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2019-2020 Pharmaceutical Industry Regulatory Outlook

HomeOpinion2019-2020 Pharmaceutical Industry Regulatory Outlook
2019-2020 Pharmaceutical Industry Regulatory Outlook
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It is often said that the only two certainties in life are death and taxes but I would say if Benjamin Franklin were alive today, he would recognise the inevitability of pharmaceutical regulations, which like death and taxes, seem to be with us all the time!

It is certainly true that even in ancient times, city states in Greece, Egypt and Mesopotamia had remedies, along with prescribed methods of preparation, curated in official texts, representing the first examples of a pharmacopoeia. As the industry grew and expanded, it became clear that further mechanisms to assess and guarantee safety of products were needed.

Since the 1930s, governments across the world have been enacting legislation and instituting measures aimed at ensuring safety, efficacy, and quality of medicines, as well as the relevance and accuracy of product information. Under the current disposition regulatory authorities championing public health and safety while companies taking care of all product-related aspects.

Good regulatory practice is predicated on companies seeking approval for products and ensuring approval is maintained for as long as they wish to keep their products on the market. A key aspect of this is keeping abreast of current and future legislation and harnessing the best available compliance practices to ensure compliance with current and future regulations.

In this briefing, we review four of the most important areas where new regulations are likely to emerge over the coming years.

1. Pricing and Reimbursement | United States

With the cost of prescription drugs among the highest in the world, drug pricing is a topic that perpetually receives attention from regulators, media, and the public. In the currently polarised social and political environment, efforts to build consensus and reform the system face seems futile. Yet, and despite this capricious context, consensus is building on Capitol Hill that something needs to be done.

Prescription Drug Price Relief Act of 2019

Introduced in August 2019 by Senators Chuck Grassley (R-Iowa) and Ron Wyden (D-Ore), the Prescription Drug Price Relief Act of 2019 seeks to establish a series of disclosure requirements for prices of branded drugs. Specifically, the bill requires the Department of Health and Human Services (HHS) to review at least annually all branded drugs for excessive pricing. If products are found to be excessively priced, HHS must (1) void any government-granted exclusivity; (2) issue open, nonexclusive licenses for the drugs; and (3) expedite the review of corresponding applications for generic drugs and biosimilars. The bill has now passed the Senate committee stage and awaits further action.

As the bill stands right now, it would significantly change Medicare Parts D and B, reduce out-of-pocket costs for Americans, save Medicare about $85 billion during the next decade and, in the short term, save Medicaid about $15 billion, according to a press release issued by Grassley.

Although many similar initiatives have met setbacks in the past, most political analysists agree that some form of this bill will pass, given how politically relevant the cost of prescription drugs has become in the United States.

State Drug Price Transparency and Reporting Laws

In response to the recent split in party control of Congress following the midterm election of 2018, a number of states have been enacting state-level legislation that will impose drug price transparency obligations on pharmaceutical companies. These initiatives require pharmaceutical companies to disclose information relating to prescription drug prices and price increases, with some statutes even prohibiting certain types or levels of increases outright. The penalties for noncompliance include civil monetary penalties. These laws are likely to further complicate the regulatory landscape and increase pricing pressures, due to the need for greater transparency and additional reporting capabilities.

Section 340B Drug Pricing Program Compliance

The 340B Drug Pricing Program is not a new piece of legislation – Congress enacted Section 340B of the Public Health Service Act in 1992 (created under Section 602 of the Veterans Health Care Act of 1992). It requires pharmaceutical manufacturers to enter into a pricing agreement with HHS in exchange for having their drugs covered by Medicaid and Medicare. Manufacturers then agree to provide discounts on certain drugs purchased by specified providers. The aim of the program is to stretch scarce federal resources as far as possible, reach more eligible patients and provide more comprehensive services.

In recent times, the Program has been under increased criticism, with reports accusing covered entities of using revenue gained from the Program for reasons other than to expand patient services. After a period of significant change, HHS has put renewed impetus to implementing drug price ceilings and civil monetary penalties for manufacturers under this program. Enforcement will likely be creating an environment of uncertainty for the pharmaceutical industry. Manufacturers should closely monitor 340B program in order to promptly and effectively respond to changes in requirements.

2. Information Security for Software-based Medical Devices | United States and European Union

A variety of regulations are raising the bar on cybersecurity related to medical devices.

US FDA Digital Health Software Precertification (Pre-Cert) Program

The Software Precertification (Pre-Cert) Pilot Program, as outlined in the FDA’s Digital Health Innovation Action Plan [PDF], aims to help provide clarity around a regulatory model for assessing the safety and effectiveness of software-based medical devices.

The basic plan of the Pre-Cert program is to shift emphasis to the software developer as opposed to the product, as it currently the case. The FDA feels that software products, by their nature, are more adaptable and responsive to glitches, adverse events, and other safety concerns quickly. In the Pre-Cert program, the FDA has proposed that products from pre-certified companies would continue to meet the same safety and effectiveness standards that are expected for products that have followed the traditional path to market.

EU General Data Protection Regulation (GDPR)

An important objective of the GDPR was to strengthen information security, by instituting a harmonised approach to data protection rights across the EU. A year and half since its introduction, the GDPR wide-ranging effects continue to unfold across many sectors. One key change that is of relevance to the pharmaceutical industry is the broad meaning of personal data under the GDPR, which now encompasses any information specific to an individual’s physical, physiological, genetic, mental, economic, cultural, or social identity.

Looking forward, information security as it relates to software-based medical devices will continue to develop, with several countries seeking to beef up their regulatory requirements.

3. Medical Device Regulations (MDR) | European Union

In April 2017, the EU introduced the new Medical Device Regulation, Regulation (EU) 2017/745, replacing the two existing directives, Medical Devices Directive (93/42/EEC) and Active Implantable Medical Devices Directive (90/385/EEC). The new Regulation (EU) 2017/745 is scheduled to enter into force in May 2020, after a 3-year transition, and will significantly be changing the market access framework across the EU single market for existing and approved medical devices.

Regulation (EU) 2017/745 aims to address long-standing weaknesses in Directive (93/42/EEC) and Directive (90/385/EEC) as well respond to the rapid developments of science and technology in the field of medical devices.

The new Medical Device Regulation introduces several changes, including:

  • More stringent controls for high-risk medical devices utilising a new pre-market scrutiny mechanism that will involve a pool of experts at EU level
  • Strengthening the criteria for designation and processes for oversight of Notified Bodies
  • Greater transparency through the establishment of an EU-wide database on medical devices as well as a device traceability mechanism based on Unique Device Identification
  • Rigorous rules on clinical evidence, including an EU-wide coordinated procedure for authorisation of multi-centre clinical investigations
  • Post-market surveillance requirements for manufacturers of medical devices

The clock is now ticking on a three-year implementation window for manufacturers and they will need to start preparing now to make sure their products are compliant by May 2020.

4. EU Guidelines on Quality Requirements for Drug Device Combinations | European Union

Broadly, drug device combinations (DDC) are drug products which contain one or more medical devices(s) as an integral part of the composition, as well as medicinal products for which one or more medical device(s) and/or device component(s) are necessary for use of the drug product.

DDCs have revolutionized therapeutics and positively impacted patient experience – for example, by simplifying delivery methods, providing controlled release of actives, or improving patient compliance. However, the increasing use of DDCs is also complicating the regulatory landscape, particularly where there is no clear regulatory pathway to follow, making compliance onerous.

In May 2017, the European Medicines Agency (EMA) published a draft guideline on quality requirements for DDCs. The consultation period has now ended and EMA has scheduled the guidelines to be completed prior to Regulation (EU) 2017/745 coming into force in May 2020.

The key issues that the guideline focuses on include:

  • Considerations that will apply to the registration of all DDCs, including standards (Ph.Eur and ICH standards having precedence over ISO standards), data submission and dossier format, justification for use of platform technologies and the relevance of obtaining scientific advice.
  • Specific guidance on what information should be provided on products, including description and composition, pharmaceutical development, manufacture, control of drug product, container closure system and stability.
  • Identification of adventitious agents and provision of information on the assessment of risk with respect to potential contamination.
  • Requirement for DDC marketing authorisation applications to include evidence of conformity of the device part of the product with the relevant general safety and performance requirements (e.g. CE mark).
  • Data to support marketing authorisation application for non-integral DDCs where the device element it separately supplied and obtained.
  • Incorporation of DDCs in clinical development and clinical trials.
  • Lifecycle management in relation to any changes to medical devices and/or device components within DDCs.
  • The possibility and provision for alternative approaches for emerging technologies.

EMA hopes that this guideline will provide consistency of information on regulatory submissions, reduce workload for all stakeholders and ultimately improve patient safety.

To stay abreast with this emerging regulatory landscape, companies will need to review the latest updated quality regulatory requirements for DDCs to see how their product offerings and business practices stack up.

Concluding remarks

As the pharmaceutical sector continues to expand, companies face an array of new regulations in a bid to maintain standards for quality, safety, and efficacy. Health authorities will likely continue to intensify their compliance oversight and enforcement efforts, not only for existing laws but also new ones. This will inevitably have a material effect on how companies do business. In this dynamic environment, companies must continue investing time, resource and effort to achieve regulatory compliance.



The views, thoughts, and opinions expressed in this briefing note belong solely to the author, and not necessarily to the Excipients Industry Forum. The Excipients Industry Forum assumes no responsibility or liability for any errors or omissions in the content of this briefing note. The information contained in this site is provided on an “as is” basis with no guarantees of completeness, accuracy, usefulness or timeliness.

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