Wednesday, August 27, 2014

Teva recalls Parkinson's disease drug because it may be 'superpotent'

Teva Pharmaceutical Industries ($TEVA), whose manufacturing operation is being significantly pared down, is recalling one lot of its generic Parkinson's combo drug carbidopa/levodopa because it may have too much active pharmaceutical ingredient.
The drugmaker said the Class II recall involved 3,881 bottles of carbidopa/levodopa 25 mg/100 mg. Teva said that stability testing found that the product might be "superpotent." The voluntary recall is for the entire U.S.
The Israel-based drugmaker has had a number of significant recalls this year. In June it announced it was recalling nearly 130,000 cartons of its Tev-Tropin human growth hormone for children because there was a chance that oil leaked into it. In April the company voluntarily recalled more than 1 million bottles of its just-released generic of Eli Lilly's ($LLY) blockbuster antidepressant Cymbalta.

Teva is going through a major restructuring as it works to cut about $2 billion in costs. Its manufacturing network is being substantially pared to help achieve those cuts. CFO Eyal Desheh has told analysts that Teva intends to close roughly half of its 75 plants in the next four to 5 years. That is being done even as it builds some new facilities in faster growing markets like Russia.

Regulation of compounding pharmacies continues to evolve with house passage of "Drug Quality and Security Act"

In the current environment it seems that few, if any, pieces of legislation are moving through Capitol Hill. However, there is one area that has seen significant activity: the regulation of compounding pharmacies. Specifically, there has been bipartisan support for legislation intended to bolster the Food and Drug Administration's (FDA) oversight of compounding pharmacies in light of last year's unfortunate incidents involving compounded medications and meningitis. For example, H.R. 3089, also referred to as the "Compounding Clarity Act of 2013," received significant support from Representatives on both sides of the aisle when it was introduced on September 12, 2013. This led to the passage of the "Drug Quality and Security Act," H.R. 3204, which, according to the bill's sponsor, Rep. Fred Upton (R-Mich.), Chair of the House Energy and Commerce Committee, builds on the provisions of H.R. 3089 by eliminating the unconstitutional provisions of the Federal Food, Drug, and Cosmetic Act (FFDCA) that created uncertainty surrounding compounding laws, requiring the FDA to engage in two-way communication with state regulators and permitting entities that engage in pharmacy compounding to voluntarily register as "outsourcing facilities," making them subject to FDA current good manufacturing practices (cGMPs), risk based inspection provisions and other standards. The bill also includes provisions addressing drug supply chain security.
Voluntary Outsourcing Facilities
In contrast to H.R. 3089, which differentiated between traditional pharmacy compounding and "outsourcing" facilities based on the percentage of the facility's total compounded sterile drug products dispensed and shipped interstate, H.R. 3204 allows compounding pharmacies to voluntarily register with the FDA. The bill specifically states that an outsourcing facility is not required to be a licensed pharmacy and is not required to obtain prescriptions for identified patients, thus allowing outsourcing facilities to compound drugs pursuant to non-patient-specific purchase orders. Pharmacies that do not register as outsourcing facilities may be prohibited from compounding drug products without a valid prescription, and this could create an incentive for facilities to register as outsourcing facilities. Drugs compounded by a licensed pharmacist at registered outsourcing facilities would be exempt from FDA adequate directions for use, new drug application and approval and drug supply chain security requirements, so long as the following conditions are met:
  • Registration. Outsourcing facilities that elect to register with the FDA must pay an annual registration fee of $15,000.
  • Compounding Limitations. Registered outsourcing facilities are prohibited from compounding certain drugs, such as drugs that have had their approval withdrawn for safety reasons or drugs included on a newly created list maintained by the FDA of drugs or categories of drugs that are reasonably likely to lead to adverse effects.
  • Labeling. Drugs compounded by registered outsourcing facilities must be labeled in a manner that prominently identifies the drug as a compounded drug product.
  • Reporting. Registered outsourcing facilities must submit biannual reports identifying the drugs compounded by the facility for the prior six-month period and information concerning each drug. Registered outsourcing facilities also must report adverse events to the FDA.
  • Inspection. Registered outsourcing facilities will be subject to inspection by the FDA on a risk-based schedule that will consider factors such as the facility's compliance and recall history or the inherent risk of the drugs compounded at the facility to determine inspection frequency. Registered outsourcing facilities will be subject to "reinspection" fees should the FDA inspect the facility more than once in a given fiscal year.
  • Penalties. If a registered outsourcing facility fails to pay its registration and reinspection fees, all of the drugs compounded by the facility will be considered misbranded until payment of the outstanding fees.
Traditional Compounding and Communication With State Boards of Pharmacy
Like H.R. 3089, H.R. 3204 does not regulate traditional pharmacy compounding and, thus, allows state boards of pharmacy to retain primary oversight authority over such compounding activities. In addition, the bill provides for enhanced communications between the FDA and state boards of pharmacy by requiring that the FDA, in consultation with the National Association of Boards of Pharmacy, implement a system by which state boards of pharmacy may submit information describing actions taken against compounding pharmacies within the state and reporting compounding pharmacies that may be in violation of federal law.
The bill also commissions a Government Accountability Office study to be submitted to Congress within three years of bill passage that includes a review of pharmacy compounding in each state, the laws and policies governing pharmacy compounding in each state and state enforcement of these provisions, the tools available to permit purchasers of compounded drugs to assess drug safety and an evaluation of the effectiveness of the communication system between the FDA and state boards of pharmacy.
Clarification of the Federal Food, Drug, and Cosmetic Act
The bill also would modify multiple provisions in Section 503A of the FFDCA relating to pharmacy compounding. Specifically, provisions in 503A of the FFDCA prohibiting compounding pharmacies from advertising or promoting the compounding of any particular drug, class of drug or type of drug, would be struck from the FFDCA under the bill. However, the bill leaves the exemption from Section 351(a)(2)(B), 352(f)(1) and 355 in place for traditional pharmacy compounded products.
Issues to Consider With H.R. 3204
  • Sterile vs. Nonsterile Compounding. Under the bill, an outsourcing facility is defined as a facility that is "engaged in the compounding of sterile drug products." But what about pharmacies that provide compounded nonsterile topical or liquid medications?
  • Voluntary Outsourcing Facility Registration. While voluntary registration may provide outsourcing facilities with some benefits, including the ability to compound drugs pursuant to a non-patient-specific purchase order, it will be interesting to see if pharmacies believe the cost of compliance with the bill's requirements outweigh these benefits.
  • Animal Use. The bill's provisions apply only with respect to "human drug" compounding, even though a significant proportion of compounded drugs are intended for animal use. How will the bill affect compounding pharmacies that specialize in veterinary medication?
  • USP Adoption. Although the bill mentions United States Pharmacopeia (USP) standards, it does not expressly adopt these standards or apply them to compounding pharmacies nationwide. What role will USP standards play in the regulation of compounding pharmacies if the bill becomes law?

Compounding Pharmacies Engaging in Profiteering With “Designer Medications”?

Compounding medications are becoming more commonplace, and more expensive. These designer drugs include a baby rash cream that costs $1600 and a compounded pain treatment cream costing $2388 for a 30 days supply. Many pharmacy benefits managers and healthcare plans are saying that the compounding trend has gotten out of hand. “While creams typically contain about four ingredients, the $8,500 scar cream contained 13 ingredients, and the $2,300 pain cream had 18 ingredients, according to Catamaran [a pharmacy benefits manager]. The $1,600 diaper rash ointment had only two ingredients, one an organic floral extract.” (New York Times, 8/14/14)
Last year Congress passed legislation that would improve the federal oversight of compounding pharmacies, in the wake of the New England Compounding Center’s fungus-contaminated steroidthat reportedly led to the death of 64 people. The FDA still lacks the authority to regulate compounding medications, consequently, consumers are often left to deal with untested products and high prices when doctors prescribe compounded medications.
According to the New York Times, part of the problem is a result of billing practices. Since a compounding pharmacy can list and individually bill for each ingredient there is a tendency to add additional products. For example, the $2,388 topical cream for muscle pain contains two muscle relaxants, one local anesthetic, a nonsteriodal anti-inflammatory, a neuropathic pain treatment medication and a cream base. A typical treatment regime for muscle pain would cost significantly less than $200.  (New York Times, 8/14/14)  There is little or no research to prove that these “super medications” work any more effectively than traditional pain medications.
The healthcare insurance companies are now going to start restricting payments for these medications. “Express Scripts, the largest pharmacy benefits manager, has said it will stop paying for more than 1,000 ingredients used in compounding, cutting spending by its health plan clients on such medicines by 95 percent. It said such spending had grown to $171 million in the first quarter of this year from $28 million in the first quarter of 2012.”  (New York Times, 8/14/14)
Some states are beginning to pass laws to control spending on compounded drugs, specifically for workers’ compensation, according to the New York Times report. So far California has enacted legislation, Ohio established a $600 cap per prescription, and Georgia is looking at setting a limit on the number of ingredients allowed in each compounded medication.   (New York Times, 8/14/14)
As expected there is push-back from the compounding pharmacies.  Profits could be at risk.  The compounding pharmacies make many arguments supporting their exorbitant pricing.  One common reason they use for support is that patients depend on specially formulated medications if they have specific allergies or other conditions, like an inability to swallow pills. These are reasonable concerns, but perhaps an insufficient reason to charge thousands of dollars for creams and ointments that likely cost a small fraction of that amount to produce.  There is a fine line between meeting patient and market demands and profiteering.   It is reasonable to question whether some of these companies have crossed that line.

Who can Recall what FDA’s Mandatory Recall Authority is? A U.S. District Court Could Not…

It is rare that we urge our readers to keep a copy of a court ruling or brief.  A Brief that FDA filed on August 21, 2014 is an exception.  Companies and others should read this brief and keep it close at hand. When someone wants to question FDA’s legal authority to compel a recall, this brief provides the clearest statement of FDA’s limited authority to compel a recall.
We previously described (here and here) the litigation commenced by Hospira, Inc. (“Hospira”) wherein the company filed suit against FDA following the Agency’s approval of generic PRECEDEX (see FDA Dear Dexmedetomidine Hydrochloride Injection NDA Holder/ANDA Applicant Letter (Aug. 18, 2014) (hereinafter “FDA Letter Decision”)).  In summary, Hospira sought, and was granted, a Temporary Restraining Order (“TRO”) that included a stay of FDA’s Letter Decision, rescission of any ANDA approvals predicated upon that Letter Decision, an order that FDA recall any product sold or distributed under such an ANDA approval, and an injunction prohibiting FDA from granting any further or additional approvals predicated upon the Letter Decision.  The court order directing FDA to recall a drug product based on a Hatch-Waxman dispute was unprecedented.
Generally speaking, FDA cannot compel a mandatory recall, except in very limited circumstances as authorized by statute, none of which apply to drugs (see here at § 7-5-3).  FDA can order a recall when the Agency:
  • finds there exists a reasonable probability that a device intended for human use would cause serious, adverse health consequences or death (21 U.S.C. § 360h(e)(1)); 
  • determines that a batch, lot, or other quantity of a biological product presents an imminent or substantial hazard to the public health (42 U.S.C. § 262(d)(1)); 
  • determines that an adulterated or misbranded infant formula presents a risk to human health (21 U.S.C. § 350a(e); see also 21 C.F.R. § 107.200);
  • finds there is a reasonable probability that a tobacco product contains a manufacturing or other defect not ordinarily contained in tobacco products on the market that would cause serious, adverse health consequences or death (21 U.S.C. § 387h(c)(1)); or
  • determines there is a reasonable probability that an article of food (other than infant formula) is adulterated or misbranded and the use of or exposure to such article will cause serious adverse health consequences or death to humans or animals (21 U.S.C. § 350l(a));
Finally, FDA has the discretion to compel a mandatory recall when it finds that a human cell, tissue, or cellular and tissue-based product is a source of dangerous infection to humans, or does not provide adequate protections against the risks of communicable disease transmission.
Recalls, in situations other than those described above, are voluntary actions by a company expected to conform to FDA policy set forth in its regulations. 
Thus, as we circle back to the Hospira litigation, we arrive at a threshold question: can a court order FDA to order a recall?  The answer from the Defendant-Intervenors as well as FDA in this case is no.  FDA states clearly and succinctly in its Brief: “FDA cannot order recalls.”  The Agency goes on to argue that the recall ordered in the Hospira TRO could not even be requested by FDA because the basis for the recall was a patent dispute and not a matter of product safety or efficacy.  FDA says: “consumers should believe that recalled products present a risk to health or are grossly deceptive. That is decidedly not the case here.”  The Agency admitted that “[i]f a company chooses not to comply with an FDA request to recall, FDA has no mechanism to enforce its request because it does not have statutory authority to order drug recalls.” FDA also argued that the court-ordered recall was not in the public interest because the recall “threaten[ed] to disrupt the consistent regulatory standards for recalls.” Finally, the Agency makes the argument that a recall based, such as this, on a patent issue and not on a product safety or efficacy issue will undermine the perception of future recalls.  To this point, FDA says: “When other future products are recalled, consumers may question whether the recall is related to a legitimate public health concern, or whether it is merely another patent dispute in which safety or efficacy is not at issue. The public interest weighs strongly against” ordering a recall.
The district court held a hearing on August 26, 2014 to decide on a Motion for Reconsideration of the TRO entered on August 19th.  In the end, the court granted the Motion for Reconsideration in part and vacated that part of the TRO that ordered FDA to compel a recall of generic PRECEDEX.

Recall of Allerex and Optodexine Eye Drops

Hong Kong (HKSAR) - The Department of Health (DH) today (August 27) endorsed a licensed drug wholesaler, Ashford Pharmaceuticals Limited, to recall from the market all batches of Allerex Eye Drops (registration number: HK-54384) and Optodexine Eye Drops (registration number: HK-54304) due to a potential quality issue.

The DH received notification from the manufacturer of both pharmaceutical products in Macau that it is recalling Allerex and Optodexine Eye Drops from the market globally. According to the Macau manufacturer, the manufacturer of one of the products' active ingredients was found to have violated the Good Manufacturing Practice (GMP) requirements. Such a violation may pose potential risks of cross-contamination of raw materials, and hence the recall is being conducted as a precautionary measure.

"Locally, the DH's investigation is continuing.

So far, no reports of adverse events have been received relating to the use of the products," a spokesman for the DH said.

Allerex Eye Drops, containing antazoline and tetrahydrozoline, is an over-the-counter medicine for the treatment of allergic conjunctivitis. Optodexine Eye Drops, containing chloramphenicol, dexamethasone and tetrahydrozoline, is a prescription medicine for the treatment of eye infections.

According to the distributor, both Allerex and Optodexine Eye Drops have been supplied to local private hospitals, medical practitioners and pharmacies while Allerex Eye Drops have also been supplied to the DH's clinics. The DH will closely monitor the recall.

Ashford has set up a hotline (2976 9949) to answer public enquiries.

"Members of the public should stop using the products and seek advice from health-care professionals if in doubt or feeling unwell after use," the spokesman advised.

Contaminated Antibiotic Recalled

Federal health officials are alerting doctors to the recall of an injectable antibiotic made by B. Braun Medical, due to floating particles found in vials of the drug.
The Food and Drug Administration posted the notice late Tuesday, warning health professionals that the company has recalled lot H3A7444 of its Cefepime for Injection USP and Dextrose Injection USP. Visible particles were found in a sample from the lot, including specs of metal, cotton fiber and hair.
The agency warned that using the drug could result in blood clots causing stroke, heart attack and other catastrophic problems.
The drug was distributed to hospitals, pharmacies and medical suppliers nationwide, according to the agency's release.
Patients experiencing health problems should contact their physician and report all issues to the company at 1-800-854-6851.

Friday, August 15, 2014

Drug recalls could hit record high in 2014

If the number of drug recalls this year continues at its current rate, 2014 could bring in the highest number of recalls to date, according to a report from the Regulatory Affairs Professionals Society.
As of Aug. 11, pharmaceutical companies have initiated a total of 836 drug recalls. In 2013, there were 1,225 recalls, a significant jump from the 499 recalls in 2012.
The RAPS report finds the majority of recalls over the past handful of years were Class II, which the U.S. Food and Drug Administration categorizes as "a situation in which use of or exposure to a violative product may cause temporary or medically reversible adverse health consequences or where the probability of serious adverse health consequences is remote." In 2013, Class II recalls accounted for 84 percent of recalls. Already in 2014, 77 percent of recalls are classified as Class II.  
What's causing the surge in Class II recalls? The RAPS report indicates the fungal meningitis outbreak of 2012 that was linked to a compounding pharmacy led to heightened scrutiny on such facilities by the FDA, and many Class II recalls since then were related to such compounding pharmacies. Additionally, the report suggests recalls initiated for current good manufacturing practice deficiencies can affect dozens of products at a time, each one requiring its own recall notice.
However, "not all recalls are created equal," according to the report, which says a recall of thousands of drug products is treated the same as a recall for a single product. "Because many compounding pharmacy recalls are for just a small handful of products, it's possible that even with a large surge in the number of recalls, the total amount of productrecalled could be relatively consistent." (Original emphasis).


Lyme Disease Is Up Throughout The Hudson Valley & Around The State; Already More Cases This Year Than in 2013 & Projected to Be More than in 2012 - Access to Doxycyline, Medicine That Helps Prevent High-Risk Tick Bites From Becoming Chronic Lyme Disease, Is Essential
Today, at the Wurtsboro Open Ridge Space in Bloomingburg, U.S. Senator Charles E. Schumer urged the federal Food and Drug Administration (FDA) to investigate and proactively address a potential nationwide shortage of doxycycline, an antibiotic that is critical in treating Lyme Disease in both humans and animals. Despite how important Doxycycline is for treating Lyme Disease, the FDA has yet to get involved in this potential shortage even though it could limit access to the drug and is already significantly driving up the price. Doxycycline--which is typically administered in 100 mg doses, two times per day to those affected by Lyme--used to be an affordable drug treatment, but according to a recent article in the Poughkeepsie Journal, the medication costs ten times more this year than it did last year. Schumer said that, with Lyme Disease rates already higher in 2014 than in past years, and the large prevalence of Lyme in SullivanOrange andUlster Counties, Hudson Valley residents must have access to Doxycyline at a reasonable price. Therefore, Schumer called on the FDA to investigate and determine ways to mitigate this potential shortage. In addition, Schumer urged the FDA to more proactively address drug shortages, rather than wait for pharmaceutical companies to self-report them.
"Lyme Disease has been a public health problem for decades, and Sullivan andOrange Counties have been the epicenter of Lyme for as long as anyone can remember," said Schumer. "After many years of treating the disease, medical professionals around the country agree that the best way to prevent Lyme's worst short-term and long-term effects is with early detection and antibiotic treatment, usually Doxycycline. That is why it is so troubling to hear that the price of this important drug has gone through the roof due to a potential nationwide shortage. If the drug becomes unaffordable or - even worse - unavailable, it would be a serious problem for the thousands of local residents who need treatment right away. This year's Lyme season is already worse than last year's, and we should do everything we can to preserve patients' access to the treatment they need. So I am calling on the FDA to step up to the plate and investigate this potential shortage and resulting price spike, and I am urging them to do everything in their power to mitigate the impact. We cannot allow the Lyme problem to get any worse."
Schumer continued, "We also must make sure that the FDA is more proactive about addressing drug shortages over the long-term. Currently, they wait for a pharmaceutical company to report a shortage to them, but the FDA should step in and investigate as soon as there is even an inkling that a shortage may be on the horizon. We cannot afford for a shortage of any crucial drug to sneak up on us."

The Hudson Valley has long been an epicenter for Lyme Disease, which is spread to humans primarily by deer tick bites and can cause severe fever, headache, joint pain and stiffness, heart palpitations and swollen lymph nodes. According to theNew York State Department of Health, there were 796 reported cases of Lyme Disease in Sullivan County residents between 2002 and 2012. During the same time span, there were 7,391 reported cases of Lyme in Orange County and 4,551 reported cases of Lyme in Ulster County. And Lyme Disease rates are up throughout the state this year -- the CDC estimates that there have been approximately 2,000 cases in New York already this year, surpassing New York'stotal number of Lyme cases in 2013. In addition, the CDC estimates that the actual number of patients with Lyme Disease is likely ten times higher than is reported, so the total for the state this year could be as high as 20,000. These totals underscore that Lyme Disease is a significant threat for every Hudson valley resident.
According to medical professionals, the best way to prevent the debilitating short-term and long-term impacts of Lyme Disease is to diagnose and treat it early with a course of antibiotics - usually doxycycline. The CDC notes that it is usually the patients who are diagnosed and treated later for Lyme Disease that have the highest risk of persistent or recurrent symptoms, otherwise known as Post-Treatment Lyme Disease Syndrome (PTLDS). That is why having unimpeded access to Doxycycline is so critical. However, according to the American Society of Health-System Pharmacists, there is currently a shortage of doxycycline that could put Lyme Disease patients' ability to fill prescriptions for doxycycline at risk.
Schumer said that it would be a serious problem if the supply of Doxycycline was unfit to treat the growing number of patients with Lyme Disease. And already this potential shortage is having a major effect on the price of Doxycycline, which has skyrocketed over the past year. According to a study by the Drug Channels Institute, the cost of doxycycline has risen faster than any other generic drug over the past year, and the price of an individual had increased by as much as 6,000% at one point at the end of last year.
Schumer noted that it is traditionally the FDA's role to manage drug shortages, and they usually wait to get involved until a drug manufacturer alerts them of a supply chain or manufacturing chain disruption. Schumer said that, given the recent price hikes and the opinion of national drug monitoring organizations that there is currently a shortage, the FDA should investigate now to determine how to alleviate it so that patients have access to this lifesaving treatment. Schumer said that preserving patients' access to doxycycline, so they can begin taking the medication as soon as a tick bite is detected or Lyme Disease is diagnosed, is critical to keeping people healthy and out of doctors' offices, which is why the FDAshould quickly intervene.
Once a drug shortage is declared, the FDA works with the drug's manufacturer to determine why the shortage is occurring - for example, whether it is the result of an interruption in the manufacturing process or due to regulatory challenges - and works with the same or other manufacturers to increase production of similar drugs in order to limit the impact of a shortage. Schumer said that, in the case of doxycycline, it is critical for the FDA to begin putting these emergency drug shortage procedures in place so that Hudson Valley residents are not faced with a situation where they are unable to access or afford a medication that could help prevent significant pain and suffering. Schumer said that there are other medications that can be used to treat Lyme Disease, but doxycycline is the most commonly recommended treatment, which further underscores the pressing need to avoid a shortage.

Schumer was joined by Assemblywoman Aileen GuntherNancy McGrawSullivan County Public Health Services Director; as well as other local Lyme Disease advocates.
"Sullivan County has some of the highest rates of Lyme Disease in the state," said Assemblywoman Aileen Gunther. "The cost and availability of doxycycline has reached critical mass. Our local pharmacists say that the their costs for doxycycline have increased from about $45 per bottle to about $1000 per bottle, with insurance reimbursement rates not nearly keeping pace. This is simply unsustainable. Insurance companies and pharmaceutical companies need to be held accountable. I appreciate Senator Schumer bringing attention to this critical issue."
"The shortage of doxycycline has been a significant problem for patients with Lyme, as it is generally the first line of defense," said Pat Smith, President of the national non-profit Lyme Disease Association. "Couple that with the Centers for Disease Control & Prevention (CDC) announcement last year that new Lyme cases in the US are around 300,000 annually, which does not even include any of the other tick-borne diseases now emerging, many also treated with doxy, and you have had doctors and patients alike scrambling for treatment options. Now when doxy is available, the prices have skyrocketed so significantly that patients are sometimes unable to afford it."
"The American Society of Health-System Pharmacists appreciates Senator Schumer's efforts to mitigate and prevent drug shortages, in particular the shortage of doxycycline," said Bona Benjamin, Director of Medication-Use Quality Improvement at the American Society of Health-System Pharmacists. "In addition, ASHP remains committed to working with Senator Schumer, the Food and Drug Administration and other health care supply stakeholders to ensure continued supply of doxycycline."
Schumer noted that the doxycycline shortage does not just impact people's health; it affects pets too. Lyme Disease is very prevalent in dogs, who often run around in wooded areas where ticks are common. Lyme Disease is not as chronic or damaging in dogs as it is in humans, but it can cause acute arthritis and many expensive trips to the veterinarian. Dogs with Lyme Disease are also more likely to bring ticks with Lyme Disease into contact with humans, so it is important to treat Lyme Disease in dogs as quickly as possible. Schumer noted that the current doxycycline shortage that is driving up prices will have an even greater impact on dog owners who need to treat their dogs because many pet owners do not have pet insurance, which can help offset the high costs of the antibiotic. In addition, Schumer noted that horses are another animal prone to get Lyme Disease, and they require a course of doxycycline that is much greater than humans. According to the same Poughkeepsie Journal article, horses can require up to 6,000 individual doxycycline pills in order to treat Lyme Disease, which, given the shortage, would cost more money than many pet owners can afford.
In addition to pushing FDA to investigate this current potential shortage, Schumer also urged the FDA to be more proactive in addressing drug shortages in the future. Currently, the FDA waits for a drug manufacturer to register a shortage before working to alleviate it, but Schumer said the FDA should proactively engage manufacturers when a drug shortage is suspected. Schumer said that he would consider introducing legislation that would give the FDA the authority it needs.

A copy of Schumer's letter to FDA Commissioner Margaret Hamburg is included below:
Dear Commissioner Hamburg,
I write today to bring to your attention a potentially life-threatening drug shortage impacting a least a thousand New Yorkers who are suffering with Lyme disease. I urge the agency to investigate this potential drug shortage of doxycycline, one of the only medications available to treat Lyme disease. It is crucial that the Food and Drug Administration (FDA) take responsibility for the public health of U.S. citizens by effectively and efficiently managing drug shortages across the country.
As you know, doxycycline is a prescription antibiotic used to treat several different types of infections such as pneumonia, respiratory tract infections and Lyme disease by preventing the growth and spread of bacteria. The Centers for Disease Control and Prevention (CDC) report an estimated 1,972 cases in New Yorkalready this year, surpassing New York's total number of Lyme cases in 2013. Furthermore, CDC estimates that there could be as many as 300,000 cases of Lyme in the United States. When Lyme disease is not caught and treated early it can cause severe fever, headache, joint pain and stiffness or, even worse, heart palpitations and swollen lymph nodes. Living with Lyme disease is painful and can be a life-long battle. This is why it is absolutely critical that the proper medications be readily available to patients.
In 2012, I strongly supported the Food and Drug Administration Safety Innovation Act (FDASIA) provisions which gave the FDA greater authority to mitigate drug shortages by requiring all drug manufacturers to provide early notification of supply and manufacturing chain disruptions. FDASIA also required FDA to issue and make available to the public noncompliance letters to manufacturers that do not properly or adequately report drug shortages. While FDASIA has prevented many drug shortages, I am concerned that more could be done to protect patients and want to work with you to alleviate all shortages. To that end, I ask that your staff provide mine with a comprehensive assessment of the doxycycline shortage and steps to ameliorate the current situation.
In addition to the provisions in FDASIA, the FDA proposed the "Permanent Discontinuance or Interruption in Manufacturing of Certain Drug and Biological Products," rule in November 2013 and I am informed that it is set to be finalized in January 2015. While there are a number of important improvements in the rule, I hope that you will work with manufacturers and patients to expand your agency's role on drug shortages. For example, the FDA could be allowed to proactively engage manufacturers in the prevention of drug shortages, which would ultimately have a more significant impact on the citizens that rely on drugs that can be used to prevent and treat debilitating diseases.
Lyme disease is only one example of an illness that when left untreated can have serious and life-threatening consequences. The current potential shortage in doxycycline could potentially harm this growing population of patients with Lyme. I urge you to take immediate action to ensure that the FDA's handling of drug shortage cases is functioning at its most efficient level.
I appreciate your consideration of this important matter, and please feel free to contact me should you have any questions.
Charles E. Schumer
U.S. Senator

Pharmacies Turn Drugs Into Profits, Pitting Insurers vs. Compounders

It may be the biggest thing in diaper rash treatment, a custom-made product to soothe a baby’s bottom at the eye-popping price of $1,600.
This is no Desitin or Balmex, or any other brand found in stores. This cream is blended to order in a pharmacist’s lab.
Does it work better than the common treatments? There is little evidence either way. But the sky-high prices commanded by such compounded medicines are drawing the ire of health insurance companies that must pick up the bill. They say the industry is profiteering at their expense.
Compounded medicines are the Savile Row suits of the pharmacy, made to order when common treatments will not suffice. Pharmacists say it is the doctors who decide what to prescribe. But many pharmacies have standard formulations and some promise six-figure incomes to sales representatives who call on doctors.
Besides the $1,600 ointment to treat diaper rash, there was the $8,500 cream to reduce scarring and the $2,300 salve to relieve pain recently billed to Catamaran, a pharmacy benefits manager. Alarmed that its spending on compounded drugs has quintupled in just two years, Catamaran has begun to review such claims more carefully.
Dr. Sumit Dutta of Catamaran, a pharmacy benefits manager, says some compounded drugs are “unsafe and overly expensive.” CreditNathan Weber for The New York Times
Pharmacy benefit managers owned by UnitedHealth and Blue Cross and Blue Shield plans are also reining in spending on compounded drugs, as are insurers like Harvard Pilgrim and various state workers’ compensation plans.
Express Scripts, the largest pharmacy benefits manager, has said it will stop paying for more than 1,000 ingredients used in compounding, cutting spending by its health plan clients on such medicines by 95 percent. It said such spending had grown to $171 million in the first quarter of this year from $28 million in the first quarter of 2012.
“There are absolutely situations where compounded medicines are appropriate,” but other cases in which the products are “unsafe and overly expensive,” said Dr. Sumit Dutta, chief medical officer at Catamaran, which is based in Schaumburg, Ill. “If you remove the profit motive, what is the base-line appropriate use of these products?”
Exhibit No. 1 for those who contend that profiteering is at least part of the reason for the proliferation of compound medicines is the indictment in June in Southern California of 15 doctors, chiropractors, pharmacists and financial brokers, including a major donor to President Obama. They are charged with engaging in a kickback scheme that billed workers’ compensation for millions of dollars in such medicines and led to the death of a baby exposed to a compounded pain cream his mother was using.
But the compounding industry is fighting back.
“Millions of people benefit from compounding,” said Jay McEniry, executive director of a coalition formed hastily in June to fight the cuts by Express Scripts and others. “For the most part, people who take compounded medications have no alternatives.”
The coalition is called Patients and Physicians for Rx Access, though it was started mainly by compounding pharmacists.
Compounding, which dates from the ancient days of medicine, involves a pharmacist making medicines for a patient who cannot be helped by mass-manufactured drugs. For instance, patients might need a special formulation because they are allergic to an ingredient in a commercial product, or a liquid formulation if they cannot swallow pills.
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Two Examples of
Compounded Pain Creams

Claims for these creams were received by Progressive Medical/PMSI, a pharmacy benefits manager. According to Progressive, initial treatment for muscle pain and inflammation would be the oral drugs ibuprofen, a nonsteroidal anti-inflammatory drug, and baclofen, a muscle relaxant. A 30-day supply for both combined would cost no more than a few hundred dollars and probably far less. Compounded pain creams contain many more ingredients and are much more expensive, as in these two extreme cases.
$2,388 total cost
Nonsteroidal anti-inflammatory
Local anesthetic
Muscle relaxant
Muscle relaxant
Neuropathic pain treatment
Cream base
$4,100 total cost
Muscle relaxant
Muscle relaxant
Local anesthetic
Neuropathic pain treatment
Nonsteroidal anti-inflammatory
Cream base
But compounding has grown well beyond that, and has gotten black eyes in the process. Two years ago, about 750 people were sickened and 64 of them died from injections of a fungus-tainted steroid made by the New England Compounding Center, a company that was essentially mass manufacturing.
Congress last year passed legislation to improve federal oversight of compounding, particularly such large operations.
The new controversy centers on medicines that are not injected, mainly topical creams to treat pain and scarring. People in the compounding business say that spending on such drugs is growing because doctors are turning away from the maligned painkillers known as oral opioids out of concern about abuse. A cream delivers relief more directly to painful joints or muscles, with less entering the bloodstream to cause side effects.
They also say the cost of ingredients has risen because of increased regulatory scrutiny of overseas chemical manufacturers. Even so, they say, compounded drugs account for less than 1 percent of pharmaceutical spending. Another factor appears to be a change in an industry standard for how such medicines are billed, which took effect in 2012.
Before that, pharmacists submitted claims listing just the main ingredient, usually with some markup. Under the new system, each ingredient is listed, with its cost.
This is something pharmacy benefit managers wanted. But they now say that compounders, knowing they can bill for each ingredient, have begun adding more of them.
While creams typically contain about four ingredients, the $8,500 scar cream contained 13 ingredients, and the $2,300 pain cream had 18 ingredients, according to Catamaran. The $1,600 diaper rash ointment had only two ingredients, one an organic floral extract.
Pharmacy benefit managers say there is scant evidence that these combinations of ingredients are safe or any more effective than conventional drugs approved by the Food and Drug Administration, like Voltaren Gel, a topical pain treatment with only one active ingredient that costs about $50 a tube. Compounded drugs do not require F.D.A. approval.
Kareem Ahmed was accused in a medical kickback scheme.CreditPaul A. Hebert/Invision, via Associated Press
Some states are acting to control spending on compounded drugs in workers’ compensation, said Brian Allen, vice president for government affairs at Progressive Medical/PMSI, a workers’ comp pharmacy benefit manager. California passed a law in 2011 and Ohio has set a limit of $600 per prescription. Georgia is looking at a limit of three ingredients per prescription.
But some say abuses continue and point to the indictments issued in June by a grand jury in Orange County, Calif. They center on Kareem Ahmed, a million-dollar donor to President Obama’s re-election campaign.
According to a 2012 profile of Mr. Ahmed in Talking Points Memo, his company, Landmark Medical Management in Ontario, Calif., buys accounts receivable from doctors and other health care providers treating workers’ compensation cases. The doctors and pharmacists get less than the face value of the claims, but do not have to wait months for processing. Landmark profits when the claim is eventually paid.
But the indictments said the purchase of accounts receivable was really a disguised kickback to doctors and chiropractors to induce them to prescribe compounded creams that Mr. Ahmed had formulated “based on the profitability of the ingredients.”
The indictments also named 10 doctors or chiropractors, two pharmacists and two Landmark employees.
Priscilla Lujan of Los Angeles applied one of those creams to her knee for a workplace injury and then prepared a bottle for her 5-month-old son, according to her lawyer, Shawn J. McCann. She allowed the baby to bounce on her knees and suck her fingers.
The next day, the boy, Andrew Gallegos, was dead, from what the coroner’s office called “multiple drug intoxication” with “extremely high and lethal” levels of some of the pain cream ingredients in his blood.
Benjamin N. Gluck, a lawyer for Mr. Ahmed, said, “Mr. Ahmed and Landmark complied with all applicable laws at all times and we expect to be fully vindicated.”
He said the prosecution’s legal theory was “defective and has never been accepted by any court.” He added that selling accounts receivable, a practice known as factoring, was “a common and completely legitimate business practice” that was “especially necessary in the medical field because insurance companies make it so difficult, time-consuming and expensive for providers to collect on their bills.”