Regulatory Focus™ > News Articles > PhRMA to FDA: Tell us How Industry can use Healthcare Economic Information

PhRMA to FDA: Tell us How Industry can use Healthcare Economic Information

Posted 05 December 2013 | By Alexander Gaffney, RAC

In 1997, legislators passed into law the Food and Drug Administration Modernization Act (FDAMA), a sweeping piece of legislation which reauthorized the Prescription Drug User Fee Act (PDUFA), overhauled the regulation of biological products, created an exemption for pharmaceutical compounding, and instituted new exemptions for some medical devices.

But 15 years after the law was enacted, one provision stands out not for its impact, but for its lack of progress.

Background: Section 114

Section 114 of the law was established to allow pharmaceutical companies to market products using healthcare economic data, similar to the health technology assessments (HTA) and comparative effectiveness research (CER) conducted by many EU payers. The basic intent: Allow companies to market products using apples-to-apples comparisons about the cumulative effects of their drugs.

The section states:

Health care economic information provided to a formulary committee, or other similar entity, in the course of the committee or the entity carrying out its responsibilities for the selection of drugs for managed care or other similar organizations, shall not be considered to be false or misleading under this paragraph if the health care economic information directly relates to an approved indication for such drug and is based on competent and reliable scientific evidence. The requirements set forth in section 505(a) or in section 351(a) of the Public Health Service Act shall not apply to healthcare economic information provided to such a committee or entity in accordance with this paragraph …. The term `healthcare economic information' means any analysis that identifies, measures, or compares the economic consequences, including the costs of the represented health outcomes, of the use of a drug to the use of another drug, to another healthcare intervention, or to no intervention.

Definitional Confusion

Those highlighted terms-"competent and reliable scientific evidence"-have been the subject of ongoing debate. In fact, that debate has been going on for more than 15 years, during which time FDA has failed to pass any regulation or guidance on the topic.

This has left industry to wonder how it might be able to use HCEI, and what standards it would be required to meet. For its part, FDA seems to be at least keeping an eye on the issue. In 2010 its Division of Drug Marketing, Advertising and Communications (DDMAC), now the Office of Prescription Drug Promotion (OPDP), sent an Untitled Letter to Cumberland Pharmaceuticals accusing the company of making unsubstantiated superiority claims relative to an oral version of the same drug based on economic data.

"None of these claims are supported by substantial evidence," FDA wrote.

But the letter doesn't mention something important: Section 114 of FDAMA, leaving open the question of whether FDA is enforcing its views relative to that standard or just basic efficacy and safety claims (i.e. not HCEI claims).

PhRMA: The Harms of no Guidance

Whatever the reason for the delay or ambiguity, industry has been less than pleased. Now a new white paper authored by PhRMA looks to make the case that it's time for FDA to clarify the standards by which industry can utilize HCEI.

The paper, "The Development and Dissemination of Health Care Economic Data to Payors, Formulary Committees, or Other Similar Entities," calls for FDA to "clarify the guidance under which a biopharmaceutical company can disseminate health care economic data pursuant to FDAMA section 114 without facing enforcement or regulatory action from the agency."

Some arguments are plainly familiar to anyone who's followed PhRMA's Citizen Petitions to FDA over the years. For example, PhRMA observes that "truthful and accurate information," regardless of its status under Section 114 or elsewhere under the FD&C Act, "is presumptively protected by the First Amendment."

But the white paper also speaks to a more basic issue: Without guidance, pharmaceutical companies are reluctant to invest in trials to obtain the information, which is in turn a burden on payers and formulary committees who have fewer informational resources with which to make informed decisions.

"Because of the lack of guidance, biopharmaceutical companies have been left to try to discern the parameters of appropriate dissemination of health care economic information, largely through ad hoc reviews of enforcement letters and other similar sources," PhRMA wrote.

While limited opportunities now exist to exchange this information, widespread dissemination remains curtailed due to regulatory uncertainty, PhRMA observed.

A Framework for Guidance

So what should guidance ultimately look like? PhRMA's white paper proposes a framework based around several points.

The first is the intended audience. HCEI is not intended for lay audiences, but instead for formularies and other payers. "FDA should issue guidance about what it considers to be a 'similar entity' to a formulary committee," PhRMA wrote. Such entities should include formulary committees, pharmacy and therapeutic committees, technology assessment panels, managed health care plans, employers, and pharmacy benefit managers responsible for making drug coverage and reimbursement decisions for a population of patients, the group said, noting their relative sophistication.

The second part of the proposed framework has to do with the distributed information, which PhRMA says should be able to address the system-wide costs associated with a drug, such as the economic costs of a disease.

Claims based on economic information, such as cost assessments, should be "considered a health care economic claim, not a comparative clinical claim," PhRMA argued. Further, regulators will need to clarify another term in Section 114, said PhRMA: "directly relates."

"FDA should clarify the scope of FDAMA section 114 and explain what type of statements would be considered 'directly relate[d]' to a FDA-approved indication, but may not be found within the four corners of the labeling," PhRMA contends in the white paper. "Any guidance issued by FDA should allow for the dissemination of health care economic data where the information is directly related to the clinical use of the drug for its approved indication, which more clearly reflects the clinical decision-making in a real-world practice setting."

Standards of Evidence and Distribution

Further, the paper's framework calls for FDA to elucidate on the standards of evidence required for claims. As noted in the 2010 Untitled Letter to Cumberland, the company had failed to make a persuasive case based on the evidence. So what would constitute "substantial" evidence?

PhRMA said Congress has "clearly" intended for a different standard to be applied to HCEI data than for traditional clinical claims of safety or efficacy, which require a randomized, controlled clinical trial. Instead, such claims should be governed by "competent and reliable scientific evidence," according to a Senate report referenced by PhRMA. That standard is now used by the Federal Trade Commission (FTC).

More rigorous standards of evidence would thus be "inappropriate," PhRMA argued.

Finally, PhRMA's framework argues that the manner in which HCEI is distributed needs guidance as well. The sophisticated audiences for whom HCEI is intended means that, "It is unlikely that any information disseminated consistent with these guidelines would have the potential to mislead or otherwise lead to inappropriate decisions," PhRMA explained. While FDA may be more than skeptical about that claim, PhRMA said several methods may serve to mitigate concerns:

  • The approved labeling for the drug should accompany dissemination of health care economic data.
  • Health care economic data that are disseminated should disclose the manufacturer's interest in the drug that is the subject of the communication.
  • If the manufacturer conducted or funded the economic analysis that is the source of the health care economic data, this should be disclosed.
  • Health care economic data should specify the design of the economic analysis, evidence underlying the economic conclusions, any limitations on the design of the study, and the sources used to value costs and clinical outcomes, along with any other methods, assumptions, or inputs used to develop the health care economic data. If the data has not been published (i.e., not subjected to an external peer review process), this should be disclosed.

A PhRMA spokeswoman tells Focus that the group is preparing to "talk about this publicly more" in the coming weeks and months, potentially placing additional pressure on FDA to release regulation or guidance on the subject. 

Tags: PhRMA

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