This follows the agency’s official end to the enforcement discretion period for developers of human cell, tissue, or cellular or tissue-based products (HCT/Ps), and it foreshadows stepped up enforcement after years of industry surveillance and notice by FDA’s Center for Biologics Evaluation and Research (CBER) to stem cell clinics and other HCT/P establishments that it considers to be marketing products unlawfully. This summer and beyond, we expect stepped up enforcement actions by the agency against parties marketing unapproved stem cell products, especially as FDA returns to full operational capacity and barriers to inspections arising from the COVID-19 pandemic wane.
This article is the sixth in our 2022 series, “Trends in Cell, Tissue, and Gene Therapies,” which aims to help you stay informed about the broad array of legal and regulatory issues affecting companies operating in the regenerative medicine space.
In 2017, FDA published a new regenerative medicine policy framework consisting of four guidance documents, which provided for a “grace period” of risk-based enforcement discretion for certain HCT/Ps. This grace period was meant to give certain manufacturers time to assess whether they needed to file an IND or marketing application with FDA, or whether they met the four regulatory criteria for continuing to market their products solely under the authority of section 361 of the Public Health Service Act (PHSA), which does not require pre-market review and approval. However, this “enforcement discretion” period ended on May 31, 2021, and FDA began cracking down on companies operating in the space that are not in compliance with the agency’s regenerative medicine policy framework.
We recently analyzed (online here) the significance that these warnings carry for companies in the regenerative medicine space, and outlined the potential risks of noncompliance. These risks go well beyond FDA enforcement, and include the possibility of FTC action, False Claims Act liability, product liability claims, and susceptibility to private lawsuits. Previously summarized here, the crackdown on illegally marketing unapproved stem cell treatments continues the stepped up enforcement by FDA, U.S. Department of Justice (DOJ), and the Federal Trade Commission (FTC). That enforcement has included actions against clinics in California, Florida, and New Jersey (those actions summarized here). Since December 2018, FDA has issued at least 400 letters to manufacturers and health care providers who may be offering violative stem cell or related products. In addition, since 2018, FDA has issued 46 Untitled Letters involving violative HCT/Ps, with over two dozen of these issuances occurring in 2020 and 2021.
Recent enforcement actions
In an Untitled Letter issued against Regenerative Stem Cell Institute this past April, FDA reviewed the Institute’s website, Facebook page, and YouTube channel for advertising and promotion about stem cell products marketed without an IND application. FDA also implied that the Institute’s claim that its products are offered “under an IRB Approved Research Protocol” was an attempt to circumvent submitting an IND. FDA emphasized that an “IRB approval is required in addition to, not in lieu of, obtaining an effective IND from FDA for the study of the investigational drug or biological product.”
In addition to focusing on advertising and promotion enforcement, FDA’s inspections have also targeted deviations from Good Manufacturing Practice (GMP) and Current Good Tissue Practice (CGTP) requirements. Another recent Warning Letter issued in February against Smart Surgical, Inc dba Burst Biologics demonstrates this trend, citing significant GMP and CGTP violations, including deficient donor screening, inadequate aseptic practices, unvalidated manufacturing processes, and deficient environmental monitoring. For example, the firm both failed to effectively screen donors from areas considered a higher risk for Zika viral transmission and failed to conduct media fill simulations to validate that the aseptic manufacturing process can “consistently produce products free of viable microorganisms.”
While factors such as limited staff and resources continue to slow down FDA’s enforcement goals, some have suggested that FDA increase its coordination with other regulators such as DOJ, FTC, state attorneys general, and state legislatures and medical boards.
Stepped up enforcement likely
Coming out of the COVID-19 pandemic, we expect to see more enforcement activity around claims/promotion of stem cell products and manufacturing compliance and quality of such products, likely to be focused on scenarios that present the highest or significant potential risk to patients and consumers. At a recent regenerative medicine webinar, CBER Office of Tissues and Advanced Therapies (OTAT) Director Wilson Bryan, M.D., said his office has been increasingly notifying, warning, and taking legal enforcement actions against manufacturers, clinics, and individuals administering unapproved regenerative medicine therapies. Indeed, in a January 2022 reorganization, OTAT added another branch to handle gene therapies, as well as a new Tissue Engineering Branch.
Speaking Tuesday at the Food and Drug Law Institute (FDLI) Annual Conference, Mark Raza, FDA Acting Chief Counsel, discussed the investigations priorities for FDA’s Office of the Chief Counsel (OCC), including its focus on stopping stem cell clinics that put patients at risk. Raza described how FDA was pleased with several recent court rulings in favor of the agency, including that the Eleventh Circuit upheld the US Stem Cell Clinic ruling in favor of FDA. Responding to that verdict, the agency said that although cell-based regenerative medicine holds significant medical opportunity, FDA “cannot allow unproven products that exploit the hope of patients and their loved ones”; we previously summarized this case online here.
Companies currently marketing HCT/Ps without licensure or other FDA marketing authorization are required to meet criteria found in section 1271.10(a) of Title 21 of the Code of Federal Regulations; those that do not are faced with limited options if they wish to lawfully commercialize those products. Of course, FDA would like to see companies in this situation submit an IND, initiate controlled clinical studies, and ultimately submit a marketing application. However, for many companies in this situation, the prospect of opening an IND and initiating registrational-quality clinical studies is daunting. A number of significant questions arise in the context of companies that pursue an FDA approval for their HCT/Ps. For example:
Will FDA require companies in this situation to conduct preclinical animal studies before initiating clinical trials in humans?
Will companies be able to persuade FDA to accept data from previous human experience with their products to support moving directly into later-stage clinical studies (rather than being required to start with conventional phase 1 trials)?
If companies previously conducted uncontrolled open-label studies with their products, will FDA be willing to accept data from those studies in support of a marketing application?
If a company lawfully markets an HCT/P in other countries, could the company submit patient data from those countries to FDA as real world evidence in support of a regulatory approval?
Will companies in this situation be able to qualify for any of FDA’s expedited programs for serious conditions, such as Fast Track, Breakthrough Therapy, Accelerated Approval, or Regenerative Medicine Advanced Therapy designation?
FDA still remains committed to bolstering cell and gene therapy approvals. The agency recently stated at the Association for Cell and Gene Therapies that it plans to undertake a series of internal measures to widen its messaging using more “group communications” through guidance, workshops, and webinars. Nevertheless, it remains to be seen how flexible FDA will be in working with companies that make a good faith effort to pursue regulatory approvals for their HCT/Ps.
If you have any questions on responding to the potential for stepped up enforcement, or if you need to evaluate whether your products and facilities comply with FDA’s regenerative policy framework, please contact any of the authors of this alert or the Hogan Lovells attorney with whom you regularly work.
Authored by Lowell Zeta and Akosua Tuffuor
This article is the sixth in our 2022 series, “Trends in Cell, Tissue, and Gene Therapies,” which aims to help you stay informed about the broad array of legal and regulatory issues affecting companies operating in the regenerative medicine space. From clinical studies, to obtaining patents, to scaling up manufacturing, our global team will discuss novel issues arising in all parts of the world, including unique deal-making, litigation, and inspections concerns for CTGT companies. Ensure you are subscribed to Hogan Lovells Engage to receive these new insights weekly!