Transcript Slide 1
FDA Inspections: Handling the
Consequences
Dealing with the aftermath of an FDA
inspection.
MAGI’s Clinical Research Conference 2009 West
Michael A. Swit, Esq., Vice President
October 6, 2009
San Diego, California
Standard Disclaimers
Views expressed here are solely mine and do not
reflect those of my firm or any of its clients.
This presentation supports an oral briefing and
should not be relied upon solely on its own to
support any conclusion of law or fact.
What We Will Cover
Enforcement Trends Prior to Obama Administration
Commissioner Hamburg Revives FDA’s Compliance
Culture – The August 6, 2009 Speech and its Impact
How to Prepare for Increased Enforcement
How to Respond if Targeted
Consequences of Non-Compliance
Enforcement Trends Prior to
Obama Administration
All Inspections – 2004 to 2008
Warning Letters – 2004 to 2008
Seizures – 2004 to 2008
Injunctions – 2004 to 2008
Hamburg: Why We Need
Effective FDA Enforcement
Conceded FDA enforcement efforts have been deficient
Five key benefits of effective enforcement:
Protect public health by promptly intercepting unsafe or
fraudulent products – prevents additional harm
Deter others who might violate law
Informs public of potential harm
Creates level playing field for industry
Instill public confidence in FDA
Hamburg: Four Essential Elements for
Effective FDA Enforcement
Vigilance – both FDA and Industry
FDA -- Regular inspections and follow-ups
Companies
Must work quickly and thoroughly to correct problems
Must understand
if you cross the line, “you will be caught”
If you fail to act, FDA will
Strategic enforcement –
Greater focus on significant risks and violations
More meaningful penalties to “send a strong message to
discourage future offenses”
Four Essential Elements for
Effective Enforcement …
Quick action – FDA must respond rapidly, especially to:
Egregious violations
Violations that threaten the public health
Visible efforts – FDA must show all stakeholders it is on
the job
Will publicize enforcement actions widely – including rationales
for action
Goal:
Increase confidence in FDA
Deter non-compliance
Hamburg: Six New FDA
Enforcement Mandates
Impose clear post-inspection deadlines
Generally -- no more than 15 business days to respond 483
After that, agency can issue warning letter or take other
enforcement action
Speed the warning letter process -- by limiting review
by FDA Office of Chief Counsel to warning letters that
present significant legal issues
Work more closely with FDA’s regulatory partners
Example: in some cases, such as food safety, state, local, and
international officials can act more quickly than the FDA
When public health is at risk, the agency will coordinate with
its regulatory partners to take rapid action
Six New Enforcement Mandates …
Prioritize follow-up on all warning letters and other
enforcement actions
FDA will work quickly to assess the corrective action taken by industry
after a warning letter, a major product recall, or other enforcement action
Via new inspection or other form of investigation
FDA will be prepared to take immediate action to respond to
public health risks.
Actions may occur before a formal warning letter is issued – at any time
Days of multiple responses to inspections -- over
Develop and implement a formal warning letter “close-out”
process.”
If FDA determines a firm fully corrected violations in a warning letter,
agency will issue an official “close-out” notice and post on FDA Web site.
Seen as an “important motivator” for corrective action
Enhanced Enforcement In Action –
Timely 483 Responses Policy
Aug. 11 Federal Register notice – Post-inspection 483 responses
timing policy published – 15 business days
Timely Responses
FDA will conduct “detailed review” in deciding any enforcement action
If FDA issues a warning letter, letter will address sufficiency of response
Late responses
Response will not be considered by FDA in deciding to take enforcement
action such as a warning letter
If warning letter issues after a late 483 response, FDA will consider the 483
response in assessing firm’s later reply to warning letter
Purpose of warning letter: “to ensure that the seriousness and
scope of the violations are understood by top management … and
that the appropriate resources are allocated to fully correct the
violations and prevent their recurrence”
Enhanced Enforcement – In Action
KV – March 2009 – GMP consent decree four weeks
after inspection
H1N1 Websites – May 2009 -- 68 Warning Letters –
response time shortened to 48 hours due to the public
health aspects
Caraco – June 2009 -- seizure six weeks after inspection
Apotex – Sept. 2009 – import alert blocks all products
from two facilities
How to Prepare for
The New Enforcement Climate
The Big Picture
Compliance Culture – must exist at the top of your
organization and be driven down by senior management
throughout your firm not only in word, but in resources
FDA law requires – “Park Doctrine” – Strict Liability
Corporate law requires
Public company duties/Sarbanes-Oxley compliance
Best strategy to “avoid” enforcement – strict compliance
via robust “quality systems” in all impacted areas – quality,
regulatory, manufacturing, packaging, testing, etc.
How to Prepare …
Change Your Corporate Compliance World View
Oust the Reactionary Compliance Model
Historical focus -- always after-the-fact
Expense focus creates little incentive for forward thinking
Compliance generally seen as production cost
Rarely seen as a revenue-generating opportunity
Viewed as lower priority within an organization
Perceived as a burden -- a leash with little up side potential
Embrace Compliance As a Corporate Asset
Corporate culture must change
Quality Systems must be integrated into the process, not an
additional component
Process must evolve from one of police action to one of
forethought
How to Prepare …
Culture Change -- Dramatic And Difficult
Quality function must be valued by management
Increase visibility of quality unit
Visibly exhibit an intolerance for lack of compliance
Quality must be seen as a priority
Embrace a Proactive Approach
“It is often said at FDA that firms that are in compliance tend
to stay in compliance, but once a firm gets out of compliance
getting back into compliance is a very steep road to climb. Try
to avoid that road.” – Daniel Troy, former FDA Chief Counsel
How to Prepare …
Build The Right Quality Systems
Create a self-determining culture
Make regulatory mandates obvious and routine, not the focus
Use Quality Assurance as a cost-improvement methodology
Proactive Approach To Increasing Profitability
Approach facilities and operations inspections proactively
Use third parties
Assess all business operations
Act on things immediately
Change focus from compliance to improvement – that
compliance is subset of quality
How to Prepare …
Detailed view – quality systems throughout your organization
that reflect strong:
Procedures
Training
Audits
Validation
Recordkeeping
Key SOPS – Clinical Research Setting
Handling FDA Inspections
Informed Consent
IRB Interaction
AER Handling
Protocol Changes
IND/IDE Maintenance
Site Monitoring
Clinical Trial Registry compliance
Clinical Supply Handling
When FDA Enforcement Hits
How It May Hit In Clinical Research Setting
Administrative Enforcement
Inspections
Investigations
Warning letter
Clinical Holds – can be compliance based
AIP
Termination of an IND or IDE
Disqualification procedures with clinical investigators
Civil Money Penalties
Judicial Enforcement
Injunction
Criminal Prosecution
When FDA Enforcement Hits …
Who FDA Can Target: any
individual within the
organization that has a position of responsibility for the
violative aspect of the company’s operation,
including:
Clinical Investigators
Research coordinators/nurses
IRBs/IRB members
When FDA Enforcement Hits -- Assessing
Assess each allegation/observation
Focus on specifics
Focus on system-wide implications
Focus on global implications
Consider affected products – should investigation continue?
Consider root-cause analysis
Focus on the regulatory requirement(s) associated
with each allegation/observation
Develop action plan to achieve immediate, short-term,
and long-term correction and to prevent recurrence
Know when to seek outside assistance
When Enforcement Hits –
Keys to Responding
Include a commitment/statement from senior leadership
Address each allegation/observation separately
Be discreet in deciding to agree or disagree with the
allegation/observation –
focus on facts
do not admit to violations
Provide corrective action accomplished and/or planned; tell FDA
the plan
Be specific (e.g. observation-by-observation)
Be complete
Be realistic
Be able to deliver what you promise
Address affected products
When Enforcement Hits –
Keys to Responding …
Provide time frames for correction
Describe method of verification and/or monitoring for
corrections
Submitting documentation of corrections where
reasonable & feasible
Be Timely and Thorough – deliver what you promised
when you promised it
FDA Expectations for Your Response
Wants to Hear Your D.R.U.M. – expects your
response to have these qualities:
Direct – i.e., address the items directly raised in the 483 or
warning letter
Related – go beyond those to potentially related problems
Universal – expand to review those issues company-wide
Management & Monitoring – show that you will stay on
top of the issues and that management is involved
Source: “Compliance and Enforcement.” Presentation by David K.
Elder, Director, FDA Office of Enforcement, at the Orange County
Regulatory Affairs (OCRA)/FDA Joint Educational Conference. June
15, 2005. Irvine, California.
Direct Possible Consequences
of Non-Compliance
Clinical holds – study stopped
AIP – application reviews suspended
Civil Money Penalties -- $$$
Injunctions – selling/manufacturing could be halted for years
Prosecutions
Fines -- $$$
Imprisonment
Disqualification proceedings
Approval withdrawal proceedings
Expense of dealing with FDA action – lawyers, consultants,
experts
Collateral Consequences
of Non-Compliance
Financial consequences
Lost sales
Stock price drops – market capitalization – ability to use capital
markets
Shareholders sue the company, its officers and directors
Other companies may sue the company if reason for noncompliance gave you a competitive edge
Federal government may suspend or “debar” company from
selling to government
Financing covenants may be violated
Collateral Consequences of
Non-Compliance …
Other Consequences
State license actions – could pull your manufacturing license
Lay-offs
Damage to corporate reputation
Lost time – interruption with normal operations
Consequences for Individuals
Job loss
Reputation
Expense of defending – and your company may not have to pay
Impact of convictions
Deportation if not U.S. citizen
Imprisonment
Fine
Right to vote/run for public office
Questions?
Call, e-mail, fax or write:
Michael A. Swit, Esq.
Vice President
The Weinberg Group Inc.
336 North Coast Hwy. 101
Suite C
Encinitas, CA 92024
Phone 760.633.3343
Fax 760.454.2979
Cell 760.815.4762
[email protected]
www.weinberggroup.com
About your speaker…
Michael A. Swit, Esq., is a Vice President at THE WEINBERG GROUP, where he develops and ensures the
execution of a broad array of regulatory and other services to drug and biologics clients seeking to market products in
the United States. His expertise includes FDA development strategies, compliance and enforcement initiatives, recalls
and crisis management, submissions and related traditional FDA regulatory activities, labeling and advertising, and
clinical research efforts.
Mr. Swit has been addressing critical FDA legal and regulatory issues since 1984. His multi-faceted experience
includes serving for three and a half years as corporate vice president, general counsel and secretary of Par
Pharmaceutical, a prominent, publicly-traded, generic drug company and, thus, he brings an industry and commercial
perspective to his work with FDA-regulated companies. Mr. Swit then served for over four years as CEO of
FDANews.com, a premier publisher of FDA regulatory newsletters and other specialty information products for the
FDA-regulated community. His private FDA regulatory law practice has included service as Special Counsel in the
FDA Law Practice Group in the San Diego office of Heller Ehrman White & McAuliffe and with the Food & Drug
Law practice at McKenna & Cuneo, both in the firm’s Washington office and later in San Diego. He first practiced
FDA regulatory law with the D.C. office of Burditt & Radzius.
Mr. Swit has taught and written on a wide variety of subjects relating to FDA law, regulation and related commercial
activities, including, since 1989, co-directing a three-day intensive course on the generic drug approval process and
editing a guide to the generic drug approval process, Getting Your Generic Drug Approved. A former member of the
Food & Drug Law Journal Editorial Board, he also has been a prominent speaker at numerous conferences sponsored
by such organizations as RAPS, FDLI, and DIA. A magna cum laude graduate of Bowdoin College, he received his
law degree from Emory University Law School and is a member of the California, D.C. and Virginia bars.