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January 11, 2022 — Bloomberg Law

Authors: Celine Castronuovo

Companies warn of reduced access to treatments

Trade organizations ask FDA for input, clarity

Patients could face disruptions in medical treatment if the FDA moves ahead with plans to regulate some products as devices instead of drugs, according to manufacturers who decry the shift as onerous and time-consuming.

The Food and Drug Administration is reviewing whether certain products long regulated as drugs—such as contrast imaging agents patients take before MRI or CT scans to provide clearer images—will need to transition to device status. The agency’s announcement was a win for manufacturers seeking device status for new products, as it is much more expensive to develop and market a drug than a device.

But industry trade groups and some attorneys say imposing a device designation on products already regulated as drugs will create unnecessary work for companies that will now have to comply with a new set of requirements. That could slow down production and threaten treatment availability, they say.

The FDA “should only impose these types of more burdensome requirements where it’s necessary to protect public health and safety,” David Rosen, a public policy attorney with Foley & Lardner LLP, said in an interview.

Rosen’s clients, for instance, make eye drops with container closure systems such as bottle tips, caps, and other parts that help control drug dosing and quality that the FDA has deemed safe under drug regulations for years, he said.

The agency’s August announcement followed a U.S. Court of Appeals for the District of Columbia Circuit ruling in Genus Medical Technologies, LLC v. FDA that any product meeting the definition of both a drug and device, under federal law, must be regulated as a device.

But several groups argue the appeals court didn’t direct the FDA to apply its ruling retroactively to existing products. They also say the agency’s move was unexpected, and that manufacturers are already receiving FDA requests for information on how they would comply with device quality system regulations.

“It does come as a bit of a surprise, because these companies have thought that there would be a process here,” for the agency to consider industry feedback before it starts taking action, Daniel Kracov, co-chair of Arnold & Porter’s Life Sciences and Healthcare Regulatory practice, said.

A list of approved drugs that will potentially need to transition will be published in the Federal Register, according to the FDA website, and the agency has said companies will have a chance to comment on the proposed list before it is finalized.

The FDA declined to comment for this story on the timeline for its reclassification plans.

Court Ruling

The FDA, in an August 2021 Federal Register notice, said that “going forward,” it would regulate “products that meet both the device and drug definition as devices,” and that it intends to “bring previously classified products into line with the Genus decision.”

Drugs and devices are products intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease. What separates a device from a drug is that a device “does not achieve its primary intended purposes through chemical action within” a person’s body and “is not dependent upon being metabolized for the achievement of its primary intended purposes,” according to the Federal Food, Drug & Cosmetic Act, a set of laws passed by Congress in 1938.

The FDA has regulated certain categories of products that meet both definitions as drugs since a 1997 court decision in Bracco Diagnostics, Inc. v. Shalala—in which a federal district court ruled the FDA must treat all ultrasound contrast agents the same, either as medical devices or as drugs.

But in 2021, Missouri-based Genus Medical Technologies argued that its Vallia SiLQ contrast agent couldn’t be considered a drug because it doesn’t cause a chemical reaction in the body or require metabolization.

The appeals court agreed with Genus, noting that the FDA’s definition of a “device” is “drawn more narrowly than its definition of a ‘drug,’” and that to the “extent the drug and device definitions conflict, it is the narrower definition—the device definition—to which we must give effect.”

The issue now, however, is that “there are certain products that are now on the market as drugs” that “do not achieve their primary intended purpose by chemical action within or on the body,” said Abeba Habtemariam, a partner at Arnold & Porter who specializes in life sciences.

‘No Legal Authority’

Several groups representing contrast imaging agents, certain ophthalmic drugs, and other products that may be required to transition to device status say that the FDA is overreaching its regulatory authority.

“FDA has no legal authority for reclassifying products that its longstanding regulations require the agency to regulate as drugs,” the Association for Accessible Medicines, the leading trade group representing the generic drug industry, wrote in a letter to the FDA.

AAM argues that the classification change should only apply to new applications—not to any that are pending or already approved. Nothing in Genus, it wrote, “justifies retroactive imposition of a new classification policy to existing or approved applications that were developed in reliance on preexisting regulations.”

The Genus decision also doesn’t compel “FDA to regulate individual components of combination products either as ‘drugs’ or as ‘devices,’” AAM added. Combination products include eye drops, insulin pen injectors, and others in which an instrument is used to deliver a particular amount of treatment.

Rosen said the FDA has already told some eye drop manufacturers that their applications are “deficient or will not continue to move forward with review and approval” without information on how they will comply with device regulations. He added that these container closure products “have been in existence for 50 years.”

Adding new device requirements to these products “that have a long history of safe use does not provide any further assurance of safety and is not in the public interest,” he said in a letter to the FDA.

Access Disruptions

The FDA has said it would review industry feedback on how much time is needed to transition products, as well as what’s needed so supply lines aren’t disrupted and manufacturers aren’t unduly burdened. But critics aren’t convinced.

Transitioning products previously regulated as drugs will “ultimately delay competition, innovation, and directly threaten our members’ ability to bring affordable medicines to the American public at the earliest possible opportunity,” the AAM said.

The Advanced Medical Technology Association, in a separate letter to the agency, recommended “grandfathering” in products already deemed safe under drug regulations into the device division until manufacturers are able to fully develop plans for following device quality system regulations. These regulations include requirements related to the facilities and methods used for the designing, packaging, labeling, storing, and servicing of medical devices.

There are also lingering questions as to whether the FDA will conduct additional rulemaking to create a separate category for contrast imaging agents and other products that might not fit perfectly within either definition of “drug” or “device.”

“Will FDA establish new classifications for those categories of agents,” Habtemariam asked, “or will the agency try to fit those contrast imaging agents into existing device classifications?”

Litigation Possible

Trade groups and policy analysts say that manufacturers could lose privileges offered to certain drugs if their products are reclassified as devices.

Unlike devices, the FDA can give drugs an exclusivity designation to incentivize the development of new treatments. The label can authorize certain delays and prohibitions on the approval of competitor drugs after a new drug application is approved. Orphan drug exclusivity for a rare disease treatment, for example, typically lasts for seven years.

Medical product trade groups are now concerned that drugs that contain a device component could lose exclusivity protections if they are reclassified. That could result in “future litigation,” Kracov said.

“If you have five years left with exclusivity on your product, and suddenly you’re going to be transferred over to device status and you lose your exclusivity and have a competitor several years sooner, the client would say, ‘We want to fight this,’” Kracov said.

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