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In the News: August 2020 Regulatory and Development Updates

Each month, Camargo’s “In the News” series highlights important changes and advancements in the regulatory and development space and explores how those changes could impact your program.

Fitbit developing algorithm for early detection of COVID-19

Fitbit recently posted a study that may indicate the company’s ability to create an algorithm that can flag cases of COVID-19 early. While not (yet) peer reviewed, the preprint posted to medRxiv says the study included over 100,000 volunteer Fitbit wearers, 1,100 of whom tested positive for COVID-19.

The study examined heartrate, variability in time between heartbeats, respiration, and sleep patterns as possible predictive variables to the onset of infection and development of COVID-19 symptoms. Fitbit reports that its devices were able to detect almost half of COVID-19 cases at least one day before the wearer reported symptoms. While the actual algorithm is still under development, the study provides an interesting example of how digital health technologies continue to grow in popularity and practicality in the current health environment.

FDA issues guidance on inspections during COVID-19 pandemic

The FDA issued a final Q&A-style guidance called “Manufacturing, Supply Chain, and Drug and Biological Product Inspections During COVID-19 Public Health Emergency Questions and Answers.” As the guidance points out, all facility (and BIMO) inspections were suspended in March 2020 given the ongoing health emergency. In July, the FDA resumed “prioritized” domestic inspections.

Many factors contribute to the decision on when a given inspection will take place: the previously announced Advisory Rating system, the categories of regulatory activity that can take place in the geographic region, a determination of whether an inspection is “mission-critical,” and a risk assessment of the facility itself, to name a few.

While many may take the attitude of “No inspections for a while? Fine by me!”, Camargo is involved in several drug application approvals which are stalled due to delayed inspections. Sponsors can mitigate the risk of such interruptions by ensuring that their API suppliers and CMOs have good compliance records with the FDA.

CMS proposed rules may affect 505(b)(2) ROI, support need for early commercial strategy

The Centers for Medicare & Medicaid Services (CMS) proposed a new Physician Fee Schedule in August whereby many 505(b)(2) drug products would be billed and paid using the existing multiple source drug code used for generics. One of the qualifiers for determining if a product would fall under the new rule is whether the product can be used and prescribed in a manner similar to other products in the multiple source drug code. The extent of the impact of this proposal depends on the definition of “similar,” which is not included in the proposed rule.

In another proposed rule, CMS takes the view that line extensions have lower innovation than new drugs and thus should have lower pricing. This could have a major impact on biopharma companies seeking to license their 505(b)(2) drugs to innovators, as they may see a lower product valuation than previously expected.

What CMS does is important because it is well established that, as CMS goes, so go other payers, and these proposed rules could lower the revenue for drugs approved via the 505(b)(2) regulatory pathway. More than ever, a drug developer needs to have a clear understanding of the proposed marketplace to inform go/no-go development decisions. This includes assessing drug pricing and reimbursement for their effect on potential return on investment early and adapting the drug development plan to ensure a truly differentiated label.

CMC changes during product development result in CRL  

BioMarin received a Complete Response Letter for its BLA for valoctocogene roxaparvovec gene therapy for severe hemophilia A. Per BioMarin, “FDA concluded that the differences between Study 270-201 (Phase 1/2) and the Phase 3 study limited its ability to rely on the Phase 1/2 study to support durability of effect.” The Phase 3 study drug was manufactured by the to-be-marketed process, whereas the earlier study drug was investigational. Apparently, BioMarin did not make the case in its BLA that the formulation was “the same” for both studies, and the FDA chose not to allow the company to submit additional information for unknown reasons. The CRL requires the company to wait to refile until the Phase 3 study completes in November 2021.

Whenever possible, sponsors should use the to-be-marketed formulation in Phase 1 studies so that the FDA can rely on the product when assessing the Phase 2 and 3 study results. Minimizing chemistry, manufacturing, and controls (CMC) changes throughout a development program and integrating CMC into the clinical program can help sponsors to avoid costly development delays.

FDA clarifies civil money penalties for violations

The FDA issued the final guidance “Civil Money Penalties Relating to the Data Bank” in August. The guidance is straightforward, describing CDER’s plans for enforcing its policies regarding

  • How CDER intends to identify parties who have failed to register and/or failed to submit the required information to the data bank
  • Under what circumstances CDER will seek civil money penalties for such failures
  • What procedures will apply
  • The possible amount of the penalties, which can be substantial

Camargo has deep experience with small innovator companies, many of whom are working on their first drug product. These sponsors are often surprised to learn the requirements associated with that they must meet. Frequently, they hesitate to comply with the registration requirements due to real or perceived confidentiality concerns connected with the registration process and the availability of information in the database. When such concerns come into play, an experienced hand such as Camargo’s is required to determine and navigate the correct path forward.


Ken Phelps
President and Founder

Bill Stoltman, JD
Senior Director of Regulatory Compliance and Submissions