The Impact of REMS on Generic Drug Approvals and Drug Competition

From the conception of the REMS in the FDAAA Act of 2007, Congress was concerned that giving FDA authority to impose new post-marketing controls could raise competitive issues about market access for generics. Congress was right to be concerned. Despite a specific admonition in FDAAA to prevent use of the most restrictive REMS programs to prevent new competition, strategies to extend product exclusivity have emerged and the competitive landscape has changed.

Congress specifically added provisions in the Food and Drug Administration Amendments Act of 2007 (FDAAA) to prevent a new drug safety tool, the Risk Evaluation and Mitigation Strategy (REMS), from causing delays in the approval of applications for generic versions. FDAAA states, “No holder of an approved covered application shall use any element to assure safe use [ETASU]… to block or delay approval of an application under section 505(b)(2) or … a drug that is the subject of an abbreviated new drug application [ANDA, i.e., a generic drug].”

FDA has reiterated its enforcement of that direction from Congress numerous times in the four years since it received REMS authority. At the very start of the post-FDAAA period, FDA informed one generic sponsor (Lannett Co. Inc.) that the agency would “exercise its enforcement discretion” to allow the manufacturer of a drug with a REMS to provide it to a generic drug manufacturer for bioequivalence studies, so that the restricted distribution does not interfere with Congress’ intent regarding REMS and generic drug development.

About the author: Edward Tabor is Vice President, Strategic Drug Development Unit, Quintiles. He is a former division director of two divisions at FDA, one in the Center for Drug Evaluation and Research (CDER) and one in the Center for Biologics Evaluation and Research (CBER).

This article is an adapted excerpt from a new book authored by Tabor, Risk Evaluation and Mitigations Strategies for US Drug Development, published by the Regulatory Affairs Professionals Society (RAPS).

Denying Access to Innovator Reference Product

However, there continues to be a possibility that innovator manufacturers might use the REMS to delay the approval of a generic drug by refusing to allow purchase of the reference drug needed to conduct a bioequivalence study for an ANDA. When there are no restrictions on distribution, the generic manufacturer can purchase the drug via normal commercial channels. When there is a restricted distribution system under a REMS ETASU, the drug cannot be purchased through normal channels, and a refusal to provide it will delay or stop development of the generic version.

When Celgene Corp. refused to provide Thalomid (thalidomide), a drug that is now used for the treatment of multiple myeloma and erythema nodosum leprosum (ENL), to Lannett, it resulted in a series of well-publicized legal actions between 2008 and 2011. Celgene did not want to distribute Thalomid to patients in studies who were not covered under Celgene’s own thorough restricted distribution program because of the history of severe birth defects caused by thalidomide. FDA wrote that the agency would “exercise enforcement discretion” to allow Celgene to provide a set number of doses of Thalomid for Lannett to conduct bioequivalence studies, but Lannett still was unable to obtain the product from Celgene. Lannett brought several legal actions against Celgene, including an antitrust action. A Federal Trade Commission inquiry also took place. The antitrust case was set for trial in February 2012 but the two companies settled out of court before the trial began.

In a separate action, Celgene refused a request of generic manufacturer Dr. Reddy's Laboratories Ltd., to buy Revlimid (lenalidomide), a product for the treatment of myelodysplastic syndrome and multiple myeloma for which the REMS has a restricted distribution program. In 2009, Dr. Reddy’s filed a Citizen’s Petition with FDA to object to Celgene’s actions and to ask FDA to “establish procedures to facilitate the availability of generic versions of drug products subject to a [REMS] and enforce the FDC Act to prevent companies from using REMS to block or delay generic competition.”

Celgene, in turn, argued that Congress had considered and rejected such a set of procedures during deliberations on FDAAA; that requiring innovators to supply product under a REMS to a generic manufacturer would violate antitrust and intellectual property laws; and that the request would subject innovator companies to undue liability. To date, FDA has not acted on the Citizen’s Petition from Dr. Reddy’s Laboratories.

The actions regarding the two Celgene products have received enough attention to form the basis of a proposed provision in the pending Senate version of PDUFA V. The Senate bill would establish a mechanism for FDA to elicit agreements from generic drug developers to assure safe use under the terms of the REMS and to assure access for those generic developers.

The pending Senate PDUFA V bill would require “as an element of each REMS” that the sponsor of the innovator product “shall not restrict the resale of the covered drug to an eligible drug developer.” To qualify as an “eligible drug developer,” a generic firm would have to agree to the terms of a notice from FDA to ensure compliance with conditions for safe use during bioequivalence testing.

REMS System Patents and Delayed Generic Development

Some manufacturers have maintained that their REMS and ETASU constitute intellectual property. Celgene has used its patented restricted distribution plan for Thalomid (thalidomide), called STEPS (“System for Thalidomide Education and Prescribing Safety”), to delay development of a generic version. (STEPS was originally created under a Risk Management Action Plan [RiskMAP], the predecessor risk management program, which for Thalomid was later designated by FDA to be a REMS.)

Celgene petitioned FDA to prevent the agency from approving Barr Laboratories Inc.’s ANDA for a generic thalidomide for treatment of ENL, arguing that Barr’s product should not be approved because it would have to have its own STEPS-like restricted distribution program because it could not use STEPS, since “S.T.E.P.S. is a closed program specifically linked to Thalomid,” and “the mere existence of multiple risk management plans” would be a risk to patients. Celgene also sued Barr for patent infringement regarding STEPS, and Barr countersued because Celgene would not provide the drug Barr needed for clinical studies. Barr later withdrew the ANDA and both lawsuits were subsequently withdrawn.

REMS for Generic Drugs

FDAAA makes it clear that Congress intended for most innovator products and their generic competitors to have identical REMS, in order to prevent the REMS process from causing too great a burden for the healthcare community. It specifies that the Medication Guide and the ETASU of the innovator must also be implemented for generic versions and that the two “shall use a single shared system” for the ETASU.

However, FDAAA permits FDA to waive the requirement for a single shared system if the “burden of creating a single shared system outweighs the benefits of having one,” or if an element of the ETASU is protected by a patent and if the generic manufacturer’s request for a license to the patent was denied. In the latter case, certification of an attempt to obtain a license to use the patented ETASU must be submitted by the generic manufacturer.

A generic product is subject only to the Medication Guide and ETASU portions of the innovator’s REMS. FDA’s REMS draft guidance from September 2009 provides a singular solution to harmonizing the communication plans: if the innovator’s drug has a communication plan as part of its REMS, as soon as an ANDA is approved for a generic version, FDA must itself “undertake the communication plan” and neither the innovator nor the generic drug manufacturer has to undertake a communication plan from that time forward. It is not yet known how FDA will implement this provision.

The REMS draft guidance also states that portions of the communication plan (such as training materials, specified procedures, patient/physician agreements or other informed consent, patient educational materials, safety protocols, medical monitoring procedures and data collection forms) can now be included as part of an ETASU (if there is one). If there is an ETASU, FDA presumably would not have to coordinate the communication plan, since the communication plan could be included in an ETASU required for both the innovator and the generic products, which in many cases could be a shared REMS.

REMS for drugs approved under ANDAs differ from REMS for innovator products in that they are not required to include a timetable for REMS assessments. REMS assessments do not need to be submitted for REMS for generic products.

Effects of a REMS on a Competitor’s Market

As the use and implementation of REMS have evolved, FDA has added requirements through policy precedents, although the extent to which these will become lasting requirements is not always clear. In 2011, FDA for the first time required that a REMS for one product include a provision that patients be told by the prescriber that a competitor’s drug in the same drug class is safer.

Glaxo Wellcome PLC’s Avandia (rosiglitazone), a marketed product, had a modification to its REMS on May 18, 2011, after it was found to have a risk of causing myocardial infarction. This REMS modification included the addition of a communication plan, an implementation system, an ETASU and a modification of the Medication Guide. It also required that physicians tell patients who were already being treated with Avandia or who would begin the drug for the first time that this thiazolidinedione drug has a risk of myocardial infarction that is not found with a competing thiazolidinedione, Takeda Pharmaceutical Co. Ltd.’s Actos (pioglitazone).

This REMS provision essentially promoted a competing product, though the intention of such required statements is to cause “restrictive prescribing.” In the past, such statements were placed only in the product labeling, and they usually consisted of mentioning approved first-line therapies when the drug in question was indicated only for second-line use. In the case of Avandia, the comparative statement also appears in the boxed warning in the label.

The possibility that FDA might require a drug to have a REMS with an ETASU can be a significant barrier for entry to the market for generic or smaller branded competitors making other products for the same indication. This enables companies already on the market to continue to play a major role for longer periods of time and/or to decrease the extent of competition.