Foreign-owned drug and device companies will have to comply with U.S. securities rules if they want to play on U.S. stock exchanges.
In a voice vote Dec. 2, the U.S. House unanimously passed the Holding Foreign Companies Accountable Act (S. 945), which prohibits the securities of a foreign-owned company from being listed on U.S. securities exchanges if the company has failed to comply with the Public Company Accounting Oversight Board’s (PCAOB) audits for three consecutive years.
The bill, which is expected to be signed into law by President Donald Trump, also requires public companies to disclose whether they are owned or controlled by a foreign government.
Passed by the Senate in May, the bill applies to all foreign companies, regardless of where they’re based. But the sponsors, Sens. John Kennedy (R-La.) and Chris Van Hollen (D-Md.), expressed particular concern about Chinese companies, noting that China currently refuses to allow the PCAOB to inspect audits of companies registered in China and Hong Kong.
“Such companies represent a keen risk to American investors as nearly 11% of all securities class action lawsuits in 2011 were brought against Chinese-owned companies accused of misrepresenting themselves in financial documents,” the senators said. They added that the number of Chinese companies listed on U.S. stock exchanges has increased significantly since then.
According to the SEC, 224 U.S.-listed companies, with a combined market capitalization of more than $1.8 trillion, are located in countries that have obstacles to PCAOB inspections.
DEA gets on board with partial Rx fills
More than four years after the Comprehensive Addiction and Recovery Act (CARA) became U.S. law, the Drug Enforcement Administration (DEA) is proposing to amend its regulations to conform with a provision in that law allowing partial fills of prescriptions for schedule II drugs.
The DEA’s proposed rule details how a prescriber should specify the quantity for a partial fill and how the pharmacist must record the quantity dispensed. In keeping with CARA, the rule also spells out the pharmacy record-keeping for when a patient requests a partial fill.
The CARA provision allows the remaining portions of a partially filled prescription for a controlled substance to be filled no later than 30 days after the prescription is written, but emergency oral prescriptions must be filled within 72 hours.
The DEA noted that several states have enacted laws placing limits on certain controlled substances that may be prescribed. It considers a prescription written for a quantity that exceeds state limits to be invalid, so a prescription can’t be partially filled over the 30 days as a means of getting around state law, the DEA said.
While it gave no reason for the lag in producing the rule, the DEA cited the rule’s potential benefits to patients and society as a whole. For starters, it could lower the cost of prescriptions for patients and insurance companies.
In addition, “reducing the dispensing of schedule II drugs that are ultimately not needed would also help to ameliorate the danger that the patient might become dependent upon or addicted to dangerous opioids or other schedule II drugs,” the DEA said in a notice to be published in the Dec. 4 Federal Register.
“The existence of unused drugs in U.S. households contributes to growing rates of prescription drug abuse among Americans. Keeping and storing unused medications in households pose several dangers related to diversion, accidental overdose, and consumption of spoiled substances,” the agency continued.
Comments on the proposed rule should reference Docket No. DEA–469 and be submitted by Feb. 2.
USPTO touts early results of amendment pilot
The pilot program the U.S. Patent and Trademark Office (USPTO) launched last year to ensure patent holders have an opportunity to amend claims challenged in America Invents Act trials, including inter partes reviews, appears to be working.
Under the pilot, patent owners can request preliminary guidance from the Patent Trial and Appeal Board (PTAB) on its motion to amend. They also can file a revised motion in response to the preliminary guidance or to the petitioner’s opposition.
Between June 1, 2019, and Sept. 30, 2020, patent owners requested preliminary guidance in 76% of the 102 motions to amend that were submitted, the USPTO said. Of those, 79% filed a revised motion.
And between April 1, 2020, through Sept. 30, 2020, the PTAB issued 31 final written decisions addressing pilot-eligible motions to amend, with 22 of those patent owners choosing at least one of the pilot options. Of those 22, 36% had at least one proposed substitute claim granted. In comparison, only about 14% of motions to amend submitted before the pilot started resulted in at least one proposed substitute claim being granted.
FDA posts combo product feedback final guidance
The FDA released the final guidance for requesting feedback on combination products, a document applicable to devices, drugs and biotech therapeutics.
The guidance was prompted in large part by the 21st Century Cures Act, but stakeholders took issue with a number of aspects of the draft. Despite criticism from the Combination Products Coalition, the final replicates the draft’s assertion that application-based mechanisms are usually “the most efficient and effective for communication with the FDA,” a passage some in industry saw as discouraging the use of the combination product agreement meeting (CPAM).
As was the case with the draft guidance, the final version states that the FDA must meet with the sponsor within 75 days of receipt of a request for a CPAM and must document any agreements undertaken during such a meeting.
The final guidance instructs that a sponsor requesting a CPAM should provide background information on product development, such as the product’s developmental phase and any prior interaction with the agency regarding the product – a recommendation not found in the draft. Both versions state that a CPAM will not be granted if the product’s primary mode of action has not been determined.