Latest / Connected With Latham / Episode 98 – Drug Pricing: Takeaways from the MDMA Annual Meeting

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Episode 98 – Drug Pricing: Takeaways from the MDMA Annual Meeting · Connected With Latham

• 0:02
  Hello and welcome to Connected with Latham, where we discuss
• 0:05
  ideas, legal developments, and business trends shaping the global economy.
• 0:09
  This is the 18th episode of the Latham & Watkins Drug Pricing series, and I'm
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  Chris Schott, a partner in the Healthcare
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  and Life Sciences Practice in our Washington, D.C.
• 0:17
  office.
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  I focus my practice on all things market access, and that includes
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  manufacturer compliance
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  related to the Medicaid Drug Rebate program, Medicare Parts B and D,
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  and the 340B Drug Pricing Program, as well as, of course, implementation
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  of the Inflation Reduction Act
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  and other health care reform initiatives such as state laws.
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  Joining me is Danny Machado, an associate in our Washington, D.C.
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  office. Hey, Chris, how's it going?
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  And if I could take this opportunity to remind our listeners
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  of the relaunch of the Latham & Watkins Drug Pricing digest,
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  where, we essentially track reports, or coverage from the trade
• 0:52
  press, government publications, releases and court opinions.
• 0:56
  And, our intention is to distribute this digest at the start of every other week.
• 1:01
  So if you would like to get this in your inbox,
• 1:03
  we're going to include a subscription link in the podcast notes.
• 1:06
  Thanks, Danny.
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  Today we're happy to welcome
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  two guests on the podcast, Latham Partners, Nate Beaton and Bill McConagha.
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  This is Bill's third appearance on the podcast,
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  so you might be familiar with him. But Nate, why don't we start with you?
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  Do you want to introduce yourself? Sure, Chris.
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  Thanks for having me.
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  I'm a member of the Healthcare and Life Sciences Practice
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  here in the Washington, D.C. office, as well.
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  I focus my practice on FDA regulatory matters across the FDA
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  regulated product lifecycle and across all FDA regulated product categories
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  from pharmaceutical products, medical devices, biologics,
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  as well as other FDA regulated product categories.
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  Thanks, Nate.
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  Bill, do you also want to introduce yourself?
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  Yes, Chris, thank you very much for having me back.
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  I'm thrilled to be here.
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  I am also a partner in Latham’s Healthcare and Life
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  Sciences Practice based here in Washington, DC.
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  I cover all things FDA, from pre-market,
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  regulatory issues to post-market issues and enforcement.
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  I worked at FDA for about 17 years
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  in a variety of capacities before I joined private practice.
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  Thanks, and thank you for joining the podcast today.
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  In each episode, we focus on a specific topic that is relevant to market
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  access, drug pricing, or the pharma and health care sectors more broadly.
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  And after discussing the substance, we ask the question
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  which Olympic sport is like?
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  And we have the list of Olympic sports here to see which most resembles
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  the topic in terms of strategy, complexity or frankly, level of conflict.
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  So, Danny, what is our topic for today?
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  Today we'll be chatting about the Medical Device
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  Manufacturers Association or MDMA annual meeting,
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  which just concluded here in Washington, D.C.
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  and as we've done in the past, after significant conferences in our prior
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  podcast episodes today, we want to do a bit of a readout
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  and discuss key takeaways from this conference,
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  which both Nate and Bill attended.
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  So maybe Nate, if we could start with you, could you tell us
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  a little bit about the MDMA annual meeting and its significance?
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  Just broadly, who are the attendees at the MDMA conference?
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  Sure. Thanks, Danny. To start.
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  MDMA itself is a Washington, DC based trade association
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  for the medical device industry,
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  and it, as an institution, has a significant role
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  both in terms of the stakeholders that attend the annual meeting
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  and other members of the organization, but also in its own right
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  as a as a key player in terms of engagement with Congress
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  and the executive branch representing industry,
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  across,
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  issues that are important to device manufacturers and in particular,
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  with respect to user fee reauthorization negotiations with FDA.
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  The annual meeting brought together manufacturers, as I said, but
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  also investors, policymakers and related professionals and other stakeholders.
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  And the meeting has a conference component, as you mentioned,
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  but it also includes, what they call a congressional Fly-In, where industry
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  members, have the opportunity to visit the Hill
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  to meet with congressional staff and congressional members
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  to discuss the companies, and the challenges that they face.
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  One of the things that stood out to me from the meeting was the participation
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  of key government officials.
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  You know, with the change in presidential administration,
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  there have been several comings and goings within the executive branch
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  and other conferences and events,
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  of this nature that we've attended recently, that would typically
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  have had federal agency officials participate, have really struggled
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  to bring in, and get those officials to either speak or attend
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  with a number of folks from the executive branch participate, to that stood out.
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  Doctor Michelle Tarver, the director of the center for Devices and Radiological
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  Health, or senior H, as well as John Brooks,
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  the deputy administrator and chief Policy and Regulatory officer
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  at the center for Medicare and Medicaid Services, or CMS.
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  You also had a chance to hear from members of both parties on the Hill.
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  Thanks, Nate.
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  It sounds like you had a nice broad based attendance there.
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  And that's great to hear that.
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  They're actually government officials attending some of these meetings.
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  I know that some other conferences trying to get organized
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  are having maybe issues getting a response from government attendees.
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  So what were some of the key issues that you were watching
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  for at this year's meeting?
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  And maybe, Bill, we can start with you on this one.
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  Sure.
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  Primarily, I was there to listen.
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  We're talking about the fact that I was on a panel,
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  but I was very interested in hearing from the attendees,
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  and the government officials, you know, what they were concerned about?
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  What they're focused on.
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  You know, where the uncertainties were, the challenges.
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  Among the things I was interested in learning
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  a little bit about and talking with people about or kind of
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  how are these medical device companies sorting through the changes
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  at FDA as it relates to product review and approval?
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  And essentially, you know, moving the freight, if you will,
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  in traditional ways, that was that changing, if at all.
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  Questions about evaluating the legal landscape.
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  You know, such as the recent decision on Ldpe T's
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  what does that portend, if anything, for new technologies
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  that would be regulated by, FDA and the center for devices
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  very interested in hearing about issues relating to compliance and enforcement,
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  getting a sense from others what they think might be areas of focus.
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  I certainly had thoughts of my own, which we can elaborate on in a moment,
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  but was really interested to hear from the companies
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  what they were anxious about.
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  And then also particularly interested in hearing about,
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  questions
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  around global supply chain, especially with the tariffs,
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  how that would impact, development of products, accessing components,
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  that were made abroad, even for domestic manufacturers,
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  and trying to figure out what kind of strategies the industry is employing,
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  as it confronts a reality that is impacting many industries.
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  Thanks, Bill, that that's fantastic.
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  As as far as issues that you were looking out for
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  and as Nate explained, you know, this event brought together folks from across
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  industry, folks from Congress, FDA, CMS, the media related professionals.
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  And now I guess it would be great if we could move, to what were some of
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  the highlights of the discussion that you heard this year?
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  Did anything stand out to you as key themes across these various domains?
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  And, Nate, I wonder if we can start with you. Sure.
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  I mean, maybe to put a finer point on, what Bill said.
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  I mean, one thing that was interesting to me as an FDA regulatory attorney,
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  having attended the annual conference for a number of years,
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  was this was actually the first meeting that I attended in which,
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  Jeff Sharon, the longtime coverage director, did not participate.
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  So I was so I was really eager to hear about the priorities
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  of his replacement, doctor Michelle Tarver.
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  As center director, her session was styled as a listening session and was designed
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  to provide MDMA with an opportunity on behalf of its members
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  to sort of put forward some of its priorities or concerns.
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  But I was really focused on her responses and what we could
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  glean from her priorities coming out of that.
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  You know, two that stood out to me was, you know, sort
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  of what she described as right sizing the Q submission program.
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  That's the program for interaction between medical device manufacturers
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  seeking authorization of their products and the agency.
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  So that can be anything from a pre-submission meeting
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  early on in development or, what's called a submission issue
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  request, where, you can hash it out with the agency,
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  you know, more discreet disputes with respect to,
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  you know, how the agency
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  interprets data in the context of a premarket submission, for example?
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  And really, her focus was on ensuring that the program is efficient with respect
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  to agency and stakeholder resources, but still providing actionable feedback.
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  So she gave some examples of, you know, folks coming to the agency with questions
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  and a pre-submission that were so broad or were so early in the program
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  so as to not what position the agency to provide meaningful for feedback.
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  Another one that she touched upon
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  was fostering the development for products for use in the home setting.
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  She she focused on facilitating,
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  you know, the development of those products for use at home
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  and really in particular, to be integrated to and designed with the home in mind.
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  And she touted Cder, HHS home as a health care hub initiative, which is designed
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  to develop new paradigms for developing and testing those products for home use.
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  The other thing that came up over and over again, that I think really speaks
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  to the cross-cutting nature of this conference and the types of players
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  who participate, was what several stakeholders called the gap between
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  sort of the concept and development stage for an FDA regulated device,
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  and then through authorization and market access and adoption.
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  So, you know, for example, a medical device manufacturer
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  may need to develop certain test data or conduct certain studies
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  in order to obtain authorization for the product, only to then find that
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  in order for that product to be adopted in the market, or to obtain coverage
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  and reimbursement from public or private payers,
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  that additional evidence or support would be needed.
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  And so this was important to both innovators in the medical device
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  space, but also the investor community, because having an opportunity to compress
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  that coverage to a higher adoption life cycle
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  has the potential to shift the risk profile and value proposition
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  for these types of medical technology and therefore to spur greater investment.
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  And this was something that came up in Doctor
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  Carver's remarks in terms of her desire to incorporate more information
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  about what payers and patients and providers need
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  when thinking through the types of information that FDA seeks.
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  And it was also something that came up in John Brooks remarks, particularly focused
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  around the Biden administration's set pathway proposal.
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  That was a, final procedural notice
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  that was issued by the Biden administration in August 2024,
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  to establish this t set
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  pathway or transitional coverage for emerging technologies pathway.
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  This would provide a pre-market evaluation by CMS of certain
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  FDA designated breakthrough devices prior to FDA authorization
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  to potentially allow transitional Medicare coverage for the device.
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  In other words, you know, allowing these products
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  to obtain coverage to get reimbursed earlier than they
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  otherwise would following FDA authorization.
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  But but one of the things that we heard from a number of stakeholders
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  is that they felt that the pathway perhaps doesn't go far enough.
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  You know, the Biden administration itself indicated that it would
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  they would seek applications for manufacturers to participate
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  in this pathway, and they only anticipated accepting five applications per year.
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  This is in contrast to a proposal to address
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  the same problem by the Trump administration.
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  The Trump administration actually issued its own final rule,
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  the Medicare coverage for Innovative Technologies rule,
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  which would have provided for much broader coverage,
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  for devices designated as breakthrough by FDA.
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  However, that rule was rescinded,
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  by the Biden administration before it became effective.
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  And so one of the things that we heard a lot about in the conference was,
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  you know, efforts in Congress to pass legislation,
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  perhaps more akin to the Trump administration approach.
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  And we heard from John Brooks, at CMS,
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  that the administration is now considering sort of a potential middle ground
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  between those two proposals
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  and not to provide this transitional coverage
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  for all FDA designated breakthrough devices,
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  but perhaps to go further than the five applications per year
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  under the Biden proposal only.
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  That sounds like there was a really deep discussion here, especially following
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  the change ministration.
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  And I can say on the drug pricing side, the first of the two big annual
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  drug pricing conferences was taking place in Philadelphia.
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  So we'll see if there's, an equally in-depth discussion there.
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  So stay tuned for a future podcast episode that will have a readout
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  from that conference.
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  So it sounds like from looking at the agenda, that one of the topics
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  here was also compliance.
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  And Bill, like you mentioned, you spoke on a panel on compliance.
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  How topics can you share with us some of the points
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  you made on the panel and also what you heard as takeaways?
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  From the panel discussion?
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  Yeah. Thanks, Chris.
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  Happy to discuss.
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  So, as you say, I was on a compliance panel.
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  I was joined by two great lawyers from another law firm
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  who made wonderful contributions
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  and also a moderator from MDMA, who is very steeped in compliance issues.
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  And, was, kind of wonderful in directing the discussion.
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  It was a nice,
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  I really felt like robust discussion,
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  as opposed to folks of just, you know, offering unilateral soliloquies.
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  I think at a high level where we all netted out
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  in terms of kind of common theme was the sense that as it relates
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  to compliance, our thinking certainly my thinking is the False Claims Act
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  and the Anna Kickback statute will remain a focus, for enforcement.
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  My sense are, since the panel senses that fraud is a bipartisan issue
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  and nothing about that has really changed.
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  And the FCA, the False Claims Act is also moneymaker for the government.
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  And let's not lose sight of that.
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  And in 2024, there were nearly $3 billion in FCA recoveries.
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  And of that, nearly 1.7 million was for FCA cases relating to health care.
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  And so there's every incentive for these,
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  these matters to, to continue,
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  inappropriate circumstances.
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  You know, much has been said about changes at the Department of Justice.
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  And, I think it's important to weigh all of that.
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  I don't personally think that DOJ is going to become less active
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  in the FCA space, but even if they do,
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  I think it's worth remembering that relator is can bring key
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  terms on their own and proceed on these
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  FCA cases on their own, even without DOJ support.
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  And so insofar as you have an active plaintiff's bar,
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  you have, you know, active,
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  you know, relator's out there, there will continue to be these incentives
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  to bring these cases, in my view, especially as it relates to the medical
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  devices, the, the, the articles we were discussing at the MDMA conference.
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  The focus of these will be on payments made to health care practitioners.
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  So these would be, very much the sort of, issues
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  that have historically been focused on, I think, of will continue payments to,
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  to HCP for speaker programs, for grants,
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  key opinion leaders, a payments made to consultants.
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  I think this would be the primary focus for medical devices.
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  I will add that in the case of pharmaceuticals,
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  I think there will also be continued focus on patient assistance programs
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  and other payments intended to offset out-of-pocket costs for patients
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  or to impact use and reimbursement.
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  And on that last point, as it relates to reimbursement, I will note that,
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  the MDMA audience being particularly interested in
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  compliance issues, is that related to reimbursement?
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  And so my thought is that this may be worth it.
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  This may be a topic worth exploring in depth in a future podcast, Mr.
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  Schott, because I think there is a real appetite for,
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  kind of the reimbursement issues, how they're being impacted
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  and what it might mean in terms of FCA in a case,
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  enforcement.
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  Sounds good. Bill, we're happy to have you back a fourth time.
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  I just I have so much to say or you can't get rid of me.
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  Maybe it's a combination of both.
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  You know, one question we got from the audience, is whether there are kind of
• 15:50
  any particular areas of focus as it relates to FDA regulatory issues.
• 15:54
  And, you know, on the compliance front, I'll note, that
• 15:58
  well, before this administration in the 2023 HHS OIG guidance,
• 16:03
  the big update there actually was,
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  interesting language in there that talked about the idea that, compliance,
• 16:10
  in these FDA regulated companies should exercise
• 16:12
  more oversight over, the quality functions.
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  And so one interesting thing is to see how have companies in the last, you
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  know, 18 months to 20 months,
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  tried to deal with that.
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  And I think what we're, what we're hearing and what was the theme
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  at the conference,
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  is this idea that it's important for there to be a relationship
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  and some level of connection and coordination between, compliance
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  and QA such that any kind of major existential issues that arise
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  in the quality setting that could actually impact compliance get elevated that.
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  But by and large, they continue to operate as independent entities
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  within these companies.
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  There's just, a better sense that compliance has,
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  some insight into what's going on.
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  As it relates to the kind of most serious issues coming out of the quality systems.
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  One other thing.
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  I'll just add that I thought was really interesting
• 17:04
  discussion towards the end of the panel was we spoke about a recent focus
• 17:08
  on, FCA cases related to wound healing.
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  And the panel collectively,
• 17:15
  explored why that has been the case.
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  What about kind of wound healing type of issues
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  would would lend itself to more activity?
• 17:23
  As it relates to fraud or reimbursement.
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  And the consensus was that sometimes when companies
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  are operating in gray spaces, as it relates to FDA oversight,
• 17:34
  there are less vigilant about their compliance programs.
• 17:38
  And so the takeaway was to be thoughtful about reimbursement
• 17:41
  and grants and payments, no matter the regulatory status of the product.
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  And so applying this kind of, you know, to to real examples,
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  I think what this means is if you sell each KTP or market or an approved drugs,
• 17:54
  maybe even let's that you still need to be careful when you think about the way
• 17:58
  you structure your compliance program and your arrangements.
• 18:02
  With HCP,
• 18:04
  if there are a
• 18:05
  federal money being, offered for reimbursement.
• 18:08
  Bill, one thing that that struck me,
• 18:10
  in those comments is and as you alluded to earlier,
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  we heard quite a bit in the hallways, and various chatter
• 18:17
  about the impacts of, potential tariffs and supply chain issues.
• 18:21
  And it just strikes me, you know, your comments with respect to QA, if, if,
• 18:26
  if folks are looking
• 18:27
  if manufacturers are looking to source alternate suppliers to move production,
• 18:32
  you know, that presents another opportunity for greater activity
• 18:35
  that could that could result in foot faults.
• 18:37
  Yeah, I think it's a great point.
• 18:38
  And, you know, one of the things I'd like to talk about in a moment is, is
• 18:43
  is there going to be based on these recent executive orders, kind of a new enhanced
• 18:46
  focus on, you know, QSR compliance or GMP compliance
• 18:50
  in these manufacturers abroad, not to mention domestically.
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  And, and how does that also impact,
• 18:56
  the, the global supply chain?
• 18:58
  So, yeah, the point is very well taken, I totally agree.
• 19:01
  Thank you both for that fantastic background on the enforcement
• 19:05
  trends that you, heard about during the conference.
• 19:08
  And I suppose looking ahead, putting your, you know, prediction hats on,
• 19:13
  what would you say we could expect in terms
• 19:16
  of regulatory enforcement, in this year, in 2025?
• 19:20
  Thank you.
• 19:20
  Jenny, I've never heard my remarks characterized as fantastic.
• 19:23
  So, thank you for that.
• 19:26
  The question you ask is a good one.
• 19:28
  And, and I think the honest answer is that it's really hard to predict
• 19:32
  how FDA is going to behave, over the next year or two.
• 19:35
  Hard to predict exactly how Cder rich will respond just 100 days
• 19:38
  into this administration, but certainly do have a few thoughts on this.
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  So first, just a level set.
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  I think it's important for us
• 19:46
  to all recognize that this is a time of serious transition at FDA.
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  Not only is there a new administration that has voiced
• 19:53
  serious concerns about how FDA does business,
• 19:56
  but there is also new leadership in the centers.
• 19:59
  And and they alluded to this earlier, right?
• 20:01
  After years of having, Doctor Jeff Stern and Doctor Bill Maisel,
• 20:06
  running the center for nearly a decade.
• 20:09
  There's new leadership, with Doctor Tarver and her lieutenants.
• 20:13
  They actually, you know,
• 20:15
  took over before the new administration came to power.
• 20:19
  But we have this kind of enormous sense of transition.
• 20:22
  And and what comes with that is,
• 20:25
  a loss of some institutional memory.
• 20:27
  Also opportunities for fresh thinking,
• 20:30
  new leaders to think about how they are going to,
• 20:32
  approach the, the, you know, enormous number of challenges
• 20:36
  that FDA has, in terms of, you know, its administrative workload
• 20:40
  and its, enforcement priorities and the like,
• 20:43
  you know, on top of that, we know that Janet Woodcock,
• 20:46
  who essentially was drugs that FDA retired,
• 20:50
  in the last two years, Peter Marks, the doctor, Peter Marks,
• 20:53
  the head of Ciba, has resigned and he's recently been replaced.
• 20:57
  So there is, really a sense
• 21:00
  that we are at a kind of a milestone or inflection point, with FDA.
• 21:04
  And I think it's hard to tell just three months into the administration,
• 21:08
  exactly what's going to happen.
• 21:11
  You know, the new leader still need to get a sense
• 21:12
  of how they're going to handle day to day enforcement, especially over things
• 21:15
  like technical violations that that may not pose an acute safety threat.
• 21:20
  For years, I think we had seen,
• 21:23
  rich, becoming less enforcement minded.
• 21:25
  They were prepared to take action in the case of real fraud,
• 21:29
  but we didn't see a lot of warning letters coming out of that or CDO.
• 21:33
  I have no reason to believe that will change, but,
• 21:36
  you know, where the priorities will shift to is a somewhat open question.
• 21:39
  I expect,
• 21:41
  you know, FDA to remain
• 21:43
  actively focused on this administration's priorities.
• 21:46
  And so we'll see that very much in the center for foods.
• 21:49
  I think we'll continue to see FDA taking action against what
• 21:52
  it regards as, unsafe food products.
• 21:55
  And I think this will lead to fairly massive changes
• 21:58
  in the way that, the safety of food is evaluated.
• 22:01
  For all the all of you who are familiar with, agency
• 22:05
  announcements is or relates to, you know, certified color additives and also,
• 22:10
  self-certify grass, for medical products.
• 22:14
  And I very much welcome your thoughts on this, Nate, in a moment.
• 22:16
  You know,
• 22:17
  I expect FDA to remain
• 22:18
  very focused on fraud cases, especially with respect to medical products.
• 22:22
  I think, that there will be a sense that these are the cases where there is
• 22:26
  a really knowing effort to commit fraud against the agency or against consumers.
• 22:31
  And consistent with that, I would note that, you know, hot off the presses
• 22:35
  is the executive order,
• 22:37
  from President Trump on over criminalization and regulations.
• 22:40
  And it essentially discourages, across the government.
• 22:45
  But this would certainly apply to FDA and DOJ to the extent that enforces, the
• 22:49
  The Food, drug, and Cosmetic Act,
• 22:51
  it discourages criminal enforcement of strict liability offenses.
• 22:56
  Where there is no proof of bad intent.
• 22:59
  And so that is kind of really interesting.
• 23:01
  And that, you know, the the plaque doctrine in the FDA space is,
• 23:05
  very much based on this idea that the responsible corporate officer doctrine,
• 23:09
  criminal cases, are brought even in the absence of a specific intent,
• 23:13
  as a strict liability, misdemeanors, you know, to make a point
• 23:16
  as it relates to enforcement and they are not much broader anymore,
• 23:20
  even though there were efforts in recent DOJ to prioritize them,
• 23:24
  we still see FDA bringing these cases in instances where
• 23:28
  there is widespread injury, even in the absence of of intent.
• 23:32
  So examples would be like, you know, the SEC compounding case issues
• 23:35
  that relate to, you know, adulterated foods that get recalled.
• 23:39
  There has been, I think, in
• 23:41
  FDA's judgment, even in recent years, a time and place where the use of this,
• 23:45
  this tool in enforcement, it will be very interesting to see
• 23:49
  if any part of FDA, much less city outrage, continues to bring,
• 23:53
  park doctrine cases in light of, the executive order.
• 23:58
  One other executive order that I think is worth noting
• 24:00
  and kind of the final thought I have as it relates to enforcement is that
• 24:04
  I think actually, where we may see the most active form of enforcement
• 24:08
  will be in relation to establishment inspections,
• 24:11
  which most people don't think of as enforcement in the traditional sense,
• 24:14
  because, you know, people aren't showing up with, handcuffs and,
• 24:18
  you know, the nylon jackets that say, say please.
• 24:22
  But, you know, FDA inspects medical product establishments,
• 24:25
  across the world that sell products into United States.
• 24:29
  And on May 6th, there was an executive order,
• 24:32
  I guess it was May 5th was executive order from, the Trump administration,
• 24:37
  followed by a May 6th announcement from FDA about the agency's intent
• 24:41
  to expand the use of unannounced inspections
• 24:44
  that for manufacturing facilities that produce foods, essential medicines,
• 24:48
  and other medical products
• 24:50
  that are going to be marketed to American consumers and patients.
• 24:53
  And Commissioner McCaffrey said that essentially,
• 24:57
  foreign companies have long enjoyed a double standard
• 25:00
  because in the U.S,
• 25:02
  advanced notice is not given surprise.
• 25:05
  Inspections occur.
• 25:06
  But for those foreign companies that, operate under FDA jurisdiction,
• 25:10
  there has historically been advance notice given before facility inspections.
• 25:14
  And I think the reality is that this longstanding practice,
• 25:18
  of announcing foreign inspections is grounded in a number
• 25:22
  of practical reality, such as visa requirements and travel arrangements
• 25:26
  and the availability interpreters and and, frankly,
• 25:29
  the fact that many of the countries in which these facilities operate
• 25:32
  are sovereign nations.
• 25:35
  But that said, I have heard about some,
• 25:38
  unannounced inspections already taking place in India.
• 25:41
  And, and so it's clear that this is an important focus for this FDA.
• 25:47
  I will add that the commissioner's also reportedly said that FDA will reduce
• 25:52
  the length of future inspections abroad, thereby enabling
• 25:56
  FDA to complete more foreign inspections with fewer resources.
• 26:00
  There has been, I think, a lot of skepticism
• 26:03
  about whether FDA can achieve these dual goals.
• 26:06
  Many believe the only way to do more foreign inspections
• 26:09
  with the same resources to truncate the visits, and that would,
• 26:13
  in theory, lead to less thorough reviews.
• 26:16
  And I'll note that Michael Rogers, who's a longtime FDA official,
• 26:20
  and was the head of the Field Inspectorate,
• 26:24
  at FDA, resigned the same week these announcements came out.
• 26:27
  But I think the bigger story in this is not whether or not
• 26:31
  there will be challenges as it relates to resources or unannounced inspections,
• 26:35
  but the fact that the administration and thus this FDA, are clearly focused on
• 26:39
  foreign suppliers and their focus on them as part of this broader,
• 26:43
  what I will call enforcement effort as promulgated in this executive order.
• 26:47
  And I expect the number of foreign inspections
• 26:49
  will increase, especially in companies like India and China that supply
• 26:53
  medical manufacturers in the United States or, are themselves establishments
• 26:58
  where finished products, be they devices or pharmaceuticals or biologics,
• 27:03
  are are
• 27:04
  manufactured and sent to the U.S and I expect that we'll see more 40 threes
• 27:09
  and more regulatory findings related to these foreign inspections.
• 27:12
  And so I intend to watch very carefully whether FDA actually classifies
• 27:17
  a higher percentage of these foreign inspections
• 27:19
  as official action indicated, as I, that it has in the past.
• 27:23
  And they're why, for our listeners who aren't familiar with it, is
• 27:26
  is the highest designation that the FDA is concerned about what it's discovered
• 27:31
  and that is prepared
• 27:31
  to take additional action, be it a warning letter or an import alert.
• 27:36
  And the import alert is an incredibly powerful tool
• 27:40
  that allows FDA to block foreign companies access to the U.S.
• 27:44
  market on the grounds that its products, and, I quote, appear
• 27:48
  to violate certain requirements of the Federal Food, drug,
• 27:51
  and Cosmetic Act, such as GMP or QSR in the case of devices.
• 27:55
  And so, you know, in the case of domestic manufacturers,
• 27:59
  civil injunctions have to be brought as adversarial
• 28:01
  proceedings filed in federal district court
• 28:03
  if with all those related due process requirements, if you want to shut down
• 28:07
  somebody who is, selling a product manufactured in the US
• 28:11
  being a medical device or pharmaceutical, in the case of foreign suppliers,
• 28:16
  FDA can put a company on an import alert as an administrative action.
• 28:20
  And while such administrative actions are subject to additional review,
• 28:24
  it begins with a unilateral administrative act
• 28:27
  by FDA that is tantamount to a de facto injunction.
• 28:31
  And so I am really interested to see if FDA uses this as a tool,
• 28:37
  in its effort to kind of,
• 28:40
  police the quality of foreign products,
• 28:43
  or I should say, products made in foreign countries that are intended for the U.S,
• 28:48
  but also to see if it uses this as a tool in its effort
• 28:52
  to help move manufacturing back within the U.S.
• 28:56
  And so, it's a point that I made, I think less directly in a prior podcast,
• 29:01
  but I still think it is, a really incredible tool that FDA has.
• 29:06
  And, I've got my eyes open about it.
• 29:09
  Yeah.
• 29:09
  I think that, you know,
• 29:10
  in addition to FDA and Bill, Bill touched on it a little bit.
• 29:14
  This is not only a time of transition
• 29:16
  with respect to FDA leadership, but across the executive branch.
• 29:19
  And so, you know, even if there are some indications
• 29:22
  that in certain areas, FDA may be less focused on enforcement,
• 29:26
  you know, we are also will need to monitor the priorities of,
• 29:30
  you know, other officials
• 29:32
  within the new administration that have the ability to bring,
• 29:36
  bring action under the fCRA.
• 29:38
  Whether that's, Maine justice at DOJ, U.S.
• 29:42
  Attorney's offices, you know, others outside of FDA,
• 29:46
  but then sort of can bring ancillary claims.
• 29:49
  Bill talked about FCA.
• 29:51
  So, you know, what are the priorities of HHS,
• 29:52
  OIG, the Office of Inspector General within HHS, and then also Cfpb,
• 29:57
  Customs and Border Protection, you know, just to name a few.
• 30:01
  And one quick thought on justice, the news is changing constantly.
• 30:05
  So I don't know where we are exactly today, but at last reading
• 30:10
  my understanding is a consumer protection branch.
• 30:13
  In justice has largely been dissolved.
• 30:14
  And, the attorneys therein have been spread
• 30:17
  to other divisions within the Department of Justice.
• 30:20
  And that's significant because CBP is the division within justice
• 30:25
  that historically had handled FDA's biggest criminal and, and civil cases.
• 30:31
  They were the group within justice who worked,
• 30:34
  you know, repeatedly and consistently with FDA and had, a level
• 30:38
  of expertise and facility with the federal Food, drug, and Cosmetic Act.
• 30:41
  There are certainly criminal cases that have been brought by, you know, U.S.
• 30:46
  attorney's offices across the country.
• 30:47
  It's not to suggest that Si CBP alone has acted,
• 30:51
  in, in furtherance of, of FDA's enforcement mission.
• 30:55
  But it is interesting that, to the point that as we kind of evaluate
• 31:00
  how is DOJ going to handle, its enforcement priorities in this space,
• 31:04
  the division that has been tasked with it for the entire time I've been in the food
• 31:08
  drug bar no longer exists.
• 31:10
  Well, that's certainly a lot to think about.
• 31:12
  And you gave us
• 31:12
  a lot of interesting trends here on enforcement
• 31:14
  and how it plays into the international scope.
• 31:17
  Maybe to wrap up our conversation at a high level,
• 31:20
  I can ask both of you to sort of make a brief closing statement
• 31:24
  on other topics that you might have your eye
• 31:26
  on coming out of this conference, and maybe we'll start with you on that.
• 31:30
  I think, like many in the room,
• 31:32
  at the conference now, I'm looking to see how CRA,
• 31:36
  handles its user fee performance in the coming weeks and months.
• 31:39
  We've touched quite a bit on changes with respect to leadership.
• 31:43
  There have been reductions in force within, HHS
• 31:47
  and there's been discussion, around, reorganization.
• 31:51
  Although at the time of the reporting,
• 31:54
  that hasn't, largely affected FDA to date.
• 31:58
  But each of those things are things that that could impact the timing
• 32:02
  for FDA's review of medical device product applications for,
• 32:07
  engaging meaningfully with,
• 32:09
  manufacturers through the Q sub program and otherwise.
• 32:12
  And those are the types of things
• 32:13
  that I'll be looking, ahead to hang out at the conference.
• 32:16
  No, those are those are great points.
• 32:18
  I, too am very interested to see how, Keurig handles the day to day.
• 32:23
  I, I'm very interested to see, how
• 32:27
  companies feel empowered or not
• 32:29
  in the area of product promotion domestically.
• 32:33
  The agency is, is, the listeners are going to be aware,
• 32:37
  fairly recently, issued a new guidance,
• 32:40
  the CEO, your guidance, the scientific information
• 32:43
  on, on unapproved uses guidance, that is, I think more permissive than ever
• 32:48
  in terms of the sorts of, consistent with label or,
• 32:53
  kind of off label, information that can be disseminated.
• 32:57
  But at the same time, I think much more quietly,
• 33:00
  the agency also issued an addendum to its,
• 33:04
  memorandum on First Amendment principles, which I think had last
• 33:06
  been updated in 2017,
• 33:08
  and they quoted heavily from a de facto case, which is, case
• 33:12
  coming out of the First Circuit that, could be read
• 33:15
  and I say could be because I think there's
• 33:16
  there's still work to be done here, but could be read,
• 33:20
  to narrow Corona and
• 33:21
  Amarin, which are kind of landmark cases, in the Second Circuit.
• 33:25
  And it suggests there may be something of a circuit split.
• 33:28
  And my point in raising this is not to say that I think FDA
• 33:31
  is going to be any more active than it has been in recent years.
• 33:36
  In this space.
• 33:38
  But it is to,
• 33:40
  also see how the industry reacts.
• 33:43
  And my own instinct is that it's important to be careful and thoughtful.
• 33:48
  And I would,
• 33:49
  suggest the companies follow the guidance and the safe harbors they're in.
• 33:54
  For those that don't, I will be very interested to see,
• 33:57
  especially in the product space or what, if anything, after he does about it.
• 34:00
  Well, thanks for the in-depth background on the takeaways from the conference.
• 34:04
  And certainly it makes sense for the companies in the space to monitor
• 34:08
  these trends that you've identified on approval, promotion and enforcement.
• 34:12
  That we've talked about here in some depth today.
• 34:14
  So before we go to the question we had posed at the very beginning,
• 34:16
  namely, which Olympic sport is the like, let me echo what Danny said at the outset
• 34:21
  and also mention the relaunch of the biweekly drug pricing digest.
• 34:25
  And we'll put the subscription link, in the podcast notes.
• 34:28
  So, Nate, we'll start with you.
• 34:30
  What do you think? Which Olympic sport is it like,
• 34:33
  My take away from the conference and the Olympic sport
• 34:36
  that came to mind for me would be a relay race?
• 34:40
  You know, we saw across both the participants
• 34:43
  and also their concerns, you know, a real focus on sort of that handoff
• 34:47
  between concept development of a product
• 34:51
  to FDA authorization and then on to, commercialization coverage
• 34:56
  and reimbursement and an acceptance by, the provider and payer community.
• 35:00
  So I think that, you know, in that sport, having a seamless handoff is really,
• 35:06
  you know, one of the keys to being successful in a race.
• 35:09
  And that's something that,
• 35:10
  you know, several stakeholders highlighted as an area of opportunity
• 35:14
  and something that members of government, again, also mentioned.
• 35:17
  There's something, you know, that's a focus for them.
• 35:19
  Yeah.
• 35:20
  Make sense?
• 35:20
  Three you definitely want a good team and, have have a good strategy for that.
• 35:24
  Bill.
• 35:25
  What do you think any thoughts about don't pick sports.
• 35:27
  Yeah. That's really painful. That's a good answer.
• 35:29
  That's going to be hard to follow.
• 35:30
  And this is my third podcast.
• 35:32
  And I think now the third time that I will have the inferior Olympic sport,
• 35:37
  but I'm going to double down on mine, which is kayaking.
• 35:41
  And I say that because I think with all that's going on,
• 35:45
  there is a need to be balanced, there's a need to be nimble.
• 35:48
  You have to concentrate, be fully engaged.
• 35:52
  There will be periods of rough waters.
• 35:55
  There will be periods of calm.
• 35:58
  I feel the the regulated industry
• 36:00
  is going to have to kind of recognize both and adjust to both quickly.
• 36:05
  And look, if, if you, hit a bump in the water, I don't know what the term is,
• 36:10
  but you, you know, you get rolled your roll back up
• 36:14
  and you keep pushing forward and it's exhilarating.
• 36:17
  And I will say that as it relates to the to the team concept,
• 36:21
  what I understand about kayaking is that it
• 36:23
  is a team sport, with combined, times.
• 36:27
  And, and so there's this kind of sense that it is a team effort
• 36:31
  that is based on these kind of strong individual efforts,
• 36:34
  dealing with kind of different challenges, as you go on the course.
• 36:37
  And so that is my Olympic sport.
• 36:40
  So I'm hearing ride the wave.
• 36:41
  Ride the wave.
• 36:42
  Well, it well said. Yes.
• 36:43
  You've managed to distill into one phrase what it took me,
• 36:47
  five minutes to describe. Well said.
• 36:48
  And there's a great link to watching as we have, Great Falls up here.
• 36:51
  You can kayak down Great Falls.
• 36:53
  And, that's certainly very exciting.
• 36:56
  Danny, over to you.
• 36:57
  Which Olympic sport do you think it's like.
• 37:00
  You know, I think baseball,
• 37:02
  both Bill and Nate mentioned the Trump administration's heightened
• 37:06
  attention to prevention of healthcare fraud and abuse and baseball.
• 37:11
  The umpire kind of serves as a vigilant enforcer of the rules.
• 37:15
  Right?
• 37:15
  Making those critical calls in the moment about,
• 37:19
  to maintain the integrity of the game, identifying balls, calling strikes.
• 37:23
  So whether indeed the FDA will be more active or not compared to
• 37:27
  prior years, it'll still be very important to be thoughtful.
• 37:31
  Chris, what do you think?
• 37:32
  What Olympic sport did you pick?
• 37:34
  Yeah, I'm gonna have to go with mountain bike cycling.
• 37:36
  And then I'm thinking a little bit like Bill here.
• 37:38
  So this is described as involving cycling off
• 37:41
  road on mountainous or very hilly terrain using a specialized bicycle.
• 37:45
  So what would make more sense,
• 37:47
  speaking about devices, than to have this very specialized bicycle
• 37:50
  as the device to succeed here, going into the mountains and hilly terrain
• 37:54
  that the new administration seems to be increasingly sending us into.
• 37:58
  So I have to go with go with that.
• 38:01
  And I think
• 38:02
  that nicely wraps up our podcast today.
• 38:05
  I think we're all ready for a bit of a break here.
• 38:07
  Danny, what do you think?
• 38:08
  Where are we going for the after party?
• 38:10
  Well, you know, I mentioned baseball, and I know that we were talking earlier
• 38:14
  about baseball games.
• 38:15
  It is mid-afternoon, and I wonder if we should just, hop
• 38:20
  on over to the Nats, arena and park to go watch a little baseball game.
• 38:24
  What do you guys think, bill?
• 38:26
  Nate, you're on board with that?
• 38:27
  Sounds great. Yeah.
• 38:29
  All right, I'm certainly ready to go.
• 38:33
  Thanks to Nate Beaton and Bill McConagha for joining the podcast today
• 38:36
  and sharing insights regarding the MDMA annual meeting.
• 38:39
  And thanks to Danny for being a moderator.
• 38:41
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• 38:44
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• 38:48
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