Pre-emption and States' Rights

As national and international marketers, pharmaceutical companies generally champion federal pre-emption of state laws to gain uniform rules governing drug promotion, research, labeling, and other activities. States have launched various efforts over the years to permit drug importing, regulate drug sales and promotion, require disclosure of certain industry activities, and establish systems for tracking drugs through the supply chain. The usual industry response is to call for national standards, as authorized by the Food, Drug and Cosmetic Act (FDCA).

Jill Wechsler

These issues have moved to center stage recently as states have launched "right-to-try" laws designed to help dying or seriously ill patients gain early access to experimental therapies (see "Compassionate Use Requests Complicate Drug Development" in Pharm Exec's June 2014 issue). Although FDA routinely approves such compassionate use requests from sponsors, state officials and patient advocates believe their efforts will facilitate the process by allowing a physician to request access to drugs in early clinical trials, eliminating FDA review of these proposals. Local advocates also hope the new policies will put more pressure on biopharma companies to provide a requested treatment, although neither state nor federal agencies can require such action by a private firm.

The larger danger of the new law in Colorado and proposals in Missouri, Louisiana, and Arizona is that they may offer false hope to patients and could erode confidence in FDA's authority to set standards for clinical research and to determine which drugs are sufficiently safe and effective to come to market. Sponsors of new drug development programs generally believe that broader patient access to a promising therapy can be achieved best by completing clinical trials and gaining FDA market approval. FDA, moreover, is not pleased at the potential for state laws to challenge its authority on drug approvals and to raise the risk of patients receiving therapies that turn out to be ineffective and even harmful.

Imports & sunshine

Pharma companies and FDA have run into similar concerns with state efforts to permit the import of less costly drugs from other countries. The latest case involves a 2013 Maine law permitting importation of prescription drugs from pharmacies in Canada and other specific countries. Maine officials assert that the program will help local residents obtain needed medicines, but Maine pharmacists and manufacturers have filed suit, claiming that the initiative could bring in unsafe products, and that Maine's action is pre-empted by the FDCA. The case is moving forward following a recent ruling by a Maine judge that local pharmacists have legal standing to bring such a suit— although drug manufacturers do not (see Kurt Karst's FDA Law Blog, May 20, 2014 for more details, www.fdalawblog.net).

And the federal Open Payments program recently went live, largely the result of industry's desire for uniform, national standards governing the disclosure of pharma company payments to health professionals. Although public access to data on "transfers of value" by makers of drugs and medical products is likely to hinder industry interactions with medical professionals and with physicians engaged to conduct clinical research, pharma companies decided that the federal program was preferable to dealing with multiple state laws.

Under rules issued this past year by the Centers for Medicare and Medicaid Services (CMS), in June companies had to submit their detailed data on payments to physicians and teaching hospitals for the last five months of 2013. CMS will post the information as a way to shed "sunlight" on relationships between industry payments and physician prescribing and treatment practices.

The final Sunshine Act provides only partial federal pre-emption of local transparency policies, as states still may require industry to report additional data and payments to more health professionals. But industry hopes that over time, the CMS program will establish a disclosure model that satisfies local health authorities.

Uniform drug tracking

Similarly, industry's desire to avoid diverse drug track-and-trace requirements was a prime factor leading to enactment of the Drug Quality and Security Act (DQSA) of 2013, which lays out a 10-year process for creating a national drug tracing system through the Drug Supply Chain Security Act (DSCSA) section of DQSA. After years of debating various options for better securing the drug supply chain to thwart counterfeiters and thieves, supply chain partners lined up behind DSCSA last year to avoid compliance with a California law establishing its own drug tracking system beginning in 2015.

State laws and biosimilars

The new law pre-empts California and other state tracking programs, reflecting general agreement that a national system is more capable of identifying genuine medical products and preventing bogus or adulterated drugs from entering the supply chain. The DSCSA requires manufacturers and distributors to establish systems able to transmit information on prescription drug movement in the U.S. from production plant to distributors and ultimately to dispensers. With an initial information-exchange phase set for launch Jan. 1, 2015, FDA is busy consulting with stakeholders on options for data exchange standards able to transmit information, initially via paper or electronically; a fully interoperable system is required by 2023 that can track drugs electronically through package-level two-dimensional bar codes.

The drug tracking measure gained traction in Congress last year due to a sense of urgency among policy makers to strengthen FDA oversight of large drug compounding operations. Although traditional pharmacy compounding is regulated by state law, a lethal meningitis outbreak linked to contaminated injectibles produced by certain compounders generated a groundswell for stronger federal controls.

The new policy walks a narrow line between tighter FDA oversight of those compounders that operate more like drug manufacturers, while retaining state regulation of the many thousands of small entities that provide compounded dosage forms to local hospitals and doctors. Maintaining a balance between state and federal rules is challenging, though, as seen in emerging disputes between FDA and compounders over specific policies, such as limits on the production of "office stock" drug supplies by unregulated compounders—something sought by FDA but opposed by some states. Compounders largely prefer state rules and regulations, and only a handful of large operators have signed up for the new voluntary FDA regulatory regime.

Jill Wechsler is Pharm Exec's Washington correspondent. She can be reached at jwechsler@advanstar.com