In the latest in a series of letters from his new home in the USA, long-time ICR member Angus Donald reports on some of the significant changes around clinical research and healthcare in general that are taking shape in the first few months of the presidency of Barack Obama.
Funding for stem cell & medical research
“
Fifteen years ago, 20 to 30% of all research proposals received significant federal support. That level is now closer to 10%. For scientists and researchers, this means more time spent raising money and less time spent on research. It also means that each year, more and more promising avenues of research are cut off, especially the high-risk research that may ultimately yield the biggest rewards”
1
President Obama has made a commitment to change this scenario, stating that “
[i]f we want an innovation economy… we have to invest in our future innovators.” By doubling federal funding of basic research over the next four years, the total price tag for maintaining the US scientific and technological edge comes out to approximately $42 billion over five years. Although difficult to comprehend, this equates to just 15% of the recent federal highway bill (and you should see the state of some of the roads over here!)
The first indication that President Obama intended to honour his commitments came early in the new administration when, in March, he passed an executive order lifting Mr Bush’s funding ban on stem cell research. The potential for finding cures for Parkinson’s disease, Alzheimer’s and other afflictions has therefore been opened in the US. The additional funding proposals from the US National Institutes of Health (NIH) not only gives hope to Michael J Fox et al, but has even generated concerns abroad of a brain drain to the US from countries where research is already ongoing to take advantage of this progressive stance.
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Financial incentives for innovation
The Obama administration is also making it a priority to transform basic genomics research into the new field known as “personalized medicine”. As a US Senator, Barack Obama introduced the Genomics and Personalized Medicine Act to increase funding for research on genomics, expand the genomics workforce, provide a 100% tax credit for the development of diagnostic tests that can improve the safety and effectiveness of drugs, and reaffirm the need to protect genetic privacy. President Obama will ensure that the process for reviewing genetic tests is modernised, to allow the nation to capitalise on the tremendous success of the Human Genome Project while protecting the privacy of individuals.
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President Obama wants to make the Research and Development Tax Credit permanent, so that firms can rely on it when making decisions to invest in domestic R&D over multi-year timeframes. Unfortunately, this credit has been allowed to expire 13 times, and has not been extended since December 2007.
4
In addition to plans to expand health care coverage, improve predictability and clarity in the US patent system and holding insurance companies accountable, the Obama administration is committed to putting responsible science and technological innovation ahead of ideology when it comes to medical research. President Obama and Vice-President Biden intend to provide health insurance companies with a new Small Business Health Tax Credit to help small businesses provide quality health care to their employees.
A more active, powerful FDA
President Obama also wants Congress to give the Food and Drug Administration (FDA) an additional $300 million in its budget, which the agency called the largest funding boost in its history. The budget request calls for the FDA to receive $2.35 billion for fiscal year 2010, compared with $2.06 billion in the previous fiscal year. Moreover, the figures don’t include user fees the agency collects from the drug, device and other industries to review product applications and inspect facilities. Including those, the request totals $3.04 billion compared with $2.7 billion in the year before.
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The overwhelming endorsement for Dr Margaret Hamburg as the new FDA Commissioner reflects on the cross-party support that is being received. Lowering the cost of medicines (and extending availability of generic medicines and parallel importations) is critical to the new policy, but more financing for the FDA with faster approvals and easier access to innovative medicines is also being promoted.
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Closing loopholes on generics
The House Comerce, Trade and Consumer Protection Subcommittee approved a bill [HR 1706] on 3rd June 2009, by a vote of 16-10, that aims to prevent pharmaceutical companies from paying others not to produce generic versions of their drugs. The bill aims to regulate the practice of so-called ‘exclusion payments’, whereby drugmakers pay generic drug companies to keep their products othe market as a way of settling patent challenges. Rep. Bobby L. Rush (Democrat: Illinois), chairman of the subcommittee, said the measure “
…will save taxpayers and consumers billions from increased generic competition in the marketplace.”
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Exclusion payment deals are seen by critics in Congress and at the US Federal Trade Commission (FTC) as anti-competitive because branded drugmakers pay their generic counterparts to abandon patent challenges that could lead to early market entry of competing generic medicines. Richard Feinstein, head of the FTC’s Bureau of Competition, contended that “
generic companies are getting paid handsomely to sit on the sidelines” under deals that “impose enormous costs on the healthcare system.” But, Mylan’s Chief Operating Officer, Heather Bresch, argued that “
generic makers were sometimes forced into settlements by branded companies that exploit a loophole in the federal law Congress passed to encourage generic companies to challenge questionable drug patents.”
US Supreme Court tackles “pre-emption”
Although the Obama administration has given positive messages to the pharmaceutical industry, a decision by the US Supreme Court has recently sent tremors through legal departments nationwide. The case of
Wyeth v Levine8 was to determine whether drug manufacturers should be protected from state product liability or fraud claims relating to FDA-approved medicines. The pharmaceutical industry association PhRMA had filed amicus curiae (friend of the court) briefs in the case, showing that the industry was keeping a close watch on the outcome. The case is expected to provide guidance to lower courts already examining similar claims.
The case involves Wyeth’s antinausea drug, Phenergan (promethazine) and stems from an incident in which a patient’s forearm had to be amputated after a direct intravenous injection of Phenergan came in contact with arterial blood and caused a severe adverse reaction. The plaintiargued that the drug’s labelling failed to warn adequately of the dangers of direct intravenous injection, ie, “IV push”. A Vermont state court found in the plainti’s
favour and rejected Wyeth’s defence that federal law pre-empted the lawsuit because the labelling had been approved by the FDA. The Vermont Supreme Court affirmed the decision, saying that the company could have avoided a state lawsuit without violating federal law by making unilateral changes to the FDA-approved labelling.
In an amicus curiae brief filed in January 2008, US Solicitor General Paul D Clement disagreed, saying that the federal regulations permit unilateral changes based only on newly available information.
9 Any change to a drug’s labelling without prior FDA approval must be the subject of a supplemental application, which the agency can approve or reject. Mr Clement confirmed that the FDA had been notified of the dangers of arterial exposure by Wyeth but stated that a balance must be struck when approving labelling, between notifying users of potential risks and not discouraging beneficial use. Quoting the dissent in the Vermont Supreme Court ruling, Mr Clement added that “
any recovery under state law would be predicated on a finding that Phenergan, as labelled, was ‘unreasonably dangerous’”, which would conflict with the FDA’s determination that the drug was safe and effective as labelled.
Disagreement within the FDA
There has been much recent debate in the media on the subject. It was reported in the Wall Street Journal
10 that in the past few years, according to FDA documents released on 29th October 2008 in a congressional investigation, career officials within the FDA objected to the agency blocking consumer lawsuits against pharmaceutical companies. The Supreme Court was scheduled to hear
Wyeth v Levine on 3rd November 2008, in which the “
FDA says Federal drug-approval and warninglabel standards should trump stricter state laws.” It was further reported that internal memos had been found to “
contradict the FDA’s position.” In the memos, two agency officials contended that “
it is wrong to assume that FDA-approved drug labels are completely reliable, or that they are based on full disclosure of safety risks by drugmakers.”
A report in the Houston Chronicle
11 stated: “
If the Supreme Court rules as expected… patients might have no legal recourse if they are harmed by an FDA-approved medicine.” At issue is whether “
the drug company was negligent because it did not provide adequate warning about the injection process” of a drug that “
led to gangrene of [a musician’s] arm and eventual amputation just below the elbow.” The Vermont Supreme Court ruled in favour of the patient, but “
the manufacturer maintains that the FDA approved the prescribing information that was used and therefore the drug company has no liability.” The Journal of the American Medical Association recently editorialized, however, “
that FDA approval is often flawed. ... Therefore, unless and until the FDA drug approval process and the post-marketing surveillance system improve significantly, patients must have a means to seek recourse through tort litigation against product manufacturers.”
The San Francisco Chronicle
12 pointed out that industry advocates believe that “
the FDA’s powers pre-empt state court lawsuits that claim stricter drug warnings were needed.” Meanwhile, “
consumer advocates argue that drug manufacturers must retain responsibility to provide current, accurate warnings to the public.” Furthermore, “
a report prepared for Rep. Henry Waxman (Democrat: California), chairman of the House Oversight and Government Reform Committee,” showed that “
career FDA experts have resisted the Bush administration’s support of the pre-emption stance.” In fact, one internal policy memo quoted a top FDA official, Dr John Jenkins, as having written that “
we know that many currently approved drug labels are out of date and in many cases contain incorrect information.” Still, Wyeth’s attorney contends that “
if the Supreme Court rules that suits such as Levine’s are pre-empted… it would protect companies such as Wyeth that had disclosed all risk information to the FDA.”
The CBS Evening News
13 reported on
Wyeth v Levine, noting that Wyeth’s lawyers “
argued that all risks were disclosed to the FDA, and that the company was not allowed to make the warning any tougher.” While several “
justices appeared open to the idea that pre-emption could follow from the FDA’s approval of a drug label -- but only if drug companies remained subject to lawsuits if they failed to disclose new information about potential risks,” the others “
seemed prepared to allow pre-emption -- but only if the drug agency had considered the particular risk before approving the label.”
… and the verdict is…
The Supreme Court ruled on 4th March 2009
14 against Wyeth, upholding a $6.7 million jury award for Diane Levine, saying that drug companies are not shielded from injury claims simply because their products and labels have government approval.
15 The decision was 6-3, with the majority saying the manufacturer bears responsibility for the content of its label at all times. State juries may, therefore, award damages for harm from ‘unsafe’ drugs even though their manufacturers have satisfied federal regulations and all drugs have a risk-benefit ratio. The ruling will expose drug companies to a kind of ‘double innovation jeopardy’.
Consequences of the ruling
The ruling “
marks the failure of efforts by the industry to fight legal settlements by imposing federal pre-emption, an argument that had been supported by George W. Bush’s administration.”
16 Apparently, Congress do not intend FDA oversight to be the exclusive means of ensuring drug safety and effectiveness. State laws are not suppose to interfere with FDA rules but are meant to enhance them. However, this ruling could make drugmakers more cautious about safety issues and may lead them to halt development of some medicines and even pull others othe market. Pharmaceutical companies are more likely to steer away from innovative drugs in favour of modest improvements to existing medications. By permitting juries to secondguess the FDA’s decisions on what options doctors should have available in administering prescription drugs, the Supreme Court’s decision creates uncertainty for patients and doctors by placing the experience of a single patient above the public health interests of the general population.
Conclusion
The past few months have seen considerable changes in the landscape of pharmaceutical development in the US and indications suggest that these radical changes, both in administrative policy and litigation, will continue during the current administration.
References
- Barack Obama. The Audacity of Hope, 2006, p166.
- www.timesonline.co.uk/tol/life_and_style/ health/article587021.ece, 9th March 2009 (accessed 31st May 2009).
- www.BarackObama.com/pdf/issues/FactSheetScience.pdf accessed 3rd June 2009.
- Wall Street Journal (Favole, Mundy), 8th May 2009.
- Ibid.
- www.barackobama.com/issues/healthcare (accessed 31st May 2009).
- CQ Today (Teitelbaum), 4th June 2009; Dow Jones Newswires (Kendall), 4th June 2009.
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Wyeth v Diana Levine, Case No. 06-1249. Details accessed at: www.supremecourtus.gov/docket/06-1249.htm on 20th April 2009.
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Wyeth v Levine. Brief for the United States as Amicus Curiae, US Solicitor-General, 21st December 2007. Details accessed at www.usdoj.gov/osg/briefs/2007/2pet/6invit/2006-1249.pet.ami.inv.html on 20th April 2009.
- Dan Slater, The Wall Street Journal, 30th October 2008. Do Newly-Released FDA Memos Hurt Wyeth’s Preemption Argument?
- The Houston Chronicle, 3rd November 2008.
- The San Francisco Chronicle, 2nd November 2008.
- The CBS Evening News on 3rd November 2008.
- www.supremecourtus.gov/opinions/08pdf/06-1249.pdf accessed 31st May 2009.
- In contrast, the Supreme Court [in Riegel v. Medtronic] ruled last year that federal law does bar such lawsuits against the makers of heart stents, artificial joints and other critical medical devices.
- The Financial Times (Jack), 5th March 2009.
