Category: Rachel Sachs

PhRMA Sues HHS (Again) For Trying To Expand 340B Discounts To Orphan Drugs

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By Rachel Sachs

For all those who have been following the ongoing fight between pharmaceutical companies and HHS over the 340B Program’s coverage of orphan drugs (I know you’re out there), last week PhRMA filed a new complaint challenging HRSA’s interpretive rule on the subject under the APA. For all those who are not (but should be) paying attention to this battle, here’s what’s happening.

The 340B Program allows certain health care organizations (such as disproportionate share hospitals) to purchase drugs for their patients at significant discounts. The Affordable Care Act expanded the number and kind of organizations that can participate in the 340B Program, but it also added an exception stating that most of the covered organizations could not obtain 340B discounts for orphan drugs — or, as the statute puts it, for “a drug designated … for a rare disease or condition.” 42 U.S.C. § 256b(e).

The battle between PhRMA and HHS is over is whether this statutory exclusion applies to orphan drugs or orphan indications. There are many drugs which have received an orphan designation for certain indications but are also FDA-approved and prescribed more generally for non-orphan indications. In such a case, can a 340B facility purchase the drug at a discount if it is being prescribed for a non-orphan indication?  Read More

House Hearing on Regulation of Laboratory-Developed Tests Displays More Consensus Than Disagreement

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By Rachel Sachs

The Health Subcommittee of the House Energy & Commerce Committee held a hearing last week on the FDA’s proposed draft guidance regarding laboratory-developed tests (LDTs), as part of its “21st Century Cures” initiative. The hearing, which can be viewed online (here and here), featured representatives from the FDA, industry, and research organizations. And although the various panelists offered differing views on the propriety of the FDA’s decision to begin exercising its regulatory authority over LDTs, there seemed to be more agreement than disagreement among the panelists.

Most interestingly, as Representative Henry Waxman pointed out toward the end of the hearing, “[no]body on the panel [is] arguing that there shouldn’t be a very careful scrutiny of these tests. It seems like the question is who should do it: CLIA or the FDA.” Representative Waxman’s subsequent colloquy with Harvard Medical School Professor Christopher Newton-Cheh on this point particularly helped to differentiate the historical roles of CMS and the FDA in this space. But even those panelists who opposed the FDA’s involvement seemed supportive of expanding CMS’ authority under CLIA to conduct clinical validity analyses. (Anyone interested in the administrative law aspects of this issue should know that problems of shared regulatory jurisdiction have recently received increased scholarly attention, with Jody Freeman and Jim Rossi providing a particularly thorough treatment of the issue in their recent article, Agency Coordination in Shared Regulatory Space.)  Read More

Gilead Announces Access Program for Hepatitis C Drug

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By Rachel Sachs

For all those who are interested in issues of global health, access to medicines, and drug pricing, yesterday Gilead formally announced its access program for enabling many developing countries to purchase its new Hepatitis C drug, Sovaldi, at low prices. This announcement is particularly noteworthy because Sovaldi represents a significant improvement over the current standard of care for Hepatitis C, as it can cure a much greater percentage of sufferers than could standard therapies, and it does so with many fewer negative side effects. Gilead’s partnership-based program will permit seven Indian generic drug companies to produce and sell the drug in 91 developing countries. The discounts are significant: although Gilead formally charges $1,000 a pill (or $84,000 for a course of treatment) for Sovaldi in the United States, it will charge just 1% of that, or $10 a pill, in India (the total cost there is estimated at $1,800, given the difference in strain prevalence).

The global health community has reacted to the announcement with mixed reviews. The 91 countries in the program include more than half of the world’s Hepatitis C patients. But tens of millions of other patients in large nations like China, Brazil, Mexico, and Thailand are left out of the program. Going forward, some of the excluded nations may seek to issue compulsory licenses in an effort to expand access to Sovaldi.

Gilead has also drawn fire in the United States for Sovaldi’s $84,000 sticker price (which, for various reasons, very few if any will actually pay), to the degree that members of both houses of Congress have asked Gilead to justify the price of the drug. Those opposing Sovaldi’s price have generally not come out publicly against the high price of many orphan drugs, which can cost $250,000-$350,000 per year. But because Hepatitis C afflicts about 2.7 million people in the US, as compared to the few thousand people with one of the relevant orphan diseases, its impact on insurers (both public and private) is likely to be much larger (as this very blog has previously noted).  Read More

The FDA Proposal for Regulating Laboratory Diagnostics Could Improve Patient Care

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By Rachel Sachs

[Note: I am very pleased to have had the opportunity to write a response to a recent commentary posted on the Hastings Center Bioethics Forum about the FDA’s proposed draft guidance for the regulation of laboratory-developed tests (LDTs), an issue I have previously written about for this blog. My response, which is posted here at the Bioethics Forum, is cross-posted below.]

Wendy Chung’s commentary last month about the FDA’s proposed draft guidance for the regulation of laboratory-developed tests (LDTs) is heavily critical of the agency’s plans. Professor Chung argues that the FDA’s involvement in this space will have two primary negative consequences: it will stifle innovation and it will harm patient care.

But the FDA’s proposal seems designed to address precisely these two consequences. The proposal could improve patient care by collecting, for the first time, clinical validity data on tens of thousands of LDTs in current use. And by using an extensive system of carve-outs, the FDA is seeking to minimize potential harms for diagnostic innovation. Understanding these key portions of the FDA’s disclosure to Congress is critical to a full policy discussion of the situation.  Read More

DARPA Announces Disease Forecasting Prize

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By Rachel Sachs

On Friday, the Defense Advanced Research Projects Agency (DARPA) announced a challenge to the public: provide the most accurate forecast of the spread of chikungunya virus in each of the countries in the Pan American Health Organization, win $150,000. Innovation prizes like DARPA’s are increasing in popularity, with public and private entities alike issuing challenges across a variety of subjects and methodologies. DARPA isn’t the first to announce a disease forecasting prize, either – the Centers for Disease Control (CDC) recently awarded a prize for predicting the timing and intensity of last winter’s flu season. But the choices both to focus on chikungunya and to do so using a prize fund are interesting ones that deserve further discussion.

Chikungunya is a viral disease spread by infected mosquitoes, much like the better-known malaria and dengue fever. Its symptoms often resemble those of dengue, whose other common name – breakbone fever – is telling. Chikungunya is rarely fatal, but it is often temporarily disabling, until the disease has run its course. And unfortunately, also like dengue, there is no specific treatment for chikungunya, although recent Phase I trials of a candidate vaccine appear to have been successful. But perhaps most importantly for DARPA’s purposes, chikungunya is also experiencing a resurgence in the Americas, including in the United States.

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The FDA Takes Steps Toward Regulating Laboratory-Developed Tests

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By Rachel Sachs

On Thursday, the FDA finally began to take an action that it had been publicly contemplating for over four years: the regulation of laboratory-developed tests (LDTs). In the FDA’s words, LDTs are diagnostic tests which are “designed, manufactured and used within a single laboratory.” There are thousands of LDTs, including very high-profile ones, such as Myriad Genetics’ test for assessing breast cancer risk. Although these diagnostic tests fall under the Federal Food, Drug, and Cosmetic Act’s (FDCA) definition of “medical device,” the FDA has for decades stated it was exercising its enforcement discretion in declining to regulate LDTs. (The FDA has exercised its regulatory powers over diagnostic tests that are designed and manufactured by one laboratory and sold to another for use.)  Although the official draft guidelines have not yet been released, the FDA’s report regarding their anticipated contents suggests that regulation of LDTs will follow a risk-based framework similar to the one in place now for other medical devices.

Much (though not all) of the relevant industry opposes the FDA’s actions here, and it’s easy to see why. Many of these LDTs would now be subject to premarket review, or at the very least additional reporting requirements, which make the development of these tests both riskier and more expensive.  Some firms argue that the FDA lacks jurisdiction to regulate LDTs, but they also argue that their LDTs are already sufficiently regulated by the Clinical Laboratory Improvement Amendments (CLIA), under the auspices of the Centers for Medicare and Medicaid Services. But here’s the problem: CLIA and the FDCA regulate different aspects of LDTs. And it can be detrimental to patient health to leave the FDCA aspects of LDTs unregulated.

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Limelight v. Akamai: Implications for Medical Method Patents

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By Rachel Sachs

Last month, as it wrapped up the 2014 Term, the Supreme Court decided a patent law case that could have a major impact on method patents in the medical arena. No, I’m not talking about Alice Corp. v. CLS Bank, the most Rorschach-like of the Term’s many patent opinions. I’m talking about Limelight Networks v. Akamai Technologies, Inc., in which the Supreme Court unanimously reversed the Federal Circuit’s ruling on the scintillating question of divided infringement under 35 U.S.C. § 271(b).

In Limelight, a splintered en banc decision, a majority of the Federal Circuit had overturned prior case law in ruling that liability for induced infringement of a method claim under § 271(b) was possible where no single entity had performed all the steps of that claim, but where those steps were divided between two or more parties, one of whom had induced the other(s) to infringe. (Previously, various opinions had held that induced infringement under § 271(b) required a single actor, just like direct infringement under current § 271(a) precedent.) In a unanimous opinion by Justice Alito, the Supreme Court reversed, essentially reinstating the single entity rule by holding that direct infringement under § 271(a) is required for inducement liability under § 271(b). Read More

New Blogger, Academic Fellow Rachel Sachs

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sachs_peoplePlease join us in welcoming new blogger Rachel Sachs to Bill of Health!

Rachel earned her J.D. in 2013 magna cum laude from Harvard Law School, where she was the Articles Chair of the Harvard Law Review and a student fellow with both the Petrie-Flom Center and the John M. Olin Center for Law, Economics, and Business. Rachel has also earned a Masters in Public Health from the Harvard School of Public Health, during which she interned at the United States Department of Health and Human Services. She holds an A.B. in Bioethics from Princeton University. After law school Rachel clerked for the Honorable Richard A. Posner of the United States Court of Appeals for the Seventh Circuit. She will be joining the Petrie-Flom Center as an Academic Fellow in August 2014.

Rachel’s primary research interests lie at the intersection of patent law and public health, with a particular focus on problems of innovation and access and the ways in which law helps or hinders these problems. Her past scholarship has examined the interactions between patent law and FDA regulation in the area of diagnostic tests, and explored the mechanisms behind the passage of patent-related legislation. Her current scholarship applies this focus on innovation and access to the intersection of patent law and drug reimbursement policies.

Representative Publications:  Read More