Food & Drug Law InstituteAnnual Conference

Washington, D.C.April 22, 2009

Michael A. Swit, Esq.Vice President

Drug Safety –Perspectives on Industry’s Duties in the Post-Vioxx Age

Standard Disclaimers

Views expressed here are solely mine and do not reflect those of my firm or any of its clients.

This presentation supports an oral briefing and should not be relied upon solely on its own to support any conclusion of law or fact.

A New Paradigm? … or Is Ignorance Bliss? … A View on

Safety & Corporate Duty

Has the “bar been raised” by what has been reported about corporate handling of drug safety since Sept. 30, 2004? My view – YES.

A key issue today -- Do you have a duty to investigate even in the absence of any indicia of a problem?

Answer – Yes … and let me tell you why …

Duties Under the Federal Food, Drug,

and Cosmetic Act

U.S. v. Park –responsible corporate agents in a position to prevent a violation can be criminally liable for FDA violations even w/o intent or knowledge. “Positive” duty to seek out potential

violations “Positive” duty to implement measures

to ensure violations will not occur

Duties Under General Corporate Law

Delaware law – must have an adequate compliance program to prevent violations and probe to ensure violations do not occur – Caremark (1996) In considering a board’s potential liability for failure

to monitor, the court emphasized the importance of a board exercising “a good faith judgment that the corporation’s information and reporting system is in concept and design adequate to assure the board that appropriate information will come to its attention in a timely manner as a matter of ordinary operations .”

Duties Under Corporate Law …

McCall (2001): Columbia/HCA shareholder derivative action against board members; Directors lose protection of “business

judgment” rule and are personally liable for failure to detect and correct violations

Board’s duty of care breached through nonfeasance: failure to investigate items from internal audit

Abbott – similar result relative to failure to act on GMP problems

Duties Under Sarbanes-Oxley

No overt duty to investigate corporate problems; however, under SOX, multiple duties on a company to have adequate procedures to ensure accuracy of public reports

Question – how can you know if your financial reports are accurate if you don’t know the status of the licenses – whether an NDA, BLA, ANDA, etc. – supporting your key products?

Answer – duty to probe into the future of those licenses

So, What Do You Do?

Some Ideas

Not Recommended

A “Guidant” Style IndependentReview Group

Guidant’s Independent Panel – recommended a permanent outside panel to review adverse events

Does this create a new standard for corporate action? Not clear, but do we want to have the plaintiffs

bar cite its absence? Look at your product line – if your products are

such that failure is likely to trigger Class I recall, consider strongly

The Product Dossier & Development Audit

Comprehensive review of applications (pending or approved) –triaged on criteria based on risk

Goal – What did we know? When did we know it? What did we do about it? Was what we did about it consistent with

benefit/risk? Do we need to take additional action? If so, what is best to protect public health?

Thoughts on Guidances &Other Actions FDA Should

Takeon Drug Safety

Transparency on REMS – Continue to Disseminate Information on

Approved REMS

http://www.fda.gov/cder/drug/DrugSafety/REMS.htm

What FDA Can Do on Drug Safety

Inspect and Enforce Put fear of Wiley in industry Home and abroad But, be careful in selecting borderline cases – Balanced and

Consisten Challenge – resources – human and financial

More guidance – are they needed? Current “Drug Safety” Guidances:

Conducting a Clinical Safety Review of a New Product Application and Preparing a Report on the Review [HTML] or [PDF] Final 2/2005

Drug-Induced Liver Injury:  Premarketing Clinical Evaluation [PDF] or [HTML] Draft 10/24/2007

Drug Safety Information - FDA's Communication to the Public [PDF] or [HTML] Federal Register Notice [TXT] [PDF] Final 3/2/2007

However – many other guidances clearly relate to Drug Safety

Lingering Questions How will FDA communicate its views of

appropriate Risk Management beyond publishing information on specific implemented REMS?

Where is FDA on fully implementing the CGMPs for the 21st Century Initiative?

How else can industry learn that vigorous compliance is the best insurance on drug safety issues and good business practices?

A Side Note on Products Liability

and Drug Safety

Wyeth v. Levine Take home message – “logical result” – any doubt,

submit a Changes Being Effected (CBE) supplement But – will that lead to over warning?

Are more warnings the answer? Do we have any empirical data that more warnings improve patient outcomes? Boxed warnings? Multiple warnings? Access to Clinical Trial Results Databases

On latter, does it emasculate whatever is left of the Learned Intermediary Doctrine? How possible – too much information to digest; physician

can’t keep up; thus, less learned Don’t know the answers, but these bear examination

Ancient Chinese Curse

May You Live In Interesting Times …

(possibly an ancient Chinese Curse)

Call, e-mail, fax or write:

Michael A. Swit, Esq.Vice President

The Weinberg Group Inc.336 North Coast Hwy. 101

Suite CEncinitas, CA 92024

Phone 760.633.3343Fax 760.454.2979Cell 760.815.4762

michael.swit@weinberggroup.comwww.weinberggroup.com

Questions?

About your speaker…Michael A. Swit, Esq., is a Vice President at THE WEINBERG GROUP, where he develops and ensures the execution of a broad array of regulatory and other services to drug and biologics clients seeking to market products in the United States. His expertise includes FDA development strategies, compliance and enforcement initiatives, recalls and crisis management, submissions and related traditional FDA regulatory activities, labeling and advertising, and clinical research efforts.

Mr. Swit has been addressing critical FDA legal and regulatory issues since 1984. His multi-faceted experience includes serving for three and a half years as corporate vice president, general counsel and secretary of Par Pharmaceutical, a prominent, publicly-traded, generic drug company and, thus, he brings an industry and commercial perspective to his work with FDA-regulated companies. Mr. Swit then served for over four years as CEO of FDANews.com, a premier publisher of FDA regulatory newsletters and other specialty information products for the FDA-regulated community. His private FDA regulatory law practice has included service as Special Counsel in the FDA Law Practice Group in the San Diego office of Heller Ehrman White & McAuliffe and with the Food & Drug Law practice at McKenna & Cuneo, both in the firm’s Washington office and later in San Diego. He first practiced FDA regulatory law with the D.C. office of Burditt & Radzius.

Mr. Swit has taught and written on a wide variety of subjects relating to FDA law, regulation and related commercial activities, including, since 1989, co-directing a three-day intensive course on the generic drug approval process and editing a guide to the generic drug approval process, Getting Your Generic Drug Approved. A former member of the Food & Drug Law Journal Editorial Board, he also has been a prominent speaker at numerous conferences sponsored by such organizations as RAPS, FDLI, and DIA. A magna cum laude graduate of Bowdoin College, he received his law degree from Emory University Law School and is a member of the California, D.C. and Virginia bars.