LIFE SCIENCES PERSPECTIVES

As the life sciences, medtech, and diagnostic industries continue to expand and grow increasingly complex, so does the legal, regulatory, and compliance landscape. To help companies and investors navigate the many evolving and emerging laws and regulations across pharmaceuticals, biologics, medical devices, diagnostics, and laboratory testing, our Life Sciences Regulatory & Compliance team has provided an overview of key developments. We will update this list on an ongoing basis throughout the year.

WHAT WE ARE TRACKING

Expand the sections below to learn more about trending topics in Q1 2024 and beyond.

Preclinical and Clinical Research

How companies develop their products:

• Beginning January 22, 2024, the Center for Drug Evaluation and Research (CDER) and Center for Biologics Evaluation and Research (CBER) will expand in-person face-to-face industry meetings (with a hybrid component), to include all Prescription Drug User Fee Act (PDUFA), Biosimilar User Fee Act (BsUFA), and Over-the-Counter Monograph Drug User Fee Program (OMUFA) meeting types. If a sponsor would prefer an in-person meeting, they should specifically request it. The division will review the format requested and communicate to the sponsor any changes in the requested format. Meetings that have already been scheduled for after January 22, 2024, will not be converted to the in-person format. More information is available here.
• In December 2023, the US Food and Drug Administration (FDA) issued a draft guidance, “Master Protocols for Drug and Biological Product Development,” in addition to a guidance snapshot and podcast episode. The draft guidance discusses the FDA’s thoughts on design and analysis of clinical trials conducted under a master protocol, and supporting documentation submitted for regulatory review. Comments may be submitted to the docket through February 22, 2024.
• In December 2023, the FDA finalized a series of guidances, two of which cover drugs and biological products (here and here) concerning the use of real-world data, “Real-World Data: Assessing Registries to Support Regulatory Decision-Making for Drug and Biological Products” and “Data Standards for Drug and Biological Product Submissions Containing Real-World Data.” The guidances provide updates and clarifications on how the FDA evaluates real-world data to determine if it is sufficient for use in regulatory decision making, as well as how sponsors can appropriately design registries or use an existing registry to support regulatory decision making about a drug’s effectiveness or safety.
• In December 2023, the FDA published a final guidance, “Digital Health Technologies for Remote Data Acquisition in Clinical Investigations,” which provides recommendations to industry, investigators, and others on the use of digital health technologies to acquire data remotely from participants in clinical investigations that evaluate medical products.
• In December 2023, the FDA and the European Medicines Agency (EMA) announced the availability of a report, “EMA-FDA joint Q&As on the Quality and GMP aspects of PRIME/Breakthrough therapy applications,” to support quality development for the FDA’s Breakthrough Therapy designation and the EMA’s Priority Medicines (PRIME) programs for patients with unmet medical needs.
• The FDA has recently been publishing articles regarding clinical trial transparency and other critical components of its oversight of clinical studies. In December 2023, the FDA addressed its work to harmonize clinical research regulations and increase options to facilitate medical product development. On December 21, 2023, the FDA issued a final rule that aims to help advance medical product development “without compromising the rights, safety and welfare of people participating in clinical research.” The rule allows for an exception from the requirement to obtain informed consent when a clinical investigation poses no more than minimal risk to people participating in the research, and the research has in place safeguards to the protect the rights, safety, and welfare of participants. We will continue to monitor any additional publications the FDA makes relating to increasing options in clinical research.
• In November 2023, the FDA released a new draft guidance, “Translation of Good Laboratory Practice Study Reports: Questions and Answers,” which provides information to sponsors and nonclinical laboratories regarding language translation of study reports for studies conducted in compliance with good laboratory practice (GLP) regulations. Comments may be submitted to the docket through February 20, 2024.
• In November 2023, the FDA released two final guidance documents (here and here), “Submitting Clinical Trial Datasets and Documentation for Clinical Outcome Assessments Using Item Response Theory” and “Submitting Patient-Reported Outcome Data in Cancer Clinical Trials.” The guidances provide technical specifications for (i) the submission of clinical outcome assessment data that use Item Response Theory with the aim of providing standardized dataset content and structure and (ii) patient-reported outcome data collected in cancer clinical trials, respectively.
• On October 17, 2023, the FDA’s CDER announced that it was soliciting public comments to better understand the state of innovation in clinical trial design and conduct of clinical trials. Comments to the docket will be accepted through April 19, 2024. In connection with this initiative, the FDA and Duke-Margolis Center for Health Policy (Duke-Margolis) will hold a joint public meeting on March 19 and 20, 2024, to discuss improving the quality of clinical studies. Registration can be completed here, and attendance can be in person or virtually.
• In November 2023, the FDA provided an updated list of Product-Specific Guidances (PSGs) that are under development to support the development of generic drugs. PSGs explain how prospective generic drug developers can demonstrate that their products are bioequivalent to the original “reference” drug.
• We continue to watch for the FDA’s implementation of its new clinical trial Diversity Action Plan authority for Phase 3 or pivotal study drug and biologic developers and device developers conducting clinical trials (whether under investigational device exemptions or not), pursuant to section 3601 of the Food and Drug Omnibus Reform Act of 2022 (FDORA). Under FDORA, the FDA is required to update or issue guidance on diversity action plans for clinical studies by December 29, 2023, that includes the format and content of such plans and the FDA’s criteria for assessing whether to grant a diversity action plan waiver, among other things. We understand that on December 5, 2023, a revised draft guidance document was sent to the White House for review.
• In November 2023, the FDA released a final guidance, “COVID-19: Developing Drugs and Biological Products for Treatment or Prevention,” which is designed to assist sponsors in the clinical development of drugs and biological products for the treatment or prevention of COVID-19.
• We continue to watch for the FDA’s implementation of a new provision of the Federal Food, Drug, and Cosmetic Act that allows the FDA to designate a “platform technology” that has the potential to be incorporated in or utilized by more than one drug. Under section 2503 of FDORA, the FDA may expedite the development and review of a subsequent application for a drug that incorporates or utilizes a designated platform technology and must issue draft guidance on the new designation program within one year of enactment of FDORA. The head of the FDA’s Office of Therapeutic Products recently noted the potential opportunity the designation can offer cell and gene therapy sponsors. Under FDORA, the FDA was required to issue draft guidance by December 29, 2023, on the implementation of this new designation program, including examples of drugs that can be manufactured using platform technologies and information about the submission and review of designation requests, among other things.
• We are monitoring new bipartisan legislation from Reps. Anna Eshoo (D-CA) and Michael McCaul (R-TX), the Innovation in Pediatric Drugs Act of 2023, which would increase funding for pediatric trials and require drugs for rare diseases to be studied in children. The legislation would also grant the FDA authority to penalize companies that do not complete required pediatric studies.
• We continue to monitor the Medicines and Healthcare products Regulatory Agency’s (MHRA) implementation of legislation to reform the regulatory framework for clinical trials in the UK. On March 21, 2023, the MHRA published its response to the public consultation that it conducted at the beginning of 2022 on legislative proposals concerning the regulation of UK clinical trials. The MHRA has confirmed that the new legislation will ensure that patients and their safety are at the focus of all clinical trials, bring the benefits of clinical trials to everyone, create a proportionate and flexible regulatory environment, cement the UK as a destination for international trials, and provide a framework that is streamlined, agile, and responsive to innovation. On October 12, 2023, the MHRA introduced a new Notification Scheme in the UK, which ensures that initial clinical trial applications for Phase 3 and 4 trials are approved by the MHRA within 14 days (instead of the statutory 30 days), provided that the sponsor shows that the trial meets the MHRA’s inclusion criteria.
• We are monitoring the EMA’s implementation of the revised transparency rules for sponsors using the EU’s public clinical trial database, the Clinical Trials Information System (CTIS). The new rules were adopted on October 5, 2023, and they remove the deferral mechanism and reduce the number of clinical trial documents that are required to be published in CTIS. On November 29, 2023, the EMA published an updated Q&A document to clarify how to protect commercially confidential information (CCI) and personal data while using CTIS. The new rules are expected to be implemented in the second quarter of 2024.

FDA, EMA, and MHRA Approvals

Deciding whether a company can market or sell a specific product:

Pharmaceuticals and Biologics

• We are actively monitoring the FDA’s recent announcement that it is investigating serious risks of T-cell malignancy following BCMA-directed or CD19-directed Autologous Chimeric Antigen Receptor (CAR) T cell immunotherapies. Life sciences companies developing CAR T cell therapies should consider whether updates to their product’s side effects disclosure are warranted, as well as the potential for the FDA to take regulatory action based on their product’s proposed mechanism of action and tolerability profile.
• In December 2023, the FDA released a final guidance, “Rare Diseases: Considerations for the Development of Drugs and Biological Products.” The guidance provides recommendations to drug sponsors to help support “efficient and successful drug development programs” and discusses selected topics on issues commonly faced in the rare disease drug development space.
• In November 2023, the FDA released a final guidance, “Real-Time Oncology Review (RTOR),” to provide recommendations to applicants on the process for submission of selected new drug applications (NDAs) and biologics license applications (BLAs) with oncology indications for review under RTOR. Note that this guidance does not discuss the FDA’s other expedited programs. In October 2023, the FDA announced that it launched a new “Enhance Equity Research Hub” as part of its Enhance Equity Initiative, run by its Office of Minority Health and Health Equity.
• We are evaluating the recently updated Standard Operating Policy and Procedure (SOPP) published by the FDA’s CBER. The SOPP covers regulatory meetings with sponsors and applicants for drugs and biological products and includes general updates as well as an appendix discussing considerations to make on the type of meeting granted and the issuance of Written Response Only (WRO).
• We are monitoring how the FDA will respond to the International Council for Harmonization’s (ICH) request for technical and regulatory writing services to help the ICH in drafting new guidelines being developed by its working groups. These guidelines are adopted by the FDA as guidances, and so we will be monitoring to see if any additional guidances are released as a result of the ICH’s efforts.
• The FDA, in collaboration with Duke-Margolis, held a public meeting on December 14, 2023, “Advancing the Development of Therapeutics through Rare Disease Patient Community Engagement,” to highlight and build upon existing actionable approaches for engaging patients, patient groups, and related experts when developing necessary evidence to support rare disease drug approvals. In addition, in connection with the FDA’s intent to take steps to further accelerate the development of novel drugs and biological products for rare disease, the FDA recently announced the launch of the START Pilot Program, a measure inspired by Operation Warp Speed.
• The FDA’s generic drug program recently announced the establishment of the Model-Integrated Evidence (MIE) Industry Meeting Pilot between the FDA and generic drug applicants. The program is offered to prospective generic drug applicants and generic drug applicants who intend to use MIE approaches for bioequivalence (BE) establishment in their abbreviated new drug applications (ANDAs). The program will serve as a specialized regulatory platform to foster communication between the FDA and generic drug applicants. The FDA’s Office of Generic Drugs began receiving requests for the pilot program on October 1, 2023, and will continue to receive meeting requests under the MIE pilot program until a sufficient number of MIE meetings are held. The FDA will reevaluate the program after one year or after five meetings are held to determine the next phase of the pilot program. Sponsors interested in participating in the pilot can learn more about the process here.
• We are following a bill (S. 2780) introduced in the US Senate that would require sponsors of drug applications and holders of approved applications to provide certain submissions and communications to the FDA and the US Patent and Trademark Office.
• We continue to follow reintroduced bipartisan legislation that would create a regulatory pathway for the provisional approval of drugs in certain cases. The Promising Pathway Act would require the FDA to establish a “rolling, real-time, priority review pathway for drugs intended to treat, prevent, or diagnose serious or life-threatening diseases or conditions.” Drugs approved under this proposed pathway would be granted time-limited approval and would be required to track usage through patient registries. On October 26, 2023, a Congressional hearing took place in the Senate Special Committee on Aging focused on the Promising Pathway Act. We continue to follow substitute language in the Preserve Access to Affordable Generics and Biosimilars Act (S. 142), which was introduced in January 2023 with 10 bipartisan cosponsors and reported to the Senate Committee on the Judiciary with an amendment to “prohibit brand name drug companies from compensating generic drug companies to delay the entry of a generic drug into the market, and to prohibit biological product manufacturers from compensating biosimilar and interchangeable companies to delay the entry of biosimilar biological products and interchangeable biological products.”
• We continue to monitor the implementation of the European Commission’s legislative proposals — Regulation 2023/0131 and Directive 2023/0132 — to replace the current EU regulatory framework for all medicines (including those for rare diseases and for children). The proposals, announced on April 26, 2023, aim to reduce costs, expedite the introduction of new medicines, and prevent medicine shortages. Read our summary of these proposals here. On October 3, 2023, the European Parliament published draft reports — Draft Report on Regulation 2023/0131 and Draft Report on Directive 2023/0132 — proposing amendments to the legislative proposals, which are being debated by the European Parliament.
• We continue to monitor the implementation of the Windsor Framework that will apply as of January 1, 2025, in the UK. On February 27, 2023, the UK government and the European Commission announced a political agreement in principle to replace the Northern Ireland Protocol with a new set of arrangements, the Windsor Framework. This new framework fundamentally changes the existing system under the Northern Ireland Protocol, including the regulation of medicines in the UK. In particular, the MHRA will be responsible for approving all medicines destined for the UK market (that is, Great Britain and Northern Ireland), and the European Medicines Agency (EMA) will no longer have a role in approving medicines destined for Northern Ireland. The MHRA will grant a single UK-wide marketing authorization for all medicinal products sold in the UK, enabling medicines to be sold in a single pack and under a single authorization throughout the UK. The Windsor Framework was approved by the EU-UK Joint Committee on March 24, 2023, meaning the UK government and the EU will enact legislative measures to bring it into law.
• We continue to monitor the implementation of the International Recognition Procedure (IRP), effective January 1, 2024, in the UK, which replaces the European Commission Decision Reliance Procedure. The IRP allows the MHRA to consider the expertise and decision-making of medicines regulators in Australia, Canada, the EU, Japan, Singapore, Switzerland, and the US when approving a new medicine. The decentralized and mutual recognition reliance procedure (MRDCRP), which allows the MHRA to have regard for approvals in the EU, will be incorporated under the umbrella of the IRP. See our summary of the IRP here.
• We are monitoring the implementation of the European Commission’s legislative proposal — Regulation 2022/0216 — on the standards of safety and quality for substances of human origin (SoHOs) intended for human application and repealing Directive 2002/98/EC, for blood and blood components, and Directive 2004/23/EC, for tissues and cells. The proposal aims to increase the safety and quality of SoHOs. On December 13, 2023, a political agreement was reached on the proposal. The European Parliament and the European Council will formally adopt it during the course of 2024.

Medical Devices and Medtech

• On December 19, 2023, the FDA released a draft guidance document, “Use of Real-World Evidence to Support Regulatory Decision-Making for Medical Devices,” to clarify how the FDA evaluates real-world data in determining whether the data is of sufficient quality to support regulatory decision-making for medical devices. Comments may be submitted to the docket through February 20, 2024.
• In September 2023, the FDA published a trio of draft guidances related to its efforts to “strengthen and modernize” the 510(k) Program. The draft guidances address two foundational issues of concern with the 510(k) process — best practices for selecting a predicate device and when clinical data is needed in a 510(k) — in addition to providing updated performance testing recommendations for manufacturers of 510(k) implant devices. See our summary of these guidances here.
• We continue to monitor the FDA’s ongoing focus on the use of digital health technology to advance health equity following the Patient Engagement Advisory Committee meeting on September 6, 2023. The meeting materials are available (along with the webcast link for those who missed it).
• We continue to monitor how the FDA is applying its September 2022 final guidance on clinical decision support software.
• We are continuing to monitor the FDA’s Total Product Life Cycle Pilot Advisory Program (TAP Pilot), designed to help reduce time from concept to commercialization for medical devices going through the FDA approval and clearance processes, which the FDA announced will be expanded as of October 1, 2023, to include devices reviewed in the Office of Neurological and Physical Medicine Devices. As of November 30, 2023, the FDA has enrolled 17 devices in the TAP Pilot. We also continue to monitor the Voluntary Alternative Pathway, a potential new regulatory pathway for novel products, including digital health products, referenced by Center for Devices and Radiological Health (CDRH) Director Jeffrey Shuren at the Food and Drug Law Institute’s annual conference in May 2023.
• We continue to monitor the implementation of new cybersecurity authorities for software-containing or internet-connected devices, enabling the FDA to require sponsors to develop cybersecurity plans for post-market implementation, as mandated in section 3305 of FDORA. The FDA issued its guidance on its “refuse to accept” policy for cyber devices and related systems in March 2023, but this policy expired on October 1, 2023 after FDA published its final guidance, titled “Cybersecurity in Medical Devices: Quality System Considerations and Content of Premarket Submissions,” in September 2023.
• We are following stakeholder input to the FDA’s recently issued draft guidance on predetermined change control plans for AI/ML-enabled devices. On October 24, 2023, the FDA, Health Canada and the UK’s MHRA jointly published the “Predetermined Change Control Plans (PCCPs) for Machine Learning-Enabled Devices: Guiding Principles,” which identified 10 guiding principles to inform the development of Good Machine Learning Practice (GMLP). In this document, the use of the term “PCCP” is meant to encompass a plan that a manufacturer specified that contains: certain planned modifications to a device; the protocol for implementing and controlling such modifications; and the assessment of impacts from modifications.
• We are monitoring the implementation of the FDA’s final guidance, “Content of Premarket Submissions for Device Software Functions.”
• We continue to monitor the impact of Regulation (EU) 2017/745 (the European Medical Device Regulation, or MDR) which has been applicable since May 26, 2021, in the EU. The MDR requires manufacturers to submit all applications for medical devices that they want to transition to the MDR by May 26, 2024, and they need to have a signed contract with an EU Notified Body for review and conformity assessment by September 26, 2024. The MDR also requires the use of the EU’s medical device database, EUDAMED, which effectively outlines the life cycle of medical devices by collating and processing information about those medical devices and related companies, such as the manufacturers of those devices. The mandatory use of EUDAMED will start when the entire system (including all six modules) is declared fully functional, which is expected in the second quarter of 2024.
• We continue to monitor the implementation of the Innovative Devices Access Pathway (IDAP), which is run by the MHRA, the National Institute for Health and Care Excellence, and other partners, including the devolved administrations in the UK. The aim of IDAP is to enable and improve patient access to innovative and transformative medical devices by providing an integrated and enhanced regulatory and access pathway to developers. The MHRA launched a pilot of IDAP on September 19, 2023, which ran until November 1, 2023. Successful applicants to the pilot are expected to hear back on the outcome of their application at the end of January 2024. The pilot is a one-off to support only the first eight products selected, and the full IDAP pathway is expected to launch in 2025.

In Vitro Diagnostic and Laboratory Testing

• On October 3, 2023, the FDA published a proposed rule to make explicit that laboratory developed tests (LDTs) are devices regulated by the FDA. At the same time, the FDA is proposing a policy to, upon finalization of the proposed rule, phase out its current general enforcement discretion approach so that LDTs would generally fall under the same enforcement approach as in vitro diagnostic (IVD) tests that the FDA currently actively regulates. Comments on the proposed rule were due December 4, 2023. The FDA announced in its Fall 2023 Unified Agenda its plans to finalize the LDT proposed rule by April 2024. You can read more about the proposed rule at our LDT Resource Page.
• We are monitoring the Verifying Accurate Leading-edge IVCT Development Act of 2023, which was introduced in the US House of Representatives by Reps. Larry Bucshon (R-IN) and Diana DeGette (D-CO) in March 2023.
• We continue to monitor the FDA Oncology Center of Excellence’s recently launched voluntary pilot program, the Oncology Dx Pilot, which focuses on the use of certain LDTs with oncology products to identify cancer biomarkers. Through this program, the FDA will request performance information for the tests used to enroll patients in a sponsor’s clinical trials that support drug approval. Based on an assessment of that information, the FDA will post to its website the minimum performance characteristics recommended for similar tests that may be used to select patients for treatment with the approved drug. Laboratories may use this information to guide development of their LDTs to identify specific biomarkers used for selecting cancer treatment and help facilitate better and more consistent performance of LDTs and overall better drug selection and improved care for patients with cancer.

Commercial Requirements

How companies manufacture, promote, and monitor their approved products:

• The FDA recently issued two draft interim policy guidances regarding the use of bulk drug substances in compounding under Sections 503A and 503B of the FD&C Act. If finalized in their current form, a bulk substance nominated on or after the finalization date would not be within the scope of the interim enforcement policy set out in the guidance documents. Bulk substances identified in Category 1 of the guidance documents would, before such finalization, not be affected by this change and will remain in scope of the interim enforcement policy until the FDA determines these substances should be included on the 503A or 503B bulk lists or if the FDA removes them from Category 1. Following finalization of the guidance documents, the FDA would continue to evaluate nominations for the 503A and 503B bulk lists even though the FDA would no longer provide a categorization of the substances. Comments can be submitted to the dockets here and here through January 8, 2024.
• On December 12, 2023, the FDA released its draft guidance for persons and organizations interested in participating in the FDA’s new Advanced Manufacturing Technologies (AMTs) Designation Program, which was established under section 3213 of FDORA. The program is intended to promote the use of AMTs that can either reduce development time or increase or maintain the supply of important drug and biological products and offers designees special resources to assist with their product. Comments can be submitted to the docket through February 12, 2024.
• In October 2023, the FDA announced a revised draft guidance document, “Communications from Firms to Health Care Providers Regarding Scientific Information on Unapproved Uses of Approved/Cleared Medical Products.” The draft guidance supersedes the agency’s 2014 draft guidance and provides direction for industry on how information regarding unapproved uses of approved/cleared medical products can appropriated be shared with healthcare providers (HCPs). You can also read our analysis of the draft guidance here.
• In November 2023, the FDA announced its new final rule establishing new requirements for direct-to-consumer (DTC) advertising. The rule requires DTC drug ads to not contain distracting elements, such as audio or visual distractions, during their presentation of the “major statement” of drug effects and contraindications. The final rule, also known as the Clear, Conspicuous and Neutral (CCN) Final Rule, provides an effective date of May 20, 2024. The FDA also issued a final guidance in December 2023 with FAQs addressing the CCN Final Rule. In addition, in December 2023, the FDA revised its final guidance, “Presenting Quantitative Efficacy and Risk Information in DTC Promotional Labeling and Advertisements,” which provides guidance on how to present quantitative efficacy and risk information in DTC promotional labeling and advertisements for prescription drug and biological products, including animal drugs.
• In October 2023, the FDA released a draft guidance, “Remote Interactive Evaluations of Drug Manufacturing and Bioresearch Monitoring Facilities,” which aims to describe how the FDA requests and conducts voluntary remote interactive evaluations at facilities where drugs are manufactured, processed, packaged, compounded, or held, and at drug facilities covered under the FDA’s bioresearch monitoring (BIMO) program.
• We continue to monitor the recent bills introduced in the House and the Senate, “Further Strengthening America’s Supply Chains and National Security Act,” sponsored by Rep. Michael Waltz (R-FL) and Sen. Marco Rubio (R-FL). The draft legislation seeks to decrease the United States’ dependency on foreign supply chains, and specifically would require drug makers to share additional information with the FDA about where pharmaceutical ingredients are sourced.

• The FDA announced a one-year stabilization period, until November 27, 2024, to allow trading partners to implement, troubleshoot, and mature their electronic interoperable systems to meet the requirements of the Drug Supply Chain and Security Act (DSCSA). This stabilization period is intended to avoid disruption to the supply chain and ensure continued patient access to drug products as trading partners work to fully implement the enhanced drug security requirements of the DSCSA. The FDA also issued an immediately effective compliance policy guidance regarding the enforcement of requirements for enhanced drug distribution security. It also issued a revised final compliance policy guidance that describes the FDA’s policies regarding enforcement requirements for wholesale distributors and dispensers to verify a product’s identifier in certain circumstances. The FDA established a new docket to receive comments about the DSCSA, specifically regarding the interoperable systems and processes for enhanced drug distribution security set to take effect in November 2024. The FDA requests that supply chain entities provide comments on how they will utilize the one-year extension of the deadline to “stabilize” the supply chain in preparation for the new system. It has also asked what these companies’ plans are to implement the new program successfully.
• In connection with the DSCSA, the FDA recently issued a final guidance, “Verification Systems Under the Drug Supply Chain Security Act for Certain Prescription Drugs,” which addresses the verification systems that manufacturers, repackagers, wholesale distributors, and dispensers must have in place to comply with DSCSA requirements.

The FDA has also updated its CDER NextGen Portal to include information on the DSCSA, which will allow the FDA and trading partners to more easily communicate when the FDA requests information related to investigations of suspect or illegitimate products or during a recall. An FAQ document and reference guide are available.

• The FDA recently issued a draft guidance intended to help applicants develop draft labeling for proposed biosimilar and interchangeable biosimilar products for submission in a 351(k) BLA. When finalized, the guidance will revise and replace the FDA’s July 2018 final guidance. It includes recommendations on labeling for interchangeable biosimilar products, product identification when the reference product labeling describes a clinical study conducted with a non-US-approved biological product, pediatric use statements, and incorporating relevant immunogenicity data and information from the reference product labeling in the biosimilar or interchangeable biosimilar product labeling.

• The FDA’s OPDP increased its activity in the second half of 2023 with untitled and warning letters. Notably, the OPDP’s recent untitled letter relating to social media posts followed its final guidance, “Presenting Quantitative Efficacy and Risk Information in Direct-to-Consumer Promotional Labeling and Advertisements.”
• In December 2023, the Office of Information and Regulatory Affairs, Office of Management and Budget, Executive Office of the President updated its website to state that it has received the FDA’s final rule to harmonize its quality system regulation with ISO 13485:2016. We are closely monitoring efforts to finalize the rule and, once issued, to implement the final rule.
• Section 3611 of FDORA codifies the FDA’s authority over medical device inspections to allow the FDA to collect “records or other information” from facilities “in advance of, or in lieu of” inspections of manufacturing establishments. We will be monitoring for FDA guidance on this topic.

As of August 14, 2023, the FDA updated the Access GUDID database and the openFDA Unique Device Identifier endpoint to include the field for Global Medical Device Nomenclature Code along with the status of the code.

Coverage and Reimbursement

Whether government or commercial payers are willing to pay for a product, how much they are willing to spend, and under what circumstances:

Pharmaceuticals and Biologics

• We continue to follow how the Inflation Reduction Act of 2022 (IRA) will affect reimbursement for pharmaceutical and biologic products (such as price caps, required discount program for all drugs, mandatory rebates if a drug’s price increases at a rate that outpaces inflation, a redesign of the Medicare Part D benefit, and an increase in biosimilar pricing). The Centers for Medicare & Medicaid Services (CMS) has selected the first 10 drugs subject to the negotiation program. Constitutional challenges filed by pharmaceutical manufacturers challenging the constitutionality of the drug price negotiation program continue to progress, alleging that the IRA’s drug price negotiation program and excise tax punishment violate the First Amendment’s prohibition on compelled speech; the Fifth Amendment’s prohibition on government taking of property without just compensation; the Fifth Amendment’s prohibition on the government depriving private parties of property without due process; and the Eighth Amendment’s ban on excessive fines and penalties. In addition, lawsuits assert that the IRA violates the Constitution’s separation of powers. Each suit requests declaratory and injunctive relief, including a delay in the implementation of the IRA’s drug price negotiation provisions. CMS held patient listening sessions on the first 10 selected drugs and has issued its first request for the public to identify therapeutic alternatives for the first 10 selected drugs, which will be used to set the initial offer and ultimately set the IRA’s price caps. We anticipate initial price offers to be made by CMS by February 1.
  • In addition, CMS released final guidance on December 14, 2023, for the inflation rebate requirements under Part B and Part D of Medicare.
  • We are monitoring the US Senate companion bill (S. 3131) to House bill (H.R. 5539), known as the ORPHAN Cures Act, which was introduced on October 25, 2023. The bill, sponsored by Sen. John Barrasso (R-WY), would provide additional exemptions for drugs granted orphan drug designation by the FDA from negotiations under the IRA. Currently, orphan drug products are exempted from the IRA’s provisions only if they treat a single condition. The ORPHAN Cures Act could exempt products from negotiations even if they are approved for multiple rare disease indications.
• On December 7, 2023, the National Institute of Standards & Technology released a proposed framework for how government agencies can implement “march-in” rights under the Bayh-Dole Act. Under the proposed framework, a government agency could make the decision to “march in” to a private enterprise (like a drug company or a medtech company) that has received federal funding for research and development activities. If the government, in its sole discretion, determines that the price of a product that is based on government-funded patents is so high as to essentially make the product unavailable (or to the extent that the price is so high that the government views it as some sort of price gouging), the high price alone is appropriate justification for the agency to exercise these march-in rights. On the same day, the White House released a statement indicating that it plans to use such march-in rights to combat pharmaceutical pricing, indicating that the government will consider marching in and assigning drug patents to others to the extent that a particular drug has been funded by taxpayers and the government views the price to be too high. Comments are due on the proposed NIST framework by February 6. See our Goodwin alert on this important and evolving topic: Federal Government Releases Proposed Guidance for Exercising “March-In” Rights Under the Bayh-Dole Act: Implications for Pharmaceutical and Medical Technology Companies".
• We continue to monitor the Department of Health and Human Services’ (HHS) proposed rule that would modify the current alternative-dispute-resolution process under the 340B Drug Pricing Program, which has been the subject of much scrutiny and disagreement among pharmaceutical manufacturers (who are obligated to cap prices significantly for patients of qualified covered 340B public health entities) and the public health entities whose patients benefit from reduced 340B pricing. The proposed rule would simplify and expedite the process by which covered entities and drug manufacturers resolve disputes about overcharging, duplicate discounts, or drug diversion.
• We are monitoring any future litigation developments in the Genesis Health Care v. Becerra ruling in November 2023 that deemed the HRSA interpretation of eligible 340B patients to be too narrow. In response to this case, HRSA announced a new webpage with program policies, guidance documents, and regulations for stakeholders to assist 340B covered entities with the meaning of “eligible patient” under the 340B program. Here is a link to the webpage for 340B Patient Definition Compliance Resources.
• Congress is considering numerous proposed pharmacy benefit manager (PBM) reforms in both the House and the Senate. Legislative proposals include but are not limited to: eliminating rebates; divorcing service fees from the price of a drug, discount, or rebate; prohibiting spread pricing; limiting administrative fees; requiring PBMs to report formulary placement rationale; promoting transparency; and many others. PBM reform and transparency measures have become a key policy topic in Washington and continue to be front and center for policy makers.
• We continue to monitor a proposed rule issued by CMS in 2023, “Misclassification of Drugs, Program Administration and Program Integrity Updates Under the Medicaid Drug Rebate Program (MDRP)” (the Proposed Rule). Among other topics, the Proposed Rule focuses on enhancing MDRP administration by incorporating policies that would facilitate more accurate and consistent drug information reporting, data collection, and operations. One of the most significant proposals is to revise the definition of “best price” to provide that manufacturers must aggregate cumulative discounts, rebates, or other arrangements to determine the final price realized by the manufacturer for a particular unit of a drug. The CMS fact sheet is available here. Comments on the Proposed Rule were due by July 25, 2023.
• The American Rescue Plan Act of 2021 includes a provision that eliminates the statutory cap on rebates that drug manufacturers pay to Medicaid. Beginning in January 2024, Medicaid rebates will no longer be capped at 100 percent of the quarterly average manufacturer price (AMP). Drug manufactures should consider taking steps to prepare for the AMP cap removal.
• We are monitoring the implementation of Regulation (EU) 2021/2282 (the HTA Regulation) on health technology assessment (HTA), which came into force on January 11, 2022 in the EU and will apply as of January 12, 2025. An HTA is a multidisciplinary process that summarizes information about the medical, social, economic, and ethical issues relating to the use of a health technology in a systematic, transparent, unbiased, and robust manner. Currently, and until the applicability of the HTA Regulation in 2025, a manufacturer, after obtaining the respective authorization for health technologies, must apply to different HTA agencies in various EU member states before new health technologies are broadly accessible. The HTA Regulation aims to harmonize various procedures and standards by ensuring health technology developers can submit only once, at the EU level, any information, data, analyses, and other evidence required for the contemplated joint clinical assessment.
• We are monitoring the implementation of the 2024 voluntary scheme for branded medicines, pricing, access and growth (VPAG) starting from January 1, 2024, which will replace the 2019 Voluntary Scheme for Branded Medicines Pricing and Access. VPAG will be run for five years. Suppliers of branded medicines to the UK’s National Health Service have until January 15, 2024, to decide whether to join one of two drug price control schemes: VPAG or the updated Statutory Scheme for 2024. The pricing and reimbursement under each scheme differs significantly. In a press release on December 14, 2023, The Association of the British Pharmaceutical Industry announced that it intends to publish further explanatory materials to support companies with making their decision on which scheme to join.

Medical Devices and Medtech

• We continue to monitor developments related to CMS’s proposed coverage procedures from 2023 that would permit earlier coverage of medical technology that has received FDA breakthrough designation. The new program, the Transitional Coverage of Emerging Technology (TCET) pathway, will leverage existing national coverage determination and coverage with evidence development processes to help ensure earlier coverage for advanced technology and to address the so-called medtech valley of death (i.e., the period after FDA market authorization and before Medicare coverage).

Compliance, Fraud and Abuse, and Transparency

Companies’ interactions with their customers and other stakeholders:

• In November 2023, the HHS Office of Inspector General (OIG) published a General Compliance Program Guidance document that is designed to serve as a comprehensive resource for healthcare and life sciences companies. It provides not only more detailed discussion on each of the “seven elements” of an effective compliance program but also addresses the needs of small companies and highlights risk areas for private equity investing in healthcare. Goodwin prepared the following alert about this latest guidance: A Practical Look at OIG’s New Compliance Guidance
• OIG also issued two recent Advisory Opinions that impact the life sciences, medical technology, and lab testing industries:
  • Advisory Opinion 23-06: Here, OIG rejects a proposal that would have allowed for an anatomic pathology laboratory that is out of network for certain commercial payers to contract with other labs that are in network to perform the technical component of tests. The pathology lab would pay a fee to the hired lab, and the pathology lab would also bill the in-network commercial payers. Notably, even though the proposed arrangement would have carved out government business — i.e., only would have involved the referral of or billing for anatomic pathology services paid by commercial payers — OIG notes its longstanding concern about arrangements that carve out government referrals by creating an opportunity to “pull through” federal government business as a result of kickbacks in connection with commercial business.
  • Advisory Opinion 23-08: Here, OIG issued another unfavorable opinion in response to a request from a cochlear implant manufacturer as to whether it can provide a free hearing aid to qualified patients who receive a cochlear implant, noting that the amount of the device exceeds the monetary cap ($570) for the value-based safe harbor under the Anti-Kickback Statute that permits items for patient engagement and support to improve quality and health outcomes, nor would it fit under the Beneficiary Inducements CMP exception for promoting access to care.
• On December 13, 2023, the HHS Office of the National Coordinator for Health Information Technology finalized its Health Data, Technology, and Interoperability: Certification Program Updates, Algorithm Transparency, and Information Sharing Rule. This rule (HTI-1) establishes transparency requirements for artificial intelligence (AI) and other predictive algorithms that are part of certified health IT; adopts the United States Core Data for Interoperability (USCDI) Version 3 (i.e., a standardized set of health data classes and elements for interoperable health information exchange) as the new baseline standard within the ONC Health IT Certification Program (i.e., the HHS voluntary certification program for Health IT) as of January 1, 2026; revises certain information blocking definitions and exceptions to support information sharing; adds a new exception to encourage secure, efficient, standards-based exchange of electronic health information under the Trusted Exchange Framework and Common Agreement (TEFCA); and implements the 21st Century Cures Act’s requirement to adopt a Condition of Certification for developers of certified health IT to report certain metrics as part of their participation in the Certification Program.

PRIVACY

Companies’ interactions with patient data:

• With companies collecting patient data on a global basis, we closely follow the latest privacy law developments around the world. In the EU, the UK, and Switzerland, we are tracking evolving case law and guidance surrounding the EU and UK General Data Protection Regulation and the Swiss Federal Act, as well as implications for companies collecting and handling patient data. In the US, the post-Dobbs era is marked by intense regulatory focus on health data. This includes state consumer privacy legislation protecting sensitive health information, health-data-specific laws such as the state of Washington’s My Health My Data Act, and a wave of Federal Trade Commission enforcement actions against digital health providers.
• On July 10, 2023, the European Commission adopted an adequacy decision for the new EU-US Data Privacy Framework (DPF), the revamped transatlantic framework designed to support transfers of personal data from the EU to US companies that self-certify compliance with the DPF’s privacy requirements. This has replaced the prior, invalidated Privacy Shield Framework. See Goodwin’s blog post for more information. This is an important update for life science companies because the previous Privacy Shield Framework excluded key-coded patient data from its scope, which prevented sponsors, clinical research organizations (CROs), and other parties involved in transfers of patient data to the US from certifying to the old framework. However, the new DPF has extended its framework’s protection to key-coded patient data processed under a clinical trial, allowing sponsors, CROs, and researchers to certify to the DPF. Separately, the UK and the US have finalized a UK-US adequacy agreement, which will took effect on October 12, 2023. The UK-US adequacy agreement opens up transatlantic data flows between the UK and the US.