Environment & Regulations

An inspector calls

There is much to celebrate for the European Fine Chemicals Group on the regulatory front. We report from CPhI Worldwide 2011

CPhI Worldwide 2011 in Frankfurt at the end of October saw the European fine chemicals industry, via the European Fine Chemicals Group (EFCG) in a more optimistic mood about regulatory trends than it has been for most of the seven years of its existence since it was launched at CPhI in Brussels back in December 2004.

In the US, a major new piece of legislation that the EFCG warmly supports, the Generic Drugs Users Fee Act (GDUFA) appears ready to go through Congress next year. Meanwhile, ExciPact, an initiative of the global pharmaceutical excipients industry to ensure that cGMP and cGDP requirements are applied to excipients via a recognised auditing and certification process, is ready for launch in January.

In addition, the Falsified Medicines Directive is being transposed into law by EU Member States and other important pieces of legislation are moving forward. Finally, Rx-360, the voluntary initiative of the pharmaceuticals industry and its suppliers to clean up the supply chain has progressed with its pilot programme of joint audits.

Both Guy Villax, CEO of Hovione, in a press conference and Janice Soreth, deputy director of the London office of the US Federal Drugs Administration (FDA), who was the keynote speaker at the EFCG Dinner, which was also held during CPhI, discussed GDUFA at length. This act is, Villax said, the second time user fees for generics had been discussed within the US government, the first attempt having fizzled out with nothing achieved.

Essentially, GDUFA is in line with the existing Prescription Drug Users Fee Act (PDUFA) inspection system for innovator drugs, which is due for reauthorisation in 2012, and existing systems for veterinary products and others. It will be introduced jointly with new fee programmes for biosimilars and medical devices.

The FDA began the public consultation process in September 2010, the EFCG joined in December and SOCMA's Bulk Pharmaceutical Task Force and the Generic Pharma Association were also involved in representing the API industry. There 17 face-to-face meetings in Washington between February 2011 and September 2011, when the negotiations concluded.

"This is lightning speed for a government agency," said Villax. "Clearly the FDA sees GDUFA as a key part of its approach to dealing with the globalisation of API manufacture." Expectations are that it will kick off on 1 October 2012 and run for five years, after which it can and probably will be renewed.

Villax - FDA has moved with unusual speed

During this period, $299 million/year will be raised from the industry, which will be used in part to hire additional staff, including about 150 more inspectors and 150 more reviewers, plus IT and scientific personnel. A one-time backlog fee of $50 million will also be levied in the first year to clear the existing backlog of about 1,000 abbreviated new drug applications (ANDAs).

About one third of the total will be raised by an annual fee levied directly by the FDA. The total amount is not yet known, though, according to others, it is rumoured to be $35,000/site in the US and $50,000 in Europe. It will split 80:20 between makers of final dosage forms (FDFs) and APIs, meaning that the API industry will pay about $60 million/year. Further fees will be payable when applying to file for drug master files (DMFs) and ANDAs, split 70:30. ANDAs that do not refer to a DMF will pay the combined fee.

Importantly, GDUFA will change the inspection and approval system for generic drug product and drug substance manufacturers from the historically based, home-grown system based on pre-approval inspection to a risk-based, continuous surveillance approach that will use input from other medicines agencies. Non-US sites are only inspected or reinspected at present if they submit a new filing.

At the end of the five-year period, Soreth said, the FDA will be acting on 90% of complete electronic ANDAs within ten months, as opposed to an average of 31 at present. It will also act on 90% of all the ANDAs and PAS pending on 1 October 2012. Meanwhile, parity should be achieved between US and foreign API and FDF sites, with both receiving risk-adjusted biennial cGMP surveillance inspections.

Other key performance metrics will include the use of complete review-response letters, completeness assessments for DMFs that are intended to be referenced by the ANDA sponsors and division-level deficiency review and first cycle meetings for ANDAs and DMFs. The FDA, Soreth said, will also develop regulatory guidance for industry and take initiatives to enhance post-marketing safety.

"GDUFA is a welcome paradigm shift for all generic industry participants, regardless of size or geographic location, as well as consumers, with predictable review times and certainty of inspection for all facilities," she said. "It will provide FDA with significant additional resources to execute its mission". All of the industry will share both the expense and the benefits.

GDUFA, agreed Villax, will be far more effective in covering the many Asian providers that are rarely if ever inspected, all funded by the industry. "This is a watershed for our industry. It is a major step forward, possibly the most significant step since the Hatch-Waxman Act," he said.

Soreth updated the EFCG Dinner on the FDA's moves to better inspection abroad

Inevitably, perhaps, there were some disappointments in the detail. The EFCG was unable to convince the FDA that it did not need to inspect in Europe, even though there is no earthly reason why European inspections cannot be recognised in the US and vice-versa. The lack of inspection for bioequivalence laboratories is another weakness, since these generate critical data. Moreover, the EU has indicated that it will not adopt the same model.

Hopefully, said Villax, some of these deficiencies will be remedied in 'GDUFA 2' after 2017. In the meantime, a DMF database will probably be created, with 'available for reference' status. The FDA will also be seeking to streamline its existing methods; it will address relatively easy to resolve deficiencies in a single telephone call before issuing a warning letter and communicate any deficiencies related to the DMF in a single letter.

The sanctions are tough. If a company does not pay its fees, its DMF will not be listed as 'available for reference' and consequently the ANDA will not be received for review. The facility will be publicly identified and no new ANDAs using material made there will be received. Indeed, all APIs or FDFs made there will be classified as misbranded and denied entry into the US.

"All this is good, because it promotes faster access to lower cost, higher quality medicines, accelerates the approval process and levels the playing field," said Villax. "The EFCG and APIC have publicly welcomed user fees since 2004 as a means to achieve inspection parity between foreign and domestic facilities and we're pleased that the FDA has taken us up on this."

The main question remaining, then, is 'Will this pass into law?' Villax was certainly hopeful on GDUFA, based not least on the speed with which the FDA has acted. Others at CPhI were more cautious, with one analyst saying that the few US API manufacturers are up in arms against GDUFA as yet another charge on them.

One US executive, who asked not to be named, noted that the malice of the Republicans towards President Obama is such that they have already come close to bringing down the whole federal government and many are hostile to giving FDA more powers to make the supply chain safer. In September, for instance, Senator Michael Enzi of Wyoming said in a US Senate Committee: "Right now, my concern is FDA over-regulating, not under-regulating."

GDUFA is not the only proposed US legislation in this field. The Drug Safety Enhancement Act will give the FDA powers of recall, to detain and destroy product at the border and establish registration for excipient manufacturers, as well as forcing drug makers to have an effective quality system and bringing in inspections at least every four years. In September, the Drugs Safety & Accountability Act and the Safeguarding Americans' Pharmaceuticals Act were introduced into the Senate and the House of Representatives respectively.

Europe is also active. Shortly after CPhI, the Council of Europe's Committee of Ministers adopted the Medicrime Convention and will open it for signature at some point before the end of the year. It will be open to both members and non-members of the Council of Europe and will be potentially global in scope.

Medicrime will oblige states that sign it to criminalise the manufacture, supply and trafficking of counterfeit medical products without authorisation or being in compliance with security requirements, the falsification of documents and the unauthorised placing on the market of medical devices that do not comply with conformity requirements. It provides a framework for international co-operation and foresees the establishment of a monitoring body to oversee its implementation.

Ruchatz - Excipients need equally stringent regulation as APIs

During her presentation, Soreth also recognised that FDA's record of inspecting abroad is inadequate and her address to the EFCG Dinner detailed some of the ways it has been seeking to remedy this in recent years. This summer, she noted, a 24-month pilot programme of joint inspections with the European Medicines Agency (EMA) and Australia's Therapeutic Goods Administration concluded successfully.

During this project, over 250 documents relating to 54 different drug products were exchanged and 13 collaborative inspections of clinical trials were organised. The participants managed to use the information to make decisions on such matters as whether to postpone or expedite its one inspections and it prohibited imports of one firm's products based on an EMA inspection. Clearly, however, true mutual recognition is some way off.

Rx-360 itself had announced the completion of its Audit Sharing Programme, in which member companies shared reports from previous audits on suppliers of APIs, intermediates, basic chemicals and chromatography services across the world, in July. This, it said, established a number of potential benefits including giving a broader picture of suppliers' quality culture and performance, identifying and pre-screening new suppliers and reducing the frequency and length of audits.

In the past year, Rx360 has continued an intensive dialogue with the FDA, the EMA, the WHO and other bodies, seeking their buy-in on its auditing criteria and to raise other concerns. Currently, Villax said, Rx360 members comprise 24 manufacturers and 26 suppliers, with eight auditors and 11 associations as observers. As expected, the 'second wave' of membership was mainly suppliers; the third is expected to be from the generics sector.

ExciPact, meanwhile, is due to be launched at an International Pharmaceutical Excipients Council (IPEC) Europe meeting in Barcelona on 25 January 2012, according to Dr Folker Ruchatz, vice-president of BASF Pharma in Switzerland, who also spoke at the press conference alongside Villax. ExciPact has been accepted by all major stakeholders, including the relevant authorities.

The concept and business plan were developed in April 2011, followed in short order by cross-referencing with Rx360, trademark protection and acceptance by IPEC and CEFIC. The scheme will be funded by fees payable for certification, which will be used to develop standards. This base funding is now 90% done and in Q1 2012, the process will be completed by hiring of staff, the establishment of the advisory board and the start of operations.

The principles behind ExciPact are simple. Excipients can make up 90% of the volume of a drug. Their supply chain needs to be equally as secure as that of APIs and the guidelines about them should be equally strong. This can most appropriately be achieved by "a substantial increase of periodical physical audits". The certification scheme, Ruchatz added, "is the industry response to help mitigate the risks and address the auditing challenge".

Laforce - Chemistry in Europe is still alive

ExciPact offers various important benefits. Manufacturers and distributors of excipients are all included and they can be audited by many different third parties, thus enabling them to demonstrate their commitment to cGMP and cGDP. The scheme is easy to understand, builds on existing ISO 9001 certification and uses well known IPEC-PQG GMP guides.

Ruchatz added that he expects to see 20-50 companies sign up in Barcelona, though the long-term potential is obviously much higher. Costs for an audit are estimated at about €25,000-30,000, including an audit fee of €15,000, a certificate fee of €5,000 and other internal costs, but this could save suppliers some €60,000-150,000 and pharmaceutical companies €150,000-300,000 over three years by avoiding repeat audits.

2011, said Roger Laforce of FIS at the same press conference, has been a busy year. In February, the Falsified Medicines Directive, which EFCG sees as "a major step forward in the fight against falsified APIs and excipients in European medicines" was approved by the European Parliament. It was published on 1 July and is now being implemented at national level. EFCG is monitoring this process and met with the EMA on the subject.

Key elements of the directive include rules on the importation into the European market of APIs already contained in medicinal products, co-operation between the EMA and EU member states, API inspection programmes, a list of equivalent third countries with inspection system that are of equal standard to the EU's and the extension of the Eudra GMP Database.

More concerning has been ECHA's current interpretation of REACH regulation on the new concept of Strictly Controlled Conditions for the handling of intermediates. This, Laforce said, "will considerably impact fine chemical manufacturers, since ECHA is walking away from internationally agreed regulations and procedures" and EFCG will continue to campaign on this issue.

"The new regulation puts European manufacturers at a decisive disadvantage to non-Europeans," he said. "SCC may even force the shutdown of entire production lines and plants in Europe. API manufacturers often make intermediates too, so it is a concern for the entire industry".

Globally, as well as GDUFA, Laforce noted that Big Pharma companies are increasingly asking for 'near GMP' manufacturing conditions for non-GMP starting materials and intermediates. Many grey areas remain and the fine chemicals industry really needs a clearer view of how compounds are to be made, but this is clearly in line with the way regulation is going generally.

In May, the Chinese SFDA announced that it will increase the level of compliance for manufacturers over the next two years. This, however, applies mostly to those supplying the domestic market; what will happen with those who only export is still to be clarified. Subsequently, the agency stated a pilot programme of overseas GMP inspections of facilities producing APIs, vaccines, solid oral dosage forms and biologics.

More general issues include over-regulation in some European national markets that create competitive disadvantages for API manufacturers, most notably in Italy, and continuing trade barrier issues, most notably in China. Overall, though, Laforce concluded, "the market trends are positive and most of our members see a positive development in their business. Chemistry in Europe is very much alive!"

 

 

From Online Issue: December 2011