DID - Feb. 8, 2008 Issue

Vol. 7 No. 27

CDER Slated for 283 New Staff in Proposed Fiscal 2009 Budget

The president’s fiscal 2009 budget request for the FDA includes an estimated 526 new full-time equivalent employees, 283 for CDER alone.

Twenty-six new employees would be in CBER, 161 would be in the Office of Regulatory Affairs (ORA) and five would be in FDA Headquarters and the Office of the Commissioner, according to data the FDA provided DID.

CBER requested an additional $5.6 million in user fees and 18 full-time equivalent employees for its human drug review program, three of whom would review direct-to-consumer (DTC) television advertisements.

The FDA’s fiscal 2009 budget request focuses on generic drug application reviews, postmarketing safety tracking and a new regulatory pathway to approve follow-on biologics. The Bush administration proposed nearly $2.4 billion for the agency, including $1.77 billion in direct budget authorities and $628 million in user fees (DID, Feb. 5).

The fiscal 2009 is a 5.7 percent increase — approximately $2.26 million more than the $2.27 billion the FDA received for fiscal 2008.

According to HHS, the proposed 2009 budget contains $738 million in program-level funding for the FDA’s human drugs program. The increase of $58.5 million over fiscal 2008 levels would help the agency implement targeted import safety activities and provide cost-of-living salary increases for CDER and ORA staff.

Twenty-two new full-time equivalent employees would review DTC advertisements for CDER, funded through increased user fees from P.L. 110-85, the FDA Amendments Act.

CDER also plans to establish procedures and tools to manage postmarketing safety issues similar to the way it tracks premarketing issues. The budget request includes $360 million, an increase of $7 million over fiscal 2008, for an initiative focused on new drug safety and postmarketing safety and effectiveness activities.

The FDA is requesting $15 million and 34 full-time equivalent employees for generic drug application reviews. In fiscal 2009, CDER expects to increase its abbreviated new drug application actions and maintain its new generic drug approval performance from fiscal 2007, when it approved 682 new generic drugs.

The budget request also seeks new authority for the FDA to approve follow-on biologics through a new regulatory pathway funded by user fees.

The agency’s legislative proposal will include a public guidance process for licensing follow-on biologic products under the Public Health and Safety Act, prescribe the type of data required for the FDA to review the applications and require labeling to address safety concerns related to the products’ interchangeability. The proposal also will include intellectual property protections, an FDA spokeswoman told DID.

Congressional committees have begun hearings to discuss the proposed budget. The House Energy and Commerce Committee has scheduled a hearing on HHS’ fiscal 2009 budget proposal Feb. 14. — Emily Ethridge


Lipitor Probe Widens to Include DTC Ad Producers

Members of Congress investigating direct-to-consumer (DTC) Lipitor advertisements featuring Robert Jarvik have turned their attention to 10 firms involved in producing the ads.

Reps. John Dingell (D-Mich.), chairman of the Energy and Commerce Committee, and Bart Stupak (D-Mich.), chairman of the Oversight and Investigations Subcommittee, sent letters to the companies expressing concerns that consumers may misinterpret the health claims of a prescription drug promoted by a celebrity physician. They also said Jarvik’s qualifications may be misinterpreted in Lipitor’s (atorvastatin calcium) advertisement campaign given that he is not a practicing physician with a valid license in any state.

The congressmen are requesting financial records relating to the companies’ association with Pfizer, including any contractual arrangements. They also asked for documents relating to any payments made to body doubles or members of Jarvik’s family who appeared in the advertisements. The letters cautioned the companies not to destroy, dispose of or tamper with any records relating to Jarvik and his association with Pfizer.

The inquiry comes a month after the committee made a similar request to Pfizer CEO Jeffrey Kindler (DID, Jan 9).

The letters were sent to imc2, Maya Group, Cline Davis & Mann, ARSgroup, Guideline, Ipsos ASI, Ipsos Understanding UnLtd., The Kaplan Thaler Group, Mindy Goldberg Associates and Unit 7. Representatives from Guideline declined to comment. The other companies did not respond by press time.

The letters are available at energycommerce.house.gov/Investigations/Jarvik.Letters.shtml. — Elizabeth Jones


Shareholder Lawsuit Against Amgen Moves Forward

A federal judge has ruled that a group of shareholders may proceed with a class action lawsuit against Amgen over alleged fraudulent statements about off-label marketing of its erythropoiesis-stimulating agents (ESAs) Epogen and Aranesp.

Judge Philip Gutierrez of the U.S. District Court for the Central District of California dismissed the case against certain individual company officials at Amgen. However, he left standing the central claims in the lawsuit, which was filed last year, that Amgen downplayed or failed to tell shareholders about safety concerns raised by a series of clinical trials of Epogen (epoetin alfa) and Aranesp (darbepoetin alfa) and that it engaged in illegal off-label marketing of the drugs.

“At the same time the FDA was questioning whether ESAs were safe for approved indications and populations, Amgen allegedly developed a sophisticated and multifaceted scheme to improperly push the ESAs for unapproved indications and populations,” Gutierrez wrote in his opinion.

He noted that the company has been accused of:

  • Training its sales representatives to prompt doctors to ask questions that would permit them to begin a dialogue regarding off-label use of Aranesp and Epogen;
  • Creating an expert speakers’ program to boost off-label sales, with the speakers each receiving a $1,000 honorarium “paid from marketing budget” upon Amgen’s receipt of their program evaluations;
  • Marketing inappropriately increased drug dosages, for example, by encouraging doctors to inject Epogen intravenously rather than subcutaneously;
  • Marketing Epogen and Aranesp to physicians and other healthcare providers by explicitly discussing the financial benefits of prescribing high volumes of these drugs in violation of Medicare regulations; and
  • Providing spreadsheets and other tools to enable sales representatives to calculate “margin and spread” (the profit that a medical practice could earn by using particular Amgen drugs in combination).

The FDA said it could not comment on whether it is investigating the alleged off-label marketing or might do so in the future. Amgen did not reply to a request for comment by press time.

In December 2007, the company said it was involved in discussions with the FDA to update the labeling for Aranesp and Epogen to reflect recent safety data from two clinical trials (DID, Dec. 10, 2007). — Martin Gidron


Merck’s Medicaid Settlement Covers Zocor, Vioxx and Pepcid

A former Merck employee will receive more than $68 million under a settlement that resulted in part from his lawsuit alleging that Merck violated the Medicaid rebate statute by not reporting substantial discounts for Zocor and Vioxx to the Centers for Medicare & Medicaid Services.
The settlement, in excess of  $650 million, was struck between Merck, the federal government, the District of Columbia and 49 states participating in the Medicaid program. Under the terms of the deal, the company admits no wrongdoing.

According to the company, Merck took a $670 million charge in December 2007 in anticipation of the settlement. As a result of the agreement, federal cases in Pennsylvania, Louisiana and Nevada concerning these matters will be dismissed, Merck said.

Merck allegedly offered deep discounts to hospitals if they used large quantities of Zocor (simvastatin) and Vioxx (rofecoxib) in place of competitor products. Those sales were classified as nominal in value and therefore not included in Medicaid best price calculations. Under the Medicaid program, manufacturers must report their best prices so the program gets the same discounts as commercial purchasers. Discounts of nominal value are exempted.

The former employee, H. Dean Steinke, also alleged that Merck engaged in illegal kickbacks to physicians through 15 separate programs used to induce doctors to prescribe the drugs. The payments were disguised as training, consultation and market research fees.

In addition to the charges from the former Merck employee, the settlement covers a lawsuit filed in New Orleans by physician William St. John LaCorte. He contends that Merck provided substantive discounts to hospitals for heartburn treatment Pepcid (famotidine) if they agreed to use that drug instead of other treatments. Those discounts were classified as nominal as well. The price cuts were offered so patients would continue to use the product after discharge, the suit alleged.

LaCorte will receive a share of the proceeds from the federal and state settlement under respective qui tam statutes. Merck also entered into a five-year corporate integrity agreement with the HHS Office of Inspector General as part of the settlement.

This is the latest instance of a company having to pay hundreds of millions of dollars to settle allegations of improper marketing prices. Last year, Bristol-Myers Squibb entered into a $515 million settlement that, at least in part, involved Medicaid price reporting and physician kickbacks (DID, Oct. 2, 2007).  Sepracor recently disclosed that it may have to reimburse Medicaid programs by as much as $100 million due to potential errors in best price calculations (DID, Jan. 31). — Christopher Hollis


Merck’s Isentress Could Hold Promise for Several Patient Populations

Merck’s HIV integrase inhibitor Isentress used in combination with other HIV medicines maintained significant viral load suppression and increased CD4 cell counts through 48 weeks of therapy in treatment-experienced patients who had failed previous antiretroviral (ARV) therapies, the company said.

Merck discussed these findings during an oral presentation at the 15th Conference on Retroviruses and Opportunistic Infections Feb. 5. According to David Cooper, director of the National Centre in HIV Epidemiology and Clinical Research at the University of New South Wales, the 48-week results indicated the Isentress (raltegravir) combination therapy continued to provide greater ARV activity and increases in CD4 cells compared with placebo and other ARV medicines.

The FDA granted accelerated approval to Isentress for this indication last October (DID, Oct. 16, 2007).

Merck is investigating the drug in other patient populations. An ongoing Phase II study in treatment-naive patients is comparing Isentress in combination with Viread (tenofovir disoproxil fumarate) and Epivir (lamivudine) against Bristol-Myers Squibb’s Sustiva (efavirenz) combined with the same agents. The Isentress combination has provided reductions in HIV RNA to undetectable levels in 83 percent to 88 percent of patients compared with 87 percent of patients taking Sustiva. 

Additionally, the company is conducting a multicenter, open-label, noncomparative Phase I/II trial in collaboration with the National Institute of Allergy and Infectious Diseases and the International Maternal Pediatric Adolescent AIDS Clinical Trials group to evaluate the drug in children and adolescents. — Elizabeth Jones


Ranbaxy Gets OK for Generic Nexium

The FDA has granted tentative approval to Ranbaxy Laboratories’ abbreviated new drug application (ANDA) for generic Nexium capsules, the first approval of any generic version of the blockbuster drug.

Ranbaxy said it was the first to submit an ANDA for generic Nexium (esomeprazole magnesium) 20- and 40-mg delayed-release capsules, potentially providing the company with 180 days of marketing exclusivity for its product upon launch.

Nexium had worldwide sales of $5.2 billion in 2007, with U.S. sales of nearly $3.4 billion, according to AstraZeneca’s 2007 earnings report.

Ranbaxy and AstraZeneca are involved in ongoing patent litigation over several of AstraZeneca’s patents on Nexium, which AstraZeneca initiated in 2005 by suing Ranbaxy in the U.S. District Court for the District of New Jersey (DID, Nov. 28, 2005). The patents — which cover the composition, synthesis and use of esomeprazole magnesium — all expire between 2014 and 2020. Court records show that no trial date has been set.

Nexium is indicated for the short-term treatment of erosive esophagitis, maintaining symptom resolution and healing of erosive esophagitis and for treating heartburn and other symptoms associated with gastroesophageal reflux disease. — Breda Lund

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Reporters: Martin Gidron, Emily Ethridge, April Astor, Breda Lund, Christopher Hollis, Elizabeth Jones

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