Objectives • New drug approval process • Pricing of new drugs • Off ...

3/15/13%
Novel Therapies: What Are the Ethical, Legal,
and Regulatory Issues
Christian Tomaszewski, MD, MS, FACEP, FACMT, FIFEM
“On the internet, nobody knows you are in Puerto Rico having a Mojito.”
Objectives
Issues in New Drugs/Applications
• New drug approval
process
• Pricing of new drugs
• Off-label drug use
1%

3/15/13%
Fairy Tale
Three Stories
Ethics
Law
Regulatory
Brief History of
Drug Development
• Problem
• “I have a headache”
• Solution
• 2000 BC- Here, eat this root
• 1000 AD- That root is heathen, say this prayer
• 1850 AD- That prayer is superstition, drink this
potion
• 1940 AD- That potion is snake oil, swallow this pill
• 1950 AD- That pill is ineffective, take this
prescription drug
• 2010 AD- That drug is too expensive take this
generic
2%

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Medicinal “Nuts”
• 67 y/o female with non-resectable carcinoma of the bowel
ground up 12 bitter almonds given to her by friend to
increase protein intake. Within 30 minutes she developed
crampy abdominal pain and then collapsed.
• VS – 128 20 138/90 afebrile
• HEENT – PERRL 4 mm, unusual breath odor
• Lungs – clear lung fields
• Cor – Regular tachycardia without murmurs
• Abd – occasional BS, soft and NT
• ABG 7.17/CO 2 25/O 2 56
• Lactate 14 meq/L
Shragg TA. West J Med 1982;136:65-69
What is the
Toxin
Cyanide
3%

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“Poison Pill”
• Amygdalin
• Emulsin
(β-glucosidase)
What Antidote did they give
4%

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Hydroxocobalamin
Drug Development & Approval
Process
5%

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R & D Efficiency Declining
(Inflation Adjusted)
Diagnosing the decline in pharmaceutical R&D efficiency
Jack W. Scannell, Alex Blanckley, Helen Boldon & Brian Warrington
Nature Reviews Drug Discovery 11, 191-200 (March 2012)
Key Elements of Drug Development
Medical
Will the drug work
How well In what
indications
Discovery
Chemistry
Can we manufacture
it Safely With
consistent quality
Pharmacology /
Toxicology
How does it work
What are the toxic
effects in the body
6%

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Transition probabilities 1993-2002
DiMasi and Grabowski (2007a)
NDAs are Filed Electronically and Can Consist of
as Many as 15 Different Sections:
• Index
• Summary
• Chemistry, Manufacturing, and Control (CMC)
• Samples, Methods Validation Package, and Labeling
• Nonclinical Pharmacology and Toxicology
• Human Pharmacokinetics and Bioavailability
• Microbiology (for anti-microbial drugs only)
• Clinical Data
• Safety Update Report (typically submitted 120 days after the
NDA's submission)
• Statistical
• Case Report Tabulations and Case Report Forms
• Patent Information and Patent Certification
• Other Information
FDA Pain Points in Drug Development
• Bureaucratic
& slow
• Not creative
• Risk averse
especially to
innovative
technologies
7%

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Orphan Drug Act
• Orphan Drug Act:
• Enacted by US Congress in 1983
• Rewards for developing drugs for
patient population fewer than 200,000
• Reward:
• 7 year monopoly
• 50% tax credit for clinical trials
• Consequence: other similar drugs cannot
compete unless they can demonstrate higher
efficacy
Animal Efficacy Rule
June 30, 2002
• Drugs and biologics intended to reduce
serious and life-threatening conditions
• May be approved for marketing based on:
• Effectiveness from animal studies
• Human efficacy studies are not ethical
or feasible
• Aim is to protect public from disabling
toxic substances and organisms
• Need pharmaco-kinetic data to gauge
dose
21 CFR Parts 314 and 601
Animal Rule: Examples
• Pyridostigmine bromide 2003
• Prophylaxis for soman exposure
• Hydroxocobalamin 2006
• Treatment of cyanide poisoning
• Levofloxacin 2012
• Treatment of pneumonic plague
• Raxibacumab 2012
• Treatment of
inhalational anthrax
8%

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Prescription Drug User Fee Act V –
effective Oct 1 st 2012
• FDA pledges to review 90% of NDAs within
12 months
• Expectation is that this increases # of first
cycle approvals
• Mid cycle and late-cycle review meetings
with sponsors
• Increased communication & transparency
• Pre-submission meeting to ensure NDA/BLA
completeness
• User fees increase:
• Application now $ 1.96 million (6.3% inc)
9%

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Cyanide Antidotes
• Sodium Thiosulfate 250mg/ml 50ml
$77
• Sodium Nitrite 30mg/ml 10ml $77
• Nithiodote ( sodium nitrite/
thiosulfate) 30-250mg/ml $150
• Cyanokit ( hydroxocobalamin) 5gm
$ 715/kit
Cyanide Treatment: $300 Antidote
10%

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Standards in Drug Development
• GLP – Good Laboratory Practice
• GCP – Good Clinical Practice
• GMP or cGMP – (current) Good
Manufacturing Practice
• 21 CFR - Title 21 CFR Part 11 of the Code of Federal Regulations
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Why are Drugs Regulated
Answer is obvious, but, as with most regulations, the rules are often
written, or tightened after the “event”, in response to one or more health
disasters:
• 1907 - Introduction of arsphenamine (anti-syphilitic organic arsenical)
• UK- Therapeutic Substances Act (1925)
• 1937 - Elixir of Sulfanilamide - USA
• Food and Drugs Act (1938)
• 1957 - Introduction of Thalidomide (ex USA)
• FDA introduced tightened approval requirements, regulation of
advertising, and GMP inspections (1962)
• UK Committee on Safety of Drugs (1963)
• European Medicines Directive (1965)
• UK Medicines Act (1968)
Regulation of Medical Products
Other public health problems that caused changes in regulatory
control of medical products:
• Viral/HIV contamination of blood & blood products
• Tylenol contamination
• CJD and prions in blood products
• Counterfeit products – GMP
• Heparin & melamine contamination – FDA overseas
• Leaking breast implants
• Malfunctioning medical devices
• Fungal infections at compounding pharmacies
12%

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Marcie Edmonds, 52,
was stung in her
abdomen last June at
her Ahwatukee
Foothills home in
Phoenix.
Eculizumab (Soliris)
• Treatment for paroxysmal nocturnal
hemoglobinuria
• Most expensive drug in the world
13%

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High Visibility & Political Pressure
Average Cost of Drug Development
INTERVAL
Spending
($m)
Time to
Core
Launch
Capitalized
Spend/
Successful Med
($m)
1- Pre-1 tox dose 76.5 9.6 207.4
2- 1 st tox dose to 1 st human dose 86.8 7.2 184.1
3- 1 st human dose to 1 st patient
dose
4- 1 st patient dose to 1 st pivotal
dose
5 – 1 st pivotal dose to 1 st core
submission
149.5 6.2 284.0
316.9 4.4 501.6
235.9 2.1 293.8
6 – 1 st core submission to 1 st core 33.3 0.5 34.9
launch
TOTAL
Mestre-Ferrandiz J: The R&D Cost of a New Medicine . Dec 2012.
Office of Health Economics based 899 on Center for Medicines 1,506 Research
US Growth in Health Expenditures
$5,000,000
$4,500,000
Projection
15.00%
$4,000,000
$3,500,000
Millions
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
Source: CMS, Office of the Actuary, National Health Statistics Group.
10.00%
5.00%
% of Total Health Expenditure
$500,000
$0
0.00%
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Health Expenditures
Prescription Drugs
14%

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25.0
National Health Expenditures as a Share of
Gross Domestic Product (GDP) to 2008
Projection
% of GDP
20.0
15.0
10.0
5.0
0.0
1960
1962
1964
1966
1968
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
Source: CMS, Office of the Actuary, National Health Statistics Group.
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
The Value Decision
Unattractive
The “Easy
No” (More
expensive and
less effective)
Standard
of care
The Dilemma
(Less expensive
and less effective)
Change in costs
The Challenge
(More expensive
and more
effective)
Change in effects
The “Easy
Yes” (Less
expensive and
more effective)
Value
Threshold
Attractive
The Pricing Channel:
Cost vs. Clinical Value
Cost per Course of Therapy
Trend Line
90% confidence limits
Ref.:%Easton%Associates,%LLC%
Clinical Value
15%

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Pharmacoeconomic Analyses
46
Analysis Type Cost Consequence
Cost Minimization $ Equal (no denominator)
Cost Effectiveness $ Natural Units
Cost Benefit $ $
Cost Utility $ QALYs
What is a life worth
• People are willing to accept a risk of
0.000002 of death to save 7 min of
walking : $1,170,000
• For each 0.0001 increase in risk of death,
there is a $240 increase in annual salary:
$2,400,000
• Each smoke detector reduces death risk
by 0.000036 for a cost of $30: $400,000
• Willingness to pay for hypothetical auto
safety feature: $1,600,000
Michael W. Jones-Lee, 1989
Pressure on Healthcare Decision
Making
Downward
pressure
Medical
Need
Value
Upward
pressure
Affordability
16%

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Dr. Gleason Promoted Xyrem
• He was making as much as
$3,000/day off Jazz
• $450 for a face-to-face
meeting in a doctor's office,
• $750 to speak at a
luncheon,
• $1,500 for a dinner speech.
• “He even gave up his medical
practice, in order to devote all
his time to "hawking" the $600-
a-month drug.”
http://evelynpringle.blogspot.com/2010/07/investigators-zero-in-on-pill-pushing.html
17%

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May 13, 2004
Under the agreement released Thursday
by federal prosecutors, Warner-Lambert
(Pfizer) acknowledged spending
hundreds of thousands of dollars to
promote non-approved uses for the
anti-seizure drug Neurontin through a
publication strategy that subsidized
production and dissemination of
anecdotal reports.
Court Rulings on Off-Label 1983
• “Once a drug product has been approved for
marketing, a physician may, in treating patients,
prescribe the drug for uses not included in the
drug’s approved labeling.” Proposed New Drug,
Antibiotic, and Biologic Drug Regulations, 48 Fed.
Reg. 26,720; 26,733 (proposed June 9, 1983).
• The FDA disclaims authority to interfere with a
doctor’s judgment to prescribe a drug for an
unapproved use. Id. See also 21 C.F.R. § 312.3(d)
(exemption from FDA regulations for “the use in the
practice of medicine for an unlabeled indication of a
new drug product approved” by the Agency”).
• The same is true for medical devices. 21 U.S.C. §
396.
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FDA’s Deputy Commissioner for
External Affairs 1992
• “…off-label drug use is often essential
to good medical practice, and in some
areas—oncology and pediatrics in
particular—off-label uses are often
considered necessary. In fact, it is on
this edge that science and medicine
move forward to benefit patients with
intractable illness.”
Carol Scheman, Prescription Drug Marketing and Promotion
—An FDA Perspective, Address before the PMA Public
Affairs Section, Mid-Year Meeting, April 15, 1992.
Cost Substitution: Off Label
• Bevacizumab
(Avastin )
• $50/dose
• $595/month
• Ranibizumab
(Lucentis)
• $2,000/dose
• $23,400/month
Patient-reported Outcomes as a Source of
Evidence in Off-Label Prescribing
• PatientsLikeMe
• “web-based community
and research platform
where patient members
share details about their
treatments, symptoms,
and conditions, with the
intention of improving
their outcomes.”
J Med Internet Res. 2011 Jan-Mar; 13(1):
e6.
19%

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On December 3, 2012, a divided Second Circuit held
in United States v. Caronia (“Caronia”) that the
misbranding provisions of the Federal Food, Drug,
and Cosmetic Act (“FDCA”) do not criminalize “the
truthful off-label promotion of FDA-approved
prescription drugs.” The two-judge majority based its
holding primarily on last year’s Supreme Court
decision in Sorrell v. IMS Health, Inc., which held that
“[s]peech in aid of pharmaceutical marketing…is a
form of expression protected by the Free Speech
Clause of the First Amendment.”
http://www.jdsupra.com/legalnews/off-label-marketing-questioned-as-a-viab-49267/
20%

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lipidrescue.squarespace.com
Controlled Animal Studies: Effect
of IV Lipid Emulsion
DRUG POSITIVE N.S.
Bupivacaine 4 3 *
Thiopental 2 0
Verapamil 5 1
Nifedipine 0 1
Propranolol 1 2
Atenolol 0 1
Metoprolol 0 1
Amitriptyline 0 1
Clomipramine 5 0
Jamaty C et al: Lipid emulsions in the treatment of acute poisoning.
Clin Toxicol 2010; 48:1-27
21%

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PATENT RIGHT
• The right to
exclude others
from making, using
or selling the
claimed invention
• Patent holder, not
government, is
responsible for
enforcement
22%

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Phase II Failures: 2008-2010
John Arrowsmith1 Nature Reviews Drug Discovery 10,
328-329 (May 2011) | doi:10.1038/nrd3439
John P.A. Ioannidis
23%

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From: Comparison of Effect Sizes Associated With Biomarkers Reported in Highly Cited Individual Articles and
in Subsequent Meta-analyses!
JAMA. 2011;305(21):2200-2210. doi:10.1001/jama.2011.713"
Date of download: 3/10/2013"
Copyright © 2012 American Medical Association.
All rights reserved."
Conclusion
• Most large treatment
effects emerge from
small studies, and when
additional trials are
performed, the effect
sizes become typically
much smaller.
• Well-validated large
effects are uncommon
and pertain to nonfatal
outcomes.
24%

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Hydroxocobalamin: Cost Analysis
• Cyanokit $715 a dose
• Save 20%
• Spend $3575/life saved
• But Nithiodote is $150
• If equally efficacious:
use this
• If better: calculate the
incremental benefit
• If a life is worth $ 1 million
Nithiodote would have to
be ~ 5% efficacious
Our Baby is Ugly!
We don’t really
need to slay
the dragon…
25%

3/15/13%
SUMMARY
• Regulatory
• FDA is expediting process
• Good manufacturing practices
• Legal
• Continue to promote drugs as we see fit
• Leverage intellectual property appropriately
• Ethics
• Price drugs so that they are affordable
• We cannot exaggerate claims of efficacy
FUTURE WINNERS
• Drugs that
reduce morbidity
and mortality
while reducing
overall health
care costs.
26%