Pharmacy Compounding: Federal Law in Brief

by Jonathan J. Darrow

Until recently, most ordinary people had never heard of “pharmacy compounding.”  Then, a number of deaths and illnesses caused by a drug that was compounded in a Framingham, Massachusetts pharmacy propelled drug compounding to the national spotlight (see, e.g., Denise Grady et al., Scant Oversight of Drug Maker in Fatal Meningitis Outbreak, N.Y. Times, Oct. 6, 2012).

Compounding is the practice of preparing a drug for an individual patient’s needs, and is used when those needs cannot be met by a mass-produced drug.  See Thompson v. Western States Medical Center, 535 U.S. 357, 360 (2002).  For example, if a patient is allergic to a particular excipient (inactive ingredient) in an FDA-approved medicine, a doctor may order a special compounding pharmacy to prepare the medicine without that excipient. Because of the very small scale of compounding, Congress in 1997 attempted to exempt (via 21 U.S.C. § 353a) the industry from a number of provisions of the Food Drug and Cosmetic Act, including the requirement to submit a new drug application prior to interstate sale (21 U.S.C. § 355), the requirement that the drug labeling bear “adequate directions for use” (21 U.S.C. § 352(f)(1)), and the need to strictly follow good manufacturing practices, or GMP (see 21 U.S.C. § 351(a)(2)(B)).  A number of controls on compounding were included, however, such as the requirement that there be a valid prescription from a licensed practitioner (21 U.S.C. § 353a(a)(1)), that the drug be compounded by a licensed pharmacist (or physician) (21 U.S.C. § 353a(a)(1)), and that the drug be compounded from ingredients that meet certain quality standards (21 U.S.C. § 353a(b)(1)(A)–(B)).

However, § 353a—and with it, all of the provisions and exemptions just mentioned—was held unconstitutional in its entirety in Western States Medical Center v. Shalala, 238 F.3d 1090 (9th Cir. 2001), aff’d 535 U.S. 357 (2002), on the basis of certain restrictions on free speech that were also contained within the statute and which, according to the Ninth Circuit, could not be severed from the remaining provisions because “Congress intended to exempt compounding from the FDCA’s requirements only in return for a prohibition on promotion of specific compounded drugs.” See 535 U.S. at 366. Thereafter, the FDA promulgated a policy by which it would primarily “defer to state authorities regarding less significant violations” but would enforce a number of provisions relating to ingredient standards, unapproved substances, commercial scale production, adulteration, and promotion.  The FDA made clear that its enforcement activities “need not be limited to” these or any particular areas, however, thus negating any expectations that Congress’ now-invalidated exemptions might nevertheless provide a safe harbor through the weight of influence, if not law. Since then, the FDA has in fact exercised oversight of compounding pharmacies, as is evident from the handfuls of warning letters that it sends to non-compliant facilities each year.  These letters have addressed, for example, promotion that made unsubstantiated efficacy claims, contamination, and the large-scale manufacture of what were essentially copies of FDA-approved drugs.

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TOMORROW: Einer Elhauge’s Obamacare on Trial – Book Talk and Panel Discussion

Obamacare on Trial

Book talk and panel discussion by Einer Elhauge, Carroll and Milton Petrie Professor of Law, Harvard Law School (and founding director of the Petrie-Flom Center)

Panelists:

Thursday, Nov. 1, 2012, 6:00 pm

Wasserstein Hall, Milstein East A

Harvard Law School

1585 Mass Ave, Cambridge, MA

Sponsored by the Harvard Law School Library

Bleg: IRBs & Health Disparities Research

By Michelle Meyer

As most readers of this blog well know, health disparities of various kinds are rampant in the U.S. — in obesity, infant mortality and morbidity, cardiovascular health, and many other areas. In most cases, however, we seem to know more about the extent of health disparities than we do about what causes and what is most likely to ameliorate them.

To rectify this situation, we need to conduct research — and lots of it. Typically, however, health disparities research will have to occur with the same populations who are most likely to be considered vulnerable and in need of extra protections from research. Often, moreover, health disparities research will need to occur in the clinical setting (as opposed to the lab), where patients normally rightly expect that everything done there is designed to serve their individual best interests, rather than to produce generalizable knowledge. Health disparities research might involve research methodologies that are relatively unfamiliar to IRBs, such as community-based participatory research (CBPR), which blurs the traditional distinction between investigator and subject on which the regulations are built. To the extent that disparities are thought to derive from provider discrimination or bias, researchers may face difficulties from a research review system that is designed to protect all “subjects,” including professionals who are incompetent or worse. Eventually, health disparities research scales up to multiple research sites, which usually requires approval from multiple, often conflicting, IRBs. Many interventions to address health disparities, finally, will take the form of public policy rather than clinical treatment. If we want such policies to be evidence-based (and we should), they will have to be tested, perhaps in ways that raise legal or ethical issues (say, randomizing a state’s Medicaid recipients to receive or not receive particular benefits, or randomizing the businesses in a jurisdiction to be required to display nutrition information on the food they sell — or not).

I’m delighted to have received so many comments, both on- and offline, on my last IRB post from those with experience in the research trenches. As I begin a new project along these lines, I would be very interested in hearing again from both researchers and research reviewers with experience in health disparities research, whether you have struggled with these or similar issues (or have abandoned research plans at least partly out of fear of such problems), or have experienced smooth sailing. Feel free to leave comments here, anonymously if you wish, or contact me directly at mmeyer at law dot harvard dot edu. Many thanks in advance.

This Week’s Edition of ACA Challenges

By Nicole Huberfeld

Earlier this week, Jonathan Adler wrote in the National Review Online that challenges to the individual mandate were just beginning.

And today, Oklahoma’s September challenge to the ACA is making headlines.  As I have described before, one of the new theories by which Jonathan Adler and the Cato Institute are seeking to thwart the ACA is by challenging the IRS rule that permits tax subsidies in exchanges created by the federal government, which Cato claims is not supported by the text of the ACA.  (State exchanges are supposedly the only avenue for obtaining tax subsidies for private insurance purchases.)  Oklahoma has brought this challenge to life in federal district court, and Cato’s interest in this and other challenges was apparently reiterated by Professor Adler during a Cato-organized panel on Wednesday. Read More

Upcoming Event: 11/01/12 Obamacare on Trial – Book talk and panel discussion with Einer Elhauge

Obamacare on Trial

Book talk and panel discussion by Einer Elhauge, Carroll and Milton Petrie Professor of Law, Harvard Law School (and founding director of the Petrie-Flom Center)

Panelists:

November 1, 2012, 6:00 pm

Wasserstein Hall, Milstein East A

Harvard Law School

1585 Mass Ave, Cambridge, MA

Sponsored by the Harvard Law School Library

Florida’s Constitutional Amendment on Healthcare: Why It Still Matters after the Supreme Court’s Healthcare Decision

By Katie Booth

This November, Floridians will vote on whether to amend the Florida constitution “to prohibit laws or rules from compelling any person or employer to purchase, obtain, or otherwise provide for health care coverage.” Similar constitutional amendments are on the ballot in Alabama and Wyoming and have already been adopted in Arizona, Oklahoma, and Ohio. While Florida’s proposed amendment has not received much attention after the Supreme Court’s decision to uphold the individual mandate requirement of the Affordable Care Act (“ACA”), these state constitutional amendments should not be written off entirely.

The Florida amendment could have some effect on the upcoming presidential election. Since the amendment is included on the ballot, it could help win votes for Romney and other Republican candidates by reminding undecided swing voters about the ACA as they are filling in the ballot. If the amendment passes—which requires sixty percent of the popular vote—it will almost certainly be seen as a referendum on the ACA that will give ammunition to Republicans in future elections.

The existence of these state amendments and other similar legislation also raises the stakes of future Supreme Court litigation over the ACA. While the Supreme Court may be loath to revisit the ACA anytime soon, opponents are likely to continue challenging different aspects of the ACA that have not yet been litigated. Some of these cases could eventually end up in the Supreme Court, especially if there is ambiguity around whether the ACA preempts certain aspects of state constitutional amendments.

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Using the Taxing Power for Public Health

By Scott Burris

In a Perspective in this week’s New England Journal of Medicine, Michelle Mello and Glenn Cohen, both professors at Harvard, write about the prospects for using the constitutional Taxing Power to adopt innovative laws to advance public health objectives.  Cueing off the Supreme Court’s decision in the Affordable Care Act litigation, Mello — who is also a member of PHLR’s Methods Core — and Cohen write that the Court appears to have opened the door for “more targeted, assertive interventions to promote public health” under the Taxing Power than Congress has previously pursued. “For example, instead of merely taxing tobacco sales, the federal government could require individuals to pay a tax penalty unless they declare that they haven’t used tobacco products during the year. It could give a tax credit to people who submit documentation that their bodymass index is in the normal range or has decreased during the year or to diabetic persons who document that their glycated hemoglobin levels are controlled. It could tax individuals who fail to purchase gym memberships. …These strategies depart from traditional uses of taxes by targeting omissions and noncommercial activities that are important drivers of chronic disease.”  Read the full article online at the New England Journal of Medicine online.

Quality Control on the Back-End via the ACA and on the Front-End via Tort Litigation

By Vickie J. Williams

I am back after a brief hiatus for the Jewish holidays. L’Shanah Tova to all my readers who have just celebrated the Jewish New Year.

The first Monday in October is, of course, a special day for all of us legal eagles–the Supreme Court is back in session. The other significant thing about October 1 for those interested in health law is that hospitals will now be fined if too many of their Medicare patients are readmitted within 30 days of discharge due to complications. As reported by the Associated Press, this is part of the Affordable Care Act’s push to incentivize quality improvement while trying to save taxpayers money. Right now, admissions for only three medical conditions are subject to the penalty: heart attacks, heart failure and pneumonia. Penalties are held to a maximum of 1% of the hospital’s Medicare payments for now, but will rise to a maximum of 3% of Medicare payments over several years. This attempt to control quality of care on the back-end constitutes a marked contrast with the way reimbursement policy has worked over the last several decades to discourage hospitals from keeping patients in beds for “social” reasons, such as having nobody to care for them at home if they are discharged. Many Medicare hospital readmissions are due to non-compliant behavior by fragile patients with few resources to help them once they leave the hospital, something that is not really subject to the hospital’s control, and says nothing about the hospital’s quality of care for the patient. For decades, Medicare payment policy, which generally pays hospitals the same amount for caring for a patient regardless of how long he or she is in the hospital, has encouraged speedy discharges. This is touted as a way to save costs. Apparently, the new policy on payments for readmission is an acknowledgement that there is both a financial and a human cost to treating medically and socially fragile people in the express lanes of health care. It remains to be seen whether the penalties result in better quality care, or significant savings, but surely they will result in increased work for hospital social workers and discharge planners. Read More

Would you rather medical school train your PCP to have good hands or a good bedside manner?

Last week NPR covered a story highlighting how medical education is morphing in order to adapt to the unmet demand for primary care physicians driven (at least in part) by the increased access to primary care that will be ushered in under the ACA.  It may be surprising to some to learn that many of the most prestigious medical schools like Johns Hopkins and Harvard do not have a primary care program; however, as reported by NPR, medical schools may soon rethink this hole in their curriculum in the face of changing demands upon the health care system and its accompanying incentives for young physicians to enter primary care.   Mount Sinai School of Medicine is leading the way in this regard by launching a new department of family medicine in June.

Intuitively, changing the medical education system to produce more primary care physicians will further goals of the ACA by increasing access to primary care, and therefore improving overall public health and diminishing cost by decreasing emergency room care for conditions that could have been treated less expensively or avoided altogether by increasing access to preventative services.  These are the arguments we’ve heard repeatedly by the champions of the ACA and by the Obama administration, particularly through its vision for the Prevention and Public Health Fund which was intended to bolster the pipeline of primary care physicians before being gutted earlier this year.

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Will ACA Create a Doctor Shortage–And If So, What Should We Do About It?

By Jennifer S. Bard

Being in my native land of Connecticut reminds me that Mark Twain is famously, if inaccurately, quoted as saying that everyone talks about the weather but no one ever does anything about it.  Nowhere is this concept more true today than in the handwringing over the coming shortage of physicians following the passage of Affordable Care Act.  We hear dire predictions that the patients who now have access to health care will flood the system resulting in poor care not just for them, but for those among us who were lucky enough to already have health insurance.  The American Academy of Family Physicians has recently expressed its concern that the shortage will be made up by nurse practitioners rather than physicians.

This is a situation where the shortage, if it exists, has nothing to do with fear of law suits.  Applications to U.S. medical schools have been steadily increasing.  Moreover, the shortage isn’t of doctors in general, it is of primary care physicians.  There are still a fair number of dermatologists and plastic surgeons, but not so many physicians who provide the kind of primary and preventive care that actually improve the public’s health.

Uwe Reinhardt, the Princeton health care economist, has been following this issue closely and in a series of posts for the New York Times’ Econmix Blog has been aggressively skeptical about the existence of the shortage as well as the actions taken so far by the Federal Government to address it.  He also questions the need both for the residency system as currently structured and for the benefit to the public of subsidizing it through Medicare given what a poor job it does in producing the primary care doctors the public really needs.  Last week, he undertook an extensive analysis of medical school debt which showed that by charging students intending to be high paid specialists the same as those who might go into primary care has created a loan burden that makes it difficult for any but the most dedicated to turn away from training for the most lucrative specialty for which they can qualify. Read More