International Initiatives on
Drug Safety
Linda R. Horton
Partner
Hogan & Hartson LLP
Brussels & Washington, DC
LRHorton@HHLaw.com
August 23, 2007
3rd Annual FDA Regulatory and Compliance Symposium
1
Harvard University Campus, Cambridge, MA
What we will discuss today
 EU Update
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Tightening Up: “First Time in Humans” Clinical Trials
Lightening Up: Biosimilars
Meds Made of Us: Advanced Therapies/Tissue-Engineering
Meds for Kids: EU Pediatrics Regulation
Truth or Consequences: EU Penalties Regulation
 Clinical Trials in Developing Countries
 Counterfeits and Sub-Standard Drugs
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The Problem
IMPACT: WHO Initiative
EU and Council of Europe Initiatives
APEC Initiatives
China Initiatives
2
EU Update
1. Tightening Up: “First Time in Humans” Clinical Trials
2. Lightening Up: Biosimilars
3. Meds Made of Us: Advanced Therapies/Tissue-Engineering
4. Meds for Kids: EU Pediatrics Regulation
5. Truth or Consequences: EU Penalties Regulation
3
To recap from 2005 and 2006:
 Looking over the Atlantic ≠ looking in a mirror.
 There is no United States of Europe.
 There is no EU FDA although, since 1995, there has
been a European Medicines Agency (EMEA).
 Each of the 27 Member States has 1 or more agencies.
 Although today 70% of new products enter via EMEA
route, most products on the EU market were approved
by Member State agencies.
4
Isn’t the EMEA like the FDA? Not quite.
The EMEA is a secretariat for a network of experts.
 There are (largely) uniform rules on testing, clinical trials,
applications, pharmacovigilance, and GMPs.
 But clinical trial regulation is entirely by Member States.
 Enforcement is by Member States.
 Review of EMEA/centrally authorized product occurs chiefly
in the national regulatory agency where rapporteur works.
 European Commission is the one who grants authorization.
5
Tightening Up: “First Time in Humans” Clinical Trials - Issues
 How should the transition from preclinical to first-in-man
testing be regulated for novel therapeutic modalities?
 How to make the transition from preclinical to human
studies without creating unnecessary obstacles?
 How to deal with the question of liability and insurance?
 Do the national regulatory authorities and the ethics
committees carry any responsibility in case of a
problem?
6
The TeGenero phase 1 trial

A sponsor, Tegenero AG, wanted to conduct a human study of a novel superagonist
anti-CD28 monoclonal antibody that directly stimulates T cells

The conventional battery of preclinical toxicity tests completed by TeGenero appeared
to the UK and German regulators to justify approval of clinical trial

Eight healthy male volunteers were recruited and dosed by Parexel Clinical
pharmacology research Unit (CPRU) on March 13, 2006. Two subjects received a
placebo. Serious Adverse Events (SAEs) were reported in 6 of the 8 subjects:
 Within 90 minutes: systemic inflammatory response characterized by a rapid
induction of proinflammatory cytokines and accompanied by headache, myalgias,
nausea, diarrhea, erythema, vasodilatation, and hypotension
 Within 12 to 16 hours: they became critically ill, with pulmonary infiltrates and lung
injury, renal failure, and disseminated intravascular coagulation
 Within 24 hours: severe and unexpected depletion of lymphocytes and monocytes
occurred
 At 8 and 16 days: intensive organ support was required due to prolonged
cardiovascular shock and acute respiratory distress syndrome developed in two
patients

Despite evidence of the multiple cytokine-release syndrome, all six patients survived
7
Investigations and findings
 Aim:
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
was the reaction seen due to contamination of the dose, an incorrect dose being
administered, or an inherent flaw in the drug?
was the short timeframe within which the doses were administered a problem?
 UK MHRA initial investigation:

no errors in the manufacture, formulation, dilution or administration of TGN1412. An
unpredicted biological action of the drug in humans was the most likely cause of the
adverse reactions in the trial participants
 UK MHRA then commissioned an investigation by an expert scientific group
committee:

the preclinical development studies that were performed did not predict a safe dose
in humans, even though current formal regulatory requirements were met
 German regulatory authorities:

no deficiencies in the manufacture, testing, storage and distribution of the TGN 1412
could have contributed to the serious adverse effects
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Initiatives - EU
 Committee for Medicinal Products for Human use (CHMP): Guidelines on
strategies to identify and mitigate risks for first-in-human clinical trials with
investigational medicinal products dated July 19, 2007 and coming into effect
on September 1, 2007
Identifies factors influencing risk for new investigational medicinal products
Predicting the potential severe adverse reactions for the first-in-man use of
an investigational medicinal product involves identifying the factors of risk.
These concerns may be derived from particular knowledge or lack thereof
on:
 the mode of action; and/or
 the nature of the target; and/or
 the relevance of animal models
 Considers quality aspects and in particular:
The determination of strength and potency, comparability with the material
used, and reliability of very small doses
 Considers non-clinical testing strategies and design for first-in-man clinical trials
 Gives strategies for mitigating and managing risk, including the calculation of the
initial dose to be used in humans, the subsequent dose escalation and the
conduct of the clinical trial
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Initiatives - UK
 UK expert scientific group committee on phase one clinical trial
recommendations:

Pre-clinical Development:
The strategy should be to have science-based decisions made and justified on
a case-by-case basis by investigators with appropriate training
Sharing and strengthening the collection of information

Transition From Preclinical to Clinical development
Broader approach to dose calculation
Maximum reduction of risk
Starting dose and dose escalation should be made on a case-by-case basis
and should be scientifically justifiable

Clinical Development
Decision on whether to conduct a first-in-man trial should be carefully
considered and fully justified
Principal Investigators and staff should have appropriate levels of training,
expertise, and qualification
Where there is a predictable risk of certain types of severe adverse reaction, a
treatment strategy should be considered beforehand
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Initiatives - UK
 UK expert scientific group committee on phase one clinical trial
recommendations:
New agents should be administered sequentially to subjects with an appropriate
period of observation between dosing
A similar period of monitoring between sequential dosing of subjects during
dose escalation
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Regulatory
More communication should be encouraged between developers and the
regulator at an earlier stage before an application is filed
The regulator should have access to additional opinion from independent,
specialist experts with research knowledge in their fields. An Expert Advisory
Group (EAG) of the Commission on Human Medicines, or a similar body, might
undertake this role

Future
Availability of ‘hands-on’ experience in the planning and conduct of clinical trials
should be widened
Feasibility of developing specialist centers for phase one clinical trials of higher
risk and for advanced medicinal products should be explored
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Regulatory process for first-in-man trials of higher risk agents and advanced
medicinal products should be subject to frequent review
Lightening Up: Biosimilars – EU Regulatory Pathway
 Article 10(4) of the Community Code on Medicinal Products
(Directive 2001/83/EC):
 “Where a biological medicinal product which is similar to a
reference biological product does not meet the conditions in the
definition of generic medicinal products, owing to, in particular,
differences relating to raw materials or differences in
manufacturing processes of the biological medicinal product
and the reference biological medicinal product, the results of
appropriate pre-clinical tests or clinical trials relating to these
conditions must be provided. The type and quantity of
supplementary data to be provided must comply with the
relevant criteria stated in the Annex and the related detailed
guidelines. The results of other tests and trials from the
reference medicinal product's dossier shall not be provided.”
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General Guidelines
 Overarching Guideline on Similar Biological Medicinal
Product
 Similar Biological Medicinal Products Containing
Biotechnology-Derived Proteins as Active Substance:
Quality Issues
 Similar Biological Medicinal Products containing
Biotechnology-Derived Proteins as Active Substance:
Non-Clinical and Clinical Issues
 Other guidance documents such as the recently adopted
EMEA document: “Questions and Answers on biosimilar
medicines”
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Specific Product Guidelines
1. Recombinant Human Erythropoietin
2. Recombinant Human Growth Hormone
3. Recombinant Human Insulin
4. Recombinant Human Granulocyte-ColonyStimulating-Factor
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Status of biosimilars
Authorized biosimilars:
 Omnitrope® (somatropin) (Sandoz): Recombinant human growth hormone Reference product Pfizer’s Genotropin®.
 Valtropin® (somatropin) (BioPartners): Recombinant human growth hormone Reference product Lilly’s Humatrope
Positive opinions from Committee on Medicinal Products for Human Use (CHMP); all
with reference product Jansen’s Eprex/Erypo
 Binocrit® (epoetin alfa) (Sandoz): Erythropoietin
 Hexal® (epoetin alfa) (Hexal Biotech Forschungs): Erythropoietin
 Abseamed (epoetin alfa) (Medice Arzneimittel Pütter): Erythropoietin
Rejected as biosimilar (received a negative opinion from CHMP):
 Alpheon (BioPartners): Recombinant interferon alpha – Reference product
Roche’s Roferon-A
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Naming and interchangeability
 INN International Nonproprietary Name (for marketing in
EU and Japan)
 USAN United States Adopted Name (for marketing in
the U.S.)
 Role: Identifies the compound within a family of
compounds based on chemistry
 Impact on:
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prescription,
substitution of drugs, and
adverse event reporting process
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Naming and interchangeability
 Similar and not identical g entails problems that are not
prevalent as to small-molecule generic medicines
 For pharmacovigilance, it is important for records to be kept to
distinguish between events associated with innovator products
and biosimilars
 Should there be special restricted substitution rules for
biosimilars?
 Does the EMEA possess the authority to recommend such rules?
Can the Commission impose such rules?
 New system of nomenclature?
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Naming and interchangeability: use of INN
 The EMEA guideline on Similar Biological Medicinal Products
recommends that the specific medicinal product which is
prescribed to the patient needs to be “clearly identified”
 The EMEA guideline does not specifically address the suitability
of using the same INN for both a biological product and any
related biosimilar. It does, however, acknowledge that concerns
exist as regards the differences that may materialise between
biological products and related biosimilars
 The 44th Consultation on International Nonproprietary Names
(INNs) for Pharmaceutical Substances was held at WHO
Headquarters in Geneva on 22-24 May 2007. The INN Expert
Group noted the nomenclature systems in this field are generally
working well. There appears to be no consensus for change
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Meds Made of Us: Advanced Therapies/Tissue-Engineering:
Issues
 Lack of an EU-wide regulatory framework for tissue engineered
products led to divergent national approaches, creating obstacles
to the internal market
 The EU Regulation on Advanced Therapy Medicinal Products
aims to address this regulatory gap
 Introduces specific rules for the authorization and supervision of
advanced therapy products for human use in the EU
 Governs three types of advanced therapies: gene therapy,
somatic cell therapy and tissue engineering
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Gene and somatic cell therapy products had previously been defined and
classified as medicinal products in the EU
Tissue engineered products had not
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What are advanced therapies?
 Defines advanced therapy products for human use including tissue engineered
products as medicinal products

This means that their authorisation for marketing in the EU will be governed by the
Community Code on Medicinal Products
 Determines that cells or tissues are "engineered" if they have been subject to
substantial manipulation, so that biological characteristics, physiological functions
or structural properties relevant for the intended regeneration, repair or
replacement are achieved, or if they are not intended to be used for the same
essential function or functions in the recipient as in the donor
 Where a medical device contains a tissue engineered product, irrespective of the
role of the medical device, the pharmacological, immunological or metabolic
action of these cells or tissues should be considered to be the principal mode of
action of a combination product

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Such combination products should always be regulated under the Regulation
Nevertheless, the medical device element should also meet the essential
requirements of the Medical Devices Directives
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Advanced Therapies: Ethics, procedure and requirements
 A controversial subject of debate during the adoption procedure for
the draft Regulation was the potential application of the Regulation
to advanced therapy medicinal products that contain or are derived
from human embryonic or foetal cells, primordial germ cells or cells
derived from those cells

The final text does not address this issue
 Establishes a compulsory centralized procedure for marketing
authorizations for advanced therapy products

This includes the establishment of a new European Medicines Agency
(EMEA) Committee for Advanced Therapies (CAT)
 Introduces stringent requirements on risk management and postauthorisation traceability requirements
 Clarifies the requirement that clinical trials on advanced therapy
medicinal products including tissue engineered products must be
conducted in accordance with the Clinical Trials Directive 21
Advanced Therapies: Status
 Regulation approved by Council of Ministers on
May 31, 2007
 Regulation now needs to be translated in all EU
official languages and formally adopted, signed
and published
 It will apply from 1 year after entry into force
22
Meds for Kids: EU Pediatrics Regulation: Issues
 More than 50% of medicines used to treat children in
Europe have not been tested for use in children and have
not been authorized for use in the care of children
 The EU Paediatrics Regulation (Regulation (EC) No
1901/2006 of the European Parliament and of the Council
of 12 December 2006 on medicinal products for paediatric
use) aims to balance:
the ethical issues raised by conducting trials on children; with
 concerns arising in treating children with products which have
not been tested on them

 It imposes extensive system of requirements on
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companies and offers rewards and other incentives
Meds for Kids: Requirements
 Requires applications for marketing authorizations for new medicines and line
extensions to:
 include results of studies in the paediatric population carried out in
accordance with an agreed Paediatric Investigation Plan (PIP); or
 proof of having obtained a waiver (e.g. because likely to be ineffective or
unsafe in part or all of the paediatric population) or deferral from this
obligation
 Requirement applies irrespective of whether or not the medicine for which
authorization is sought is intended to be administered in children
 Requirement does not apply to generic products, biosimilars, hybrids, products
containing substances acknowledged to have well-established medicinal use,
herbal medicines and homeopathic medicines
 The PIP must be agreed with a new expert Paediatric Committee (PDCO) within
the European Medicines Agency (EMEA)
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Meds for Kids: Benefits
 For newer medicines benefits include:

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six months extension of the SPC to which the product is entitled
two years extension of market exclusivity for orphan medicines
optional access to the centralized EU level procedure for marketing
authorization applications that include one or more paediatric indications
on the basis of studies conducted in accordance with the agreed PIP
 For older medicines, a new type of marketing authorization, a
Paediatric Use Marketing Authorisation (PUMA) will be available


This type of authorization, for which eight years’ data protection and ten
years’ market protection are provided, will apply solely to products for
which the patent has expired and which are not protected by an SPC
It covers therapeutic indications developed exclusively for use in the
paediatric population in accordance with an agreed PIP
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Meds for Kids: Status
 Entered into force on 26 January 2007
 Some provisions enter into force later on:

Obligation to agree a PIP
 For medicines not authorised by 26 January 2007, enters into force on 26 July 2008
 For line extensions enters into force on 26 January 2009

In the meantime, companies may approach the Paediatric Committee, which will
be established by 26 July 2007, to agree a PIP
 The PUMA will be available from 26 July 2007
 Should lead to increased assurance concerning the quality, safety and efficacy
of medicinal products prescribed for paediatric use
 However, obligations are strict and it remains to be seen whether industry will
consider that the benefits provide adequate compensation for the additional
studies undertaken and costs involved
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Truth or Consequences: EU Penalties Regulation
 Commission Regulation (EC) No 658/2007 was
finally adopted on 14 June 2007, and will enter
into force on 5 July 2007
 Commission can now impose fines, for breaches
of certain regulatory obligations, on companies
whose medicinal products have been authorized
in accordance with the central authorization
procedure laid down in Regulation 726/2004
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Penalties for breach of certain obligations
 Penalties can be imposed for breaches of certain obligations,
such as:
 the obligation to provide accurate and complete information in
the marketing authorization application;
 failure to comply with the conditions or restrictions included in
the marketing authorization;
 failure to notify the EMEA about the date of placing the
product on the market; or about any prohibition or restriction
imposed by the competent authorities of any country in which
the medicinal product is marketed;
 failure to supply the EMEA with any information that may
influence the evaluation of the risks and benefits of the
product;
 breach of labelling and packaging obligations;
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 breach of pharmacovigilance obligations, etc.
Types of penalties
 The Regulation provides for two types of financial penalties: fines
and periodic penalty payments
 Where the marketing authorisation holder has committed,
intentionally or negligently, an infringement, the European
Commission may impose a fine of up to 5% of the authorisation
holder’s Community turnover in the preceding year. The Regulation
provides that in determining whether to impose fines and in
determining the appropriate fines the European Commission shall
be guided by the principles of effectiveness, proportionality and
dissuasiveness
 Where the marketing authorisation holder does not terminate the
infringement, the European Commission may impose periodic
penalty payments per day not exceeding 2.5 % of the holder’s
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average daily Community turnover in the preceding business year
Non-cooperation penalties
 The Penalties Regulation also permits the European
Commission to impose fines on marketing authorization
holders not exceeding 0.5 % of their Community turnover
in the preceding business year where, intentionally or
negligently they do not comply with requests by the EMEA
or the European Commission during the investigation or
they supply incorrect or misleading information in
response such a request
 Moreover, where non-cooperation of the marketing
authorization holder continues, the European Commission
may also impose periodic penalty payments per day not
exceeding 0.5 % of the holder’s average daily Community
turnover in the preceding business year
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Clinical Trials in
Developing Countries
1. The continued supply issue
2. Liability issues for sponsors
31
The continued supply issue – World Medical Association
 Paragraph 30 of the WMA Declaration of Helsinki :
 "At the conclusion of the study, every patient entered into the study should
be assured of access to the best proven prophylactic, diagnostic and
therapeutic methods identified by the study.“
* Paragraph 30 was added at the 52nd WMA General Assembly,
Edinburgh 2000
 Note of clarification on paragraph 30):
 “The WMA hereby reaffirms its position that it is necessary during the
study planning process to identify post-trial access by study participants to
prophylactic, diagnostic and therapeutic procedures identified as beneficial
in the study or access to other appropriate care. Post-trial access
arrangements or other care must be described in the study protocol so the
ethical review committee may consider such arrangements during its
review.“
• The note of clarification was added at the 55th WMA General
Assembly, Tokyo 2004
32
U.S. approach
 Foreign studies performed under an investigational new drug application (IND)
or investigational device exemption (IDE) must meet the same requirements of
21 CFR Part 312 or 21 CFR Part 812, respectively, that apply to U.S. studies
conducted under an IND or IDE
 Under 21 CFR 312.120(c)(1), FDA will accept a foreign clinical study not
conducted under an IND only if the study conforms to the ethical principles
contained in the Declaration of Helsinki (Declaration), as set out in 21 CFR
312.120(c)(4), incorporating the 1989 version of the Declaration, or with the
laws and regulations of the country in which the research was conducted,
whichever provides greater protection of the human subjects
33
U.S. approach
 The U.S. has not incorporated in its clinical trial regulations the
amendments to the Helsinki declaration added at the 52nd WMA
General Assembly in Edinburgh in 2000
 The U.S. regulations follow the 1989 version of the WMA
declaration, which does not incorporate paragraph 30
 The EU Clinical Trials Directive 2001/20/EC refers to the 1996
version of the WMA declaration, which does not incorporate
paragraph 30. However, the EU Community Code as amended by
Directive 2003/63/EC refers more generally to the Declaration of
Helsinki without specifying which version.
34
Latin American countries’ approaches vary
 Brazil has enacted legislation (ANVISA Resolution 251-1997) which provides
that the sponsor must guarantee the subjects of the trial access to the
medicines under study if these prove to be superior to conventional treatments.
More recently ANVISA has published a recommendation on how the sponsor
should proceed, under certain circumstances, with the donation of the product
to the subjects of the study once the clinical trial is over
 Argentina follows the current version of the Helsinki declaration, but in practice
the ANMAT and the Ethics Committee decide, on a case by case basis,
whether the sponsor is required to continue the supply of the tested drug once
the trials is over. In taking this decision the ANMAT and the Ethics Committee
will take into account factors such as the availability of the drug in the market or
the chronic character of the disease
 Chile follows an approach similar to that of Argentina
 Other countries like Mexico have no continued supply obligations
35
Liability for International Activities: Abdullahi v. Pfizer
 Abdullahi v. Pfizer is an ongoing case about whether U.S.-based researchers
and clinical trial sponsors can be held accountable in the United States for torts
arising out of international clinical trials. This case arises out of a 1996 trial
conducted in Nigeria to test Trovan on children with brain infections
 Background
Plaintiffs, who are Nigerian residents, sued Pfizer under the Alien Tort Claims Act
(ATCA), 28 U.S.C.A. 1350, which allows U.S. courts jurisdiction over a tort action
committed in violation of the “law of nations or a treaty of the U.S.”
 Plaintiff argue Pfizer violated international laws and ethical standards – including
the Nuremberg Code, the Declaration of Helsinki, and other guidelines – when it,
among other things, failed to secure informed consent when conducting a clinical
study involving Trovan in Nigeria
 Plaintiff’s are seeking almost $2 billion in compensatory and punitive damages for
allegedly causing injuries or death to 64 children and an injunction that would
prevent Pfizer from conducting any testing without proper informed consent

36
Abdullahi v. Pfizer: Current status
 Current Status




In August 2005, the Southern District Court of New York granted Pfizer’s
motion to dismiss the case for the second time after it was remanded by
the U.S. Court of Appeals for the Second Circuit
After a closer consideration of the facts surrounding the decline of
jurisdiction by Nigerian courts in the similar case, the District Court held
that Nigeria was an available adequate forum for the litigation
In light of recent Supreme Court and Second Circuit precedent concerning
the ATCA, the District Court held that there was no right of action under
ATCA because the Nuremberg Code, the Declaration of Helsinki, and the
other guidelines do not impose obligations sufficient to give rise to a
private right of action under the ATCA
On September 6, 2005, the Plaintiff’s filed a notice of appeal, but there has
been no decision from the Court of Appeals and oral argument was
scheduled for July 12, 2007
37
Abdullahi v. Pfizer: Current status
 In May 2006, the Washington Post obtained a copy of a previously unreleased
report completed by a panel of Nigerian Medical Experts who investigated
Pfizer’s Trovan trial in Nigeria
 The panel allegedly corroborated the Plaintiff’s allegations as disclosed in their
Court of Appeals brief
 It is alleged that::
 Pfizer Inc., developed the protocol in the U.S. and did so in 6 weeks
(ordinarily, this takes over a year)
 Pfizer did not receive government authorization to conduct the clinical trials
 The protocol was not reviewed or approved by an Ethics Committee prior to
conducting the trial
 The “approval” letter that Pfizer submitted was backdated and possibly
forged
 The protocol “allowed the doctors the discretion of their clinical judgment,”
but the panel who investigated judged some deviations to be serious
deviations that compromised patient care
38
Abdullahi v. Pfizer: Nigerian cases
 Pfizer is facing four separate lawsuits in Nigeria, two launched by State of Kano,
where the trials took place, and two by the Federal Government of Nigeria
 These cases have faced a number of delays due to procedural issues
 In early July, 2007 the civil case filed by the State of Kano seeking 2.7 billion
has been adjourned until July 30 to allow both parties to study their positions.
Pfizer asked for it to be dismissed because of lack of jurisdiction
 On July 20, 2007, at the request of the Federal Government, the Federal
High Court struck the Federal Government’s 7 billion federal suit instituted.
This was apparently a strategic move to allow the government to fix defects
in the complaint as the government expressed its intention to re-file another
suit
 On July 25, 2007, the criminal case was delayed to allow prosecutor more
time to prepare
 On July 26, 2007, the Federal Government filed a criminal case against
Pfizer International and Pfizer Nigeria and several individuals accusing them
of bribing officials, forging documents, and illegal importation of the drug
39
Counterfeits and SubStandard Drugs
1.The Problem
2.IMPACT: WHO Initiative
3.EU and Council
of Europe Initiatives
4.APEC Initiatives
5.China
Initiatives
40
The Problem
 According to WHO:
 Fake packaging, correct quantity of correct ingredient
(clone)
 Fake packaging, wrong ingredient
 Fake packaging, no active ingredient
 Fake packaging, incorrect quantity of correct
ingredient
 Genuine packaging, wrong ingredient
 Genuine packaging, no ingredient
 Genuine packaging, incorrect quantity of correct
ingredient
41
Scope of the Problem
 WHO Survey

60% of counterfeit medicine cases occurred in poor countries and
40% in industrialized countries from January 1999 to October 2000
 Counterfeits make up more than 10% of the global medicines
market and are present in both industrialized and developing
countries.
 Up to 25% of the medicines consumed in poor countries are
counterfeit or substandard
 Annual earnings from the sales of counterfeit and
substandard medicines estimated at over US$ 32 billion
globally
 Up to 25% of medicines consumed in developing nations are
estimated to be fake or substandard
42
The Counterfeit Drug Market
SOURCES OF COUNTERFEITS
Photos courtesy of Lewis Kontnik
43
What can be done in the United States?
 Trafficking in counterfeit, unapproved, adulterated, or
misbranded products is a felony violation of the U.S.
Federal Food, Drug, and Cosmetic Act (FDCA)
 FDA’s “Long Arms”
Cease & Desist Orders
 Import Alerts
 Warning Letters
 Civil Monetary Penalties
 “Cybersmuggling”

 Patent Infringement
 Business & Professional Code Violations
44
Jurisdiction Under FDA and Other U.S. Laws
 FDA Jurisdiction over Foreign Entities (including
“Internet Pharmacies”)








If impact in U.S. (example: shipping products to U.S.)
Injunctions against or criminal prosecutions of foreign
nationals
Seizures of product, injunctions, criminal prosecutions, and
civil penalties
Conspiracy Laws
18 USC 1001 (False Reports to the Government Act)
18 USC 542 (relating to entry of goods by means of false
statements)
18 USC 545 (relating to importation contrary to law and
smuggling)
Money laundering charges
45
FDA’s February 2004 Report
COMBATING COUNTERFEIT DRUGS
46
Source: http://www.fda.gov
FDA Recommendations – Summary
 Multilayered approach; no “magic bullet”
 New Technologies
 Stricter Licensing Requirements
 Tougher Penalties
 More Secure Business Practices
 Reporting and Response
 Increase Education
 International Collaboration
47
Securing the U.S. Drug Supply
 Technology:
 Unit-of-Use Packaging
 Tamper Evident Packaging
 Authentication Technology
 Identification of Products likely to be
counterfeited
 Radio-frequency Identification (RFID Technology)
 FDA Conclusion:
 Mass serialization and RFID would provide better
protection if adopted as the standard track-and48
trace technology
Much teamwork is needed to stop counterfeiting
 FDA will collaborate with foreign stakeholders to develop
strategies to deter and detect counterfeit drugs globally
 FDA will work with WHO, Interpol, and other international
organizations on worldwide strategies
 FDA suggests that drug producers, distributors, and dispensers
ensure legitimacy of business partners and refuse to do business
with unknown or suspicious persons.
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What is being done?: WHO
 WHO: international framework convention
 Concept paper
 Goal:
To establish norms that countries should adopt and incorporate
into drug laws and the manner in which to implement them
 To include:
Development of national measures to strengthen drug
regulatory authorities
Measures to ensure quality of drug supply
Penalties and sanctions
 Participants agreed that further development needed
 Recommendations:
Make counterfeiting specific crime
Raise public awareness
Increase cooperation
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IMPACT: WHO Initiative
 In February 2006, the WHO launched the International Medical Products AntiCounterfeiting Taskforce (IMPACT) in response to the growing public health
crisis of counterfeit drugs
 Aims to build coordinated networks across and between countries in order to
halt the production, trading and selling of fake medicines around the globe
 A partnership comprised of the major anti-counterfeiting players, including:
international organizations, non-governmental organizations, enforcement
agencies, pharmaceutical manufacturers associations and drug and regulatory
authorities
 Comprised of working groups to address the areas where action is needed:
legislative and regulatory infrastructure, regulatory implementation,
enforcement, technology and communication
 Expert group of lawyers, of which I am member, met in Brussels in July 2007 to
work on draft legislative concept paper.
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EU Initiatives

Council Regulation (EC) No 1383/2003 of July 22 2003 concerning customs action against
goods suspected of infringing certain intellectual property rights and the measures to be
taken against goods found to have infringed such rights
 Identifies two categories of goods that infringe property rights: counterfeit goods and
pirated goods
 Enables customs authorities, in cooperation with right-holders, to improve controls at
external border
 Sets up a more efficient system by laying down:
the conditions for customs action where goods are suspected of infringing
intellectual property rights; and
the measures to be taken against goods that have been found to infringe
intellectual property rights
 Simplifies the procedure for the lodging of applications for action with the customs
authorities, in particular for small and medium-sized enterprises (SMEs), and for the
destruction of fraudulent goods
 Extends the scope of application of Community action to cover new types of
intellectual property rights: new plant varieties, geographical indications and
designations of origin
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EU Initiatives
 Directive 2004/48/EC of the European Parliament and the Council of April 29
2004 on the enforcement of intellectual property rights
•
•
•
Harmonizes national legislation on enforcement of intellectual property rights to
ensure equality of rights for all rights holders in the EU
Establishes an effective information exchange system between the competent
national authorities
Thereby aims to:
•
•
•
•
•
promote innovation and business competitiveness
safeguard employment in Europe
prevent tax losses and destabilization of the markets
ensure consumer protection
ensure the maintenance of public order
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Other EU Initiatives
 Draft Directive amending Directive 2004/48/EC on the enforcement of
intellectual property rights


Adopted by the European Parliament on April 27, 2007
If agreed by the European Council, Member States would be obliged to adjust
their penal codes and to establish harmonized criminal sanctions against IPRinfringers
 Launch of coordinated customs actions at major EU ports and airports
 Establishment of an Anti-Counterfeit Task Force of Customs experts to improve
targeted customs controls
 Introduction of an Integrated European Risk Management framework to target
and prevent the entrance of high-risk goods at EU borders
 Efforts to share intelligence with third countries, such as the US and China, on
trafficking developments and the detection of high-risk consignments
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Council of Europe Initiatives
 Council of Europe Draft Convention on
Counterfeit medicine/pharmaceutical crimes
March 30, 2007
 Classifies pharmaceutical offenses as serious crimes
 Provides that Member States must penalize the manufacture and distribution of
counterfeit medicines
 Establishes a network of a Single Point of Contact in all sectors concerned
 Requires the adoption at national level of provisions to control the quality of
components for pharmaceutical use, packaging material and manufacturing
processes in accordance with the standards laid down by the Pharmacopoeia
 Intensifies co-operation between law enforcement agencies at the national and
European level
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Asia-Pacific Economic Cooperation (APEC) Initiatives
 On 3 June 2005 APEC Trade Ministers endorsed a series of AntiCounterfeiting and Piracy measures including guidelines for
authorities to seize and destroy pirated goods and support to
increase the capacity of economies to deal with counterfeiting
 The APEC Anti-Counterfeiting and Piracy Initiative is part of
efforts intended to strengthen intellectual property protection and
overcome damage caused to regional innovation and commercial
competitiveness, especially for small businesses
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APEC Initiatives

It includes a range of measures to:
 Reduce Trade in Counterfeit and Pirated Goods - Economies aim to reduce
counterfeit and pirated goods trade and combat transnational networks that
produce and distribute these items. Actions include establishing guidelines for
authorities to inspect, suspend, seize and destroy goods and equipment used in
counterfeit and pirated goods trade
 Reduce Online Piracy - Appropriate legal regimes and enforcement systems will
be enacted to curtail online piracy and to undermine the online trade in counterfeit
goods. This includes the development of guidelines to prevent Internet sales of
counterfeit goods
 Increase Cooperation to Stop Piracy and Counterfeiting - Operational contact and
the sharing of information between customs and law enforcement agencies will be
increased to combat counterfeiting and piracy networks
 Increase Capacity Building to Strengthen Anti-Counterfeit and Piracy Enforcement
- Member Economies' ability to develop and manage effective anti-counterfeiting
and piracy enforcement systems will be increased through education and training
throughout the region
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China Initiatives
 In 2006, China reportedly investigated over 300,000 reports of
counterfeit drugs worth about $6.3 million and closed 530
factories
 China is reportedly currently investigating the issue of fake drugs
in a number of Chinese hospitals:



Suspicion was raised in Jilin, where nearly 60 hospitals and many
pharmacies were found selling a fake version of albumin
Over 2000 bottles of albumin, all packaged in legitimate boxes, have been
seized
There are suggestions that large Chinese counterfeit gangs, who also
manufacture fake credit cards, weapons and narcotics, are involved
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Technology
 FDA’s Recommendation

A multilayered approach that includes radio frequency trackand-trace and authentication features
 Chipless ID
 Issues



Cost
Availability
Reliability
 Other Security Mechanisms
 Pedigree???
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THE END
Linda R. Horton
Partner
Hogan & Hartson L.L.P.
Brussels & Washington, D.C.
202-637-5795
+322-505-0931
LRHorton@HHLaw.com
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