WASHINGTON – The U.S. FDA's 2018 final guidance for payer communications widely was seen as long overdue upon delivery. For his part, Paul Savidge, U.S. general counsel at Philadelphia-based Spark Therapeutics Inc., said his company's development of the required information for such communication was "a massive undertaking" that proved useful a second time when it came to promoting its product after FDA approval.

Savidge made his comments during the Food and Drug Law Institute's Advertising and Promotion for Medical Products Conference, taking place last week in Washington.

The FDA posted the final guidance in June 2018 along with statements from then-Commissioner Scott Gottlieb and two members of the House Energy and Commerce Committee, thus underscoring the document's importance. One of the changes to the final guidance vs. the draft was that the former was more explicit about the inclusion of medical technology in the scope of the policy. But the emergence of the final guidance came with the expectation that drug- and device makers would more readily engage in value-based arrangements with providers, thanks to the enforcement cover presumed to accompany the guidance.

That expectation regarding value-based arrangements took a hit recently with the issuance of the U.S. federal government's draft policy regarding changes to the anti-kickback statutes (AKS), which unexpectedly excluded makers of drugs and devices. There are indications, however, that this aspect of the draft AKS policy is not set in stone.

Savidge also noted that the FDA guidance on payer communication addressed a long-standing sore spot for payers and makers of drugs and devices. He said the emergence of the draft was an important moment for the company because it was at the time working toward FDA approval for a gene therapy product to treat ocular disease. "We were very eager to understand how [the guidance] may help us" communicate health care economic information (HCEI) to a payer audience, he said.

Emphasis on disease burden

Spark had engaged in a number of HCEI efforts prior to filing the biologics license application for Luxturna (voretigene neparvovec -rzyl), and the company chose to emphasize the burden of blindness without highlighting the details of the gene therapy to the extent it otherwise might have. Spark provided payers and formularies with patient utilization projections to give those entities some idea of the frequency with which the treatment might be invoked, even if the company could not provide specific information on price. Savidge also noted that the FDA guidance required that manufacturers update their information regarding specifics on a routine basis. "We took that [provision] very seriously," he said.

The company used no brand colors or name in its presentation to payers and formulary administrators and prominently displayed a disclaimer that the product was still investigational. While the company had to dedicate significant resources to the collection of all the related data – not to mention the effort needed to sort through what to say and what not to say during HCEI presentations – this payer communication program "allowed us to think about how we were going to describe the product after it was approved," Savidge said.

Michael Labson, a partner at Covington & Burling LLP who spoke on the same panel as Savidge, said Congress had weighed in on the payer communication question at least as far back as the Food and Drug Administration Modernization Act of 1997 (FDAMA). Labson noted that Section 114 of FDAMA lowered the evidentiary standard for health care economic information from "substantial evidence" to "competent and reliable scientific evidence," while Section 3037 of the 21st Century Cures Act expanded the conditions under which such data could be provided.

The Cures Act also introduced the CARSE acronym (competent and reliable scientific evidence) to the regulatory lexicon. Labson pointed out that the Cures Act also said that payers, formularies and "similar entities" could be the recipients of HCEI. Given that providers and provider groups are increasingly liable for outcomes under Medicare payment arrangements other than fee-for-service care, Labson posed the question of whether a large physician practice or practice network might qualify as a recipient of such information under Cures. The answer to that question is not yet evident, he said.

FDA's Schiller to industry: 'Cut the shenanigans'

Lowell Schiller, the FDA's principal associate commissioner for policy, provided the keynote address on the first day of the conference, and he struck a strident tone on a number of points. Specifically, Schiller said brand name drug- and biologics makers engage in a number of games to frustrate competition from generics and biosimilars. He added that the FDA is running out of patience for tactics such as disallowing the availability of the brand name product for evaluation by the competition. The take-home message for those companies, Schiller said, is to put a halt to efforts to suppress generic drugs and biosimilars or face the wrath of the federal government.

Schiller allowed that FDA-regulated industries are not entirely populated by bad actors, as there is still some controversy around questions such as what kind of data constitute valid scientific evidence. He said bad actors are engaging in "increasingly sophisticated behaviors," adding that promotion of unapproved products is still conspicuous on the agency's radar screen.

The opioid-directed Support Act was passed in October 2018, which gives the agency the authority to halt products at the port of entry based on the substances found in those imported products without having to examine the associated claims. Through August 2019, the FDA and its sister agencies have halted roughly 8,300 shipments of suspect products, more than 7,000 of which were destroyed or will soon be, assuming the administrative process does not place a hold on those actions, Schiller said.

Despite the gamesmanship, Schiller said, the current system tries to balance innovation and competition, an approach that "has worked remarkably well in many ways." Schiller said that the practice of restricting pharmaceutical and biotech distribution amount to a practice of regulatory arbitrage designed to prevent competitors from turning out generic drugs and biosimilars. That practice – and others of similar intent – "threatens to undermine our broader system for balancing innovation and competition," he said.

The FDA is at least ethically charged with ensuring that generics and biosimilars reach the market in a timely fashion in an effort to hold down the costs of those therapies. Schiller noted that generic drugs account for the vast majority of prescriptions written each year. The FDA will have none of the gamesmanship, however, and Schiller add that "my message is simple: Cut the shenanigans."

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