Life Science Compliance Update

September 20, 2017

Draft Released on Nevada Pharmaceutical Representative Registration Procedure

Filling-out-form

Nevada passed legislation earlier this year, putting many new restrictions and regulations on the pharmaceutical industry there. Now, we see that the state is moving much quicker than we had anticipated on implementing those regulations.

Timeline

The legislation had many different parts to it, touching just about every facet of the pharmaceutical industry.  With many different parts, an extensive timeline is required, with many different deadlines.

It was required that by July 1, 2017, the Department of Health and Human Services (DHHS) was to adopt regulations to help them carry out the provisions of the bill, including the form and manner in which manufacturers need to provide information described in the bill.

Also on July 1, 2017, and on every July 1 in an odd-numbered year from here on out, DHHS shall determine whether there is sufficient funding in place to carry out the provisions of the bill and if there is insufficient funding, has the ability to suspend any component for which there is insufficient funding. Also, DHHS may apply for – and accept – any grants, bequests, devises, donations, or gifts from public and private sources.

By October 1, 2017, some of the first deadlines go into effect, including: amending the definitions to reference those as defined in the bill; requiring DHHS to post the information received from non-profits, pharmacies, and the list of essential drugs, along with the wholesale acquisition cost and reports as required by the bill; and extending protection to DHHS for any act, omission, error, or technical problem that results in a failure to provide any (or incorrect) information.

Also on October 1, 2017, any manufacturer, pharmacy benefit manager (PBM), or non-profit that fails to provide the required information to DHHS may be fined up to $5,000 per day. Additionally, any representative that doesn’t provide the required information can be fined up to $500 per day.

January 1, 2018, several rules regarding PBMs go into effect, including: a fiduciary duty to third parties with which it has entered into a contract to manage the plan of the third party and shall notify the third party in writing of any activity, policy, or practice of the PBM that presents a conflict of interest that interferes with the ability of the PBM to discharge that fiduciary duty. A PBM gag rule will also be instituted, disallowing a PBM from: prohibiting a pharmacist or pharmacy from providing information to a covered person about the amount of any copayment or coinsurance or information of a less expensive drug, penalizing the pharmacist or pharmacy for providing information or selling a less expensive alternative, prohibiting a pharmacy from offering or providing delivery services directly to a covered person, or charging a copayment or coinsurance that is greater than the amount paid to a pharmacy in their network.

On every April 1, manufacturers are required to start reporting: costs of producing drugs, total administrative expenditures, profits earned and percentage of total profits attributable to the drugs, total amount of financial assistance provided through patient assistance, costs associated with coupons, wholesale acquisition costs, increase history for five years, aggregate amounts of all rebates provided to PBMs, and any additional information DHHS requires under regulations.

Also required on April 1 annually is PBM reporting, which requires reporting of the amount of rebates negotiated for the drugs on the list, the amount of the rebate retained by the PBM, the total amount of rebates negotiated for recipients of government-funded health care, and rebates negotiated for recipients of non-governmental third parties.

Additional timeline requirements can be found here.

Draft Pharmaceutical Representative Registration Procedures

Any individuals who meet the requirements included on this site must register with DHHS by October 1, 2017, or within thirty days of hire, and must be registered before engaging in work in Nevada.

If you are a pharmaceutical representative and you physically visit Nevada for five days or more annually to communicate with health care providers, you meet the requirements and will need to register. Additional activities that will include you in the definition include:

  • Engage in the marketing of prescription drugs to doctors or other health care providers, pharmacists or pharmacy employees, and employees of medical facilities. Marketing includes providing educational presentations and/or details intended to inform prescribers about their products as a way to influence them to purchase or prescribe.
  • Meet with physicians or other healthcare providers to answer questions about product use and benefits or providing discussion and product information and resources to key decision makers while representing the manufacturer or supporting promotional efforts of the manufacturer.
  • Distribute FDA regulated product samples and product information.

Excluded activities – ones that you can engage in and not be considered a representative that needs to register – are:

  • Attending a trade conference or convention hosted in Nevada that is not solely marketed to health care providers licensed in Nevada.
  • Activities related to clinical trials, investigational drugs, or Risk Evaluation and Mitigation Strategies.
  • Activities performed by wholesale distributors who do not represent a single manufacturer.

To register, the employing manufacturer may send an email to drugtransparency@dhhs.nv.gov, and DHHS staff will include the person’s name on the registry. If staff are hired or terminated from a company, they must notify DHHS who will then add or remove them from the current registry.

False Claims Act Mid-Year Review: Significant Life Science Settlements, Post-Escobar Developments & Industry Round Up

False-Claims-Act-Atlanta-Medical-Clinic-“AMC”-And-Dr.-Timothy-Dembowski-Have-aAreed-to-Pay-For-Violated-Medicare-Rules-And-The-False-Claims-Act

Several significant False Claims Act settlements and judgments in the first six months of 2017 suggest this year will result in the eighth year of over $3 billion in FCA recoveries. Additionally, recent judicial decisions in FCA suits have further refined the test outlined in the Supreme Court’s 2016 Escobar decision, statistical sampling has resulted in significant FCA judgments, and the government continues to explore new frontiers for FCA liability.

The False Claims Act (“FCA”) continues to be a powerful tool for the government (and relators) to curb fraudulent conduct. FCA settlements and judgments to date in 2017 have surpassed $1.5 billion in recoveries. This rate suggests that for an eighth consecutive year the government is on track to collect more than $3 billion total from FCA cases.

As in the past, several significant FCA settlements and judgments this year have targeted the life science industry. Additionally, several decisions in the first half of 2017 helped refine the Supreme Court’s consequential Escobar decision, demonstrated willingness by the government to apply statistical sampling to calculate recoveries, and further refined the heightened pleading standards required for FCA suits. Finally, government scrutiny of pharmaceutical manufacturers related to donations to charitable patient assistance programs (“PAPs”) signals the possibility of burgeoning FCA risk and underscores the importance of compliance.

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September 19, 2017

Study Released on Comparison of International Regulatory Authorities

International

 

Pharmaceutical regulations vary widely across the world, and while our sister publication, Life Science Compliance Update, keeps compliance professionals abreast of new development and comparisons across continents and countries, an article published August 2017 in Nature Reviews Drug Discovery offers comparisons in terms of the regulators’ budgets, staff, new drug approvals and timelines for approvals.

 

Of the regulators in the more established major pharmaceutical markets (in this study, the United States, Europe and Japan are considered the regulators in such markets), the United States Food and Drug Administration (FDA) has the most internal reviewers (an estimated 2,000), though the European Medicines Agency (EMA) has a network of more than 4,500 experts providing scientific expertise to the agency.

 

Japan’s Pharmaceuticals and Medical Devices Agency (PMDA), meanwhile, has about 560 reviewers, while the China Food and Drug Administration (CFDA) had only about 120 staff in its Center of Drug Evaluation to perform scientific evaluations through August 2015. Since August 2015, the research says the State Council of China has brought that number up to about 300 to work through a backlog of applications. 

 

As far as new drug application (NDA) submissions and approvals, differing NDA definitions or their equivalents between authorities make direct comparisons difficult, though in the established markets, the FDA was noted as approving the most NDAs for new drugs (45) in 2015, while Japan’s PMDA approved the most NDAs (48) in 2016. 

 

Similarly, timelines to NDA approval have different definitions and processes, though the researchers said the shortest time to market was 210 calendar days for EMA and the longest was 900 calendar days for CFDA (though CFDA is trying to accelerate that process). Several of the authorities also have programs to enable accelerated review of products that are considered to be addressing particularly important medical needs, such as the FDA's priority review designation, which is associated with a review timeline of 180 days, compared with the standard review timeline of 300 days.

 

NDA review fees also vary, the authors reported, noting India had the lowest fees (50,000 Indian rupees; ~$1,000), whereas FDA had the highest ($2.3 million). 

 

"Overall, the regulatory authorities in developed countries such as the United States, European Union, UK, Canada and Japan are more evolved in terms of regulatory systems and resources, such as technical reviewers, but have higher NDA fees," the authors wrote.

 

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