Vol. 10 No. 58
The Supreme Court ruled in a unanimous decision that drug companies must report adverse events to shareholders even though they may not be statistically relevant.
The High Court’s decision Tuesday provides a new standard for what drug and device companies must disclose to investors, but some attorneys disagree over the impact the ruling will ultimately have.
The case, Matrixx Initiatives, Inc., et al., v. James Siracusano, et al., stems from a lawsuit brought by Matrixx shareholders alleging the company received reports from users that its OTC cold remedy Zicam (zinc gluconate) impaired users’ sense of smell, a condition known as anosmia. However, Matrixx failed to disclose that information to investors or the public, likely fearing the negative reaction from the market.
The Supreme Court said that Matrixx should have released information on cases of users losing their sense of smell to the public.
“Both medical experts and the Food and Drug Administration rely on evidence other than statistically significant data to establish an inference causation,” Justice Sonia Sotomayor wrote in the court’s opinion. “It thus stands to reason that reasonable investors would act on such evidence.”
A 2009 FDA warning letter to Matrixx documents 130 reports of patients losing their sense of smell, and the agency ordered the drug off the market (DID, June 17, 2009). At the time, Zicam was a $4 billion OTC drug.
Investors initially filed a lawsuit in 2005 before a federal court tossed it out. The shareholders alleged violations of fiduciary duties, misrepresentation of Zicam’s safety and failure to warn consumers that Zicam could cause anosmia.
But the Supreme Court agreed to hear the case in October 2009 after Matrixx started a partial recall, and the Ninth Circuit Court of Appeals reversed the lower court’s 2005 ruling (DID, Oct. 30, 2009).
In arguments before the court in January, Matrixx said disclosing information about adverse events without significant evidence would amount to disclosing unfounded, false allegations (DID, Jan. 12).
Sotomayor noted the FDA may take regulatory action against drugs based on postmarket evidence that only gives a suspicion of causation. The court also found statistically significant data are not always available, but that doesn’t mean medical experts have no reliable basis for inferring a causal link.
“Not only does the FDA rely on a wide range of evidence of causation, it sometimes acts on the basis of evidence that suggests, but does not prove, causation,” Sotomayor wrote. “Given that medical professionals and regulators act on the basis of evidence of causation that is not statistically significant, it stands to reason that in certain cases reasonable investors would as well.”
James Beck, a pharmaceutical liability attorney with Dechert in Philadelphia, said Tuesday’s ruling shouldn’t have much impact on drug company’s exposure in product liability lawsuits.
Beck said the Supreme Court’s new standard for how companies should act on adverse event data does not match the legal standard of proof in product liability cases.
Richard Samp, chief counsel for the Washington Legal Foundation, which filed an amicus brief supporting Matrixx, suspects there will be an increase in information companies release about the adverse events surrounding their products.
However, he called the additional information meaningless because the public and investors would have no way to separate significant from insignificant events. He also predicts an increase in securities fraud cases because the court took no hard-line standard definition on what makes and doesn’t make a case.
“There is no minimum hurdle the court is going to establish, as long as you are able to reasonable establish this is a significant event to an investor,” Samp told DID.
Matrixx had no comment, a company spokeswoman said Tuesday afternoon.
The Supreme Court decision is available at www.supremecourt.gov/opinions/10pdf/09-1156.pdf. — David Pittman
Bristol-Myers Squibb’s (BMS) ipilimumab met its primary endpoint in a clinical trial as a first-line melanoma treatment, just days before the FDA is set to act on the biologic’s BLA as a second-line therapy.
While the company did not tout specific data Monday from the recently concluded study 024, it did say ipilimumab met the primary endpoint of improving overall survival in previously untreated patients with metastatic melanoma.
Analysts expect full data, including the actual overall survival benefit and safety findings, from the trial in June, but “showing an overall survival benefit obviously will carry the day over any of the other details,” Credit Suisse analyst Catherine Arnold said in a note Monday.
Study 024 compared overall survival in unresectable stage III or stage IV melanoma patients who had not received prior therapy. Patients were randomized to receive either ipilimumab 10 mg/kg in combination with dacarbazine or dacarbazine alone.
Ipilimumab’s user fee action date is Saturday (DID, Nov. 4, 2010).
Ipilimumab received priority review for the second-line indication, which is based on results from study 020 that compared overall survival in patients who were previously treated for unresectable stage III or stage IV melanoma randomized to receive either ipilimumab and gp100 vaccine or gp100 vaccine alone. Patients receiving the combination of therapies showed a better survival rate (DID, Aug. 19, 2010).
The hope for overall survival benefit is prompting analysts to review their previously positive, though conservative, forecasts for ipilimumab sales.
In the past, Arnold had a pricing assumption of $30,000 per patient per year, but after results from the 024 study, “we would not be surprised if the actual price was nearly double our current estimate,” she said. She assumes peak global sales of $1.1 billion.
Likewise, Leerink Swann analyst Seamus Fernandez expects FDA approval in the second-line indication and sees potential as a first-line treatment as well. He estimates global revenue of $100 million this year, growing to $925 million in 2017, based on a price tag of $50,000 per year. Like Arnold, Fernandez believes results from 024 could bump up the price by as much as 50 percent, possibly adding up to $600 million in additional revenue in 2017.
“BMS plans to implement an innovative customer management model that will involve physicians, nurses and patients and the company is ready with launch inventories,” Fernandez added in a Monday note.
In the same vein, Bernstein analyst Tim Anderson said he has been expecting positive results from the 024 study and “the drug has now been shown to work in all lines of therapy for advanced malignant melanoma.”
While Anderson calls ipilimumab “an exciting drug,” he also expected the “FDA would want to wait until the first-line data from 024 were in before approving the drug, with the idea being that there is likely to be substantial off-label usage ahead of having full approval for first line.”
Gauging from previous results, Anderson Tuesday predicted ipilimumab gives a meaningful two-year survival benefit compared to monotherapy treatment and a smaller portion of patients may show a “near-cure like response.”
Anderson forecasts worldwide sales of $1.7 billion in 2015, representing 10 percent of BMS’ total company sales, based on a selling price of $100,000 per year.
He adds sales may go higher, depending on the success of up-and-coming competitor RG7204, a B-RAF inhibitor under development from Roche. Anderson says by the end of the year patients and physicians may be choosing between either treatment, and “eventually these therapies may be used in combination, but no such studies are yet running.”
Beyond Roche’s RG7204, ipilimumab faces competition from Celgene’s Abraxane (paclitaxel protein-bound particles) and GlaxoSmithKline’s GSK2118436 and GSK1120212. All four contenders are currently in Phase III trials.
Comparing ipilimumab to its competitors, BMS spokeswoman Tracy Furey told DID, “This is the first time we’ve ever seen a significant survival benefit in a Phase III trial” in a first-line setting. — Molly Cohen
Drugmakers are generally supportive of the goals outlined out in the FDA’s Transparency Initiative, but they’d like to see more emphasis on direct communication between the agency and sponsors, as well as more specific information about new databases and tracking systems.
These and other suggestions come from stakeholder comments on the third phase of the initiative, “Improving Transparency to Regulated Industry,” collected by the agency through March 8.
Lundbeck requests in its comment that the agency consider giving “more attention to increasing communication between sponsors and FDA during the review of an application.” The company also expressed disappointment with after-action meetings, saying the meetings are inconsistent and often result in few commitments from the agency.
The Biotechnology Industry Organization (BIO) also weighed in on the matter, calling the lack of communication with first-time filers a “missed opportunity.” Companies often have queries that can easily be answered via phone conferences, rather than in meetings or formal letters, which are time-consuming for both the agency and sponsors, BIO writes.
BIO also recommends earlier communication with drugmakers about potential safety issues so “the company and other affected companies may develop complementary communications to the public … or work collaboratively with the FDA to establish a joint communication plan.”
A secure electronic tracking system that would allow sponsors to monitor the review process was also embraced in the comments, which encourage further discussion of the subject. Johnson & Johnson (J&J) suggests such a system could incorporate elements of the electronic user fee payment systems.
Comments make suggestions about other electronic tracking systems and databases, too, with many companies advising that FDA presentation documents, which the agency proposes to list online, should be available in a searchable database. Alternatively, Lundbeck suggests a fully automated electronic request form could be used for obtaining the documents.
Other stakeholders write in support of the “web-based system that would help importers more easily determine the proper requirements for importation.” GlaxoSmithKline also notes the FDA should provide a timeline or completion date for imported shipments that are detained.
Companies such as J&J and Lundbeck also commented on a plan to inform industry about the progress of “high priority” guidances, with J&J calling for an expanded definition of “high priority” and for the agency to make its rationale for revisions to existing guidances available.
Stakeholders also wrote to urge the FDA to reconsider suggestions the agency had tabled and to commit resources to other initiatives. Many companies ask the agency to re-examine its policy on providing scientific advisement on promotional materials.
“Contrary to FDA’s statement in the report, the current request process … does not satisfy the need,” for agency scientific advisement, J&J writes. BIO also addresses the issue, saying “FDA’s current practice of providing feedback on a specific promotional pieces does not address the need for clarification,” and suggests that the FDA could issue binding opinions while still maintaining flexibility.
Lundbeck, writing in a summary of general comments on the initiative, expresses broad support for the actions outlined in the report but calls many of them “low-hanging fruit,” and urges the FDA to pursue other initiatives with more resources. Lundbeck singles out the Benefit Risk Action Team in particular, which would provide more specific guidelines to help regulators make decisions about the safety of certain compounds.
The Transparency Initiative dates back to a task force formed in the summer of 2009 and seeks to explain its decisionmaking process to the public as well as regulated industries (DID, June 3, 2009). The agency plans to issue a final version of its “Strategic Priorities FY 2011-2015” this month.
The agency’s report, “FDA Transparency Initiative: Improving Transparency to Regulated Industry,” is available at www.fdanews.com/ext/files/FDA-2009-N-0247-0261.pdf. — Wilson Peden
The FDA’s Division of Drug Marketing, Advertising and Communications (DDMAC) has cited Taro Pharmaceuticals for sponsoring a children’s book about head lice with the name of the company’s head lice lotion on the cover without stating the drug’s risks.
A version of the book, There’s a Louse in My House, written by Cheri Hayes, has the logos of Taro and Ovide (malathion) on the cover and title page. The company distributed it at the 2010 American Academy of Physician Assistants conference in Atlanta, according the FDA.
The story in the 24-page book revolves around a young girl inflicted with head lice and the steps her mother takes to remove the bugs. Although the girl doesn’t wash her head with the lotion in the book, Taro’s and Ovide’s name are listed on the cover and title page.
“The book entirely omits all risk information associated with the drug product,” the untitled letter dated March 11 states. “By omitting the most serious and frequently occurring risks associated with the drug, the book misleadingly suggests that Ovide is safer than has been demonstrated.”
In fact, warnings on the product’s label state Ovide is flammable. Potential adverse reactions include skin irritation and inflammation of the eyes if it comes in contact.
“DDMAC requests that Taro immediately cease the dissemination of violative promotional materials from Ovide such as those described above,” the letter states.
Taro’s Executive Director of Regulatory Affairs Kavita Srivastava failed to return a request for comment by press time.
The untitled letter is available at www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/EnforcementActivitiesbyFDA/WarningLettersandNoticeofViolationLetterstoPharmaceuticalCompanies/UCM247656.pdf. — David Pittman
The FDA and industry are at odds over a proposal to further define the criteria that would allow a small business to qualify for a user-fee waiver because it would impact the number of businesses who are granted them.
A group of FDA officials and industry representatives meeting to negotiate items for the Prescription Drug User Fee Act reauthorization on Jan. 25 and 27 debated the definition of the term “affiliate” in regards to whether a small business qualifies for the waiver, according to minutes of the meetings.
Small business waivers are intended for firms that have fewer than 500 employees and are submitting their first application to the FDA. However, the agency says that if an affiliate of that business has previously submitted an application — even if the affiliate is no longer in existence — it will weigh that fact when considering whether to grant a waiver.
Industry disagreed, however, stating that affiliation should be based on a company’s current status. In addition, using a “past-tense inquiry” of affiliates might be “virtually impossible to ascertain in some cases and, therefore, could impede other eligible small business from receiving a waiver,” industry argued.
FDA officials, however, expressed concern that accounting for just current affiliates would give some small businesses waivers even though they were not intended to be recipients, and an increased number of waivers could increase user fees overall.
The FDA’s position has been somewhat undermined by an Illinois federal court decision in December 2009 that only current affiliates should be taken into account when determining whether an applicant qualifies for a waiver. The decision was rendered in Winston Laboratories, Inc. v. Kathleen Sebelius, et al., in the U.S. District Court for the Northern District of Illinois (DID, Aug. 7, 2009). — Jonathan Block
The FDA’s Division of Drug Marketing, Advertising, and Communications (DDMAC) issued an Untitled Letter to AMAG Pharmaceuticals telling the company to cease distribution of a nephrology direct mailer for Feraheme (ferumoxytol) injection.
According to the Feb. 17 letter, published online Friday, the mailer is misleading because it overstates Feraheme’s efficacy.
Feraheme is indicated for the treatment of iron deficiency anemia in adults with chronic kidney disease (CKD).
The drug’s efficacy is based on three randomized, open-label, controlled
studies, in which patients with CKD were randomized to either Feraheme or oral
iron. The primary endpoint in all three trials was the change in hemoglobin from
baseline to day 35. Secondary endpoints included percentage of patients who were
hemoglobin responders at day 35, the mean change in baseline in serum ferritin
at day 21, and mean change from baseline in transferring saturation at day 35,
the letter says.
In the mailer, AMAG suggested patients had experienced increases in hemoglobin levels without concomitant use of erythropoiesis-stimulating agents (ESAs), a result the trials had not substantially demonstrated, DDMAC says. For instance, AMAG said that Feraheme increased patients’ hemoglobin “even without ESA” and resulted in more pronounced increases in hemoglobin in nondialysis-dependent CKD patients, independent of ESAs.
“While concomitant ESA use at baseline was noted, none of the studies, including the referenced trial, were designed to evaluate the efficacy of Feraheme based on ESA use and patients were not stratified by ESA use at randomization,” the letter says. The problem is exacerbated by AMAG’s “complete omission of results of the actual primary efficacy analyses from these studies,” it adds.
The untitled letter is available at www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/EnforcementActivitiesbyFDA/WarningLettersandNoticeofViolationLetterstoPharmaceuticalCompanies/UCM247653.pdf. — Meg Bryan
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