FDA: A Bargain at Two Cents Per Day Per American

FDA touches every American many times each day. Today's investment (2 cents per day per American) is a pittance compared to the benefit of a strong FDA and the risk of an underfunded FDA. There cannot be many agencies in the US government that have such a vast scope of responsibilities and so few dollars to get the job done.

This is the powerful message that the Alliance for a Stronger FDA has been delivering to Capitol Hill. Even still, it will be a difficult year for any federal agency whose mission and responsibilities are growing.

In recent testimony to the House and Senate Appropriations Committees, the Alliance focused on the large gap between FDA's responsibilities and resources. The Alliance also points to ways in which the agency's job becomes tougher each year—notably through increased scientific knowledge and rapid industry globalization.

In the style of David Letterman's Top Ten lists, the Alliance has its own list of 10 things they hope policymakers will know and remember about FDA:

• FDA is a comparatively small agency with a small appropriation: just $2.35B in 2010 to regulate products that represent a quarter of all consumer spending.
  
• Twenty-five years ago, FDA and CDC were the same size; today the CDC budget is nearly 2 1/2 times as large.
  
• A strong FDA is good for the US economy and for our balance of trade.
  
• FDA is an integral part of our response to public health emergencies, including defense against bioterrorism.
  
• FDA's appropriation is almost entirely staff costs, requiring nearly 6% increase each year to sustain program levels.
  
• After three years of good increases (thank you, Congress), FDA staffing levels from the 2010 appropriation have only just been restored to the previous high-level achieved in 1994.
  
• User fees serve valuable functions, but they are targeted and support only specific activities. They don't strengthen the FDA in carrying out its overall public health mission.
  
• All FDA stakeholders support a stronger FDA (consumers, patients, health professionals, and industry).
  
• FDA's responsibilities increase each year---through new mandates, globalization, and scientific complexity.
  

And the single most important reason (and the one raised at the beginning of this column):

• FDA touches every American many times each day. Today's investment (2 cents per day per American) is a pittance compared to the benefit of a strong FDA and the risk of an underfunded FDA.
  

To their credit, the Obama Administration has committed to cutting domestic spending by funding priority programs, rather than relying on across-the-board cuts. This is a challenge FDA can meet: showing that increased funding brings substantial benefits to the American people and is worthy of increases beyond what other agencies are getting.

Going from 2 cents to 3 cents per day doesn't seem like much, but it would add $1 billion to the FDA budget.

Steven

For purposes of disclosure, I am one of the founders of the Alliance for a Stronger FDA and serve as its deputy executive director. FDA Matters is not affiliated in any way with the Alliance.

For more information about the Alliance, send me a note at sgrossman@strengthenfda.org.

The Alliance for a Stronger FDA's House testimony is at:

http://fdaalliance.files.wordpress.com/2009/11/alliance-statement-house-appropriations-committee-fy-11.pdf

Follow-on Biologics: 1-2-3-GO

The long fight is over for follow-on biologic (FOBs). The Senate-passed version of health reform will become law, even while the larger fight continues over the reconciliation package. Within 10 days, FDA will be busy implementing an approval pathway for FOBs.

The world of biopharmaceuticals will never be the same, but not in the ways that many players expect. Here is FDA Matters' guide to understanding the next phase.

Laws set the rules, but what happens next is remarkably dynamic and unpredictable. I was one of the Senate negotiators on the Patent Term Restoration and Drug Price Competition Act (Hatch-Waxman) and the Orphan Drug Act (ODA). What we thought would happen…and what actually happened…were not the same. Not necessarily better or worse. Just different.

We thought Hatch-Waxman would create an orderly world of patent extensions and generic approvals. We could not imagine the scandal in the generic drug office a few years later and would have been astounded that companies might still be litigating ground rules 25 years later.

The ODA was a triumph of good intentions, but would not have worked without the subsequent amendment redefining orphan drugs as affecting fewer than 200,000 Americans each year. We were not thinking about cancer patients. Yet they have been among those who have benefitted most by the ODA.

What will happen to FOBs will be just as dynamic and unpredictable.

The market was not waiting for the law to pass. Even though a legislatively-created FOB approval process was uncertain, Pfizer, Merck, Novartis, Teva and other major biopharmaceutical companies had already made decisions to be involved. Billions have already been spent or committed by companies before they knew the final FOB ground rules in the US.

More knowledge about the discovery, creation and manufacturing of biologics will be good for innovators, as much as imitators. Some of those biologically-similar products will themselves be innovative. As a result, many will require full approvals rather than being able to take advantage of an abbreviated FOB pathway.

Innovators will benefit from progress on characterizing biologic molecules, new testing methodologies and manufacturing improvements. To take a single example, the FOB market will force new investments in understanding immunogenicity that will benefit the entire industry, as well as patients.

FDA will be remarkably conservative for at least the next 5 years. FDA is ready for FOBs. Passage of the law gives the agency an important new public health mission: assure the safety and efficacy of biological products that will provide better access and greater affordability for life-saving and life-enhancing therapies.

Enthusiasm aside, the FDA is likely to be conservative in its policies and actions. They have not forgotten the problems in managing generic drug applications after Hatch-Waxman. They are fully aware of potentially big consequences in very small differences in biological products. They have lived through contaminated heparin and Genzyme's manufacturing problems.

FDA will want new safety and efficacy data from all applicants, with an emphasis on immunogenicity testing. Knowledge in these matters will increase rapidly and FDA will loosen up over time. But not soon…and in measured steps.

Steven

Here is an earlier column on the likely dynamics of the FOB marketplace.

The Follow-on Biologics Market

Since the debate began several years ago, the policy and politics of follow-on biologics (FOB) have been driven by assumptions and projections of the anticipated market. There has been a lot of fuzzy thinking about what type of companies will be players and how they will position themselves. Read the rest of this entry »

Wrestling for the Soul of FDA

User fees are acceptable if they pay for processing passports or extra services at national parks. I don't worry that the American public will lose confidence in the State Department or the National Park Service. This doesn't translate to every user fee and every government department.

User fees are a bad way to fund FDA, a public health regulatory agency that oversees nearly a quarter of all consumer spending. It's not that user fees are corrupting. FDA is capable of making good and bad decisions without regard to where the money comes from. But user fees have the potential to erode public confidence in the agency.

FDA Matters gets it. The agency needs more money to fulfill its mission and the Congress won't pay for all of the costs. In FY 10, nearly $700 million came from user fees charged to drug and device manufacturers and a few others. (This total and the remaining discussion omit tobacco user fees. No one thinks tobacco companies are getting favorable treatment for their monies!).

FDA received $2.345 billion from public funds in FY 10, more than three times the amount from user fees. It would take a long-time and a lot of user fees for the overall balance in the agency to be threatened.

The real story (and the worry for the future of the rest of the agency) is the Center for Drug Evaluation and Research (CDER). It receives about $750 million to run the drug approval process and other CDER activities (other than inspections and enforcement). Of that total, about $335 million comes from public funds (45%); $415 million from user fees (55%). How can it be good for industry to provide the predominant funding for CDER or any of the other FDA centers?

Nothing wrong is occurring. But the overreliance on user fees is confidence-eroding for Congress, media and the American public…and dispiriting for FDA staff.

Now is the time to raise and debate these issues.

• FDA has begun the public hearing process for the next drug user fee act (PDUFA V). Another round of user fee increases could push CDER into even greater dependence.
  
• The appropriations committees have started consideration of the agency's FY 11 appropriation. Under the President's request, existing user fees (excluding tobacco and proposed new fees) will grow about 15%, while public funds only 6%.
  
• Congress may pass new food safety legislation and the House version includes $220 million in new user fees to pay part of the costs of new responsibilities. This is about 20% of the food monies in the President's FY 11 budget request. This percentage could increase if Congress doesn't provide several times this amount from public funds to implement the law.
  

For fiscal and political reasons, user fees are here to stay and FDA will never be funded entirely from public monies. This should not blind us to the risk of FDA slipping into dependence on user fees. Nor should it blind us to how user fees are a drag on public confidence in FDA.

I believe that FDA, regulated industries, Members of Congress and other stakeholders agree with FDA Matters. Yet, you are unlikely to hear them say so. Each fears that FDA would shrink without user fees. Someone needs to go first and say: we will find public monies to keep FDA from becoming dependent on user fees.

The soul of the FDA may not be at stake. But we should not underestimate the damage to the agency from a public perception that user fees are darkening its soul.

Steven

At the March 10, 2010 House Appropriations Committee hearing, Commissioner Hamburg addressed the relationship between user fees and FDA decisionmaking:

…. [E]xamining the integrity of our decision making and ensuring that it is free from conflict of interest and other concerns is one of the most essential elements of FDA being able to do its work, being able to have the trust and confidence of policy makers and the public and certainly one of my highest priorities.  So we take it very seriously. We have established firewalls in terms of the use of user fees. We are committed to a science-driven decision making process, and it's a dynamic concern. We can't just sit back and say our systems are in place, move onto the next issue. It's something we have to continually be monitoring, continually responsive to concerns as they're raised and ensuring that we have the right checks and double checks.

My earlier blog column on this topic:

It's Time to Change CDER Funding

    September 17th, 2009

As most readers know, bio-pharma companies pay user fees, based on activities (such as submitting a New Drug Application) and on the number of their manufacturing facilities. The amounts are set by law. As part of the arrangement, FDA agrees to certain performance goals, which are also specified in law.

We often hear how dependent CDER is on user fees. The actual numbers are startling and deserve to be well-aired. Read the rest of this

Fortuitous Timing and Public Health Leadership at FDA

At the end of March, Commissioner Hamburg will have been at FDA for 10 months and Dr. Sharfstein for a year. They are very good leaders who have also benefitted from their prior experiences and the timing of their appointments. Here is FDA Matters' analysis:

Public Health vs. Academic Medicine. Since at least the mid-1970's, FDA commissioners have come from academic health centers or government. Not one had run a public health agency at the federal, state or local level. In contrast, Dr. Hamburg spent 6 years leading the New York City Health Department. Dr. Sharfstein was recruited from his job heading the Baltimore City Health Department.

The difference is largely unappreciated. Running an academic health center is inwardly focused, with the goal of making a highly-complex institution run well. The primary outputs are patient care, research, and teaching.

Power in an academic health center is widely shared and interaction based on collegial ties. External forces, particularly the government political process, are often intermittent and remote and crises rarely come from outside the organization. Accountability is a virtue, but often not a requirement. Diplomacy and people management are the primary skills.

In contrast, a city public health agency is externally focused, with the goal of improving the health of a population. The primary outputs are programs of intervention and education, along with regulations. The structure in a public health department is hierarchical at every level.

The commissioner is integral to the political process and must be responsive to the Mayor and the City Council. External forces drive much of the activity. Crises are so frequent as to become routine and accountability is a necessity. Diplomacy and people management are valuable skills, but the premium is on concrete actions occurring in real-time, even if someone's feelings are bruised.

FDA is very much like a big-city health department, only minimally like an academic health center. This gives an enormous advantage to Drs. Hamburg and Sharfstein.

FDA in 2010: A Chance to Grow Stronger. In a hostile and uninterested environment, the very best leadership can survive, but not prosper. The new FDA leadership team is fortunate to have the best situation in 30 years for improving FDA.

FDA's budget has grown over the last three fiscal years, providing the new Commissioner with resources to strengthen the agency and prioritize initiatives. Over much of the prior two decades, the agency received annual increases close to, or below, inflation. There is not much new you can do when you are struggling to fund pay raises and rent increases.

Further, it matters when a Commissioner serves in the Presidential life cycle. As a rule, there is a lot of policymaking in the first few years of a Presidency and comparatively little in the later years. If policy improvements are to be made at FDA, 2010 is the time.

In addition, President Obama is alone among the post-war presidents in his interest in public health. Inadvertently, this was reinforced last year when he had to handle the peanut crisis himself because there were no confirmed appointees at DHHS. President Obama knows what FDA does and has a feeling for why it is important.

None of this is to take anything away from Drs. Hamburg and Sharfstein. They deserve credit for progress occurring at FDA. They are fortunate to have experience and timing that are likely to take them further than most of their predecessors.

Steven

FDA Needs at Least a $250 Million Increase in FY 2011

The President's proposal to freeze domestic discretionary programs in FY 2011 (and beyond) will force painful cuts across government and in programs that millions of American rely upon. Even some traditionally-favored agencies, such as NIH, are looking at only small increases. With a proposed 6% increase (about $150 million), FDA would seem to be doing far better than most.

FDA Matters feels strongly that this is not nearly enough. By my calculations, at least a $250 million increase for FDA would be needed, just to achieve the program levels anticipated in the President's budget request. The Alliance for a Stronger FDA has asked for a $495 million increase, which could be put to good use by the agency. Why is 6% not enough?

Despite three good years of increases for FDA, we are still fighting decades of neglect. Appropriated staffing levels in 2010 are only back to where they were in 1994. Over a 25-year period, CDC has grown from an agency the size of FDA to one that is three times as large. Meantime, FDA has new responsibilities and an ever more-complex environment in which to function.

A 6% increase doesn't go very far. A tad more than $100 million will be taken up by increases in salaries, benefits and rents. Other costs go up also. On a FY 10 base of $2.35 billion, about $40 million is available for new programming in FY 11. It will probably go to hire more food inspectors, which is an important need.

This suggests that the rest of the agency (apart from food inspection) will be able to operate in FY 11 at their FY 10 staffing/program levels. In reality, this won't be the case unless the Congress provides FDA with an appropriation above the President's request.

Here is why the picture is actually quite grim. According to FDA budget documents, the increased cost of salaries in FY 11 is $66 million. As far as I can tell, only about $3 million is actually part of the President's request. So, what we consider as an increase to cover inflation…..actually does nothing of the sort. The President has told Congress: give FDA a $146 million increase in monies and it will provide a $143 million increase in programming.

So, food inspections, patient safety and advancing regulatory science  (the President's budgetary priorities) will happen….and parts of the rest of the agency will shrink (because they can't cover inflation) OR vital, existing services will continue, but FDA won't be able to deliver on the President's initiatives. It will take an extra $100M (an increase of $250 million total) to cover inflation in salary, rents, etc. and provide the new programming in the President's request.

To bring this down to specifics, the President has requested $25 million for advancing regulatory sciences. This is a priority of Commissioner Hamburg and much lauded by the stakeholder communities. At an IOM meeting last week on regulatory science, there was palpable excitement that the President had made a great first-year commitment. But follow the logic of this analysis and it is unclear whether there really will be monies to get started in FY 2011.

The bottomline: FDA needs more than the increase proposed in the President's request. The President, by his budget justification, agrees....and envisions an FDA that will require at least a $ 250 million increase.  

Steven

Some recent thoughts on the same topic, but with a different focus:

The President's Budget Request: Is 6% Enough for FDA?

February 4th, 2010

The President's FY 11 budget request for FDA includes a $146 million increase in appropriated (non-user fee) funding. This is about 6% of the $2.36 billion appropriation that FDA received in FY 10. With the President's tough talk about deficit reduction, anything above a freeze should be considered good. Why was the Alliance for a Stronger FDA disappointed? Read the rest of this entry »

Shaken to the Core: What FDA and FDA-Regulated Companies Can Learn from Toyota

I do not believe that Toyota became a global success by cutting corners and ignoring safety concerns. Nonetheless, the company may not survive the investigations, the lawsuits, the civil and criminal fines, the securities litigation, the recalls (8.5 million cars so far), the loss of consumer confidence and the possible criminal indictments.

FDA Matters hopes that the CEO's of FDA-regulated companies are paying attention. They need to understand that their company can be "shaken to the core," as Toyota has.

What's a CEO to do?

First and foremost, believe (really believe) that bad things can happen to you and your company. Being FDA-regulated means "always worrying that you will have to say you're sorry." Foods, drugs and devices are central to our everyday life. By their nature, problems are to be expected. Deadly consequences are never more than one mistake or misjudgment away.

Don't assume that you can limit the damage. Problems escalated quickly for Toyota, revealing flaws in the company's process and attitude, not just its products. Most of the product lines are involved. And concerns keep multiplying, while confidence dwindles in the company's ability to fix the problems.

Recognize that "the buck stops here." Congress and the media are fascinated by what Mr. Toyoda knew and when he knew it. But it is quite beside the point. His public humiliation and the likely ruin of the Toyota brand are going to occur regardless of his level of knowledge. The CEO is responsible and will be held accountable for the actions and failures of all the company's employees and vendors.

Trust, but verify. In a large, multi-national company, there are an endless number of decisions.

Hiring good people and delegating is "necessary but not sufficient." Even the best employees find it difficult to tell their boss about a serious issue that might require costly pre-emptive action. It's too easy for them to think: last year's worst fears never materialized, so maybe today's concerns won't turn out to be bad either.

Don't drink the Kool-Aid. Everyone wants to be part of the team--to believe in the product they are creating. It becomes hard to be objective about the good and bad points of what one's company and team are doing. The CEO needs to believe the worst is possible, ask the tough questions and be skeptical when everyone responds "we're okay."

Your crisis management plan is not enough. Crisis planning is a step-child of corporate communications. Not enough companies have such plans and even fewer take them seriously enough to practice and update them. I doubt many companies have well-honed plans that prepare them to deal with multi-system failure.

In a hurricane of adversity, it is unavoidable that companies will be "shaken to the core." As with real storms, the survivors will be those who built sounder structures, monitored performance closely, and put plans in place for the "once in a hundred years" event that devastates everything.

Such preparation does not happen naturally and cannot be delayed until the storm clouds appear.

However, CEO's can commit to running "shaken to the core" reviews—to anticipate and prevent problems, as well as prepare for dealing with the worst. FDA Matters sees at least three keys to success in this type of "360 degree" inquiry:

• no person, project, product, or process can be protected from review,
  
• employees need to know that they can speak up confidentially and without fear of reprisal, and
  
• outside experts are needed to perform reviews and audits, because no one can be sufficiently objective about their own work or team.
  

And yes, FDA Commissioner Hamburg is a CEO….. and this column applies to FDA as much as it does to any FDA-regulated company.

Steven

Some related columns:

Executions in China: A Thanksgiving Message

November 24th, 2009

Sometimes it takes other people to give us a perspective on our own values. Read the rest of this entry »

Black, White, Shades of Gray

November 13th, 2009

Civil and criminal investigations are becoming a more prominent feature in the world of FDA-regulated industries. People who never gave any thought to this….suddenly find themselves needing to understand how investigations work. Read the rest of this entry »

The Beatings Will Continue…
November 1st, 2009

It has been an expensive year for pharmaceutical companies. Billions of dollars have been paid to federal and state governments and whistleblowers in settlement of allegations and lawsuits. The complaints include off-label marketing and overcharging Medicaid, but there are many others. Read the rest of this entry »

Commissioner Hamburg’s Most Important Personnel Decision

With due respect to the many fine individuals that Commissioner Hamburg has recruited, FDA Matters thinks the most important appointment so far has been Michael Taylor to be Deputy Commissioner for Foods. An even more important decision needs to be made soon: choosing the right person to be Associate Commissioner for Regulatory Affairs.

Not so many years ago, the Associate Commissioner for Regulatory Affairs—who heads the Officer of Regulatory Affairs (ORA)—was the #2 or #3 person at FDA, depending on whether there was a principal deputy. If the commissioner was abroad or unavailable, the person with the regulatory affairs portfolio was next in line. This changed at some point, but I am not sure when or why.

The head of regulatory affairs oversees all of the inspection and enforcement activities of the agency. This is an extraordinarily powerful position, even though very few people know who heads ORA or much about it. FDA seems to consciously downplay the leadership, mission and importance of the office.

Yet, the Associate Commissioner for Regulatory Affairs controls more than one-third of the FDA's appropriated budget and oversees about 4,000 people spread across the US and the world. Last year, I proclaimed the head of regulatory affairs to be "the uncrowned prince of FDA."

On January 27, FDA posted a job notice seeking a new Associate Commissioner for Regulatory Affairs. Since the job has been vacant, the responsibilities have been carried out by an "acting" associate commissioner. Applications must be received by February 24.

The FDA needs a permanent head for the Office of Regulatory Affairs…and the sooner the better. Congressional and media attention have increasingly focused on FDA's capacity to perform effective inspections and rigorously enforce the law. The agency's good name and public credibility are tied to success in these areas. If the FDA's rigor as a regulator comes into questions, its ability to undertake initiatives elsewhere in the agency may ultimately flounder.

Since the Commissioner has so many roles, she needs someone to be the highly-visible, public face of tough FDA enforcement. Two decades ago, when I worked at HHS, the Inspector General was a former professor who had become the supervisor of the organized crime units in the FBI's Chicago Office. He was a good, smart man and a friend…but you knew immediately that you didn't want to be a target of one of his investigations. FDA needs someone like him.

I don't have any particular candidate in mind. Even if the "acting" associate commissioner were to be promoted, he would have more authority than at present.

Getting the right Associate Commissioner for Regulatory Affairs is Commissioner Hamburg's most important personnel decision. Once a decision is made, I hope she will see the value of creating a stronger profile for both the office and the office-holder.

Steven

The job posting is at:

https://jobs.smartbrief.com/action/listing?listingid=E5035373-B323-472F-8D7F-A765DE87A093&briefid=3e572e18-3fbc-11d5-ad13-000244141872&sid=9ae0455d-fd94-42bf-aca1-47b8d3adbfa7

Earlier columns relevant to this topic:

A New Food Agency Has Become Unnecessary (For Now)

January 15th, 2010

FDA Matters applauds the appointment of Mr. Michael Taylor to be the first Deputy Commissioner for Foods at FDA. With more authority, experience and stature than any previous food leader, he has the opportunity to shape and re-shape food regulation and the safety of the food supply. Because Mr. Taylor will be outstanding in this new post, the campaign for a separate food agency will go away, at least for a couple of years. Read the rest of this entry »

Executions in China: A Thanksgiving Message

November 24th, 2009

Sometimes it takes other people to give us a perspective on our own values. Read the rest of this entry »

The Uncrowned Prince of FDA

September 15th, 2009

Which FDA line manager has the most appropriated resources to work with in FY 09? Is it Janet Woodcock, head of the drug center or Stephen Sundlof, head of the food center? The correct answer: neither. Read the rest of this entry »

Transition at PhRMA

Former Representative Billy Tauzin tendered his resignation this week, ending a 5 ½ year tenure as President of the Pharmaceutical Research and Manufacturing Association (PhRMA). When his successor is chosen, it will tell us a lot about how the pharmaceutical industry sees itself….and what the big pharmaceutical companies think is their next major challenge. Here is FDA Matters' analysis.

Congressman Tauzin has won some major battles for the association's members. Depending on the news story, his departure is linked to criticisms of the industry's health reform deal with the White House or to Board unhappiness with his management style. His contract is up this year, so the timing may be nothing more than a mutual parting.

Tauzin was hired in 2005. Immediately before, the otherwise successful battle for the Medicare Part D benefit had revealed how far the industry's relationship with Congress had deteriorated. Industry was feeling very insecure about reimportation, follow-on biologics, counterfeiting, access to generic drugs, and drug price negotiations. Among other things, Tauzin built relationships with Democrats, balancing the industry's traditional political strength with Republicans.

In retrospect, it seems obvious that PhRMA's new President would be well-connected and well-respected on Capitol Hill. Yet, PhRMA had never before looked to Congress for a leader to run the association.

Going back more than 30 years, the Congressman's four predecessors at PhRMA were politically savvy and experienced—but not of, or close to, Congress. Each was also quite different from another.

The first one I remember was Joseph Stetler, president during the 1970's. At the time, the pharmaceutical industry's greatest challenge was from the medical professions. There were complaints about industry influence on medical education and clinical practice…and questions about whether medical journals should carry ads from pharmaceutical companies.

Among Stetler's qualifications: he had been general counsel to the American Medical Association for 12 years.

Lewis Engman followed Stetler in the late 1970's, as the industry became more concerned about attacks on its business practices, notably efforts to keep generic drugs off the market. He was President during the negotiations on the Hatch-Waxman legislation in 1983 and 1984, which fundamentally changed the industry's business model.

Among Engman's qualifications: he had been chairman of the Federal Trade Commission.

His successor was Gerald Mossinghoff, who guided the industry through implementation of Hatch-Waxman. As generics were becoming serious market players, he moved PhRMA toward a more far-reaching and comprehensive positioning on the protection of the industry's intellectual property.

Among Mossinghoff's qualifications: he had been head of the US Patent and Trademark Office.

His successor was Alan Holmer. The pharmaceutical industry of the mid-1990's was feeling the pressure of globalization. Worldwide markets had become increasingly important. Trade barriers had begun to threaten the industry, which still had a strong domestic focus.

Among Holmer's qualifications: former Deputy US Trade Representative and a Deputy Assistant Secretary for Import Administration in the Department of Commerce.

Holmer was as accomplished and renowned as an international trade lawyer as his predecessors had been in their areas of expertise. Tauzin followed, filling the industry's need to mend fences and improve relations with Congress.

I don't know what the PhRMA board is thinking with regard to a new President to succeed Representative Tauzin. It may not be a former member of Congress, as many assume.

History tells us that the new PhRMA President will reflect the Board's view of the state of the industry and its most pressing needs.

I recommend a bowl of popcorn and a comfortable place on the couch as we watch the pharmaceutical industry decide who they are and what they want to be.

Steven

FDA’s Growing Presence Outside of the Washington Beltway

The federal government is closed for the fourth straight day. However, it would be more accurate to say: closed in the DC area. A significant part of FDA is open and has been all week....making this a good time for FDA Matters to acknowledge and explore the growth of FDA in places far from the Washington Beltway.

Overseas Offices. FDA's commitment to creating overseas offices has been widely praised and deservedly so. The ultimate goal is to have FDA employees and offices in every area of the world where there are significant amounts of commerce in FDA-regulated products or their constituent ingredients. If food and drug problems can be identified and fixed near the beginning of the supply chain, then America becomes less dependent on successful inspections of cargoes entering the US.

FDA has created permanent offices in China (Beijing, Shanghai, and Guangzhou) and India (New Delhi and Mumbai) over the last two years. It has also upgraded and formalized its presence in Latin America (Costa Rica, Chile, and Mexico City) and Europe (Brussels and London).

Other areas, such as the Middle-East and Asia/Africa, are still overseen from FDA headquarters, but with an increasing local FDA presence in those areas. Likewise, headquarters handles various treaty arrangements (e.g. with Canada and Mexico) and relationships with international organizations.

Growth in Field Staff. Since 2006, FDA employees assigned to "field activities" has grown from 3450 to 4200. These individuals work for the Office of Regulatory Affairs (ORA) and are involved in inspections and enforcement. ORA personnel represent about 45% of the total FDA staff paid out of the agency's appropriations (non-user fee) budget.

According to FDA's website, over 85 percent of ORA's staff works in 5 Regional Offices, 20 District Offices, 13 Laboratories, and more than 150 Resident Posts and Border Stations.  This means more than 3500 FDA staffers in ORA are conducting government business away from headquarters.

National Center for Toxicological Research. NCTR is less well-know, but an important part of FDA. Its 210 employees are located in Jefferson, Arkansas, far from snowy DC. Its webpage was updated yesterday, so we know they are at work.

NCTR defines itself as conducting "FDA mission-critical, peer-reviewed, critical path (translational) research targeted to develop a scientifically sound basis for regulatory decisions and reduce risks associated with FDA-regulated products."

In plainer language, they are the applied sciences part of FDA, focused on toxicology and toxic effects of food, drugs, packaging materials and so on. As Commissioner Hamburg's campaign to promote "regulatory science" gains momentum, NCTR will be a key part of the effort.

In total, nearly 4,000 FDA staffers work outside the DC metropolitan area. This is a good thing, since the nation's food and medical products don't stop because Washington, DC had back-to-back blizzards.

Steven

For more about FDA's overseas offices, go to: http://www.fda.gov/ForConsumers/ConsumerUpdates/ucm185769.htm

For more information about the Office of Regulatory Affairs, go to: http://www.fda.gov/AboutFDA/CentersOffices/ORA/default.htm

For more information about NCTR, go to: http://www.fda.gov/AboutFDA/CentersOffices/NCTR/WhatWeDo/default.htm

The President’s Budget Request: Is 6% Enough for FDA?

The President's FY 11 budget request for FDA includes a $146 million increase in appropriated (non-user fee) funding. This is about 6% of the $2.36 billion appropriation that FDA received in FY 10. With the President's tough talk about deficit reduction, anything above a freeze should be considered good. Why was the Alliance for a Stronger FDA disappointed?

Or to be more precise, the Alliance (www.StrengthenFDA.org) appreciated that FDA got more than most agencies, but felt that an inflation level increase was insufficient for FDA. The Alliance pointed out that the increase will not cover the ever-growing demands on the agency or strengthen the agency's capacity to fulfill its mission. They added: three good appropriations cycles for FDA (FY 08 to FY 10) have not undone more than a decade of budgetary neglect.

Of the $146 million increase for the agency's appropriated budget, CFSAN would get $60 million, about an 8% increase. This is a little more than an inflationary increase and foods programs will be able to grow marginally in FY 11. This is progress…though not nearly what is needed to meet the continued challenge of keeping foods safe and the increasing complexity and international scope of the food supply chain.

Far less was provided for medical products. Drugs and biologics received a combined $28 million increase in the President's request (about 4%). Devices received an $11 million increase (less than 4%), which does not cover the cost of pay increases. Other items that will increase this year (rent, IT, training, and travel) will need to come from existing program dollars. 

There is near-universal acceptance that the federal budget needs to be trimmed. Few domestic agencies did better in the President's request than FDA.

But there are differences in the needs of federal agencies. FDA's budget is almost entirely people costs. Salaries are more than 60% of the agency's budget. When you add in benefits, rent, IT services, travel, training, etc., 80% of the budget is devoted to people and the support they need to do their jobs.

If the FDA's appropriated budget does not grow by at least inflation each year, then staff levels decrease. This is what happened in most years from 1994 to 2007.

For example, after 9/11 the agency received significant new monies to hire inspectors to decrease the risks of agro- and bio-terror. Within 5 years, this increase in the FDA field force had disappeared, due to inflation, attrition and a lack of supportive funding. There is nothing hypothetical about the consequences of underfunding FDA.

Undoubtedly, FDA will find ways to be more efficient in FY 11, which will relieve a little of the pressure of doing more without new money. However, the amount to be gained in this manner is not large.

In contrast, there are plenty of areas for additional investment. FDA is operating a 1990's IT system, requiring it to work with databases that are incomplete and do not provide sophisticated support for decision making. Training the FDA workforce is another priority for additional funding.

FDA is still very much in the catch-up mode from past underfunding. Six percent is not enough!

Steven

For purposes of disclosure, I am one of the founders of the Alliance for a Stronger FDA and serve as deputy executive director. FDA Matters is not affiliated in any way with the Alliance.

Chart provided by the Alliance for a Stronger FDA:

President Obama's FY 11 Request for the FDA

Compared to the Alliance for a Stronger FDA's FY 11 Request

Budget Authority Appropriations (does not include user fees)

Function Note: budget authority only, by center	FY 08 Actual (December 2007)	FY 09 Final (March 2009)	FY 10 Final (October 2009)		FY 11 Alliance Request	FY 11 President's Request
Food	$   510 million	$   649 million	$   784 million		$ 955 million	$ 848 million
Human Drugs	$   353 million	$   413 million	$    465 million		$ 580 million	$ 484 million
Biologics	$   155 million	$   183 million	$    206 million		$ 255 million	$ 215 million
Animal Drugs/Feed	$     97 million	$   116 million	$    135 million		$ 165 million	$ 141 million
Devices & Radiological Health	$   238 million	$   280 million	$    315 million		$ 385 million	$ 326 million
Natl. Ctr. For Toxicological Research	$    44 million	$    52 million	$    59 million		$ 72 million	$ 61 million
HQ, Office of Commissioner and Other	$    97 million	$   121 million	$    144 million		$ 183 million	$ 162 million
Rent & Facilities Cost	$  220 million	$   223 million	$    237 million		$ 250 million	$ 259 million
SUBTOTAL, Salaries and Expenses	$ 1.714 billion (+$145M over FY 07)	$ 2.039 billion (+$325M over FY 08)	$ 2.346 billion (+$307M over FY 09)		$ 2.845 billion	$2.496 billion
Building and Facilities Repair	$ 8 million	$ 16 million	$ 16 million		$ 12 million	$ 12 million
TOTAL, ALL Budget Authority Appropriations (no user fees)	$1.722 billion	$2.055 billion	$ 2.362 billion		$ 2.857 billion (Proposes + $495M over FY10)	$2.508 billion (Proposes $146 million over FY 10)

Because OMB includes new and proposed user fees in their totals, these numbers vary considerably from those being discussed by the Administration and reported by many sources. Notably, the President's request includes user fees being collected for the new tobacco center at FDA, monies that exactly match the cost of new responsibilities added this year.

FDA, SOTU, and the President’s Budget Request

The President's State of the Union (SOTU) address gave no clues as to the fate of the FDA budget for FY 11 (begins October 1, 2010). Both the general and specific details for the agency await the February 1 release of the President's budget request.

While the House and Senate have control over the final amount that FDA receives, the President's request is the baseline against which the Congress works. FDA Matters is pleased to offer a guide to interpreting this first stage of the FY 11 appropriations process.

What the State of the Union didn't tell us. There was hope that the President would make reference to FDA or touch upon food safety. This didn't occur and there was almost nothing on public health in the address. Even a reference to cancer research did not lead to a mention of support for NIH.

The President announced a three-year freeze on discretionary domestic spending, followed by inflationary increases for the rest of the decade. Within this, some agencies and programs will continue to grow, while others will need to be cut substantially or eliminated. Other than to exclude defense and veteran's affairs, the President did not give any indication of who would be favored with budget increases.

What to expect when the President's budget request is released. It will be confusing. Increased revenue from existing and new user fees is likely to be included in totals showing that FDA is growing. This will mask whether the non-user fee budget authority (BA) appropriations (public funds) will increase under the President's request.

Media often report straight from the OMB summary sheets, so don't believe any reported numbers unless they recognize the distinction between user fees and BA appropriations. Another potential point of confusion is whether the user fees that fund the new Tobacco Center will be represented as providing more resources to FDA.

The distribution of any new funds among the FDA functions is also important. It is possible, for example, for food safety to receive increases while the rest of FDA is flat-funded.

Looking strictly at BA appropriations, FDA received $2.35 billion for FY 10. Based on year-over-year inflation in FDA costs, the agency needs an increase of $120 to $140 million just to maintain current staffing and program levels. Any less will mean cutbacks within the agency.

It is possible the President's request will include new responsibilities for FDA. Unless separate additional funding is provided, this will also hinder efforts to strengthen the agency.

For comparison purposes, FDA received a $306 million increase in FY 10. The Alliance for a Stronger FDA is recommending a $500 million increase for FY 11.

What Congress does next. Just as the President has weighed FDA against competing priorities, so must Congress. Action will accelerate through the Spring, with hearings, mark-ups and negotiations. Congress will be trying to get appropriations done by September 15, well before the elections.

Why advocacy is essential to funding the FDA. The Alliance for a Stronger FDA has 180 members and represents all FDA stakeholder groups: consumer and patient groups, health professional societies, associations, companies and individuals. Former FDA commissioners and Secretaries of HHS have chosen to be honorary members and support efforts to provide better funding for FDA.

The Alliance has been a potent force over the last 3 years by successfully reversing a decade of budgetary neglect of FDA. The Alliance needs your support to continue its work in what appears to be a very rough year. For information about becoming a member, please write to me at sgrossman@StrengthenFDA.org.

Steven

For purposes of disclosure, I am one of the founders of the Alliance for a Stronger FDA and serve as deputy executive director. The Alliance is not affiliated in any way with FDA Matters or with my consulting practice, HPS Group, LLC.

An earlier column with additional background:

Can FDA Withstand the FY 11 Budget-Cutters?

December 6th, 2009

The President's FY 11 budget request is likely to be deeply constrained. Having advocated successfully for a number of costly initiatives, President Obama will need to show that he can also reduce the deficit. He asked Cabinet secretaries to submit their budget requests at a no-growth level and an alternative budget on the assumption that their Department might be reduced by 5% overall. Read the rest of this entry »

Mr. Brown Goes to Washington

The election of Massachusetts' new Senator, Scott Brown, has set off a media frenzy about the fate of health care reform legislation. However, the ramifications of his election reach far beyond health reform.

FDA turns out to be a good example. FDA Matters sees at least three consequences of his election that may affect the agency in 2010.

Congressional Focus. Health reform is still alive, but it will require considerable effort to re-start the process and advance new legislation. This could mean yet another year in which the nation's dialogue on health issues will be largely limited to one topic, health reform.

If health reform is re-started, Congress may enact food safety reform and hold scattered hearings on medical devices, drug safety, and medical innovation. However, Congress will lack the time and focus to attend to other important FDA issues.

Regulatory Pathway for Follow-on Biologics. A regulatory pathway for approval of follow-on biologics (FOB) is a probable casualty of the Brown election and the demise of current health reform legislation. Chairman Waxman has never wanted FOB in health reform. In the days before Senator Brown's election, he was reportedly working with the White House and the Democratic leadership to reduce the 12-year data exclusivity that had been in both the House and Senate-passed legislation.

If FOB is to be adopted in 2010, it will probably have to be as stand-alone legislation. This is a mixed blessing for the biopharmaceutical industry. While it gives Chairman Waxman a new opportunity to shape the House version, the strength of the industry has been in the ranks, rather than with leadership. The key to the industry's earlier victory in the House was that the legislation sponsored by Representative Anna Eshoo had 140 bi-partisan co-sponsors from every part of the country.

The time for legislation may also have passed. I believe more companies are going to file full Biological License Applications (BLA), rather than waiting for a generic-oriented pathway. BLA's are more expensive, but there are offsetting proprietary advantages. Some companies may also be able to build their US BLA on clinical data that had been compiled to support abbreviated applications in Europe.

Deficit Reduction. Senator Brown's election may also be a harbinger of another trend that could impact FDA. President Obama had already announced that the Administration's appropriations requests for 2011 (considered in 2010) would focus on deficit reduction.

Congressional enthusiasm for deficit reduction is always strong on rhetoric, but weak on follow-through. Many members of Congress see the Massachusetts special election as reflecting a growing and ugly mood in America about the economy and jobs. Because the federal deficit is an important contributor to this mood, Members of Congress may take deficit reduction more seriously this year.

If the deficit reduction fervor increases further, FDA is at-risk of receiving a very small increase at a time when the agency's needs are growing and it still working to overcome a decade of budgetary neglect.

It is rare for a Congressional special election to affect DC. This one is different and we are likely to see considerable change as Mr. Brown comes to Washington. FDA Matters will continue to watch closely how the election may impact: Congressional attention to FDA, the follow-on-biologics debate and the fate of FDA's appropriation.

Steven

For more background on the battle over FOB's in the House last year:

The Best Little Chess Game in Town

August 3rd, 2009

One of the reigning champions of political chess, Representative Henry Waxman, has found himself in an endgame on follow-on biologics (FOB). His three decades of success have been built on extraordinary mastery of Congressional procedure, artful compromise and strategic alliances. His defeat seems unavoidable, but no one should assume that he can't yet win or draw this game. Read the rest of this entry »

A New Food Agency Has Become Unnecessary (For Now)

FDA Matters applauds the appointment of Mr. Michael Taylor to be the first Deputy Commissioner for Foods at FDA. With more authority, experience and stature than any previous food leader, he has the opportunity to shape and re-shape food regulation and the safety of the food supply.

Because Mr. Taylor will be outstanding in this new post, the campaign for a separate food agency will go away, at least for a couple of years.

People solve problems, reorganizations don't. Whatever problems exist within FDA would still exist within a separate food agency. Sometimes matters get even worse, as they did with the creation of the Department of Homeland Security.

Enter Mike Taylor, the person who can solve the problems. He has been an advisor on foods to the Commissioner for months and has been promoted to line manager and decisionmaker for every food activity within FDA. Most of us think only of the Center for Food Safety and Applied Nutrition (CFSAN), but there are food programs in the Center for Veterinary Medicine, Office of Regulatory Affairs and elsewhere at FDA. He will be responsible for all of them.

Mr. Taylor has all the elements for providing transformational leadership: experience, knowledge, respect, determination and foresight. By bringing leadership to foods, he will eliminate the urgency-- and probably the need-- for a separate food agency.

Intriguingly, Mike Taylor has been an advocate for a single food agency and there is some question about how that might affect his leadership. It won't. Some might think his appointment accelerates the move to a separate food agency. It doesn't.

Circumstances have changed. To continue to advocate for a separate food agency, Mr. Taylor would need to point to activities and policies that would be different and better if done outside FDA. It is hard to imagine what those would be--with him in charge and a supportive Commissioner. Or said another way: neglect, not the organizational structure, has always been the problem.

Things may look different in a couple of years. A new food safety law seems certain to be adopted in 2010. Implementing that law might create new reasons to support a separate food agency.

If so, an additional benefit of Mike Taylor's appointment would be continuity. His leadership and his structure would be carried over into a new organization. And he would have no trouble being confirmed by the Senate if that were required.

Which leaves one remaining question: will increased attention to food come at the expense of attention needed by the medical products function at FDA? I see no reason to think so. The broad, grassroots push of patient groups for safe and effective treatments has no counterpart on the food side.

Steven

Has FDA Slipped Back into Anti-industry Mode?

An industry CEO wrote me to observe: FDA is returning to the anti-industry paradigm of the past.  His concern is understandable. Yet, I respectfully disagreed with him. It is natural to fear change. It is easy to confuse activism with ideology.

FDA Matters believes there are two perspectives from which to judge the situation of FDA versus industry.

The first perspective is relative. The nation elected a liberal Democratic president committed to change. He had the opportunity to appoint an ideological FDA commissioner…someone who would have seen FDA's mission as re-regulating the entire FDA world after 8 years of perceived neglect.  

Instead, the President appointed Dr. Margaret Hamburg, an experienced administrator whose strength is pragmatic approaches to public health problems. As I have written before, being a big city health commissioner predisposes and reinforces pragmatic rather than ideological thinking.

Compared to what might have been in a Democratic administration with Democratic congressional majorities…FDA and Dr. Hamburg are a lot more open to industry concerns than could be expected.

The second perspective is thematic.  Commissioner Hamburg has been explicit about embracing innovation and recognizing that a safety-only perspective is counter to the public health. New medical products are more than just hope; they relieve suffering, restore functioning, strengthen families and sometimes they provide cures. These are all public health values, too.

The ongoing revolution in biological sciences is very much on Dr. Hamburg's mind. The commissioner speaks often about how FDA needs to strengthen and expand regulatory science at FDA to develop the tools necessary to evaluate increasingly complex medical products.

This is definitely pro-industry. An FDA that is ill-equipped and uncertain is one that won't be able to evaluate new science or recognize subtleties. FDA's default response then becomes "no." Dr. Hamburg does not want this to happen any more than industry does.

Some of the alleged anti-industry initiatives need to be seen in context.

Almost all FDA-regulated companies intend to abide by the law. Yet, there are lots of missteps that go unrecognized and lots of evidence of people cutting corners or being outright frauds. In the face of this, FDA enforcement had become lax. For the most part, companies are being pushed into greater vigilance of their own actions…..where good and bad practices may mean life or death for some patients and consumers. While painful to some, I don't see this as anti-industry.

Context is also important in assessing whether the current review of the medical device approval process is anti-industry, which some believe. I see the review as long overdue, given the importance of medical devices and the arcane way in which they are approved. A comprehensive re-examination has not occurred in more than 15 years. In the end, I think FDA and the Institute of Medicine (IOM) are going to reach conclusions that are "uncomfortable but acceptable" to industry. The industry will be able to flourish once the controversy is behind them.

It hurts FDA, as well as industry, if there are fewer new drug and device approvals or if systems cannot be put in place to make our food safer. The success of FDA-regulated industries is important to FDA.

Dr. Hamburg understands this and is acting accordingly.

Steven

Some related columns from FDA Matters:

Public Health Leadership Comes to FDA. FDA leadership–Dr. Hamburg and Dr. Sharfstein– come from an entirely different mold than their predecessors. They have begun an era of public health leadership at the agency. FDA staff and agency stakeholders will eventually come to appreciate that this difference is good for FDA. Read the rest of this entry »

CARS: The Vehicle for FDA's Future. Commissioner Hamburg has spoken a number of times about the importance of regulatory science. She is right. FDA must have the scientific tools and methodologies to be a 21^st century regulatory agency. FDA needs to define regulatory science, develop programs to support it, and package them in a way that will quickly bring recognition and funding. Read the rest of this entry »

Executions in China: A Thanksgiving Message. Sometimes it takes other people to give us a perspective on our own values. Today, Associated Press reports that two men were executed in China for tainting milk powder with melamine, an industrial chemical. The adulterated milk killed at least six children and reportedly sickened more than 300,000. Read the rest of this entry »

"No Surprise" That Medical Devices Are Under Scrutiny. My column entitled, "Re-Evaluating the Medical Device Approval Process" was not widely-read. I assumed it was because everyone already knew that a review was underway at FDA, with more activity coming. Apparently, I was wrong. Read the rest of this entry »

Stigmatizing the Obese and Criminalizing Food

Well-meaning policymakers are constantly advocating for specific solutions to societal problems. They intend to create a better world and often they do.

In the process, their good purpose is sometimes hijacked by unintended consequences. FDA Matters believes this is the inevitable fate of policies that tell Americans what foods they are allowed to eat.

I applaud the enthusiasm of public health advocates for their anti-obesity initiatives and hope a large number of Americans will cut their food intake and make wise food choices. Unfortunately, unintended consequences are likely to neutralize these public health efforts, resulting in little or no net progress against obesity. It is a wasted opportunity.

Stigmatizing the obese. I suspect that most obese people (1/4 of the American population) already experience substantial negative feedback about their weight. It comes from family and friends, strangers in the mall, and the persistent cultural message that "thin is in." Obese people surely feel they are under assault from the world around them.

In the current environment, the self-worth of obese people is under attack by society…and ill-will toward the obese is increasingly acceptable. These are not effective ways to encourage behavioral changes.

Public health may not have caused the cultural shift toward stigmatizing obesity…but the public health community has a responsibility—by its utterances and its campaigns—not to make the situation worse.

These are foreseeable, albeit unintended, consequences of campaigns to reduce obesity. Public health should not be complicit. There is still time to send a more nuanced message that discourages ridicule of individuals who are obese and provides more encouragement and assistance to those who struggle to lose weight.

Criminalizing Food. Efforts to restrict access to foods that are sugary, fatty, salty, high-calorie, etc. are also doomed to failure. People want these foods. And by now Americans should understand that prohibition is not an effective public health strategy.

Where access to foods is restricted, black markets will form. A recent BBC news story describes an enterprising English lad who was caught selling "crisps" (British equivalent of our potato chips) at his school. He was suspended for violating the school's "healthy snacks policy." With true entrepreneurial spirit, he had also marked up the price.

Things are just starting to heat up on this side of the Atlantic. Last year, New York City decided to severely limit school bake sales and regulate what foods are allowed in school vending machines. Ironically, sports programs are likely to be the hardest hit by loss of income from these sources.

We are not to the point of criminalizing foods. But I worry that moralism about food is on the ascendancy. It is absurd to be worrying about "food pushers" lurking on the edge of the school grounds trying to corrupt our youth. It is sad to see time, energy and money diverted from what really counts: improving nutritional education and increasing support for obese people who want help losing weight.

Our relationship to food is both complex and highly emotional. By all means, let's spread the public health message that obesity has serious personal health consequences. But we need to do it in a way that helps people, not hurts them. To do this, we must be careful that the unintended consequences don't ruin the good that could be achieved.

Steven

The BBC story on the student suspended for selling unhealthy snacks on school grounds:

http://news.bbc.co.uk/2/hi/uk_news/england/merseyside/8412310.stm

A description of the situation in New York City:

http://www.nytimes.com/2009/10/03/nyregion/03bakesale.html?_r=2&scp=1&sq=bloomberg%20and%20bake%20sales&st=cse

Messages to the FDA-Regulated: Seven Columns to Re-read for 2010

This past year has been a tumultuous one for FDA-regulated industries as they struggled to provide new and safer medical products and safer foods, while weathering much criticism.

FDA Matters has explored a number of industry issues in 2009. As they evolve in the new year, I will continue to provide readers with my analysis and commentary. Meantime, here are seven columns that provide insight about FDA-regulated companies. They provide useful background for 2010:

The Follow-on Biologics Market

Since the debate began several years ago, the policy and politics of follow-on biologics (FOB) have been driven by assumptions and projections of the anticipated market. There has been a lot of fuzzy thinking about what type of companies will be players and how they will position themselves. Read the rest of this entry »

"No Surprise" That Medical Devices Are Under Scrutiny

My column entitled, "Re-Evaluating the Medical Device Approval Process" was not widely-read. I assumed it was because everyone already knew that a review was underway at FDA with more activity coming. Apparently, I was wrong. Read the rest of this entry »

The Beatings Will Continue…

….until the biopharmaceutical and medical device industries clean up their act.

It has been an expensive year for pharmaceutical companies. Billions of dollars have been paid to federal and state governments and whistleblowers in settlement of allegations and lawsuits. The complaints include off-label marketing and overcharging Medicaid, but there are many others. Read the rest of this entry »

Patients Come First

It is a distracting time for the biopharmaceutical and medical device industries. All this frenzy makes it a good time to stop, draw a breath and remember why seriously-ill patients care about the success of biopharmaceutical and medical device companies. Read the rest of this entry »

Black, White, Shades of Gray

Civil and criminal investigations are becoming more prominent in the world of FDA-regulated industries. Being FDA-regulated means "always worrying that you will have to say you're sorry." But it matters whether you are apologizing to FDA or trying to apologize to investigators. Read the rest of this entry »

FDA: Invisible Arbiter of What Constitutes Disease

The nature of disease and constantly changing definitions are pertinent to FDA, which often makes decisions on behalf of society that reshape our understanding of disease. Read the rest of this entry »

Internet Communications: FDA Needs to Divide the Issues to Conquer the Problem

Creating an Internet communications policy for regulated medical product companies is so daunting that FDA has largely ignored the responsibility. FDA needs a different approach. This is not a matter of a large, complicated problem with many facets. Rather, it is a number of smaller problems that can be addressed separately. Read the rest of this entry »

Steven

FDA Leadership and Challenges: Seven Columns to Re-read for 2010

As a rule, FDA Matters does not cover the day-to-day events at FDA and in Congress. Most readers have multiple sources for news about the agency. I doubt I could do better.

Rather, the goal of this blog is to cover larger themes and provide deeper insights into the world of FDA. I place a premium on exploring FDA's future, as an observer, commentator and instigator. Here are seven columns about FDA leadership and challenges that will help you to better understand the agency in 2010.

Public Health Leadership Comes to FDA

FDA leadership–Dr. Hamburg and Dr. Sharfstein– come from an entirely different mold than their predecessors. They have begun an era of public health leadership at the agency. FDA staff and agency stakeholders will eventually come to appreciate that this difference is good for FDA. Read the rest of this entry »

Turning Data into Knowledge

Through statute and directive, FDA has been asked to collect, analyze, interpret and utilize massive amounts of data. The systems are not in place to do this, at least not at the required level of sophistication. Even if they were in place, sifting valuable information from background noise is extraordinarily hard. As a result, FDA needs to manage Congressional and public expectations as to "what is possible and when." Read the rest of this entry »

FDA and NIH: Natural Allies

Tension between CMS and FDA is a fact of life at HHS. This is not surprising because they have fundamentally different missions and world views. An analysis of the FDA-CMS relationship leads to an interesting conclusion: FDA should be doing a lot more with NIH because they have complementary missions and similar world views. They are natural allies. Read the rest of this entry »

In Praise of Predictability

FDA has always found it challenging to make its actions predictable. This problem will worsen while Dr. Hamburg redefines the agency's mission, policies, actions and working assumptions. Once this has been accomplished, the agency will become dramatically more predictable to stakeholders, including Congress. Read the rest of this entry »

To Whom Much is Given, Much is Expected

FDA has received $306 million (15%) more to spend in FY 10. This is the third good year for FDA, after years of bad ones. The agency is still severely underfunded, but progress is finally being made. Now the hard work begins: spending the new money wisely and showing that it has been used to accomplish important public health missions. Read the rest of this entry »

CARS: The Vehicle for FDA's Future

Commissioner Hamburg has spoken a number of times about the importance of regulatory science. She is right. FDA must have the scientific tools and methodologies to be a 21^st century regulatory agency. FDA needs to define regulatory science, develop programs to support it, and package them in a way that will quickly bring recognition and funding. Read the rest of this entry »

Long-term Challenges Need Short-term Attention

FDA Matters has identified seven long-term challenges for FDA. Some of these challenges may take years to accomplish; all need to be started now. Three or four years from now, Commissioner Hamburg will be judged by whether she moved the agency forward in these areas. Read the rest of this entry »

Steven

Scientific Reductionism and the End of Medicine

"For the last 400 years, science has advanced by reductionism ... The idea is that you could understand the world, all of nature, by examining smaller and smaller pieces of it. When assembled, the small pieces would explain the whole." (John Holland).

Have you ever heard someone accused of "reductionist thinking?" You probably will in 2010 because scientific reductionism is a critical, but rarely articulated, foundation of personalized medicine.

Reductionism is an attempt or tendency to explain a complex set of facts, entities, phenomena or structures by another, simpler set of constituent parts. Historically, scientific reductionism has held that all biology can be explained in terms of chemical reactions. In turn, these chemical reactions can be explained at the atomic level by physics.

An example of scientific reductionism is the belief that a blueprint for understanding and curing all disease will result from mapping genomes (human, bacteria, etc.). In effect, the complexity of biology ultimately yields to a much simpler paradigm based on de-coding the meaning of each component in the human genome and then delivering medical therapy personalized to the individual's genetic make-up. To oversimplify a little, biology then becomes a predictable "machine," subject only to additional reductions that yield smaller pieces and even more insight.

In contrast, many scientists believe that the complexity found in biology is more than just the inability of scientists to simplify the tangle of life and disease. No matter how much we know about genomic causation and associations, we will never have a full picture of life nor unlock the secrets to all diseases. These scientists believe that life is more than the sum of its parts. To them, reductionism is not wrong; it just produces an incomplete vision of biology because it cannot account for systems effects. A new field, systems biology, is trying to develop ways to understand the complex, irreducible biological qualities of life.

FDA Matters views scientific reductionism as a source of actionable knowledge. But just as the book, "The End of History," was more provocative than predictive, there is no "end of medicine" where human biology is reduced to the point of near-total knowledge and flawless cures.

Thus, personalized medicine will not defeat biological complexity. Further, the reductive process will incorporate knowledge from the human genome, but then take us past it into even more difficult and unpredictable challenges to understanding biology and curing disease.

Meantime, public policy is being shaped by the belief that biology and medicine will eventually yield answers that are concrete and totally reliable. But even when personalized medicine provides better targeted therapies, there will still be phase II and phase III clinical trials that inexplicably fail to show patient benefit. After approval, even the most well-documented and logical therapies may prove harmful and require modification or recall. FDA will need to constantly manage the expectations of Congress, the media and the general public to be sure that they understand that no amount of knowledge or evidence renders a medical therapy certain or riskless.

One prominent futurist has said: if we can just live long enough, progress in medicine will allow us to live forever. I say: not so.

The nature of medicine will be quite different 20 years from now, but unpredictability will still be common. As we develop vast amounts of new biological and medical information, old uncertainties about diseases and drug development will be resolved. New uncertainties will emerge.

Steven

Off-Label Uses Need to Become On-Label Indications

A friend asked: what advice would you give a pharmaceutical company in the late stages of developing a new product that will be widely used off-label? The company's concern was that FDA might hold the first use to a very high, perhaps unrealistic standard to protect patients that might receive the drug off-label after approval.

In thinking about how FDA views this type of situation, I realized there were two very concrete things the company could do. Here is the FDA Matters analysis:

FDA controls the availability of prescription medicines and devices in the US. It does not control the practice of medicine. Once a drug/device is approved for marketing, any doctor can prescribe it for an indication that is not on the label of the drug or device. For example, narcolepsy drugs are often prescribed to enhance concentration and wakefulness in individuals without the disease.

The agency is remarkably positive about deferring to the professional judgment of physicians. Even still, FDA's mission is to protect the public health. It would like to see every off-label indication get the scrutiny necessary to assure it is safe and efficacious.

One of FDA's great fears is that off-label prescribing will become dominant in clinical medicine (as I am told it has in certain areas of oncology). FDA is concerned that companies will get approval for a first use, then (directly or subtly) encourage doctors to prescribe off-label. If this strategy is profitable, FDA worries that fewer and fewer companies will commit the time and money to get approval for additional indications. If a company can't promote off-label, then it is more likely to invest in clinical trials to gain approval of the additional indications.

There are two components to FDA's concerns.

First, does the company intend to do the studies to support additional indications for their product? FDA has been promised much by companies and often receives very little back.

Companies can address this FDA concern by having a clinical trial plan in place for any additional indication(s). Where FDA will permit subsequent trials to be initiated prior to first approval, doing so will further strengthen the company's case. A clear commitment to seek FDA approval for additional indications will reassure the agency that the first indication should be judged on its own merits; not elevated to a higher level by the agency's angst about subsequent off-label use.

Second, will the company try to build the market by promoting the off-label uses? By all appearances, companies often decide that off-label use will be so profitable and supplemental indications so expensive that it does not "pay" to do clinical trials for additional indications. And since companies have paid billions of dollars in fines over the last few years for off-label promotion, FDA assumes that such marketing will occur.

The path is open for a company to announce that they will be implementing the strictest possible controls on marketing and sales practices to prevent promotion of off-label uses of their product(s). In the case of a first approval of a product with multiple uses, such an announcement could assuage FDA's fears that the first use is the only indication that the company will seek.

There is a larger issue here, apart from the strategic and psychological aspects of getting a first approval for a specific product.

Getting more indications on-label should be a public health priority. FDA and industry need to discuss how to accomplish this.

Steven

Two prior columns touched on off-label use and off-label promotion:

Internet Communications: FDA Needs to Divide the Issues to Conquer the Problem
December 2nd, 2009

Creating an Internet communications policy for regulated medical product companies is so daunting that FDA has largely ignored the responsibility. November's FDA hearing on social media was an important step, but offered no sign that new policy will be announced anytime soon.

FDA needs a different approach. This is not a matter of a large, complicated problem with many facets. Rather, it is a number of smaller problems that can be addressed separately. Read the rest of this entry »

Off-Label Promotion and Whistleblowing
September 9th, 2009

Whistleblowing and off-label promotion of drugs and devices have become hot topics because of the September 2 Pfizer settlement with the federal government. While none of my views are specific to Pfizer, the company's settlement provides an opportunity to comment on off-label promotion….and to encourage bio-pharma and medical device companies to engage in deeper soul-searching. Read the rest of this entry »

Senate Debate on Drug Re-importation

FDA Matters was ahead of our time, publishing our thoughts on drug re-importation about ten weeks ago. Now the issue is being debated on the Senate floor.

At stake is whether Americans can have access to drugs being sold in overseas markets at heavily discounted prices.

Advocates point to the unfairness of Americans paying more for the same drugs, which are often manufactured in the same overseas plants and use the same suppliers as pharmaceuticals being shipped into the US. If re-importation is permitted, they envision large savings for government programs, health plans and individual patients. They also believe that safety can be assured by limiting re-importation to countries with US-level regulatory and safety controls, such as Canada.

Opponents focus on the strict controls placed on drugs being manufactured for the American market and imported by US-regulated drug companies and wholesalers. While the world is awash in billions of dollars of counterfeit drugs, comparatively little enters the US under the current system. If counterfeits become more common, there is likely to be a significant increase in costly, sometimes deadly, therapeutic failures. This would jeopardize public health and wipe out much of the predicted savings.

Ideological positions have hardened on drug re-importation. There is far more shouting, far fewer efforts to reason and educate. How do we, as patients and consumers in a complex society, decide on the best path for Americans?

Years ago, a drug trade association ran a campaign with the seemingly-paradoxical theme: the only pill we don't test is the one you take yourself. The goal, as I recollect, was better public understanding of how testing and quality controls permeate every stage of drug development and manufacturing.

Because the actual pill can't be tested, the campaign made me realize that there is a critical leap of faith that the drug product you take is identical to the one that was originally shown to be safe and effective. This is not just a matter of chemical sameness, but also dissolution rates, absorption rates, purity, side effect profile, consistent safety and effectiveness across populations, etc.

I have the highest degree of confidence that a branded product is the same as the one that was originally tested and approved. I have nearly the same confidence in generics and regularly use them, although I have had at least one bad experience.

Beyond that, I become very concerned about drugs re-imported from overseas. Among the potential problems: ingredient substitution, inconsistent manufacturing, lack of quality controls, inadequate inspections, lack of corporate accountability, and the absence of a strict chain of custody that prevents counterfeits.

This risk is compounded because consumers, pharmacists and doctors might never know whether a therapeutic failure was a result of an individual's biology or because of an inferior copy or counterfeiting. At least with brand and generic drugs, the pharmacy puts the drug's name and manufacturer on the label of the bottle and we can reasonably assume the accuracy of the information.

I have no faith that re-imported drugs will, on a consistent basis, be identical to the original products in quality, safety and efficacy.

The promised price discounts from re-imported drugs don't justify the risk to my health from a therapeutic failure.

Steven