The user fee proposal is one of three such agreements that the agency is submitting to Congress for approval by lawmakers. The agreements would each charge drug manufacturers application fees for reviewing traditional drugs, generic drugs and a new class of generic biotech drugs, respectively.

The FDA has used industry fees to hire extra staff to review regular prescription drugs since 1992. One of the proposals unveiled Friday extends that approach to generic drugs, which have long had slower review times.

Whereas most new drugs are reviewed in 10 months, the typical review time for a generic drug is 30 months. The FDA has a backlog of more than 2,000 generic drug applications awaiting review, according to the Generic Pharmaceutical Association.

The FDA proposes collecting $299 million in fees annually to hire additional generic drug reviewers starting in fiscal year 2013. That figure would come from an estimated 750 generic drug applications per year as well as other fees, including the inspection of foreign drug manufacturing sites. In return for these fees, the FDA will aim to review 90 percent of generic drug applications within 10 months.

“These agreements are important because they are a substantial resource that lets the agency carry out its mission of protecting patients and ensuring important products come to market in a timely way,” said Allan Coukell, director of the Pew Charitable Trusts’ health advocacy group. “For the first time we will also have funding directed at increasing FDA’s inspection of foreign manufacturing facilities.”

Another first-of-a-kind agreement would charge companies for the review of generic versions of biotech drugs, which are complex medicines that often contain proteins and living microorganisms.

Up until 2010, the FDA did not have authority to approve knock-off versions of biotech drugs, or biosimilars, which are produced using far more complicated manufacturing processes than traditional chemical drugs. But the Obama administration’s health reform law signed into law in March 2010 instructed the FDA to begin reviewing and approving biosimilars. The FDA is still drafting instructions on how companies should submit applications for biosimilars.

The FDA also sent Congress its proposal for the traditional prescription drug user fee program, which is expected to raise more than $712.8 million in fees annually over five years. Like the other agreements, the deal must be approved and drafted into law by Congress before Oct 1, 2012, to be in place for the government’s next fiscal year.

Lawmakers already have granted three 5-year extensions to the Prescription Drug User Fee Act, which has allowed the FDA to hire hundreds of additional scientists in return for meeting certain performance goals. Under the latest version of the agreement, the FDA would be tasked with providing more meetings and updates to companies that have submitted first-of-a-kind drugs for review.

Separate but similar talks between the FDA and medical device makers are dragging out over a number of disagreements. Those companies have made shorter review times a priority, though the FDA says that goal will require significantly more funding, according to minutes from closed-door meetings between regulators and company executives.

Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

[FirstWord] Merck & Co. disclosed Monday in an SEC filing that it received a subpoena from the US Department of Justice as part of a “federal health care investigation under criminal statutes” into the company’s marketing of three drugs acquired in its merger with Schering-Plough. Merck spokesman Ron Rogers said the drugmaker is cooperating with the probe.

Specifically, the agency requested information from January 2004 to the present on the brain cancer drug Temodar (temozolomide), hepatitis C therapy PegIntron (pegylated interferon alfa-2b), and Intron A (interferon alfa-2b), which is approved for the treatment of certain cancers and other conditions. Sales of the drugs totalled $481 million, $319 million and $96 million, respectively, in the first six months of this year.

Separately, Merck revealed that the justice department and Environmental Protection Agency (EPA) are pursuing civil penalties of more than $2 million against the company for alleged violations of environmental regulations at two Pennsylvania facilities. The action results from the EPA’s inspection of the West Point and Riverside sites in 2006, and Merck’s submission of information to the agency. However, the drugmaker indicated that it believes it has meritorious defences against the allegations.

In addition, Merck said that it agreed to pay a $260 000 fine and sign a consent decree to resolve alleged environmental violations at its Las Piedras facility in Puerto Rico in connection with an EPA inspection in 2008.

[Bloomberg] Teva Pharmaceutical Industries Ltd. (TEVA), the world’s largest generic-drug maker, was sued by a joint venture of GlaxoSmithKline Plc (GSK) and Pfizer Inc. (PFE) for infringing a U.S. patent for the HIV drug Epzicom.

Teva has applied to the U.S. Food and Drug Administration for permission to sell generic Epzicom tablets in violation of a 2002 patent, lawyers for ViiV Healthcare said in an Aug. 5 complaint filed in federal court in Wilmington, Delaware.

Teva’s FDA submission “constitutes infringement” and “ViiV will be irreparably harmed” by the low-cost version of Epzicom if it’s sold before the patent expires in 2016, according to court papers.

GlaxoSmithKline, based in Brentford, England, and New York- based Pfizer announced the ViiV joint venture to combat HIV in 2009. The lawsuit seeks a permanent injunction to block Israel- based Teva’s U.S. sales of the drug and damages if the generic medicine is sold.

ViiV has facilities in Brentford and at Research Triangle Park in North Carolina, according to court papers.

Teva spokeswoman Denise Bradley declined to comment on the suit

The case is ViiV Healthcare UK Ltd. v. Teva Pharmaceuticals USA Inc., U.S. District Court for the District of Delaware (Wilmington).

The Food and Drug Administration said on Tuesday two 2010 inspections, an internal company investigation and a third-party audit uncovered “significant instances of misconduct and violations” at a Cetero facility in Houston.

The Cary, North Carolina-based firm does early-phase clinical research and bioanalytics for a number of drugmakers. The pharmaceutical companies can then use those studies as supporting evidence in drug approval applications to the FDA.

“The pattern of misconduct was serious enough to raise concerns about the integrity of the data Cetero generated during the five-year time frame,” the FDA said, warning drugmakers they might have to repeat or confirm any studies Cetero did in support of their applications between April 2005 and June 2010.

It remains unclear which drugmakers have used Cetero’s services to apply for regulatory approvals and the FDA is asking companies to identify such instances. The regulators said the measure is precautionary and the safety and efficacy of drugs already on the market are unlikely to be affected.

The FDA inspected Cetero in May and December last year and found falsified records about studies.

Specifically, in at least 1,900 instances between April 2005 and June 2009, laboratory technicians identified as conducting certain studies were not actually present at Cetero facilities at that time, the FDA said in its May report.

The FDA also said at the time that Cetero might have “fixed” studies to get the desired result, or did not include failed results in their report.

“Cetero’s May 2010 and December 2010 responses are inadequate because the scope of their internal investigation was far too narrow to identify and adequately address the root cause of these systemic failures,” the regulators said.

Cetero was not immediately available for comment.

(Reporting by Alina Selyukh and Anna Yukhananov; editing by Andre Grenon)

[WSJ]- The vast majority of U.S. hospitals have restricted the use of life-saving chemotherapy drugs and other critical-care medications in the past six months to cope with unprecedented shortages, according to a survey released Tuesday.

More than 80% of hospitals surveyed by the American Hospital Association reported they had to delay treatment, and nearly 70% said patients received less effective substitute drugs.

Three out of four hospitals reported rationing or restricting the use of drugs in short supply. For some drugs, such as a leukemia drug called cytarabine, there are no effective substitutes.

The survey of 820 hospitals was released by the AHA on Capitol Hill as part of push for legislative action. A separate survey commissioned by the American Society of Health-System Pharmacists estimated additional labor costs for hospitals to deal with the shortages at $216 million a year. Pharmacists and technicians spend about 17 hours a week managing drug shortages.
Most of the drugs in question are generic and not highly profitable, and are now made by only one or two companies. Teva Pharmaceutical Industries Ltd. and Hospira Inc. are two of the bigger producers of generic drugs.

The shortages are growing more severe, in part, because of industry consolidation and manufacturing problems in the past year. When one company runs into a manufacturing problem with a product or decides to quit making a drug, competing companies can’t quickly fill the void. In April, Teva reopened a California plant that it had shut down voluntarily for about a year, in part to retool to meet Food and Drug Administration manufacturing guidelines.

The FDA reported a record 178 drug shortages in 2010. Although the agency doesn’t have figures for 2011, it said the shortages “have continued at a rapid pace.”

Most of the shortages involve older, generic drugs administered by injection or intravenously. They include chemotherapy drugs to treat cancer, antibiotics to treat infections and nutritional drugs for patients who can’t eat. There are also continuing shortages of drugs used in emergency rooms and intensive-care units.

More than 90% of hospitals in the hospital-association survey reported shortages of surgery or anesthesia drugs and emergency-care drugs, and two-thirds reported shortages of chemotherapy drugs. Almost half of the hospitals reported coping with 21 or more shortages in the past six months.

The pharmacists’ survey showed the biggest shortage in 2010 involved the drug succinylcholine, used in procedures to insert a tube into patients’ airways to help them breathe.

The product is made by Hospira and Sandoz, a unit of Novartis AG. Production at Hospira was slowed last year when the company couldn’t get enough active pharmaceutical ingredients and Sandoz couldn’t immediately fill the gap. Hospira said full production has resumed. Sandoz didn’t immediately respond to a request for comment.

Bills introduced in the House and Senate would require companies to notify the FDA when they have a problem that could result in a shortage. Current law requires companies to report to the FDA in cases when they are the only supplier of a drug and they plan to quit making it.

The House bill, sponsored by Reps. Diana DeGette (D., Colo.) and Tom Rooney (R., Fla.) would subject companies to fines of up to $10,000 a day, with a cap of $1.8 million, for failure to comply with reporting requirements.

The measure would also allow the FDA to post letters online from companies informing the FDA of potential or actual shortages, to give hospital pharmacists a better gauge of how long a particular shortage might last. Hospira and the FDA support the bill.

Sen. Amy Klobuchar (D., Minn.), co-sponsor of a similar Senate bill, said the legislation is meant as an early warning system. While some companies do notify the FDA about potential problems like shortages of ingredients used to make drugs, Ms. Klobuchar described the current system as “haphazard.”

The FDA has said 38 shortages were prevented in 2010 when companies voluntarily gave the agency early notification of a problem with a drug. In some cases, the advanced warning gave the FDA time to work with competing manufacturers to ramp up production.

The FDA, which has emphasized concerns about whether the drug works on breast cancer, took off the gloves Tuesday to talk about the drug’s risks. An agency medical official described women who suffered fatal hemorrhages or other side effects from the drug and argued that it didn’t deserve approval in breast cancer.

The hearing is drawing close attention from cancer patients and the drug industry because it is a rare challenge to the FDA’s authority to make up-or-down decisions on drugs for life-threatening diseases, particularly cancer. Critics say the agency is too tough on new treatments, while backers contend the FDA is standing up for science against a political onslaught.

Emotions reigned on the first day of the two-day hearing, with tearful stories, rowdy protests and some booing of witnesses.

An FDA advisory panel is set to vote as soon as Wednesday on whether Avastin should retain its approval for breast cancer, following the FDA staff’s withdrawal recommendation last December. FDA Commissioner Margaret Hamburg will make the final decision.

The drug is approved for four other forms of cancer and will stay on the market regardless. FDA officials say that in breast cancer, studies show the drug delays tumor growth only for a month or so in most women and doesn’t extend lifespan.

About 20 women told the panel that the studies don’t reflect Avastin’s real benefits.

“According to the data, I should have been dead years before,” said Patricia Howard, a breast cancer patient from New York City. “I’m not just a statistic, and it’s in your hands to ensure I don’t become one.”

Betsy Swersky of Long Island sobbed as she talked about being able to see her three children grow up. “I am pleading with you today to keep my miracle drug Avastin available for all breast-cancer patients,” she said.

Some cancer patients testified in favor of the FDA.

“The women who didn’t do well taking this drug can’t testify today,” said Helen Schiff, who came to speak on behalf of a coalition of breast and ovarian cancer survivors. A member of her group who took Avastin suffered a hemorrhage and “was bleeding from every orifice in her body,” said Ms. Schiff. The woman died about a month later, she said.

In a rare move, the FDA offered accounts of side-effect victims to support its case. Agency official Patricia Keegan talked at length about a 53-year-old patient who suffered an “Avastin-related gastrointestinal perforation” after receiving four doses of the drug. “Women are dying,” she said.

A spokesman for Roche’s Genentech unit, Ed Lang, said the side effects are known and disclosed. “These examples are important for people to know about, but you also saw examples this morning of women who are living,” he said. The company cites a study suggesting Avastin may delay tumor growth for five months or more.

The National Breast Cancer Coalition’s representative, Christine Brunswick, drew boos when she said the FDA’s decision should be based on science, “not on any individual story, no matter how compelling.”

The day began with a 30-person pro-Avastin demonstration outside the FDA, guarded by nearly a dozen police and security officers. Inside, a few protesters shouted criticism of FDA cancer-drug chief Richard Pazdur.

A number of pro-Avastin patients and family members said they were afraid that if the breast cancer approval is taken off the drug’s label, their insurers or Medicare will stop paying for the drug, which costs about $88,000 a year.

But some doctors and government officials said that was unlikely because the drug will continue to be listed as a breast-cancer treatment in compendiums that Medicare and private insurers use as references.

The National Comprehensive Cancer Network, an alliance of cancer centers, manages one such compendium and has already said Avastin will continue to be an accepted treatment for breast cancer.

“Most of the major insurance companies have said they will continue to pay for Avastin for breast cancer because they follow NCCN standards,” said Len Lichtenfeld, the deputy chief medical officer for the American Cancer Society, in an interview. “I’m not certain an insurer would want to fight this coverage battle in the current environment.”

Avastin was given accelerated approval in February 2008, conditional on two further studies that would show significant delay in tumor regrowth. Last July, after reviewing the results of those studies, an FDA panel of experts voted 12-1 against Avastin for breast cancer.

Dr. Pazdur, the FDA cancer-drug chief, spoke to the panel Tuesday and said Avastin is mostly used in combination with paclitaxel, “a known effective chemotherapy agent,” which he said could explain some patients’ positive stories. “When an individual is administered both drugs together, it is not possible to ascribe any benefit to Avastin alone,” he said.

The decision on Genentech’s appeal could have implications for the FDA’s accelerated approval program. The program is designed to get new medicines on the market faster, but the FDA is concerned that it will have trouble revoking the approvals if later data don’t support the drugs.

Write to Alicia Mundy at alicia.mundy@wsj.com

Personal testing, which is mainly available online from firms operating outside traditional medical institutions, can produce ambiguous or misleading results without proper analysis, panel members said.

“I would suggest that we are not ready yet to put this completely in the consumer’s hands,” said panelist Joann Boughman of the American Society of Human Genetics. “Each test is complex, and when you have each provider doing slightly different tests, it complicates it even more.”

For example, a consumer test to determine whether someone is a carrier for cystic fibrosis might not screen for all the genetic permutations that trigger the disease, meaning that a negative result could promote a false sense of security.

“It’s very dangerous to get a false reassurance when you don’t know about environmental and other risk factors,” said panel member George Netto of the Johns Hopkins School of Medicine.

The 21-member panel, predominantly a mix of physicians and academics, did not vote on specific questions during the first day of a two-day hearing that concludes Wednesday. But members expressed general agreement that doctors should be in charge of ordering and interpreting the tests.

The panel’s consensus on new regulations is not binding on the FDA, but the agency usually follows them.

Unlike genetic tests ordered by doctors, which are processed by a laboratory and delivered to the physician for review with the patient, direct-to-consumer testing allows individuals to get genetic information directly from a lab without involving a healthcare provider.

Advocates of testing say it allows consumers to take a better-informed role in their medical care.

“We’re not trying to substitute for a physician — we’re simply providing a service that doesn’t exist otherwise,” said Jeff Gulcher, cofounder of testing company deCODE Genetics Inc. of Reykjavik, Iceland.

Critics argue that personal testing still lacks the precision to be an effective mass-market healthcare tool.

Doubts were fueled in July by a Government Accountability Office report that found that different companies came to different conclusions about the meaning of the same DNA sample.

In one example cited by GAO investigators, four companies evaluating the same DNA reported variously that the person supplying it had a below-average, average and above-average risk for prostate cancer and hypertension.

Direct-to-consumer tests have been available online for several years, but assumed a higher public profile in May when Walgreen Co. announced that it would sell one brand of tests in its drugstores.

That prompted the FDA, which had publicly said little about the tests, to declare that they needed to meet regulatory standards as medical devices.

Walgreen has shelved plans to sell the test in its stores until the regulatory uncertainty is cleared up, a spokesman said.

The Food and Drug Administration aims to increase its reliance on third-party inspectors and has started reaching out to industry trade groups about the change, John Taylor, the agency’s acting principal deputy commissioner, said today. The agency will work more closely with other countries and share findings, potentially reducing the number of inspections plants would undergo each year, he said.

The FDA inspects foreign drug facilities once every nine years on average, compared with once every 30 months for U.S. plants, the Government Accountability Office reported in September. While the agency has had federal employees in countries such as China since 2008, Taylor said this model for increasing oversight won’t be sustainable as demand for lower- cost resources and labor leads more companies to make health- care products outside the U.S.

“We recognize that third-party inspection programs need to be a bigger part of the discussion because we can’t do all the work ourselves,” Taylor said at a conference in Washington sponsored by consulting firms Venn Strategies LLC and Greenleaf Health LLC. “We’re looking at anything, anything and everything that will allow us to leverage our resources better.”

FDA Commissioner Margaret Hamburg’s two top priorities are globalization and innovation, Taylor said. A former executive at Abbott Laboratories in Abbott Park, Illinois, and the Biotechnology Industry Organization trade association in Washington, Taylor became the agency’s No. 2 official after Joshua Sharfstein resigned last month to become Maryland’s top health official.

The authors of a study published Feb. 10 in the New England Journal of Medicine count 153 new drugs and vaccines from public sector research institutes over the past 40 years. They include Remicade (infliximab), considered a giant step forward in the treatment of rheumatoid arthritis and other inflammatory and autoimmune disorders, and Lyrica (pregabalin), used to treat pain neuropathy, fibromyalgia and pain from shingles.

“Not only do federal funding programs, such as those from the National Institutes of Health and the National Science Foundation, advance the scientific knowledge base of the country, but they contribute practical advances that can help people and create economic opportunity,” said study author Ashley J. Stevens, a lecturer at the Boston University School of Medicine and senior research associate at the university’s Institute of Technology Entrepreneurship and Commercialization.

Traditionally, publicly funded researchers tended to dig up the causes and vulnerabilities of a particular disease while the sexier follow-up of actual drug development was left to pharmaceutical companies.

That apparently has changed, according to the study team, which included researchers from Norway and from the Office of Technology Transfer at the U.S. National Institutes of Health (NIH).

Thanks to legislation passed in 1980, universities, teaching hospitals, nonprofit research institutes and federal laboratories could start owning and licensing intellectual property coming from federally funded research, the authors stated.

This coincided with the boom in biotechnology research, which made so many new biologic drugs possible.

The 153 new entities identified by the authors included 93 small-molecule drugs, 36 biological agents, 15 vaccines, eight diagnostic tools and one over-the-counter drug. More than half were to treat or prevent cancer or infectious diseases. And many were fast-tracked to approval, suggesting that their effect was considered substantial. The therapeutic effect of these public sector-developed drugs will likely be disproportionately large, the researchers said.

The news comes in the midst of looming concerns about budget cuts and the future of government-funded research.

“This study helps justify sustained federal support for the NIH,” said Jon Retzlaff, managing director of science policy and government affairs at the American Association for Cancer Research (AACR) in Washington, D.C.

“The AACR is extremely concerned about the current funding environment, and specifically the threats of budget cuts to the NIH and the National Cancer Institute. It is imperative that at this critical juncture Congress not waver in its longstanding commitment to providing the resources and support for research and discovery efforts,” he said.

“These are what fuel advances in cancer prevention, diagnosis, care and treatment,” he added.

“Long-term flat funding or, worse, a reduction in funds for biomedical research and cancer research will slow research progress and squander invaluable scientific opportunities to the detriment of our nation’s health, our fragile economy and our global competitiveness,” Retzlaff said.

As legislators try to balance the federal budget, these funds must not be considered discretionary, he added. “This data shows that these are part of our economic development,” he said.

More information

The U.S. Food and Drug Administration has more on how drugs are developed and approved.

The new proposed Innovation Pathway program for pioneering medical devices, highlighted in a report published on the FDA’s website today, is part of a broader effort underway in the FDA’s Center for Devices and Radiological Health (CDRH) designed to encourage cutting-edge technologies among medical device manufacturers.

The initiative will also seek to strengthen the nation’s research infrastructure for developing breakthrough technologies and advancing quality regulatory science. Proposed actions include:

• establishing a voluntary, third-party certification program for U.S. medical device test centers designed to promote rapid improvements to new technologies during a product’s development and clinical testing stages;
• creating a publicly-available core curriculum for medical device development and testing to train the next generation of innovators; and
• using more device experience and data collected outside the United States.

In addition, CDRH intends to engage in formal horizon scanning – monitoring medical literature and scientific funding in a systematic way to predict where technology is heading. CDRH will include public input in this process to prepare for and respond to transformative innovative technologies and scientific breakthroughs.

“Each year, millions of American patients benefit from innovative medical devices that reduce suffering and treat previously untreatable conditions,” said CDRH Director Jeffrey Shuren, M.D., J.D. “CDRH’s Innovation Initiative will help accelerate the development of and patient access to innovative medical devices, which often fulfill unmet public health needs.”

The FDA has accepted its first submission from the Defense Advanced Research Projects Agency (DARPA) to review a brain-controlled, upper-extremity prosthetic designed to restore near-natural arm, hand and finger function to patients suffering from spinal cord injury, stroke or amputation. The arm system uses a microchip implanted on the surface of the brain to record neuronal activity and decode the signals to actuate motor neurons that control the prosthesis. DARPA and the FDA have signed a Memorandum of Understanding addressing both the development and review of this project.

The proposed Innovation Pathway program includes the following features:

• products would have to be truly pioneering technologies with the potential of revolutionizing patient care or health care delivery;
• selected products would receive an Innovation Pathway memorandum from CDRH containing a proposed roadmap and timeline for device development, clinical assessment and regulatory review; and
• products would be assigned a case manager, their important scientific issues would be identified and addressed earlier in the development process, and they might be able to qualify for flexible clinical trial protocols.

Applications would be reviewed by the Center Science Council, a new oversight body currently being developed within CDRH comprised of senior managers and experienced scientists, who would facilitate this device development and evaluation process. Enrollment in the Innovation Pathway program would not change the scientific or regulatory standards that CDRH would use to evaluate device submissions and determine their appropriateness for marketing.

Because of the transformative nature of the devices that would be eligible for this pathway, CDRH expects them to generally be approval pathways intended for either high risk or novel products.

The FDA could conduct premarket reviews of products in the Innovation Pathway within 150 days, nearly half the time it currently takes the FDA to review most premarket approval applications.

CDRH has set up a public docket to solicit public comment on the Innovation Initiative and will host a public meeting on the topic on March 15, 2011 at the Center’s White Oak campus.

For more information:

* CDRH Medical Device Innovation Initiative at http://www.fda.gov/deviceinnovation

Mullen, who is leaving Biogen Idec in June, also predicted biotech companies will face a more difficult regulatory process in the United States. “The environment to launch new products… is going to be tougher, the pricing is going to be tougher, the probability (of drug approvals) is probably going to be more challenging,” he said.

Henri Termeer, chief executive of Genzyme Corp. in Cambridge, said the new law has the potential to boost investment in biotechnology research through a 12-year data exclusivity provision that shields biotech drugs from generic competition. The bill also contains a therapeutic-research tax credit for biotech start-ups.

Unlike past pushes for health care overhaul that failed, “this particular set of discussions didn’t focus on the cost of innovation,” Termeer said. “It focused on the cost of access. In fact, you could say that innovation was somewhat talked about in a kind of benevolent way. There was support for the need to be able to take the risks that are necessary. This (Obama) administration is actually interested in innovation.”

Termeer and Mullen spoke on a panel during the MassBio meeting at the Seaport World Trade Center in South Boston. The discussion was moderated by Deborah Dunshire, chief executive of Millennium Pharmaceuticals, another Cambridge biotechnology company that was bought by Japan’s Takeda Pharmaceutical Co. for $8.8 billion in 2008.

Dunshire described her fellow chief executives as “battle-scarred” biotech veterans and noted that they face pressures from increasingly impatient investors. But during the 60-minute event — which didn’t allow for questions from the audience — Genzyme’s high-profile manufacturing problems at its Allston Landing plant and shareholder activist Carl C. Icahn’s push for seats on the boards of both Genzyme and Biogen Idec weren’t discussed.

Mullen took a parting shot at the US Food and Drug Administration, saying European regulators “frankly seem to be a little more balanced” in approving riskier new drugs. Citing what he said was the reluctance of biopharmaceutical companies to develop new treatments for cardiovascular diseases, the Biogen Idec chief said, “The FDA has made it almost impossible to develop anything in cardiovascular. What they ask for sounds very logical in headlines. It’s just not doable.”

FDA officials didn’t immediately respond to requests for comment.