow manufacturers to provide more information with the product. Manufacturers will now be permitted to circulate information from peer review studies about off-label uses of a product, although with certain restrictions. The FDA will have the opportunity to review the material before it is circulated, and the manufacturer must already have an NDA or BLA m effect and be in the process of obtaining FDA approval for the new, off-label use. Pharmacoeconomic data can be made available to managed care organizations and formulary committees so that these groups can compare the cost-effectiveness of an approved product to other available therapies. A data bank will be established at the NIH to make information about ongoing clinical trials accessible to the public. For implantable medical devices, mandatory tracking protocols will now be required.
III. Implications of FDAMA
The provisions of FDAMA are consistent with the traditional FDA commitment to public health. FDAMA expands consumer access to investigational drugs and devices. Other public health measures contained in FDAMA include incentives for investigating pediatric applications of drugs and more liberal "humanitarian" availability for devices.
Overall, beneficial effects can be anticipated in the regulated industries as FDAMA is implemented. For example, while serving important health needs, FDAMA concomitantly offers manufacturers expanded markets. Furthermore, the expedited regulatory review resulting from the provisions of FDAMA is expected to lower the time and cost involved in obtaining FDA approval to market a drug, biologic or device. This should positively affect product development and ultimately corporate value, thereby stimulating investment. In addition, better dialogue between sponsors and the FDA during the approval process, as mandated by FDAMA, should minimize uncertainties regarding the likelihood of ultimate approval, and thus influence investor confidence positively. Where commercial-ization of the product is governed by a licensing agreement, FDAMA provisions can lead to an earlier achievement of clinical milestone payments.
On the negative side, the requirements of FDAMA will be a significant dram upon FDA resources. FDA now faces an intense demand for its regulatory oversight, while its funding has been restricted. The requirements of FDAMA will put further stress upon this limited resource pool as FDA tries to achieve the statute's primary objective of getting products to market faster while protecting the public health.
Even though FDAMA points the FDA in a direction more consistent with the objectives of the regulated industries, the Agency retains considerable discretion to implement and interpret the statute in light of its own institutional culture and experience. The new statute commits the FDA to an ongoing program of communication and collaboration with industry, but does not require the Agency to abdicate its regulatory function. The overall message of FDAMA is that the FDA should continue the recent progress toward greater responsiveness to the public need for expedited access to useful medical technologies. It is likely that in exercising its oversight function. Congress will continue to be involved in guiding the FDA toward satisfying the nation's desire for new products that are safe and effective. Most importantly, the certainty that the pace of extraordinary medical breakthroughs in the field of life sciences will only accelerate in the years ahead and will be accompanied by increased demand by patients for access to these new treatments, will fuel a continued drive for a modernized FDA. If implementation of FDAMA is marked by newly constructive relationships between industry and the FDA, then DAMA will mark a vital step toward that end.
*Nick Littlefield, is a partner at Foley, Hoag & Eliot, Boston, Massachusetts; and was the former Democratic Staff Director for Senator Edward M. Kennedy, (D. Mass) United States Senate Committee on Labor and Human Resources Committee (1989-1998). M. Sharon Webb, M.D., J.D., is a member of the Patent group at Foley, Hoag & Eliot, Boston, Massachusetts; and was, prior to attending Harvard Law School, for twenty years a surgeon active in medical research and teaching.