Commercialisation of healthcare in the United States: overview

A Q&A guide to the commercialisation of healthcare in the United States.

This Q&A provides an overview of the regulatory framework for the commercialisation of medical products in the United States. It covers the key requirements for manufacturing, advertising and selling drugs, medical devices, biological products and natural health products.

To compare answers across multiple jurisdictions, visit the commercialisation of healthcare Country Q&A tool.

This Q&A is part of the Commercialisation of Healthcare Global Guide. For a full list of jurisdictional Q&As visit www.practicallaw.com/healthcare-guide.

Contents

Regulatory overview

1. What is the regulatory framework for medical products?

Legislation

The primary legislation governing medical products is the Food, Drug, and Cosmetic Act (FDC Act).

Regulatory authorities

The US Food and Drug Administration (FDA) is the primary regulator of medical products in the US. It is responsible for reviewing and approving almost all drugs, medical devices, and biological products prior to their entry into the market. The FDA is also responsible for enforcing post-market requirements, including the reporting of adverse events and recalls, and the conduct of post-market studies. In addition the FDA regulates products such as dietary supplements, medical foods, food additives, and cosmetics.

The Federal Trade Commission (FTC) regulates the advertising and promotion of many products regulated by the FDA, including over-the-counter (OTC) drugs, cosmetics, dietary supplements and some medical devices. The FTC can take action against a company if it believes a company is making claims for a product which are false or misleading, or are not supported by substantial evidence.

In addition, states regulate the manufacture and distribution of medical products within and between jurisdictions, and can take action against parties for failing to obtain and maintain the necessary licences.

For more information on the FDA and FTC see box: The regulatory authorities.

Private parties

Private parties do not usually play a direct role in the regulation of medical products in the US. Some private parties are authorised to review certain device submissions, and companies can engage private parties to conduct audits to measure the company's compliance with FDA's regulations. However, such audits are not substitutes for FDA inspections, and a clean audit by a private party does not mean that the FDA will not make any observations during its audits.

Private individuals may also be part of the approval process for drugs or devices if the FDA holds an advisory panel. These individuals may be medical or clinical experts or, in some cases, consumer or patient representatives. Private parties also make complaints and provide other information to the FDA, which can affect product regulation. They can also file lawsuits raising issues relating to FDA regulation.

 
2. What types of medical products are regulated?

Almost all healthcare products are regulated to some extent by the Food and Drug Administration (FDA). Many drugs, devices, and biological products must be reviewed and approved by the FDA before entering the US marketplace.

Even products that are not subject to the FDA's pre-market review are subject to post-market enforcement. This means that although some products (such as cosmetics or dietary supplements) do not require pre-market review and approval by the FDA before being introduced into the US market, the FDA can take enforcement action against manufacturers of those products if they either:

  • Make claims that the FDA considers turns the product into a regulated product (such as a drug).

  • Are contaminated or present other safety issues.

 

Drugs

3. What are the general requirements for a drug to be manufactured, advertised and sold?

In the US, drugs are primarily regulated by the FDA's Center for Drug Evaluation and Research (CDER). The definition of drug is set out in the Federal Food, Drug, and Cosmetic Act (FDC Act). Drugs are defined as (§201(g)(1), FDC Act):

  • Articles recognised in the official US Pharmacopoeia, official Homoeopathic Pharmacopoeia of the US, official National Formulary, or any supplement to those.

  • Articles intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease in man or other animals.

  • Articles (other than food) intended to affect the structure or any function of the body of man or other animals.

  • Articles intended for use as a component of any article specified above.

The FDA's laws and regulations aim to strike a balance between encouraging innovation, protecting human subjects and providing access to therapies. The FDA regulatory scheme is complex, and includes, among other elements, expedited review programmes for drugs that treat serious and rare conditions.

Manufacturing

Companies or other entities that seek FDA approval to manufacture or, more specifically, market a new drug (sponsors or applicants) must file one of three types of new drug application:

  • A new drug application (NDA), for brand new "innovator" drugs.

  • A right of reference NDA (505(b)(2) NDA), for modified versions of previously approved drugs.

  • An abbreviated new drug application (ANDA), for identical or close copies of approved drugs.

Each approval route has unique features that are discussed in greater detail in this chapter.

The classification of a product as a drug can be controlled by the product's intended use. For example, a product typically regulated as a dietary supplement will be subject to regulation as a drug if it is intended to diagnose, cure, mitigate, treat or prevent a disease (for example, folic acid marketed to prevent neural tube defects in neonates).

New drugs are approved via NDAs (see below). A "new drug" is a drug that, based on its intended use, is not "generally recognised as safe and effective" or lacks a significant history of use in treating the condition(s) for which the drug will be promoted.

In addition, a drug can be considered new if it:

  • Contains a new ingredient.

  • Is a new combination of old ingredients.

  • Consists of new proportions of existing ingredients.

  • Is a new mode of administration or dosage form of an approved drug.

The drug development process. The drug development process starts with the identification of a promising compound or compounds. These compounds then go through the pre-clinical and clinical phases of drug development before (if all goes well) they are reviewed by the FDA.

Pre-clinical testing includes in vitro and animal testing, and is designed to evaluate whether a therapy is reasonably safe for testing in humans. The pre-clinical phase is also important because it helps to identify safety parameters and toxicities and determine a safe initial dose in humans. Pre-clinical testing must be conducted in accordance with good laboratory practices.

Based on information obtained in the pre-clinical testing phase, a sponsor may decide to prepare an investigational new drug (IND) application. INDs include information about a drug's composition and manufacturing and the results of pre-clinical testing. INDs also outline a plan for testing in humans. The FDA reviews INDs to:

  • Ensure that the proposed studies do not place human subjects at unreasonable risk.

  • Assess the scientific validity of the study design.

  • Verify that the investigator will obtain adequate informed consent and protect human subjects.

In addition, the FDA requires that study protocols be reviewed and approved by an Institutional Review Board (IRB). An IRB is a committee, board or other group designated by an institution to review and monitor research involving human subjects. The FDA requires IRBs (which may also be independent of the institution where the investigation takes place) to ensure that appropriate steps are taken to protect the rights and welfare of human subjects.

If the FDA does not respond to an IND within 30 days, the sponsor can start its studies. Alternatively, if the FDA objects to the sponsor's proposal, it can place a clinical hold on the IND. Reasons for clinical holds include:

  • Unreasonable risk of injury.

  • Insufficient information to assess risk to subjects.

  • Use of unsuitable investigators.

  • Deficient study protocols.

Studies that are conducted outside of the US need not be conducted under an IND. However, for data to support the marketing application, sponsors must ensure that the studies comply with relevant local regulations and that the FDA will not find the study population to be unrepresentative of prospective patients in the US.

If there are no issues with its IND, a sponsor will start clinical development. Clinical development is traditionally carried out in three phases:

  • Phase one: initial administration of the drug to humans. This step is normally performed in healthy subjects (about 20 to 80). Phase one data is used to assess optimal dose, metabolisation, pharmacological action and any side effects associated with increased doses.

  • Phase two: investigation extended to subjects with the condition the drug is intended to treat (30 to 300 patients). The purpose of phase two is to confirm the optimal dose and to evaluate safety and effectiveness issues. Phase two is typically the first time a control is introduced.

  • Phase three: gathering additional information about safety and effectiveness in additional patients (several hundreds to several thousands). The data collected in phase three will form the foundation for the FDA's risk-benefit determination. By the end of a clinical programme, a sponsor should be able to meet the "substantial evidence" requirement.

More recently, these traditional phases have blurred, and different permutations are often employed. Ultimately, FDA reviewers must determine whether the sponsor, through its NDA, has provided "substantial evidence" that the benefits of the proposed use(s) outweigh the risks for the intended use. The FDC Act defines "substantial evidence" as "evidence consisting of adequate and well-controlled investigations, including clinical investigations, by experts qualified by scientific training and experience to evaluate the effectiveness of the drug involved, on the basis of which it could fairly and responsibly be concluded by such experts that the drug will have the effect it purports or is represented to have under the conditions of use prescribed, recommended, or suggested in the labeling or proposed labeling thereof" (§ 505(d), FDC Act).

Satisfying the substantial evidence standard for a new drug generally requires either:

  • Two adequate and well-controlled studies.

  • One adequate and well-controlled study and confirmatory evidence.

However, the FDA has shown some flexibility regarding this requirement. Confirmatory evidence can consist of independent substantiation from study data in related uses of the drug, such as studies in other populations or a closely related disease. "Adequate and well-controlled investigations" are studies whose design "permits a valid comparison with a control to provide a quantitative assessment of drug effect". Depending on the clinical programme, these studies can be placebo-controlled, active treatment-controlled or historically-controlled. The FDA has exercised notable flexibility on these requirements in its review of therapies intended to treat rare diseases (that is, for orphan drugs).

Clinical trials must be conducted in accordance with good clinical practice (GCP). GCP is a set of ethical and scientific quality standards for designing, conducting, recording and reporting trials that involve the participation of human subjects. GCP requires informed consent from patients (or others acting on their behalf) to ensure that participation is voluntary. An IRB must review and approve the participation of clinical sites in the US.

NDA. On completion of its non-clinical and clinical development programmes, the sponsor of an innovator drug will prepare and submit an NDA (§ 505(b)(1), FDC Act). Submission of an NDA is the formal step for requesting FDA's approval of the drug. The FDA will review the application within 60 days to determine whether the NDA is "sufficiently complete to permit a substantive review". If the NDA is "fileable", the FDA will accept the NDA for filing. FDA's review clock starts once the NDA is accepted for filing. The FDA has committed to reviewing 90% of applications within ten months of filing.

The user fee for filing an NDA is US$2,038,100 (for 2017).

Alternatively, if the FDA determines that the application is for a drug that treats a serious condition and, if approved, would provide a significant improvement in safety or effectiveness, the FDA will grant "priority review". The FDA has committed to reviewing 90% of priority review applications within six months of filing.

Sponsors can also take advantage of the FDA's priority review programme through the use of a priority review voucher (PRV) and payment of an additional fee. PRVs are granted to sponsors of drugs for:

  • Neglected tropical diseases (§ 524, FDC Act).

  • Rare paediatric diseases (§ 529, FDC Act).

On approval of a new drug or biologic for a listed tropical disease or rare paediatric disease, the FDA will issue a PRV to the sponsor. The sponsor can then either use the PRV or sell it. PRVs accelerate the review of marketing applications that are otherwise ineligible for priority review. To date, about a dozen of PRVs have been issued. A handful of PRVs have been sold, with one selling for US$350 million.

The FDA's review includes close examination of the drug's chemistry, manufacturing, microbiology, pharmacology, medical data and statistical data. During its review, the FDA may determine that an advisory committee is necessary. Advisory committees are made up of outside experts who are convened to provide the FDA with independent recommendations on FDA policies and whether to approve applications. The FDA is not obliged to follow the panel's recommendations, but it typically does.

The FDA will also conduct pre-approval inspections to verify, among other things, that the sponsor's manufacturing processes are adequate to maintain identity, strength, quality and purity. In addition, the FDA will review whether the proposed label provides sufficient information to limit risks and enhance benefits. The FDA must therefore consider whether the label contains appropriate indications and dosages, directions for administration, and contraindications and warnings, and whether the drug should be evaluated for controlled substance scheduling based on abuse potential (see below, Controlled substances). The FDA will then approve the application or issue a complete response letter. A complete response letter is a letter sent by the FDA that informs the sponsor that its marketing application will not be approved in its present form and which details the deficiencies found during the FDA's review of the marketing application. In 2015, the CDER approved 45 NDAs and biologic licence applications (BLAs), the most in almost 20 years.

To ensure that the benefits of a drug outweigh its risks, the FDA can require manufacturers to establish a risk evaluation and mitigation strategy (REMS). REMS include medication guides, patient package inserts, communications plans and, for drugs with the most serious risks, elements to assure safe use (ETASUs). ETASUs can include restricted distribution plans, physician certification, patient registries and other similar requirements.

REMS are often onerous. Drug sponsors must effectively implement and assess their programmes. Sponsors must also submit assessments of their REMS programme at pre-determined times (typically 18 months, three years and seven years after approval of the REMS). The failure to adhere to a REMS can result in the drug being deemed misbranded and the sponsor being subject to a civil monetary penalty.

505(b)(2) NDA. A sponsor can file a new drug application under section 505(b)(2) of the FDC Act if, in putting together its new drug application, it wishes to rely on data collected in investigations it did not conduct or were not conducted on its behalf, "and for which [it] has not obtained a right of reference or use from the person by or for whom the investigations were conducted". A 505(b)(2) application "contains full reports of investigations of safety and effectiveness but at least some of the information required for approval comes from studies not conducted by or for the applicant, and for which the applicant has not obtained a right of reference" (FDA Guidance, Applications Covered by section 505(b)(2), 1 October 1999, available at: www.fda.gov/downloads/Drugs/Guidances/ucm079345.pdf). Right of reference is defined as "the authority to rely upon, and otherwise use, an investigation for the purpose of obtaining approval of an application, including the ability to make available the underlying raw data from the investigation" (§ 314.3(b), 21 Code of Federal Regulations (CFR)).

The user fee for filing a 505(b)(2) NDA is US$2,038,100 (for 2017).

The 505(b)(2) pathway is not always available. For example, a 505(b)(2) application cannot be filed by sponsors seeking approval of products either:

  • That duplicate a listed drug (an ANDA must be filed instead (see Question 4).

  • Whose only difference from a listed drug is that the active ingredient is less readily absorbed or available.

Supplemental NDA (sNDA). An NDA holder must file a supplemental NDA (sNDA) to add a new indication, change the dosage form or strength, or substantially alter a manufacturing process for its approved drug. For example, if a company with a drug approved for migraines decides to seek an additional indication for general pain, the company will need to submit an sNDA. In general, sNDAs require less data than NDAs and the review typically focuses on evidence of safety and effectiveness relating to the new indication or change. If a company's sNDA requires the FDA to review new clinical data (other than bioavailability or bioequivalence data), the user fee will be half of that for an NDA.

Non-prescription/over-the-counter (OTC) drugs. In the US, OTC drugs can be marketed and sold directly to consumers without a prescription or the supervision of a physician or pharmacist. For a drug to become an OTC drug, consumers must be able to self-diagnose, self-treat and self-manage the disease or condition for which the OTC drug is intended.

There are two pathways to market for OTC drugs:

  • A company can ensure that its product conforms to an OTC drug monograph.

  • A company can seek approval via an NDA or ANDA (see above).

The development of OTC monographs is complex and can take decades. An OTC monograph is essentially a finding by the FDA that a drug is not a "new drug". The FDA has developed OTC monographs for over 80 therapeutic classes of OTC drugs. Each monograph specifies acceptable ingredients, doses, formulations and labelling for OTC drugs marketed within a particular therapeutic class. Manufacturers that develop OTC drugs that meet the specifications set out in a monograph are not required to seek FDA approval before marketing their drugs. However, if a product cannot be formulated in compliance with one of the "recipes" set forth in a monograph, the sponsor must file an NDA or ANDA.

The FDA's OTC monograph process is still ongoing. Many drugs fall within Tentative Final Monographs (TFMs), which are tentative orders published in the Federal Register establishing the conditions under which a category of OTC drugs is generally recognised as safe and effective and not misbranded. OTC drugs that are covered by TFMs can be marketed, subject to the FDA's current enforcement policies.

If no applicable OTC monograph exists, the manufacturer can submit an NDA and request that the drug be considered for OTC status. The FDA can require extensive labelling comprehension studies and actual use studies in patient populations for OTC NDAs. In addition, NDA holders of prescription drugs can request that their products be considered for OTC status. This process is called an RX-to-OTC switch.

Patent protection and exclusivity

In the US, there is a variety of means to reward pharmaceutical innovators. These mechanisms include patents and exclusivity. Patent and exclusivity information for approved drugs can be found in the FDA's Approved Drug Products with Therapeutic Equivalence Evaluations, which is more commonly referred to as the Orange Book.

Patent protection. Patents are granted by the US Patent and Trademark Office and permit the patent holder to exclude others from making, using, offering for sale or selling the invention in the US or importing the invention into the US. Patents expire 20 years from the patent filing date. Because patent terms often begin to run well before a drug is approved, lengthy drug development programmes may exhaust substantial portions of the patent term. Congress has addressed this issue and enacted certain provisions for patent term extension.

Marketing exclusivity. Sponsors of innovator drugs may be eligible to receive a number of exclusivities, including:

  • New chemical entity (NCE) exclusivity. This is a five-year exclusivity. It is granted for drugs that contain an active moiety (that is, the molecule or ion, excluding those appended portions of the molecule that cause the drug to be an ester, salt or other non-covalent derivative of the molecule, responsible for the physiological or pharmacological action of the drug substance) not previously approved by the FDA as a drug.

  • New clinical investigation exclusivity. This is a three-year exclusivity. It is granted for sNDAs and non-NCE NDAs that contain reports of at least one new clinical investigation (other than bioavailability studies) conducted by or on behalf of the applicant that were essential to approval (for example, new indication and new dosage form).

  • Orphan drug exclusivity. This is a seven-year exclusivity. It is granted for drugs designated and approved for diseases with fewer than 200,000 cases in the US, or for which the sponsor has no reasonable expectation of recovering US development and marketing costs from US sales.

  • Paediatric exclusivity. This is a six-month exclusivity. It extends NCE exclusivity, new clinical investigation exclusivity, and orphan drug exclusivity by six months. It also adds a six-month period to certain patents listed in the Orange Book. It is granted if the sponsor performed required testing in paediatric populations in response to a request from FDA.

  • Qualified infectious disease product exclusivity (QIDP). This is a five-year exclusivity. Similar to paediatric exclusivity, it extends other exclusivities by five years (but not patents). It is granted for products that treat an antibiotic/antifungal-resistant disease, or a bacterial or fungus that has been designated by the FDA as a qualified product.

In addition, if a generic applicant is first to challenge the innovator's patent(s), the generic applicant is entitled to share the innovator's monopoly for 180 days.

While NCE exclusivity (or new clinical investigation exclusivity) and orphan drug exclusivity run in parallel, paediatric exclusivity and QIDP exclusivity extend to other exclusivities. In addition, the exclusivity period starts on the date of the drug's approval. For example, a sponsor that receives five-year NCE exclusivity, seven-year orphan drug exclusivity, and five-year QIDP exclusivity would receive ten-year NCE exclusivity and 12-year orphan drug exclusivity. In this example, the last remaining exclusivity would be orphan drug exclusivity, and it would expire 12 years after the drug was approved. There is a substantial amount of litigation relating to grants of exclusivity.

Controlled substances

In the US, drugs identified to have the potential for abuse are classified as controlled substances, and are regulated under the Controlled Substances Act (CSA). In addition to the FDA, controlled substances are also regulated by the Drug Enforcement Administration (DEA). The DEA categorises controlled substances as schedule I to V, with drugs with the highest abuse potential and no medical value designated as schedule I. The interplay between the FDA approval process and DEA scheduling can be a source of regulatory complexity.

The purpose of controlled substance regulation is to establish a "closed chain of distribution" and prevent diversion for illicit use and abuse. Restrictions on controlled drugs include:

  • Federal and state licensing requirements.

  • Special security requirements.

  • Prescribing policies.

To manufacture, sell or prescribe controlled substances, manufacturers, wholesalers, pharmacies and healthcare professionals must obtain special DEA registrations and state licences for controlled substances. Controlled substances laws also apply to imports/exports, and certain chemicals that have legitimate uses but which can be used to unlawfully manufacture controlled substances. The CSA imposes additional penalties for violations of controlled substances laws.

Post-marketing requirements

Drug manufacturers must comply with a number of regulatory requirements once their drugs are approved and on the market. Key post-marketing requirements include:

  • Ongoing compliance with current good manufacturing practices (cGMPs).

  • Change notification.

  • Adverse drug experience (ADE) reporting.

  • Annual reporting.

The FDA requires manufacturers to conform to cGMPs to ensure the quality and safety of their drug products. The overarching theme for cGMPs is that quality should be built into the product at each manufacturing step, and that final product testing alone is insufficient to ensure quality. The FDA's regulations on cGMPs are rather broad, although they are supplemented by more specific guidelines. Companies must establish their own specific cGMP-compliant procedures.

A sponsor must also notify the FDA of changes in its approved products. The FDA may require prior approval depending on the change's potential to have an adverse effect on the identity, strength, quality, purity or potency of the drug, as these factors relate to safety or effectiveness (for example, a change in formulation or packaging materials).

In addition, a sponsor must carry out ongoing post-marketing reporting of ADEs. An ADE is broadly defined as "[a]ny adverse event associated with the use of a drug in humans, whether or not considered drug related" (§ 314.80(a), 21 CFR). The timeline for notifying the FDA of ADEs depends on the seriousness of the ADE and whether it was unexpected. Serious and unexpected ADEs must be reported to the FDA within 15 days. Other ADEs must be reported either quarterly in the first three years after drug approval, or annually.

A sponsor must issue field alert reports to the FDA within three working days if it receives (§ 314.81(b)(1), 21 CFR):

  • Information concerning any incidence that causes the drug product or its labelling to be mistaken for, or applied to, another article.

  • Information concerning any bacteriological contamination, or any significant chemical, physical, or other change or deterioration in the distributed drug product.

  • Information on any failure of one or more distributed batches of the drug product to meet the specification established in the application.

Sponsors must also submit annual reports that summarise significant new information that could affect safety, effectiveness or labelling.

Enforcement

The FDC Act prohibits, among other acts, the introduction or delivery for introduction into interstate commerce of any drug that is adulterated or misbranded. A drug is considered adulterated if:

  • It contains any filthy or decomposed substance.

  • Its strength, quality or purity falls below compendial standards.

  • It is not manufactured, packaged or held in conformance with cGMPs.

Under the FDA's cGMP requirements, a drug can be adulterated even if it meets final product specifications.

A drug is misbranded if, among other reasons:

  • Its labelling is false or misleading in any particular way.

  • It lacks adequate directions for use.

  • Its label or labelling omits certain specified information (for example, generic name, manufacturer's name and place of business).

The FDC Act also prohibits the introduction of an unapproved new drug.

The FDA has a variety of enforcement tools, which include:

  • Inspections.

  • Warning letters and untitled letters.

  • Recall authority.

  • Publicity.

  • Withdrawal of product approval.

  • Formal statutory sanctions.

The FDA has the authority to inspect both domestic and foreign establishments. These inspections seek to determine whether facilities are in compliance with FDA laws and regulations. Inspections are generally of a specific type or scope. For example, a cGMP inspection by the FDA will investigate whether the firm was operating in conformance to those standards. The FDA typically provides at least some notice prior to inspection. However, the FDA can conduct unannounced inspections. Inspections can range from a single day to several weeks or longer. At the conclusion of an inspection, the FDA investigator can issue a Form 483, which is a form used to communicate observations made during the FDA's inspection. If a Form 483 is issued, companies must respond to the deficiencies within 15 business days.

Warning letters are issued to companies for perceived violations and threaten further enforcement action if the issues identified in the letter are not corrected. Warning letters are publicly available on the FDA's website. The FDA also issues untitled letters, which are less formal and ominous. Untitled letters are often sent for allegedly unlawful promotional activities.

Manufacturers can initiate drug recalls. While they are not required to report these recall activities to the FDA, they are expected to do so. The FDA can also request voluntary recalls or order compulsory recalls, depending on the seriousness and likelihood of the threat posed by the product.

The FDA can withdraw an NDA on either mandatory or discretionary grounds. Grounds for a mandatory withdrawal include new evidence showing that the drug is either unsafe or lacks substantial evidence of effectiveness. The FDA can also immediately suspend approval of a drug if there is an "imminent hazard to the public health". Grounds for a discretionary withdrawal include new information showing serious manufacturing deficiencies that were not corrected in a timely manner, or failure to maintain adequate records.

Statutory sanctions available to the FDA include:

  • Product seizure.

  • Injunction against a company or employee.

  • Criminal and civil penalties.

However, these actions cannot be initiated by the FDA. Instead, the FDA must rely on the Department of Justice to bring these actions on behalf of the US.

Advertising

Under the FDC Act, the FDA has the authority to regulate drug labelling. Labelling is defined broadly. The Federal Trade Commission (FTC) also has the authority to regulate drug advertising under the Federal Trade Commission Act. Under a 1971 Memorandum of Understanding between the FDA and the FTC:

  • The FDA is primarily responsible for the regulation of prescription drug labelling and advertising.

  • The FTC is primarily responsible for the regulation of drug advertising for OTC drugs.

Drug advertising to patients and healthcare providers is generally permitted. However, such advertising cannot be false or misleading. Advertisements for prescription drugs must also present a "fair balance" between information on effectiveness and risk, and reveal material facts that a healthcare provider or patient would find important in assessing whether to use a drug. Sponsors that wish to make claims comparing their products to other products must provide "substantial evidence" via adequate and well-controlled studies. However, drug companies are permitted to compare certain facts in their drug's label against the facts in their competitors' labels (for example, once a day versus twice a day).

Recently, one of the FDA's primary enforcement focuses has been on off-label promotion (that is, promotion of a drug for uses other than those approved by the FDA). From a policy standpoint, if manufacturers were allowed to promote drugs for unapproved uses, there would arguably be less incentive for drug companies to seek FDA approval or perform clinical studies. On the other hand, the FDA does not regulate the practice of medicine, and physicians can prescribe drugs for unapproved indications. The FDA's ability to restrict off-label communication, although fairly broad, is subject to review and challenge under the First Amendment of the US Constitution, as illustrated by a recent lawsuit filed by Amarin Pharma Inc. against the FDA.

Typically, before the FDA seeks legal recourse for inappropriate labelling, it will send an untitled letter or warning letter to notify the manufacturer that it is in violation of prescription drug advertising and marketing regulations. While untitled letters are less formal than warning letters, they are still very important and should be treated seriously.

The FTC has the authority to prohibit unfair or deceptive acts or practices and false advertisement for OTC drugs. An advertisement is unfair if it "causes or is likely to cause substantial injury to consumers which is not reasonably avoidable by consumers themselves and not outweighed by countervailing benefits to consumers or to competition" (§ 45(n)15, United States Code (USC)). In addition, an advertisement is deceptive if a representation or omission is likely to mislead the consumer and is material to consumers' decisions.

Sale

In the US, drugs generally either require a prescription or are available as OTC drugs.

Prescription drugs are prescribed by healthcare providers such as physicians. If a prescription drug is to be taken outside of a hospital, a patient generally obtains his or her prescription drug via a physical or online pharmacy. Pharmacy laws often differ in each state. At the federal level, special requirements apply if, for example, a drug is a controlled substance (see above, Controlled substances) or is subject to a REMS (see above, Manufacturing).

OTC drugs are available to consumers without a prescription. OTC drugs can be sold via non-pharmacy outlets such as retail stores or online retailers.

 
4. Are there different requirements for patented and generic drugs?

A sponsor seeking to duplicate an innovator drug (that is, to create a generic drug) can submit an abbreviated new drug application (ANDA). The main advantage of submitting an ANDA is that the Food and Drug Administration (FDA) generally does not require ANDA sponsors to include pre-clinical or clinical data to establish safety and effectiveness. This saves substantial time and money, and allows generic drug manufacturers to sell drugs at significantly lower prices than manufacturers of innovator drugs. To take advantage of this path, generic drug manufacturers must typically wait for the innovator drug's patents and exclusivities to expire (see Question 3, Patent protection and exclusivity), or bring certain types of court challenges against the patent holder.

An ANDA sponsor must demonstrate that its product is bioequivalent to the innovator drug (that is, it displays comparable bioavailability when studied under similar experimental conditions to the innovator drug). This means that the generic drug must have identical active ingredients, dosage form, strength, route of administration and conditions of use, including labelling. Under certain circumstances, if a sponsor submits a suitability petition, the FDA will allow a generic drug to have limited differences compared to the innovator drug (for example, a change of dosage form from capsule to tablet).

The fee for an ANDA is US$70,480 (for 2017).

In addition, for approval of an ANDA and for continued marketing of a generic drug, the FDA cannot have decided of the withdrawal of the innovator drug for reasons of safety or effectiveness.

 
5. What authority is responsible for regulating the manufacture, advertising and sale of drugs?

The Food and Drug Administration (FDA) regulates the manufacture, advertising and sale of prescription drugs.

For more information on the FDA see box: The regulatory authorities.

 
6. Are there fewer or different requirements for drugs that have already been licensed/approved in another jurisdiction?

Although the Food and Drug Administration's (FDA's) application requirements are no less stringent for drugs licensed or approved in other countries, clinical data developed for foreign approvals can be used in US applications if the trials were conducted in accordance with good clinical practice (GCP) and local requirements. In addition, the FDA permits the use of foreign marketing data to support the development of OTC monographs (see Question 3, Manufacturing: Non-prescription/over-the-counter (OTC) drugs).

 
7. Is it possible to sell drugs to or buy drugs from other jurisdictions?

The Food, Drug, and Cosmetic Act (FDC Act) prohibits the introduction or delivery of any adulterated or misbranded drug product into interstate commerce. Therefore, all FDA-regulated products are subject to examination when they are imported or offered for import into the US. Most prescription drugs that are not covered by an investigational new drug (IND) application or an approved new drug application (NDA) cannot be imported. Each foreign manufacturer must have an establishment registration and identify a US agent at the time of registration. Foreign manufacturers must also ensure that each product is listed with the Food and Drug Administration (FDA), and manufacture products in compliance with current good manufacturing practices (cGMPs).

The FDA works closely with the US Customs and Border Patrol to enforce its rules on imported drugs. Under the FDC Act, the FDA can refuse admission to any drug that "appears" to be unapproved. This standard shifts the burden to importers to prove that their products do not violate the FDC Act. If the FDA identifies a problem with imported articles, it can file an "import alert". An article placed on import alert cannot be legally imported into the US.

Importation of non-compliant products is permitted in certain limited cases. Examples include:

  • Import for export, which is defined as the importation of certain unapproved or non-compliant products for further processing in the US and subsequent export.

  • Import for personal use. The FDA policy may allow, on a very limited basis, individuals to import unapproved drugs if they started treatment with the unapproved drug in a foreign country and wish to continue therapy in the US, or if they suffer from a condition with no FDA-approved treatment.

Although the FDA's primary concern is imports, certain export restrictions also apply. For example, drugs that are not manufactured in conformity with cGMPs or do not comply with international standards recognised by the FDA cannot be exported. Drugs that are not approved in the US can be exported under certain conditions detailed in section 802 of the FDC Act.

 
8. Is it permitted to advertise drugs to consumers? Are there restrictions on advertising?

The Food and Drug Administration (FDA) permits advertising to consumers, including print and broadcast advertisements. The same general concepts that apply to advertisements directed at healthcare professionals also apply to advertisements directed at consumers. However, promotional materials directed at consumers must use consumer-friendly language. There are also a number of requirements specific to direct-to-consumer (DTC) advertisements. For example, DTC print advertisements must include the statement, "You are encouraged to report negative side effects of prescription drugs to the FDA. Visit www.FDA.gov/medwatch, or call 1-800-FDA-1088.

 

Medical devices

9. What are the general requirements for a medical device to be manufactured, advertised and sold?

Manufacturing

In the US, medical devices are regulated by the Food and Drug Administration (FDA) under the authority of the Federal Food, Drug, and Cosmetic Act (FDC Act) and its implementing regulations. A device is defined under section 201(h) of the FDC Act as "an instrument, apparatus, implement, machine, contrivance, implant, in vitro reagent, or other similar or related article, including any component, part, or accessory" which does not achieve its primary intended purposes through chemical action within or on the body of man or other animals and which is not dependent on being metabolised for the achievement of its primary intended purposes, and where one of the following applies:

  • It is recognised in the official National Formulary, or the US Pharmacopeia, or any supplement to them.

  • It is intended for use in the diagnosis of disease or other conditions, or in the cure, mitigation, treatment, or prevention of disease, in man or other animals.

  • It is intended to affect the structure or any function of the body of man or other animals.

Devices are very heterogeneous, ranging from simple, low-risk products to complex, life-saving products. When it enacted legislation in 1976 to regulate devices, Congress decided that it could not apply a single regulatory structure for all devices, and this essential flexibility has been maintained since.

The FDA classifies devices into class I, class II or class III, depending on their risk. Classifications provide a key to the framework for device regulation:

  • Class I devices are considered "low-risk" devices. Only general controls apply (see below), and these devices are generally exempt from any kind of pre-market review by the FDA. Examples of class I devices include manual stethoscopes, tongue depressors and arm slings.

  • Class II devices are "moderate-risk" devices. General controls apply and the FDA can impose special controls. Pre-market notification is generally required, although the FDA has exempted certain class II devices. Examples of class II devices include endoscopes, powered wheelchairs, infusion pumps and glucose tests.

  • Class III devices are the highest risk devices, and are subject to general and special controls, and pre-market approval, which is the most rigorous of the FDA's pre-market review processes. Examples of class III devices include cardiac ablation catheters, coronary stents, breast implants and assays to detect human papilloma virus.

Depending on the classification, the FDA imposes different types of controls. All devices are subject to general controls, which include:

  • Establishment registration.

  • Device listing.

  • Quality system regulation (QSR).

  • Filing medical device reports (adverse events) with the FDA.

  • Reporting corrections or removals (for example, recalls) when required.

The FDA has exempted some class I devices from virtually all of the QSR requirements. Special controls may be applicable to class II and III devices, and may include special labelling, adherence to certain recognised standards, post-market surveillance or patient registries. For class II devices, the FDA issues these special controls in the form of guidance documents or regulations. For class III devices, the FDA can issue special controls either in the form of a guidance document or in its approval letter to the applicant.

The most common routes to market are the:

  • Pre-market notification (or 510(k) submission), usually applicable to class II devices.

  • Pre-market approval application (PMA), applicable for most class III devices. However, there are still a handful of class III devices that are reviewed as 510(k) submissions.

Pre-market notification (510(k) submission). The standard of review for a 510(k) submission is showing "substantial equivalence" to a "predicate device", meaning a comparison of the new device to a legally marketed device of the same type or class. About 97% of products that undergo FDA review are reviewed through a 510(k) review.

The 510(k) review is appropriate for:

  • New devices for which it is believed that there is a predicate device.

  • Significant modifications to a 510(k)-cleared device.

  • Most new indications for use of a 510(k)-cleared device.

The applicant must compare its device to a predicate device. By statute, the proposed device must have the same intended use, although in practice some variation is allowed. It must also have either the same technological characteristics as the predicate or, if it has different technological characteristics, the information in the 510(k) submission must not raise different questions of safety or effectiveness, and the information submitted, including the clinical or scientific data, must demonstrate that the device is at least as safe and effective as the predicate. These standards give the FDA significant latitude in determining what constitutes substantial equivalence.

Review of a 510(k) submission by the FDA results in clearance, not approval. The FDA can take enforcement action against a company for referring to a 510(k) clearance as an approval, although it rarely does so. To obtain 510(k) clearance, the submission generally must be supported by pre-clinical data, such as animal studies and bench testing. The FDA can require that a 510(k) submission be supported by clinical data, but most 510(k)s do not require clinical data. However, requests for clinical data to support a 510(k) submission have increased in recent years.

The statutory time frame for review of a 510(k) is 90 days. However, if the FDA has questions for the submitter, it can stop the clock to request additional information. The FDA has committed to accelerating its review process under user fee legislation. It is not uncommon for the 510(k) clearance process to take six to 12 months, or longer in some cases.

If a manufacturer makes a change to a product cleared through the 510(k) process, a new 510(k) submission may be necessary. To determine whether a new 510(k) is needed, the manufacturer must assess whether the following applies (§ 807.81(a)(3), 21 Code of Federal Regulations (CFR)):

  • The change constitutes a major change or modification in the intended use of the device.

  • The change could significantly affect the safety or effectiveness of the device.

The FDA expects manufacturers to consider the cumulative effect of their product changes. Manufacturers and the FDA often disagree on whether a modification requires a new 510(k) submission. In 1997, the FDA issued a guidance document to assist manufacturers in making this determination. In 2011, the FDA issued a revised draft guidance which would have required substantially more 510(k)s due to product changes. After significant criticism from the industry, Congress required the FDA to withdraw the draft guidance and revert to the 1997 guidance. In August 2016, the FDA issued a revised draft guidance in which it removed many of the provisions found by industry to be most troubling. The 2016 draft appears to be more consistent with the language of the 1997 guidance.

PMA. Most devices that are not reviewed through the 510(k) process are reviewed via the PMA process. The standard of review for a PMA is "reasonable assurance of safety and effectiveness". Most class III devices must go through the PMA process. PMAs must be supported by valid scientific evidence of safety and effectiveness, and generally contain prospective clinical data. PMAs for new types of devices are generally reviewed by advisory panels. It is standard practice for the FDA to audit at least some of the clinical data. The manufacturing facility will generally be inspected prior to the FDA's approval of the PMA.

PMA submissions require voluminous amounts of data. Although the FDC Act provides for a 180-day review time frame, approval can take several years in practice. Many changes made to a device approved through the PMA process require the submission of a PMA supplement to, and approval by, the FDA prior to the changes taking effect.

De novo process. This is a third pathway to the market for a medical device. This is generally reserved for moderate-risk devices for which there is no predicate, but, due to the risk of the device, PMA approval is overly burdensome. Historically, this process has been inefficient and underutilised. In 2012, Congress passed legislation intended to streamline the de novo process to make it more efficient. These changes appear to have made the process more efficient and increased its use. Between 1997, when the de novo process was introduced, and July 2012, when the statute was amended, only 77 de novo clearances had been granted. Since August 2012, 87 de novo clearances have been granted (at the date of writing).

Expedited access pathway (EAP). In early 2015, the FDA implemented a new, voluntary programme for medical devices that "demonstrate the potential to address unmet medical needs for life threatening or irreversibly debilitating diseases or conditions and are subject to [PMAs] or de novo requests" (FDA Guidance, Expedited Access for Premarket Approval and De Novo Medical Devices Intended for Unmet Medical Need for Life Threatening or Irreversibly Debilitating Diseases or Conditions (13 April 2015)). Devices eligible for the EAP must be intended to treat or diagnose a life-threatening or irreversibly debilitating disease or condition, and address an unmet need. Given the limited time for which the EAP has been available, its value is not yet known, although many companies are interested in pursuing this programme.

Investigational device exemption (IDE). A sponsor may need to conduct a clinical trial before submitting a 510(k), PMA or de novo petition to the FDA. Usually, to introduce a medical device into interstate commerce, a device must have obtained the necessary clearance or approval from the FDA. However, an exception applies to investigational devices, to allow the trial sponsor to ship the investigational device to study sites throughout the US and globally.

The FDA may need to approve an IDE before starting certain clinical trials. Whether the FDA will approve an IDE depends on whether the study is of a "significant risk" or "non-significant risk" device. A significant risk device is a device that:

  • Presents the potential for serious risk to the health, safety or welfare of subjects and is an implant.

  • Is intended to support or sustain life.

  • Is of substantial importance in diagnosing, curing, mitigating or treating disease.

  • Otherwise presents potential serious risk.

If a sponsor believes its device study is of non-significant risk, it must present this conclusion to each Institutional Review Board (IRB) that will be reviewing the study. If each IRB agrees with this assessment, the sponsor can start the study at that site without FDA approval. If any IRB believes the study is of significant risk, the sponsor must seek approval for an IDE. If the FDA believes that the sponsor and IRBs were wrong, an IDE will need to be submitted for the study to continue. There are also studies that are entirely exempt from the IDE requirements. These are principally in vitro diagnostic trials.

Regardless of whether the FDA must approve an IDE before starting a clinical study, there are certain protections for human subjects with which all studies must comply. All studies must:

  • Obtain IRB approval of the protocol.

  • Secure informed consent or a waiver of consent.

  • Comply with certain record-keeping, reporting and labelling requirements.

Post-market requirements

Medical device manufacturers must comply with a number of regulatory requirements once the device is on the market. The key requirements include:

  • Compliance with the QSR.

  • Submission of medical device reports (MDRs).

  • Initiation of product recalls.

  • Reporting certain corrections or removals to the FDA.

The QSR is essentially a system of good manufacturing practices for medical device companies. Although the QSR outlines the components of a quality system that the manufacturer must develop and maintain, it does not specify how the manufacturer must do so. This provides flexibility to allow each manufacturer to develop a system appropriate for its particular device type. When the FDA conducts a routine inspection of a manufacturing facility, it inspects compliance with the QSR. The QSR includes elements such as design control, management review, process validation, finished device acceptance, and corrective and preventive actions. The QSR also requires the manufacturer to maintain a unit responsible for investigating complaints. The majority of medical device warning letters issued by the FDA relate to failure to comply with the QSR.

The failure to properly or timely file MDRs also often subjects manufacturers to enforcement action by the FDA. A manufacturer must file an MDR if its device either (§ 803.50, 21 CFR):

  • May have "caused or contributed" to death or serious injury.

  • Malfunctioned, and the malfunction would be likely to cause or contribute to death or serious injury if it were to recur.

Manufacturers must have in place a system for determining when it is appropriate to file an MDR, and must document any decisions not to file. Generally, manufacturers have 30 days to submit a report from learning about the event. The FDA can review those files during an inspection and, if it disagrees with the company's decision not to report, can require the manufacturer to report. The failure to report can also lead to issuance of a warning letter or other enforcement action.

Manufacturers must also initiate recalls when needed, some of which must be reported to the FDA. Manufacturers must report a correction or removal (known collectively as recall) to the FDA if the recall was initiated to reduce a risk to health (Part 806, 21 CFR). This report must be submitted within ten days. If the manufacturer decides it is not necessary to file a report with the FDA, it must retain internal documentation justifying that decision. This information must be available for the FDA to review on inspection. Failure to comply with the regulation can result in enforcement action.

In October 2014, the FDA issued a final guidance entitled Distinguishing Medical Device Recalls from Medical Device Enhancements. Its stated purpose is to clarify when a change to a device constitutes a medical device recall and distinguish those instances from device enhancements that do not meet the definition of a medical device recall. The guidance advises that a company must distinguish a recall from an enhancement by looking at whether the device modification is intended to address a violation of the FDC Act against which the agency would take action or a change that does not address such a violation. However, the guidance is of limited use to companies for making this distinction.

In September 2013, the FDA finalised the rule requiring placement of a unique device identifier (UDI) on the label and package of most medical devices. Each UDI must be provided in a plain-text version and in a form that uses automatic identification and data capture technology. If a device is intended to be used more than once and to be reprocessed before each use, it must also be directly marked with the UDI, so that the identifying information is available even when separated from the original label or packaging. Product information will be maintained in the FDA's Global Unique Device Identification Database, unless an exemption applies. 

Enforcement

The FDA enforces the requirements discussed above through inspection and market surveillance. If the FDA finds a violation, it can take a wide variety of enforcement actions, ranging from a public warning letter to more severe sanctions, such as:

  • Fines.

  • Injunctions and civil penalties.

  • Recall or seizure of products.

  • Operating restrictions, partial suspension or total shutdown of production.

  • Refusing requests for 510(k) clearance or PMA approval of new products.

  • Withdrawing 510(k) clearance or PMA approvals already granted.

  • Criminal prosecution.

Advertising

The FDA regulates the labelling of medical devices. Medical device advertising may also be regulated by a separate agency, the Federal Trade Commission (FTC). In practice, the FTC plays a minor role in medical devices regulation. The FDA exercises jurisdiction over advertising for "restricted devices".

The FDA applies its labelling requirements broadly and to many forms of communication, including:

  • Any promotional materials that discuss the uses or benefits of a device.

  • Social media.

  • Journal articles distributed by manufacturers.

  • White papers.

Labelling also includes quotations from physicians or patients if the manufacturer uses those quotes in the promotional materials it distributes. Labelling that is false or misleading is deemed to have misbranded the product, and therefore unlawful.

While physicians can use a device for any purpose they choose, manufacturers can only promote the use of a device for the indications for which the device received FDA clearance or approval. There must also be adequate data substantiation for any claims made.

One of the biggest challenges for medical device manufacturers is determining what claims fall within the cleared or approved indications for use. The FDA often clears devices for a very general use (for example, ablation of soft tissue) and the question then arises whether the manufacturer can promote the device for a specific use (for example, ablation of a particular type of soft tissue). The FDA has taken the position that a manufacturer may not be able to promote for a specific indication that fits within the broader clearance unless and until the FDA reviews the relevant data and clears a new 510(k) notification or approves a new PMA. There is continued debate between the FDA and the industry as to which claims are general and which are specific, and the scope of the 510(k) clearance.

Promotion for a use outside the scope of the cleared or approved indication is known as "off-label promotion". The FDA, in conjunction with the Department of Justice, has taken a number of enforcement actions against medical device companies for off-label promotion. However, there are certain circumstances under which the FDA (under judicial influence) has stated that it is acceptable to distribute information on an off-label use. For example, a manufacturer can distribute information about an off-label use to a physician in response to an unsolicited request for information. Additionally, a manufacturer can distribute off-label information if it follows guidelines set forth by the FDA, for example if the publication meets all the following conditions:

  • It is published in a peer-reviewed journal.

  • It is not false or misleading.

  • It clearly states that the uses discussed are off-label.

  • It is not distributed in a promotional context.

  • It is accompanied by approved labelling and a comprehensive bibliography of relevant publications.

Manufacturers can also support continuing medical education programmes that discuss off-label uses, if such programmes are independent of influence by the manufacturer. Some FDA restrictions on off-label use have been successfully challenged on the ground that they violate the First Amendment of the US Constitution. How, if at all, these court cases will influence enforcement actions taken by the FDA and the Department of Justice is not yet clear.

Sale

For a medical device to be sold in the US, it must have obtained the appropriate clearance or approval from the FDA. A device will either be cleared or approved as a prescription or over-the-counter (OTC) product.

Prescription devices can only be sold on the order of a physician. Certain devices, known as "restricted device," may also be subject to certain restrictions on sale, distribution or use if there cannot otherwise be reasonable assurance of their safety and effectiveness. For example, hearing aids (which are not prescription devices) can only be sold to persons who have obtained a medical evaluation of their hearing loss by a physician within six months prior to the sale of the hearing aid, unless the patient waives that requirement in writing. Additionally, the labelling of hearing aids must contain information on their use and maintenance.

 
10. What authority is responsible for regulating the manufacture, advertising and sale of medical devices?

The Food and Drug Administration (FDA) regulates the manufacture, advertising and sale of medical devices. Medical device manufacturers may need to obtain licences from various states.

For more information on the FDA see box: The regulatory authorities.

 
11. Are there fewer or different requirements for medical devices that have already been licensed/approved in another jurisdiction?

The requirements for obtaining clearance or approval of a medical device in the US are not affected by approvals in other jurisdictions. Although the Food and Drug Administration (FDA) will consider data obtained in foreign trials to support a submission, the existence of an overseas approval alone does not reduce or waive any regulatory requirements, or otherwise speed up the process of obtaining clearance or approval. Having a foreign approval is essentially of no benefit during the FDA review process.

 
12. Is it possible to sell devices to or buy devices from other jurisdictions?

Importation of products approved overseas, but not in the US, is not permitted except in limited circumstances, such as import for export.

If a company attempts to import an unapproved product, such product will be subject to detention by Customs and Border Patrol, and the Food and Drug Administration (FDA) will put the product on an "import alert". A company's devices can be put on import alert due to violations of the quality system regulation (QSR) or for other reasons. A product on import alert cannot be brought into the US until the alert is lifted. For an unapproved product, this would require obtaining the necessary clearance or approval. There are exceptions to allow for the importation of investigational devices, or displays at trade shows.

 
13. Is it permitted to advertise medical devices to consumers? Are there restrictions on advertising?

It is permitted to advertise medical devices to consumers. Restrictions on advertising and promotion are discussed in Question 9, Advertising.

 

Biological products

14. What are the general requirements for a biological product to be manufactured, advertised and sold?

The Food and Drug Administration (FDA) regulates biologics through its Center for Biologics Evaluation and Research (CBER). A biologic is defined as "a virus, therapeutic serum, toxin, antitoxin, vaccine, blood, blood component or derivative, allergenic product, protein (except any chemically synthesized polypeptide), or analogous product, or arsphenamine or derivative of arsphenamine (or any other trivalent organic arsenic compound), applicable to the prevention, treatment, or cure of a disease or condition of human beings "(§ 262(i)(1), Public Health Service Act, 42 United States Code (USC)).

Biologics also include other types of products, such as tissues and transplants, which are subject to good tissue practices.

Although biologics are reviewed by the CBER, the regulatory requirements for biologics are generally similar to that for drugs (see Question 3).

There are three substantial differences between biologics and drugs:

  • Generally, the manufacturing of biologics is much more difficult and therefore more closely scrutinised by the FDA.

  • Generic versions of biologics (that is, biosimilars) have, for the most part, not yet been successfully developed (although a number of biosimilars are expected in the near future).

  • New biologics are eligible for a longer, 12-year exclusivity period.

 
15. What authority is responsible for regulating the manufacture, advertising and sale of biological products?

The Food and Drug Administration (FDA) regulates biologics through its Center for Biologics Evaluation and Research (CBER).

For more information on the FDA see box: The regulatory authorities.

 
16. Are there fewer or different requirements for biological products that have already been licensed/approved in another jurisdiction?
 
17. Is it possible to sell biological products to or buy biological products from other jurisdictions?

It is possible to sell biological products to or buy such products from other jurisdictions (see Question 7). Special requirements apply to human and animal tissues. In some instances, other government agencies may be involved, including the Centers for Disease Control and Prevention and the US Department of Agriculture.

 
18. Is it permitted to advertise biological products to consumers? Are there restrictions on advertising?

It is permitted to advertise biological products to consumers (see Question 8).

 

Natural health products

19. Is there a category for natural health products (including, for example, traditional medicines, homeopathic medicines, supplements, vitamins and minerals)?

There is no category of products identified or defined as "natural health products". However, natural health products can fall within the category of "medical food". The concept of medical food is a legal category recognised by Congress in 1988 in the Orphan Drug Act, and later incorporated into the Food, Drug, and Cosmetic Act (FDC Act). A medical food is "a food which is formulated to be consumed or administered enterally under the supervision of a physician and which is intended for the specific dietary management of a disease or condition for which distinctive nutritional requirements, based on recognised scientific principles, are established by medical evaluation" (§ 360ee(b)(3), 21 United States Code (USC)).

Medical foods do not need pre-market approval by the Food and Drug Administration (FDA). With some exceptions, medical food manufacturers are subject to the same requirements as manufacturers of conventional foods, for example:

  • The ingredients must be approved as food additives or generally recognised as safe (GRAS) for the intended use.

  • They must comply with good manufacturing practice and preventative control and registration requirements for food manufacturing facilities.

  • All claims must be truthful and non-misleading.

However, medical foods are exempt from certain labelling requirements, including nutrition labelling requirements (§ 403(q)(5)(A)(iv), FDC Act).

To be considered a medical food, the following criteria must be met:

  • The product must be a food for oral or tube feeding.

  • The product must be labelled for the dietary management of a specific medical disorder, disease or condition for which there are distinctive nutritional requirements.

  • The product must be intended for use under medical supervision.

The distinction between a drug and medical food is subtle. To avoid drugs being sold as medical foods, and thereby circumventing pre-market review, the FDA has further narrowed the definition by requiring that the distinct nutritional requirements cannot be met by the modification of the diet alone (§ 101.9(j)(8), 21 CFR). However, the FDA has been inconsistent in the application of this requirement.

A typical example of a medical food is a food to manage a metabolic disorder such as phenylketonuria. Individuals with this disorder need (medical) protein foods that are free of the amino acid phenylalanine.

 
20. What are the general requirements for natural health products to be manufactured, advertised and sold?

Manufacturing

There are no specific requirements for the manufacturing of medical foods. They are subject to the same current good manufacturing practice (cGMP) and preventative control requirements as other conventional foods.

Advertising

Under the Food, Drug, and Cosmetic Act (FDC Act), the Food and Drug Administration (FDA) has the authority to regulate food "labelling". Labelling is defined broadly and includes brochures, websites, broadcast advertisements, social media and many other items typically considered as advertising. The Federal Trade Commission (FTC) also has the authority to regulate food advertising under the FTC Act. Under a 1971 Memorandum of Understanding between the FDA and the FTC, the FTC is primarily responsible for the regulation of the advertising of foods, including medical foods.

Because medical foods must be used under the supervision of a doctor, these products are frequently marketed directly to physicians, who will then decide whether the patient could benefit from the product. As a result, consumer deception is less of a concern.

Neither the FTC nor the FDA reviews advertising pre-marketing. Companies that market medical food products must have competent and reliable evidence to support the claims for the medical food (including support that the product is a medical food).

Sale

Although medical foods must be taken under the supervision of a physician, they can be sold over the counter. Medical foods can be sold in the same venues as any conventional food products.

 
21. What authority is responsible for regulating the manufacture, advertising and sale of natural health products?

The Food and Drug Administration (FDA) is responsible for regulating the manufacture and the sale of medical foods. The Federal Trade Commission (FTC) is responsible for regulating the advertising of medical foods.

For more information on the FDA and FTC see box: The regulatory authorities.

 
22. Are there fewer or different requirements for natural health products that have already been licensed/approved in another jurisdiction?

There are no fewer or different requirements for medical foods that have already been licensed/approved in another jurisdiction.

 
23. Is it possible to sell natural health products to or buy natural health products from other jurisdictions and/or electronically?

Like any other foods, medical foods can be sold in the US provided that they are manufactured and labelled in compliance with the Food, Drug, and Cosmetic Act (FDC Act) and any other applicable provisions.

 
24. Is it permitted to advertise natural health products to consumers? Are there restrictions on advertising?

Medical foods can be advertised to consumers. Because they are intended for use under the supervision of a physician, medical foods are frequently advertised to physicians rather than consumers. The advertising must be truthful and not misleading.

 

Reform

25. Are there any plans to reform the rules on the development, manufacture, advertising and sale of medical products?

For more than two years, Congress has been working on legislation to reform the healthcare innovation infrastructure in the US. These efforts have produced the (still evolving) 21st Century Cures Act (H.R. 6), which has been passed by the House of Representatives. If it becomes law, the bill will have major implications for discovery, development and delivery of healthcare. For example, the 21st Century Cures Act would increase funding to the National Institutes of Health and further promote the use of biomarkers in drug development.

 

The regulatory authorities

Food and Drug Administration (FDA)

W www.fda.gov

Principal responsibilities. The FDA is the primary regulatory authority responsible for regulating medical products in the US. The FDA's primary areas of responsibility include reviewing and approving or clearing medical products for sale based on a demonstration of the product's safety and effectiveness.

Federal Trade Commission (FTC)

W https://.ftc.gov ( www.practicallaw.com/9-201-1342)

Principal responsibilities. The FTC regulates the advertising and promotion of many products regulated by the FDA, including over-the-counter (OTC) drugs, cosmetics, dietary supplements and certain medical devices.



Online resources

Food and Drug Administration (FDA)

W www.fda.gov

Description. This website is maintained by the US FDA. The page that contains information about the applicable laws is www.fda.gov/RegulatoryInformation/Legislation/default.htm. The FDA's webpage is generally updated regularly.



Contributor profiles

Jeffrey Gibbs, Attorney

Hyman, Phelps & McNamara, P.C.

T +1 202 737 4288
F + 1 202 737 9329
E jgibbs@hpm.com
W www.hpm.com

Professional qualifications. District of Columbia, Attorney, 1978

Areas of practice. Food and drug law.

Non-professional qualifications. BA, Princeton University

Professional associations/memberships.

  • General Counsel and Secretary, Food and Drug Law Institute.

  • Lecturer, Department of Biomedical Engineering, George Washington University.

  • University Lecturer and Fischell Literati, Fischell Department of Bioengineering, University of Maryland.

  • Previously member of Human Subject Research Board, George Mason University.

Publications

  • Genetic Engineering & Biotechnology News.

  • In Vitro Diagnostic Technology.

  • Food and Drug Law Journal.

  • Expert Review of Molecular Diagnostics.

Jennifer Newberger, Attorney

Hyman, Phelps & McNamara, P.C.

T +1 202 737 4292
F +1 202 737 9329
E jnewberger@hpm.com
W www.hpm.com

Professional qualifications. District of Columbia, Attorney, 2007

Areas of practice. Food and drug law.

Non-professional qualifications. BA, Washington University; MPH, Emory University

Professional associations/memberships. University Lecturer and Fischell Literati, Fischell Department of Bioengineering, University of Maryland.

Publications

  • Food and Drug Law Institute (FDLI) Update.

  • Scrip Regulatory Affairs.

Languages. Spanish

Riëtte van Laack, Attorney

Hyman, Phelps & McNamara, P.C.

T +1 202 737 9637
F +1 202 737 9329
E rvanlaack@hpm.com
W www.hpm.com

Professional qualifications. District of Columbia and Georgia, Attorney, 2004

Areas of practice. Food and drug law.

Non-professional qualifications. MS, Agricultural University of Wageningen; PhD, University of Utrecht

Languages. Dutch

Alexander Varond, Attorney

Hyman, Phelps & McNamara, P.C.

T +1 202 737 4594
F +1 202 737 9329
E avarond@hpm.com
W www.hpm.com

Professional qualifications. District of Columbia and California, Attorney, 2011

Areas of practice. Food and drug law.

Non-professional qualifications. BS (double major in biomedical engineering and management science), University of California, San Diego

Professional associations/memberships.

  • Drugs and Biologics Committee Member, Food and Drug Law Institute.

  • Lecturer, Department of Biomedical Engineering, George Washington University.

  • Member, Drug Information Association.

Publications

  • Bringing Your Pharmaceutical Drug to Market.

  • Regulatory Focus.

  • FDAlawblog.net.


{ "siteName" : "PLC", "objType" : "PLC_Doc_C", "objID" : "1248225169529", "objName" : "ACT_OWNED - READ_ONLY - 0-618-4502", "userID" : "2", "objUrl" : "http://uk.practicallaw.com/cs/Satellite/resource/0-618-4502?null", "pageType" : "Resource", "academicUserID" : "", "contentAccessed" : "true", "analyticsPermCookie" : "2-3b01f5d1:15b0b2dd987:7c6", "analyticsSessionCookie" : "2-3b01f5d1:15b0b2dd987:7c7", "statisticSensorPath" : "http://analytics.practicallaw.com/sensor/statistic" }