How Fair is FDA in Enforcement? Stacking Up the Agency Against a New Memo from the White House

October 2, 2020 Becky Hurt

By Phil Crooker, VP – Technical, Regulatory & Access, Parexel

On May 19, 2020 the president of the United States issued Executive Order 13924 – Regulatory Relief To Support Economic Recovery. You can find a copy of the order that was published in the Federal Register here - https://www.federalregister.gov/documents/2020/05/22/2020-11301/regulatory-relief-to-support-economic-recovery. The order directs that federal agencies must take several actions to remove barriers that would inhibit economic recovery, including fairness in administrative enforcement and adjudication that is outlined in Section 6 of the order. Notably, the scope of the order does not indicate that these directives are limited only to the duration of the declared national emergency related to the emergence of the COVID-19 pandemic.

The principles outlined in Section 6 of this order complement the directives to federal agencies for eliminating unfair surprise in civil enforcement actions that were issued on October 9, 2019 as part of Executive Order 13892 – Promoting the Rule of Law Through Transparency and Fairness in Civil Administrative Enforcement and Adjudication. More information about this order can be found in one of my previous blogs you can find here - https://www.parexel.com/news-events-resources/blog/further-limits-use-guidance-enforcement-how-will-fda-react.

In order to guide federal agencies in reviewing their regulatory programs and implementing the directives in Section 6 of Executive Order 13924, the Office of Management and Budget (OMB) in the Executive Office of the President recently released a memo which compiled a list of best practices. You can find a copy of the memo here -https://www.whitehouse.gov/wp-content/uploads/2020/08/M-20-31.pdf.  I’ll unpack some of the more significant points raised by OMB in the memo and offer some brief comments about FDA stacks up to these in their current practices.

  • Agencies should read statutory or regulatory ambiguities related to administrative violations in favor of the targeted party.
  • Regulations should require investigating staff to either recommend or bring an enforcement action or cease the investigation within a defined time.
  • If a party has been informed by an agency that it is under investigation, the agency should inform the party when the investigation is closed and when the agency has made no finding of violation.

For both these points, the FDA has adopted the use of 90-day decisional letters to inform manufacturing sites whether an inspection has been classified as “OAI” or “VAI.” Although the letters don’t inform the facility about whether an enforcement action will be recommended, it is widely recognized that the basis for classifying a facility as “OAI” necessitates that FDA determine that there are regulatory violations that are significant. FDA considers an Establishment Inspection Report an investigatory record under 21 C.F.R. § 20.101(c) and are typically released when any enforcement action has concluded or is considered closed (see 21 C.F.R. § 20.64(d)).

  • Agencies should eliminate multiple enforcement actions for a single body of facts for situations that do not involve a continuing or expanding violation.

The FDA’s policy for several years has been not to issue consecutive Warning Letters to the same conventional drug manufacturing facility for the same underlying violations or deviations. This policy differs from that in other product centers such as manufacturers considered “recidivist” by the Centers for Devices and Radiological Health (CDRH).

  • Agencies must publish a rule of agency procedure governing civil administrative inspections (emphasis added).

The FDA makes its Investigations Operations Manual (IOM) publicly available in its website – you can find the current version here - https://www.fda.gov/inspections-compliance-enforcement-and-criminal-investigations/inspection-references/investigations-operations-manual. This was a directive from Executive Order 13892. Although the information is in the public domain, it has not been published in a proposed or tentative final rule.

  • The government should provide favorable relevant evidence in possession of the agency to the subject of an administrative enforcement action.

As discussed previously, the FDA does not typically release an EIR until the enforcement action is considered closed.

  • Agencies should adopt or amend regulations regarding evidence and adjudicatory procedures, consider incorporating other standards under the Federal Rules of Evidence (FRE), and make these rules of evidence and procedure easily accessible on their websites.
  • Agencies should explicitly authorize the representation of regulated parties by legal counsel and in appropriate cases by qualified representatives. Agencies should take steps to avoid disadvantaging parties who are not represented by counsel.
  • Agencies should establish policies of enforcement discretion that decline enforcement when the agency determines that the regulated party attempted in good faith to comply with the law.
  • Agencies should make the public aware of the conditions in which investigations and enforcement actions will be brought and provide the public with information on the penalties sought for common infractions.

The FDA publishes all Warning Letters on its website, as well as other frequently requested compliance related documents. Other documents, such as Form FDA 483, are available through Freedom of Information Act requests. FDA officials also make numerous public presentations and several offices publish annual reports with compliance information.

  • Agencies should not initiate additional investigations of a party after commencing an enforcement action unless the agency can demonstrate good cause, except in situations where the additional investigation is prompted by facts uncovered in the initial investigation.
  • In any document initiating an investigation or enforcement action, an agency should include a citation to the statute and regulation asserted to be violated and an explanation as to how the asserted conduct is prohibited by the statute or regulation.

Every FDA Warning Letter should contain the following four (4) elements: (1) the specific section of the statute or regulation that was violated; (2) what the FDA personnel observed during the inspection; (3) actions the regulated party took in response to the FDA observations; and (4) the reason why the FDA has determined that the actions the firm took are inadequate to comply with the statute or regulation.

  • Agencies should create procedures to make pre-enforcement rulings available. This was required as part of Executive Order 13892 Section 9 and Executive Order 13924 Section 5.

The 90-day decisional letters are only issued after the FDA has made a determination that the manufacturing facility is classified as “OAI” or “VAI.” The FDA does not routinely send a regulated party any communication prior to this determination, although it could be argued that a 90-day decisional letter that classifies a facility as “OAI” precedes any regulatory or enforcement action and could be considered to be a pre-enforcement ruling.

  • Agencies should provide regulated parties with at least as much time to respond to an agency notice of charges as parties would have to respond to filings in civil complaints brought in federal court under the Federal Rules of Civil Procedure (FRCP) unless the need for urgent action to protect the public warrants otherwise.

FDA requests that manufacturing facilities that have received Form FDA 483 observations or Warning Letters respond to each in writing in no more than 15 working days. Depending on the type of motion, responses under FRCP can include 14, 21 and 30 days.

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