New FDA Directions, Part 1 – Pricing

With a change in leadership at FDA there naturally a great deal of anticipation with regard to the potential for new direction for the agency and the impact it will have on the agency’s diverse stakeholders.

That is especially true right now. Not only has there been the serial drama of Congressional actions around healthcare reform, the new commissioner has taken over FDA at a time when the agency itself is experiencing vast amounts of change while facing ever increasingly complex new challenges. Prior to the confirmation of the new FDA commissioner, many of those challenges were deliberated by members of Congress during the nomination approval process. These ranged from the implementation of the wide-ranging 21st Century Cures Act to facing down the threats posed by opioid abuse. Now that we have a new commissioner, it is a good time to look back at those issues and how they are actually playing out. In Part 1 of examining the new directions for FDA, we’re going to look at the issue of the agency’s role in addressing issues related to pharmaceutical pricing, actions which have garnered national media attention.

FDA does not have a direct role in directly regulating the price of prescription products. In fact, if the subject of price comes up during an advisory committee deliberation, the chair will usually step in to remind the participants that the subject is not one they need discuss. It did come up during Dr. Gottlieb’s confirmation hearings, however.

In fact, while not directly involved in pricing, there are nevertheless actions that FDA takes that can have an indirect impact on price. One of the more obvious has to do with bringing more generics to market. The more generic versions of a drug that come to market, the greater the downward pressure on brand pricing. Therefore the faster FDA approves generic versions the greater the pressure brings down price.

During his confirmation hearing on April 5, Endpoints reported that in response to a question about FDA’s role in lowering the cost of prescription drugs, Dr. Gottlieb talked about enhancing the entry of generics into the market. He said this would be accomplished by (1) reforming the regulatory pathway especially for complex generics and (2) improving the ANDA process.

That was then, this is now. What has happened since confirmation? On June 21, Commissioner Gottlieb published a blog posting on FDA Voice “FDA Working to Lift Barriers to Generic Competition” in which he announced a Drug Competition Action Plan, the first manifestation of which was a public meeting held July 18 to solicit input on where and how FDA might remove obstacles to generic competition. One of the stated goals was also to make sure that FDA regulations were not being “gamed” to delay generic entry to the market. He also said that FDA would be looking to work with the Federal Trade Commission (FTC) to identify and publicize anti-competitive practices by industry – another point he had raised in his Senate hearing. His opening comments to the meeting are available here.

On the FDA Meetings site, there is no link for the meeting on the “FDA Conferences, Meetings and Workshops” page. However, the Federal Register Notice for the meeting presents 6 questions for which the agency is seeking input on a range of subjects related to the generic pathway. As of this writing, 14 comments have been posted in the docket, including one from former Congressman Waxman which is well worth noting for the breadth and scope of the suggestions put forth.

In addition to these actions, on June 27, the agency issued a press release “FDA Tackles Drug Competition to Improve Patient Access” that announced that it was (1) publishing a list of off-patent, off-exclusivity branded drugs without approved generics and in addition was (2) issuing a new policy to expedite review of generic drugs and were positioned as the first actions by the agency under the Drug Competition Action Plan. Of course, actions on generic drugs can impact price, but that addresses the price of older drugs, not new ones coming onto the market.

FDA does not move on a dime and there is usually a good deal of process (collecting information, studies, e.g.) that is put into place before any real action is taken, but clearly the change in leadership is affording the opportunity to demonstrate momentum towards specific goals and putting pre-nomination approval words into post-approval action. Time will tell whether that momentum continues from process to action to impact. In the meantime, FDA has taken steps and through a fairly aggressive communications strategy has made sure that people knew about them.

In the next installments, we’ll look at some of the other issues talked about before the change in leadership and where there has been action.