A study of interest for those in the Philadelphia region has recently been released.

Philadelphia skyline
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Rising two spots from last year, Philadelphia has been ranked fifth on the list of life science clusters in the United States recently published by professional services and research firm JLL.  Following Boston, San Francisco, San Diego and Raleigh-Durham, Philadelphia was cited as the leader in the “Breakout Cluster”, which are regions “making strides in life sciences through new development and a growing scientific community.”  The study weighted various factors such as life science employment concentration, venture capital funding, lab supply, employment growth, establishment concentration, NIH funding, market occupancy rates and average asking rent.

The study states, “The Greater Philadelphia region is home to many elite academic and research institutions, as well as numerous hospitals and a strong pharmaceutical industry. Nearly 400,000 students attend one of the region’s 90 plus colleges or universities. The region is a top winner in federal research funding, attracting $900 million in NIH awards in 2016. As of 2015, 567,000 people in the Philadelphia metropolitan area worked in the “eds and meds” sectors. Eds and meds institutions are proactive partners in the life sciences economy.”

From The Navy Yard, a hub of life science activity, and the expansions at Drexel University in the city proper to activity throughout the suburbs, including the planned expansion of the Pennsylvania Biotechnology Center in nearby Bucks County, the region’s boasts a growing life sciences sector. The study cites as a priority for the future the growth of access to regional venture capital.

Congratulations Philadelphia!

Fox Partner Jean Frydman recently wrote an article on the 21st Century Cures Act for the Food and Drug Law Institute’s member magazine Update. In it, Jean describes the significant potential of the Act to transform the life sciences sector.  She outlines the key provisions of the law and how their implementation during the next five years will impact standards and practices within the industry. These provisions include the use of Real World Evidence (RWE) in regulatory decision-making, patient-focused drug development, patient access to regenerative medicine, breakthrough medical devices, and Healthcare Economic Information (HCEI).

We invite you to read the full article on the Fox Rothschild website.

Medical research
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Under Section 3033 of the 21st Century Cures Act, a drug is eligible for regenerative medicine advanced therapy (“RMAT”) designation. To obtain this designation, the treatment must be “a cell therapy, therapeutic tissue engineering product, or any combination product using such therapies or products, “intended to “treat, modify, reverse, or cure a serious or life-threatening disease” and have preliminary clinical evidence that the drug has the potential to address unmet needs. In its Guidance for Industry entitled “Expedited Programs for Serious Conditions-Drugs and Biologics,” the FDA has defined its interpretation of whether a disease or condition is serious or life-threatening and whether a drug is intended to treat a serious disease or condition.

Copyright: kentoh / 123RF Stock Photo
Copyright: kentoh / 123RF Stock Photo

The RMAT designation provides an easier path to approval by lowering the bar for unmet medical need for serious or life-threatening diseases. The request for RMAT designation must be made either concurrently with submission of an Investigational New Drug (“IND”) application or as an amendment to an existing IND.  Additional data other than that required for an IND will not be required for a RMAT request.

This designation will provide additional resources from the FDA to expedite the approval process.  The agency will take an active role in assisting the applicant with advice during review.

Time will tell how well this provision is executed under the new law. For now, we have our first publicly disclosed RMAT designation for Humacyte and its product Humacyl, announced in March.

Patient-Focused Drug Development

Additional information focusing on the patient’s experience while using an investigative drug will be included in 505b submissions.   Input on the experience will be derived from any person, including patients, family members and caregivers of patients, patient advocacy organizations, disease research foundations, researchers, and drug manufacturers. Methodologies to collect such information will be issued in a guidance from the FDA.   Clearly, the FDA will be seeking more input regarding the experience of the patients, other than the manufacturer when determining the decision to approve a drug.

Advancing New Drug Therapies

There are new provisions in the Act which will allow the Secretary to establish a process for the qualification of drug/biologic development tools such as a biomarker, a clinical outcome assessment and any other method, material or measure that aids drug development and regulatory review.  Such submissions for the qualifications will have a transparent review process for all to see on the FDA website.  The purpose of qualifying development tools to encourage the development of genetically targeted drugs or biologics for rare diseases.   Other areas of interest will be drugs for serious or life-threatening diseases and a program will be developed to encourage treatments for rare pediatric diseases. Grants and vouchers for priority review of drugs for such conditions will be expanded by the FDA and other federal agencies.

 Modern Trial Design and Evidence Development

The Agency will consider sources for data regarding the usage or potential benefits or risks of a drug derived from sources other than randomized clinical trials. A framework for collecting this information shall be established with the consultation of industry, academia, medical professional organizations, representative of patient advocacy groups, consumer organizations, disease research foundations and other interested parties.  The goal is to consider other sources when determining regulatory approval and conditions for use of the drug/biologic.

Patient Access to Therapies and Information

Manufacturers of investigational therapies for serious diseases shall make available policies for inclusion of patients on a publicly available website. Certainly applications for regenerative advanced therapy under 505(b)(1) will be eligible for priority and accelerated review meeting certain criteria.  This will apply to cell therapy, therapeutic engineering products, human cell and tissue products, and combination products using such therapies or products.  By opening the door in this area the FDA will be issuing guidance for devices used in the recovery, isolation or delivery of regenerative advanced therapies.

Combination Products

To assist and streamline the review of all combination products consisting of a drug, device or biologic product, the Agency shall assign a Center to regulate these products.  The purpose is to streamline the review of these products and help focus on the “primary mode of action” and administer any requests for review by the sponsor of an application if the “primary mode of action” is in question and general shepherding the review process to approval.

Antimicrobial Innovation and Stewardship

The Agency shall continue to monitor, along with other federal agencies, those antimicrobial drugs which become resistant to humans. In a limited population, the FDA may approve an antibacterial or antifungal drug, alone or in combination with one or more other drugs, in a limited population those that are intended to treat a serious or life-threatening infection. Such drugs may be approved notwithstanding a lack of evidence to fully establish a favorable benefit-risk profile in a population that is broader than the intended limited population. Promotional material for such drugs will require preapproval 30 days prior to dissemination. The Agency will develop appropriate susceptibility test interpretive criteria and provide the information on its website.

Medical Device Innovation

A program will be established for expediting approval for breakthrough technologies for which there are no comparable technologies. In doing so, the Agency will work with the sponsor to help with a development plan. Certain criteria will be developed for determining if a device meets this designation.

Another area of importance and very much needed is the requirement for the Agency to clarify medical device software regulations.  With the evolving technology of medical devices, this is very much needed.

Note:  The implementation of these programs have varied timeframes from the passage of the 21st Century Cures Act on December 13, 2016

This week, the Senate passed an expansive health bill known as the “21st Century Cures Act” after the bill received approval from the House earlier this year.  Due to its far-reaching effects in the healthcare and life science industries, among others, the bill was one of the more lobbied pieces of legislation in recent history.  President Obama is expected to sign the bill into law by the end of the year.

Highlights of the bill include significant amounts earmarked for improving cancer research (including funding for the Cancer Moonshot initiative championed by Joe Biden), fighting the epidemic of opioid abuse, making improvements in mental health treatment, helping the Food and Drug Administration (FDA) speed up drug approvals, and facilitating improved use of technology in medicine (such as the Brain Research through Advancing Innovative Neurotechnologies® (BRAIN) Initiative and the Precision Medicine Initiative).

Below is a brief summary of winners and losers under the bill:

Winners

  • Healthcare Information Technology and Software Companies: Healthcare IT companies and data management companies are set to gain millions of dollars in new business as a result of incentives in the bill for federal agencies and healthcare providers to use electronic health records systems and enhance research and treatment through the collection of electronic data.
  • Pharmaceutical and Medical Device Companies: The bill allows the FDA to require fewer studies from pharmaceutical and medical device companies and gives the FDA additional resources to speed up approvals. This will likely allow drug and device companies to save billions of dollars in bringing products to market.
  • Medical Schools, Hospitals and Physicians: Subject to annual appropriations, the bill provides $4.8 billion over 10 years in additional funding to the National Institutes of Health. This funding is intended to open the door to hundreds of millions in additional research grant dollars for researchers at universities and medical centers, many of whom will be focusing on cancer, neurobiology and genetic medicine.
  • Mental Health and Substance Abuse Advocates: The bill provides $1 billion in state grants over 2 years to address opioid abuse and addiction. The majority of this amount will fund both new and existing treatment facilities, while the remainder will fund improvements in mental health research and treatment.
  • Patient Groups: Many specialty disease and patient advocacy groups receive a portion of their funding from drug and device companies. With the allocation of additional dollars and requirements for more patient input in the drug development and approval process under the bill, these patient groups are slated to wield more power and influence.

Losers

  • Preventive Medicine: The bill cuts $3.5 billion, or about 30 percent, from the Prevention and Public Health Fund previously established under Obamacare. This fund promotes prevention of Alzheimer’s disease, hospital-acquired infections, chronic illnesses and other ailments.
  • The FDA: The bill provides the FDA with an additional $500 million through 2026 and more hiring authority. A win?  Sure, but the FDA contends that these measures aren’t enough to offset the additional workload that the bill will impose on its resources.  In addition, the agency fought and lost with respect to a controversial voucher program which awards companies that approve drugs for rare pediatric diseases.
  • Consumer and Patient Safety Groups: Many consumer and patient safety advocates (such as Public Citizen and the National Center for Health Research) are adamant that the bill will result in unsafe drug and device approvals and doesn’t address rising drug costs.
  • Hair Growth Patients: Under the bill, federal Medicaid will no longer help pay for drugs that help patients restore hair. Hair growth patient advocates such as the National Alopecia Areata Foundation spent significant sums of money to fight this.

While some of those against the bill continue to be disappointed and claim that “Congress gave Big Pharma and the medical device industry an early Christmas present by passing the 21st Century Cures Act”, most seem to be encouraged by lawmakers’ renewed and bipartisan efforts to focus on scientific research, effective care delivery, and the removal of barriers to scientific progress.


Update: A representative of the National Alopecia Areata Foundation (NAAF) recently reached out to me regarding this post. I think it’s important to clarify that NAAF does not oppose the Act – on the contrary, it has been supportive of it. They had spent significant sums specifically for greater insurance parity through the bill for those with alopecia areata so they could better afford cranial prosthetics, but were unsuccessful. They have worked toward a separate bill introduced in the House in April, the Cranial Prosthetic Medicaid Coverage Enhancement Act, to address the issue via Medicaid.

Dietary supplements
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In an Alert published yesterday, I provided an update on new FDA guidance regarding dietary supplements:

Dietary supplements that came on the market after October 15, 1994 must have a new dietary ingredient notification (NDI) to the FDA, according to an extensive new guidance document issued on August 11.

This includes manufacturing processes on supplements prior to this date that change the identity of the ingredient such as a different chemical structure or composition, use of extraction or use of a different starting material, such as a different part of a botanical.

If you manufacture or sell product in this category and did not submit a notification with the proper information to the FDA at least 75 days before marketing, your product may be deemed adulterated and an unapproved drug or an otherwise dangerous substance and falsely labeled as a dietary supplement.

The FDA estimates there are more than 55,600 dietary supplements on the market, and that 5,560 new dietary supplement products come on the market each year. However, the agency has received fewer than 1,000 NDI notifications since 1994 when the Dietary Supplement Health and Education Act (DSHEA) was passed.

To read my full discussion of the guidance document, please visit the Fox Rothschild website.

In part 1, I described the state of play with regard to biologics after the FDA’s approval of its second biosimilar product Inflectra (infliximab). Now we turn to the regulatory process for such approval.

Copyright: kentoh / 123RF Stock Photo
Copyright: kentoh / 123RF Stock Photo

Before approving a biosimilar, the FDA requires the following:

  • Information demonstrating that the biological product is biosimilar to a reference product based upon data derived from:
    • analytical studies demonstrating that the biological product is highly similar to the reference product notwithstanding minor differences in clinically inactive components;
    • animal studies (including the assessment of toxicity); and
    • a clinical study or studies (including the assessment of immunogenicity and pharmacokinetics or pharmacodynamics) that are sufficient to demonstrate safety, purity, and potency in one or more appropriate conditions of use for which the reference product is licensed and intended to be used and for which licensure is sought for the biological product.  The design of these studies will differ depending on the type of biologic being studied.  The dose and route of administration should be the same as for the reference product.
  • Phase 3 clinical equivalency trials demonstrating that the proposed biosmilar has neither decreased nor increased activity relative to the reference product. That is, the goal is to demonstrate that any difference in efficacy or safety between the biosimilar and reference product is less than a prespecified margin of “clinical equivalence.”
  • Quality documents providing information on:
    • extensive characterization studies of both the active substance and the finished product; and
    • the development, manufacturing process, and quality control of both the active substance and the finished product. There should be a comparability exercise between the biosimilar and reference products on both the active substance and the finished products and the applicant should provide justification for any observed difference with regard to their potential impact on safety and efficacy. These differences can determine the amount of clinical data required for the biosimilar.
  • Pharmacovigilance Requirements
    • A report of local suspected serious or unexpected adverse drug reactions and periodic safety update reports.
    • Periodic Safety Update Reports on the biosimilar product every 6 months for the first 2 years, and then annually for the following 3 years after the registration is approved.

Information on the Risk Management Plan and/or Risk Evaluation and Mitigation Strategy for the biosimilar product as required by the reference agency if applicable, and any proposed local risk management plan activities and risk mitigation strategies, including a statement how these issues will be addressed in the post-marketing follow-up.  Finally, the proposed labelling for the healthcare professional and the patient must be provided.

As with generic drugs, increased availability of approved biosimilars will markedly decrease medical costs for patients, something which we all can get behind.

Do we finally have clarity on the regulatory process for more biosimilars to reach the market?  Now that the FDA has approved its second biosimilar product Inflectra (infliximab) to market, will we see more biosimilar approvals in 2016?

Copyright: kentoh / 123RF Stock Photo
Copyright: kentoh / 123RF Stock Photo

Why were there no biosimilars for biologics in the past?

 Previously, there was no regulatory pathway for a biosimilar.   Biologics typically are derived from living organisms.   FDA broadly defines biologics as vaccines, blood and blood components, allergenics, somatic cells, gene therapy, tissues, and recombinant therapeutic proteins.  Biologics can be composed of sugars, proteins, or nucleic acids or complex combinations of these substances, or may be living entities such as cell and tissues.  Biologics can provide unique challenges.  They work by causing an immunologic reaction in the patient; different physiological responses may be seen, particularly among certain patient populations.

Biologics depend on living systems to produce products for market.  Even tiny variations in the manufacturing process can significantly affect the finished medication and, most importantly, the way it functions in the body.  “The product is a process.”  A drug, by contrast, is a small molecule which is produced by chemicals.  Once we understand the chemistry of a drug, anyone can produce it, thereby making generic drugs comparatively simple to regulate. However, biologics are large molecules which have been manipulated in some way and are impossible to replicate completely.

The cost of manufacturing a biosimilar is almost 100 times the cost of manufacturing a generic drug.  The complexity of manufacturing a biologic requires a large, up-front financial investment for biosimilars compared to the small-molecule generic drug market.  Biosimilar makers must essentially re-invent a production process, and then prove to the FDA that it results in a drug that is clinically the same as the branded product.

Will we see more biosimilars on the market?  

 If biosimilars provide the same benefit as biologics, surveys show the use of biosimilars would lower the cost of these medications as much as 40 percent and that competition from biosimilars would reduce total drug spending by approximately $25 billion over the next 10 years.  There are still some outstanding federal and state regulatory issues, including whether biosimilars will share the same name with reference biologics and whether pharmacists in states will be able to automatically substitute interchangeable biologic products without unnecessary encumbrances.

However, there are several biosimilar applications pending at FDA and since the recent approval of the Celltrion/Pfizer biosimilar Inflectra.to Jannsen’s Remicade, FDA may be under pressure to approve these pending applications.  One of the concerns is how much data the FDA would require to establish the “no clinically meaningful difference” standard for 351(k) biosimilar applications.

Congress has been fairly critical of the pace at which the FDA is approving biosimilars and how Medicare plans to reimburse for biosimilar products. The FDA has begun to collect more money under the user fee program and that should provide the FDA with more robust funding for biosimilars. The Federal Food, Drug and Cosmetic Act, as amended by the Biosimilar User Fee Act of 2012, authorized FDA to assess and collect fees for biosimilar biological products from October 2012 through September 2017.  FDA dedicates these fees to expediting the review process for biosimilar biological products.

In part 2, we’ll explore the FDA’s requirements for approving a biosimilar application. Stay tuned.

Prescription drugs and fast-track programs
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Expedited approval programs are referred to as fast-track programs.  The FDA created these programs for new drugs in 1992 under the Prescription Drug User Act (“PDUFA”) with the aim of meeting treatment needs for serious or life-threatening medical conditions more quickly.

What are the options?

  1. Fast-track designation is granted to a drug for a serious condition for an un-met need that will improve the survival or the day-to-day function of the patient.
  2. A breakthrough therapy is a drug that treats a serious condition and shows preliminary evidence that it is superior to a drug already on the market with clinically significant endpoints.
  3. Accelerated approval is granted to a drug that treats a serious condition using surrogate endpoints to show the benefit of the drug. A surrogate endpoint is one that demonstrates it is reasonably likely to predict a real clinical benefit. E.g. shrinking tumors=longer survival
  4. Priority review is granted to a drug that is highly effective, substantially eliminates adverse reactions that prevent treatment, is safe and effective in a new subpopulation and/or helps patients be more compliant with the drug regimen.

The specific meaning of each of these paths and the distinction among them can be confusing.  It is important to determine early in the beginning clinical stages if the drug might fit into either of these pathways. You need an advocate to describe to the FDA in detail how the drug may fit into one of these fast-track programs.

The advantages of being part of a fast-track program for your drug are the FDA accelerates the review of the drug and stays in close contact with the sponsor of the drug.   The FDA wants the product to be successful and is part of the review process early in the development. The Agency also has shortened timeframes within which it must respond to the applicant or sponsor. Of course, the economic advantages are obvious!

Is your company missing out on these options?


Jean W. Frydman is a partner in the firm’s Princeton office.

Navigating intellectual property protections and issues can be a complicated and challenging process for emerging companies. In the fast-paced start-up world, it is not unusual for IP concerns to take a backseat. But disciplined and proper IP management is critical to any emerging company. Strong IP rights can be used to impose a barrier to competition, generate a portfolio of assets that can be leveraged, and help increase the value of a business. Here are four essential steps to protecting and strengthening your IP assets.  :

Copyright: stuartburf / 123RF Stock Photo
Copyright: stuartburf / 123RF Stock Photo

1. Insist that developers assign all IP rights to your company

Anyone who creates IP for a company should be under a written obligation to assign the rights in such IP to the company. This includes employees, independent contractors, suppliers, other developers and even company founders. Often, companies assume that because they are paying for development work, they own the results of the development. However, this is usually not the case, especially with respect to independent contractors. When it comes to development, having a written agreement that details assignment obligations is always a wise approach.

2. File early for patent protection

Patent protection may not be a top priority for an emerging company during its early stages due to cost concerns or because an invention has not yet perfected. But often, it is the technology developed during the early stages that ultimately has the most value. A wait-and-see approach to patent filing carries with it certain risks. For example, in the United States, a patent application must be filed within one year from the first public disclosure (i.e., a non-confidential, enabling disclosure of an invention such as a public use of the invention, a sale of the invention, an offer to sell the invention, a journal article describing the invention, a trade show presentation or the like). In addition, the United States operates on a first-to-file basis, meaning that the first person to file a patent application has rights for protection of the invention. As such, waiting to file for patent protection risks someone else filing first.

3. File for patents before public disclosure—especially for foreign protection

Although the United States has a one year grace period during which a patent application can be filed after a public disclosure, the majority of countries outside of the United States do not have comparable grace periods. Unlike the United States, a public disclosure is considered a bar to patentability in these countries. If foreign patent protection is part of a company’s IP strategy, then it is important to file a patent application before a disclosure in order to preserve foreign rights.

4. Understand and comply with the terms of your open source software

Open source code is often an efficient and cost free solution for emerging companies. Although use of open source software may be free of monetary cost, it is not free of responsibility. As a general rule, users may not use or distribute software without a license from the owner. And this rule applies equally to open source software despite its being publicly available or available for free. Like commercial software, the use of open source software is usually governed by a license agreement that includes terms and conditions controlling use of the software.  It is critical to understand the license terms and also how conditions may apply to open source software usage. In addition, it is important for users to understand the terms of any viral open source software, especially if the open source software is being combined with or integrated into proprietary software. Failure to do so could lead to an obligation to make proprietary source code available under a similar license.