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BioCommunique Article

Takeaways from FDA Commissioner, Dr. Scott Gottlieb’s video conference interview and what you need to know about the government shutdown.

Biocom CEO Perspective on the 2019 J.P. Morgan Conference & the Government Shutdown

  • 2019-01-21T06:21:00.000+0000
  • California
  • Author: Joe Panetta

The J.P. Morgan Healthcare Conference took place the week of January 7th in San Francisco with more than 450 presenting companies and more than 9,000 attendees. We’re eager to share the experience of Biocom’s CEO as well as an update on the government shutdown and how it is affecting our members and California’s life science innovation. Here’s what our CEO had to say after returning from the 37th Annual J.P. Morgan Healthcare Conference:

Upon arriving to the overflowing luncheon plenary at JPM last week, I was pleased to be able to find a center front room seat to hear FDA Commissioner Scott Gottlieb’s interview that took place via video telecast from Washington, DC. Dr. Gottlieb was to be there in person, however, he could not travel to the event due to the government shutdown.

Dr. Gottlieb began the interview by commenting that the Agency will issue a number of new guidance documents this year, much of the aim being to promote greater competition. He shared that he does not see FDA getting into evaluating the cost-effectiveness of drugs; rather this role should remain with the open market. One important guidance will address interchangeability, meaning the ability to substitute a biosimilar for the reference biologic the same way a generic can be substituted for the novel pharmaceutical. He expressed concern about the potential for failed biosimilar launches discouraging other companies from entering the market.

Gottlieb also stated said that FDA will outline new parameters for companies to go through the Abbreviated New Drug Application process – or ANDA, the approval process for generics – with a complex generic process. One specific focus will be on complex generic drugs, which are generic versions of drugs that, while no longer protected by patents or exclusivity, have certain features that make “generalizing” them more difficult, such as complex injectables and asthma inhalers.

On my overall impressions of the JP Morgan Health Care Conference:
Once again this year, there was a trend of up-beat expectations for innovation, product development and continued progress toward commercializing many new drugs and technologies. The specter of Congressional scrutiny and regulation of drug pricing, and similar indications by the President that he plans to do something about what he believes is too high a cost for drugs did not dampen the overall atmosphere at the meeting.

I was pleased to hear presentations made by CEOs of many of our member companies, which greatly contributes to my understanding of the overall progress that the California life science industry is making in our quest to develop new cures and therapies. I was also pleased to speak with reporters about the important issues facing the industry and prospects for the future from important industry publications such as Xconomy and The Economist, and to participate on a panel discussing the intersection of policy and sentiment regarding drug pricing at the well-attended nearby Biotech Showcase and to provide closing remarks after a remarkable seminar on the future of biotechnology at the annual WuXi Global Forum.

On the government shutdown:
With the government shutdown still in effect, we here at Biocom are focused around our members and how this has directly impacted them. Paul Laikind, President and CEO of Viacyte is concerned with the SEC being closed for public offerings, which means that while the SEC will accept filings, no one is available to review them. This halt effects those filing now, but even more alarming is the backlog that will impact future filings.

Ted Shroeder, CEO of Nabriva Therapeutics, shared that while Nabriva has seen no impact, he worries about the statements made by Dr. Gottleib regarding the remaining five weeks of cash left if the shutdown isn’t resolved before then. “Does that mean that the FDA will work on our applications until the cash runs out and then stop? If this occurs, the impact to Nabriva will be substantially negative,” Shroeder commented.

Sandra Brown, vice chancellor of research at UC San Diego shared how they have been greatly affected by the shutdown with some of their postdoctoral researchers considering or actively seeking, personal loans because they are currently working without salaries.

"We are beginning to see issues surfacing in multiple areas of research at UC San Diego. Last year we received approximately $130 million in funding for new projects from agencies that are currently shut down (most significantly from NOAA, NASA and NSF). This means that although projects underway can continue, no new projects funded from these agencies can be launched and decisions cannot be made regarding current projects. This is already posing problems for researchers transitioning to new projects and all individual research fellowships awarded in the last several months are on hold until the shutdown ends. We have postdoctoral scholars considering or actively seeking personal loans as they have no salaries. Additionally, postdocs, professors and researchers are finding their work impeded by the shutdown. Most notably, agency staff are not able to process needed forms and verifications so some projects may not just be delayed, but cancelled meaning researchers will miss a year’s worth of data."

Brittany Blocker, Biocom’s Manager of Regulatory Affairs in our Washington DC office breaks down what life science companies need to know about the government shutdown:

The partial government shutdown took effect on December 22nd after political leaders failed to reach an agreement to keep the government open through the holidays and into early 2019. Heading into its 31st day, the partial shutdown is the longest in US history and has impacted about 25% of the government and caused approximately 800,000 federal workers to be furloughed or work without pay. 59% (10,344) of the Food and Drug Administration (FDA) employees have been retained and 41% (7,053) have been furloughed during the shutdown.

During the lapse period, FDA can still maintain essential public health-related operations as well as continue to perform user fee funded activities for prescription and generic drugs, biosimilars, medical devices, animal drugs, and tobacco products. The agency will still conduct vital activities to respond to emergencies, manage high-risk recalls, pursue criminal enforcement work and civil investigations related to imminent threats to human health or life, review import entries to determine potential risks to health, and respond to other critical public health issues, as appropriate.

FDA can only perform user fee-funded activities using carryover user fee balances and is unable to collect FY2019 user fees until new appropriations or a Continuing Resolution is passed, which means no new applications for products under user fee programs will be accepted. Commissioner Scott Gottlieb has cautioned the agency only has about five more weeks’ worth of funding left. Consequently, the FDA has suspended reviews of existing Investigational New Drug (IND) and Biologics License Application (BLA) applications not covered by user fees, and is not reviewing applications for new drugs, biologics, and medical device submitted during the shutdown period, except for emergency INDs and BLAs. Other suspended activities include the development of policies, such as the drafting of guidances, finalizing draft guidances, proposing or finalizing rules, and acting on citizen petitions. The agency isn't responding to Freedom of Information Act requests, hiring and training new staff, and making frequent updates to the website.

As the shutdown continues to drag on, it will put anticipated new treatments in jeopardy due to delays in FDA decision-making for drug and device sponsors that planned to submit applications at the start of 2019. STAT reports that upcoming regulatory decision dates for highly anticipated drugs from Janssen, Sanofi, and Novartis for depression, diabetes and multiple sclerosis could soon be impacted. The FDA will be issuing additional information on activities being continued during the shutdown via Twitter.