Health Care Law Matters

Contributed by Rebecca Jones McKnight as part of our ongoing Quality Matters series.

It has been hard for those in the life sciences industry to ignore the fact that quality matters (see our prior blog on this topic).  Despite the complexities of dealing with quality in the context of a global supply chain and distribution network, now is no time to be caught with your head in the sand.

This month, FDA issued a special report on the Pathway to Global Quality and Safety (the “Report”) calling for a transformation of the way the agency conducts business with respect to global product safety. 

Times, They Are A Changin’

• According to the Report: “Just a decade ago, 6 million shipments of FDA-regulated goods passed through the nation’s 300 ports of entry. This year the number will quadruple to 24 million shipments.”
• Earlier this year FDA Commissioner Margaret Hamburg noted that the realities of global economic conditions, as well as innovations in refrigeration, transportation, and communication, have enabled and spurred consolidation and globalization, resulting in a striking rise in imports of FDA-regulated goods.
• Hamburg also cited the pressure on industry to reduce costs and increase productivity; the search for cheaper production and testing locations—across the globe—is not likely to stop anytime soon,
• John M. Taylor, FDA Acting Principal Deputy Commissioner, also commented earlier this year: "[T]he supply chain from manufacturer to consumer has become more and more complex . . . involving a web of re-packagers and redistributors . . . making oversight significantly more difficult.”
• Taylor suggested that with the growth of internet commerce, consumers are able to purchase products more directly, bypassing traditional safeguards.

We Are The World

• The products we use are increasingly global.  Hamburg has stated it is necessary to work globally in order to protect American consumers.
• FDA has called for working together with health authorities in other countries to establish greater coordination and enforcement of regulatory standards to ensure safety and quality regardless of where a product comes from, and to help build regulatory capacity in those countries that are more resource poor and systems that are still developing.
• According to Taylor, the agency’s aim is to construct a global coalition of regulators and to build capabilities in intelligence gathering and risk analytics, as well as to enhance global information and data sharing, and leverage public and private third parties to more effectively allocate FDA resources based on risk.

Living In America

So what can companies regulated by FDA expect, based on the Report?

• FDA plans to establish a review and audit infrastructure to verify the integrity of the information submitted by industry, members of the public, other third parties to ensure that the agency can take rapid follow-up enforcement measures or actions where needed.
• In order to stay competitive, western economies will increase their productivity, which will lead to more imports and increased pressure to reinvent manufacturing processes.
• “Money, goods, data and people will increasingly and more quickly cross borders.”
• “Manufacturers will adopt new manufacturing processes and emerging technologies in response” to increased demand, limited supply, and an increase in regulatory and public scrutiny.
• “Governments worldwide will increasingly be called upon to mitigate the sometimes negative impacts of globalization on their citizens,” with potential impact on U.S.-based or –regulated companies.

Please contact us for specific advice on how your company can navigate this changing landscape.

Contributed by Kimberly K. Egan and Rebecca Jones McKnight as part of our ongoing Quality Matters series.

Have you done a mock GMP audit?  Do you have quality agreements with all of your suppliers?  Have you personally met your contract manufacturers?  Do you know if any of your components or ingredients come from China? 

In other words, are you ready for the new world of Good Manufacturing Practices enforcement?

It used to be that if something went wrong in a company’s Quality System, FDA could – from some perspectives – dawdle along, issuing some 483 Observations, dialoguing back and forth with the company about corrective measures and timelines for putting them into action, and possibly issuing a Warning Letter when it was all over.  It used to be that FDA reserved more serious enforcement measures for repeat offenders and scofflaws.  An early indication that things would be changing came when FDA Commissioner Margaret Hamburg announced on August 6, 2009 that FDA would give companies only 15 days to respond to significant inspection findings, or FDA would issue a Warning Letter or take other enforcement action.

Still, FDA’s enforcement of its current Good Manufacturing Practices (GMP) rules was largely the domain of quality assurance personnel and plant managers, with words like “validation,” “deviation” and “calibration” rarely catching the interest of the Department of Justice, much less the media.

That all changed late last year.  On October 26, 2010, the Department of Justice announced it had settled a dispute with GlaxoSmithKline for $750 million.  Especially notable was that in doing so, the Department of Justice confirmed that GMP violations could constitute health care fraud. 

This changes the GMP enforcement environment substantially.

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