Washington Representatives Retreat (Day 1)

1. Washington Representatives Retreat (Day 1) November 30 - December 1 Loews Annapolis Hotel 126 West Street, Annapolis, MD

2. 21st Century Cures Act: Pharmaceutical & Biologics Provisions2017 Washington Representatives RetreatNovember 30- December 1, 2017 David B. Clissold

3. Background Nearly 3-year timeline to enactment: • 21st Century Cures Initiative launched by House E&C Committee on April 30, 2014 • First of four 21st Century Cures Roundtables on May 6, 2014 • First of eight 21st Century Cures Hearings on May 20, 2014 • House released the discussion draft on January 27, 2015 • House Subcommittee on Health advanced the bill on May 14, 2015 • House approved the Act on July 10, 2015 • House passed the Act on November 30, 2016 • Senate passed the Act on December 7, 2016 • President signed the Act into law on December 13, 2016 (Public Law No. 114-255)

4. Summary of Pharmaceutical and Biologics Provisions 21st Century Cures Act is Organized into Five Titles: • Innovation Projects and State Responses to Opioid Abuse • Discovery • Development • Delivery • Savings

5. Summary of Pharmaceutical and Biologics Provisions Title III Development Organized into Ten Subtitles: • Patient-Focused Drug Development • Advancing New Drug Therapies • Modern Trial Design and Evidence Development • Patient Access to Therapies and Information • Antimicrobial Innovation and Stewardship • Medical Device Innovations • Improving Scientific Expertise and Outreach at FDA • Medical Countermeasures Innovation • Vaccine Access, Certainty, and Innovation • Technical Corrections

6. Top 13 Pharmaceutical and Biologics Issues • Patient Experience Data (Section 3001) • Patient-Focused Drug Development (Sections 3002-3004) • Qualification of Drug Development Tools (Section 3011) • Priority Review Vouchers (Sections 3013, 3014, & 3086) • Human Research Protections (Sections 3023 & 3024) • Expanded Access Policies (Section 3032) • Limited Population Pathway (Section 3042) • Health Care Economic Information (Section 3037) • Real World Evidence (Section 3022) • Regenerative Advanced Therapies (Sections 3033-3036) • Hiring Authority (Section 3072) • Targeted Drugs for Rare Diseases (Section 3012) • Novel Clinical Trial Designs (Section 3021)

7. Real World Evidence (Section 3022) • Establishes program to evaluate the potential use of real world evidence (RWE) to: • Support new indications of approved drugs (label expansion). • Satisfy postapproval (e.g., Phase 4) data requirements . • RWE means “data regarding the usage, or the potential benefits or risks, of a drug derived from sources other than clinical trials.” • Contemplated to include: • Ongoing safety surveillance, observational studies, registries, claims data, and patient-centered outcomes research activities. • Primary purpose of program: to develop a RWE “framework” (in 2 years) and issue guidance (draft in 5 years and final 18 months later) on: • Sources of RWE; • Gaps in data collection activities; • Standards and methodologies for collection and analysis; • Potential pilot opportunities and challenges; and • Priority areas for using RWE for regulatory actions • Does not alter current approval standards for NDAs and BLAs.

8. Real World Evidence • Insights into FDA’s approach to a real world evidence framework: • Sherman et al. (Dec. 8, 2016). Real-World Evidence – What Is It and What Can It Tell Use? New England Journal of Medicine, 375(23), 2293-2297. • RWE can provide useful data about actual use in a clinical setting without the strict eligibility criteria and controlled procedures of clinical trials. • Clinical trial methodologies, such as randomization and planned intervention, are not inconsistent with methods for collection and analysis of RWE. • Warns that many RWE sources are not organized or optimized for supporting research or regulatory assessments. • The priority in developing a RWE framework is to make the best use of relevant evidence that are generated through reliable methods that limit the effect of bias and confounding factors as much as possible.

9. Real World Evidence • Potential utility: • Interventional “pragmatic” studies (e.g., using cluster randomization). • Generation of hypotheses for prospective trials. • Assessment of generalizability of findings from interventional (RCT) trials. • Conduct of safety surveillance of medical products. • Examination of changes in patterns of therapeutic use. • Measurement and implementations of quality in health care delivery. • Ability to assess causal inferences in drug development? • Cautious, long-term optimism. • See also: Jarow, J.P., LaVange, L., & Woodcock, J. (Aug. 22, 2017). Multidimensional Evidence Generation and FDA Regulatory Decision Making: Defining and Using “Real World” Data. JAMA, 318(8): 703-704.

10. Natural History and Registry Data as RWE: Opportunities for Use of the External Control • An externally controlled trial compares a group of subjects receiving the test treatment with a group of patients external to the study, rather than to an internal control group consisting of patients from the same population assigned to a different treatment (ICH E-10 Guidance). • Relevant kinds of external controls: • Population treated earlier (i.e., historical control). • Population treated contemporaneously at another institution. • A group treated outside the study within same institution. • Baseline-control.

11. FDA’s Commitments to RWE • Under 21st Century Cures Act (Dec. 2016): • Must establish program to evaluated potential use of RWE to: • Support new indications of approved drugs (label expansion). • Satisfy postapproval (e.g., Phase 4) data requirements. • Primary purpose: to develop a RWE “framework” (in 3 years) and issue guidance (draft in 5 years and finalize 18 months later). • Under PDUFA VI Performance Goals (Aug. 2017): • Goal to enhance use of RWE in regulatory decision-making. • Must host at least one public workshop (by end of FY 2018). • Must form pilot studies and methodology development projects to address outstanding concerns (by end of FY 2019) and must issue guidance (draft by end of FY 2021 and finalize with 18 months).

12. Furthering FDA’s Commitments to RWE • National Academies of Sciences, Engineering, and Medicine’s Forum on Drug Discovery, Development, and Translation hosting three workshops on RWE in medical product development: • Workshop 1 (Sept. 19-20, 2017) - how to align incentives to support collection and use of RWE in health product review, payment, and delivery. • Workshop 2 (2018) - explore what types of data are appropriate for what specific purposes and suggest approaches for data collection. • Workshop 3 (2018) - foster discussions that will examine and suggest approaches for operationalizing the collection and use of RWE.

13. Regenerative Advanced Therapies(Sections 3033-3036) • Creates process and requirements for designating a drug as a regenerative advanced therapy (RMAT). • Background: see R. Califf’s Nov. 30, 2016 NEJM Perspective, Clarifying Stem-Cell Therapy’s Benefits and Risks. • Designation if: • “cell therapy, therapeutic tissue engineering products, human cell and tissue products, and combination products using any such therapies…”; • “is intended to treat, modify, reverse, or cure a serious or life-threatening disease or condition”; and • “preliminary clinical evidence indicates [it] has the potential to address unmet medical needs.” • Effect of designation: • FDA must take actions to expedite development and review of the drug (i.e., analogous to breakthrough therapy designation). • Includes early interactions “to discuss any potential surrogate or intermediate endpoint to be used to support the accelerated approval of the product.” • Eligible for priority review. • Eligible for accelerated approval under current FDA preapproval standards but with new postapproval requirements.

14. Regenerative Advanced Therapies • Section 3034 - requires FDA to issue guidance, within 1 year, clarifying how FDA will evaluate devices used in the recovery, isolation, or delivery of RMAT. • Section 3035 - requires HHS to report annually to Congress: • The number and type of applications for approval of RMAT filed, approved/licensed, withdrawn, or denied; and • How many such applications were granted accelerated approval or priority review. • Section 3036 – requires HHS to coordinate the development of standards and consensus definitions to support the development, evaluation, and review of regenerative medicine and RMAT, as well as review and update relevant regulations and guidance.

15. Regenerative Advanced Therapies • Opportunity to increase the visibility and use of Accelerated Approval: • Since FDA created the Accelerated Approval pathway in 1980’s to address the AIDs crisis, FDA has employed Accelerated Approval pathway in few approvals over 30 years for conditions other than HIV/AIDS or cancer. • Both PCAST and 2012 FDASIA law recommended that FDA expand, beyond cancer and AIDS, use of its Accelerated Approval authority to approve medicines for those with serious diseases and no available therapies. • Regenerative Advanced Therapies provision: • Is one visible sign of movement to expand use of Accelerated Approval beyond cancer and AIDS. • Tailors this authority to a specific class of therapies (e.g., tightens eligibility for access to it yet relaxes post-approval requirements).

16. Regenerative Advanced Therapies • Encourages FDA to adopt a practice of considering the appropriateness of Accelerated Approval for each new RMAT. • Consider whether that therapy could be a candidate at key FDA-sponsor meetings such as pre-IND, End-of-Phase 2, pre-NDA/BLA and Advisory Committee meetings. • Creates new options for postapproval requirements in addition to controlled trials that FDA has traditionally required (e.g., clinical studies; patient registries; other sources of real world evidence, such as electronic health records; or postapproval monitoring of all patients treated with such therapy prior to approval of the therapy).

17. FDA’s Commitment to Regenerative Advanced Therapies • On November 16, 2017, FDA released a comprehensive policy framework for how the Agency intends to apply existing laws and regulations that govern regenerative medicine products, including human cells, tissues, and cellular and tissue-based products (HCT/Ps). • The policy framework also serves to implement regenerative medicine-related provisions of the 21st Century Cures Act, including the Regenerative Medicine Advanced Therapy (RMAT) designation program. • Final Guidance: • Regulatory Considerations for Human Cell, Tissues, and Cellular and Tissue-Based Products: Minimal Manipulation and Homologous Use. • Same Surgical Procedure Exception under 21 CFR 1271.15(b): Questions and Answers Regarding the Scope of the Exception. • Draft Guidance: • Expedited Programs for Regenerative Medicine Therapies for Serious Conditions. • FDA, for the first time formally, interprets section 506(g) to include gene therapies, including genetically modified cells, that lead to a durable modification of cells or tissues (this policy was first announced by Commissioner Gottlieb in August 2017). • Evaluation of Devices Used with Regenerative Medicine Advanced Therapies.

18. Patient Experience Data (Section 3001) • Requires FDA to make public a brief statement regarding the patient experience data and related information, if any, submitted and reviewed as part of an approved NDA or BLA. • This includes the following information: • Data that are collected to provide information about the patients’ experiences with a disease or condition, including related to the impact of the disease on patients’ lives and patient preferences with respect to treatment; • Information on patient-focused drug development tools (e.g., Patient-Reported Outcome measures); and • Other information FDA determines to be relevant.

19. Patient Focused Drug Development (Sections 3002-3004) • Section 3002 – requires FDA issue guidance documents, over 5 years, on the collection of patient experience data, as well as the use of such data and related information in drug development and in FDA’s assessment of a drug’s benefits and risks. • Section 3003 – exempts collection of patient experience data from Paperwork Reduction Act. • Section 3004 – requires FDA to issue reports in June 2021, 2026, and 2031 on the use of patient experience data and PFDD.

20. Patient Focused Drug Development • What must the FDA guidance cover? • Methodologies for collecting patient experience data: • Approaches to collection of patient experience data; • Approaches to identification of what is most important to patients; • Methods to measure impacts on patients in clinical trials; and • Methodologies for collection and analysis of clinical outcomes assessments. • How patient experience data will be used by FDA: • Format and context of submissions of patient experience data; • How FDA will respond to such submissions; and • How FDA anticipates using this information, including in assessing a drugs benefits and risks.

21. Proposed Guidance Commitments Under PDUFA VI • Approaches to collecting patient and caregiver input on burden of disease and current therapy. • Processes and methodological approaches to development of holistic sets of impacts that are more important to patients. • Approaches to identifying and developing measures of an identified set of impacts that may facilitate patient input in clinical trials. • Clinical outcome assessments (technologies and incorporation into regulatory decision-making). • Also, revise existing MAPPs and SOPPs to include patient focus in FDA public meetings.

22. General Framework For Patient Input Into Regulatory Decisions • FDA reviews medical products on a case-by-case basis when it receives an application. • Patients and caregivers can contribute to FDA’s regulatory decision-making in two ways: • Consult and advise on specific development programs and applications. • Provide context applicable to all development programs and applications.

23. Therapeutic Context in Benefit-Risk Decisions • To adequately assess benefits and risks, FDA must understand the context in which a potential therapy will be usedTwo relevant categories of patient experience: • The disease and its impact on patients’ daily lives (what is the severity of the condition?). • Patients’ perspectives on the adequacy of available therapies (what is the current state of the treatment armamentarium?). • This helps FDA understand the types of benefit that matter most to patients.

24. The Applications are Endless

25. Best Practices

26. Thank You! David B. Clissold Director Hyman, Phelps & McNamara, P.C. dclissold@hpm.com 202-737-7545 www.fdalawblog.net @fdalawblog

27. 1332 and 1115 Waivers: Current Landscape and Future Outlook National Health Council Annapolis, MD November 30, 2017 Jennifer Tolbert Director, State Health Reform Kaiser Family Foundation

28. Following demise of ACA repeal/replace efforts, focus shifted to state waivers. • Section 1332 of the ACA permits states to develop innovative approaches for providing health coverage while retaining basic ACA protections • Section 1115 of the Social Security Act allows waivers of certain Medicaid provisions that are: • “Experimental, pilot or demonstration projects” • “Likely to assist in promoting the objectives of the program” • Both 1332 and 1115 waivers must be budget-neutral to federal government and are subject to state and federal public notice and comment periods • States may submit coordinated 1332 and 1115 waivers

29. Section 1332 waivers allow states to alter certain ACA provisions within limits. ACA Provisions that Can Be Waived • Individual and employer mandate • Essential health benefits • Annual limit on out-of-pocket costs • Establishment of state exchanges • Premium tax credits • Cost sharing subsidies • Subsidy pass through (states can receive PTCs and CSRs on behalf of eligible residents as an aggregate payment) 1332 Statutory Guardrails Provide coverage that is at least as comprehensive in terms of covered benefits Provide coverage that is at least as affordable (taking into account premiums and excessive cost sharing) Provide coverage to at least a comparable number of state residents; and Not increase the federal deficit

30. To date, 1332 waiver activity has been somewhat limited. ME VT WA NH MT ND MN OR MA NY WI SD ID MI RI CT WY PA NJ IA NE OH DE IN IL NV MD CO UT WV VA CA DC KS MO KY NC TN AZ SC OK AR NM GA AL MS Waiver Status LA TX Approved (4 States) AK FL HI Pending or On hold (2 States) Waiver withdrawn (3 States)

31. Most states have sought 1332 waivers to stabilize insurance markets.

32. There are 42 approved Medicaid waivers in 34 states and 22 pending waivers in 20 states as of November 2017. NOTE: Some states have multiple approved and/or multiple pending waivers, and many waivers are comprehensive and may fall into a few different areas.

33. Over two-thirds of states have approved and/or pending 1115 waivers. ME VT WA NH MT ND MN OR MA NY WI SD ID MI RI CT WY PA NJ IA NE OH DE IN IL NV MD CO UT WV VA CA DC KS MO KY NC TN AZ SC OK AR NM GA AL MS Waiver Status LA TX Approved (17 States) AK FL HI Approved & Pending (17 States) Pending Only (3 States)

34. Both expansion and non-expansion states are seeking provisions that would restrict eligibility and enrollment never before approved by CMS, as of November 2017. NOTES: *TX = Healthy Women family planning waiver. SOURCE: KFF, Section 1115 Medicaid Demonstration Waivers: A Look at the Current Landscape of Approved and Pending Waivers, (Sept. 2017).

35. New waiver approval criteria does not focus on coverage and quality. 2015 Waiver Approval Criteria: • Increase and strengthen overall coverage of low-income individuals in the state; • Increase access to, stabilize and strengthen providers and provider networks available to serve Medicaid and low-income populations in the state; • Improve health outcomes for Medicaid and other low-income populations in the state, or • Increase the efficiency and quality of care for Medicaid and other low-income populations through invitations to transform service delivery networks. New Criteria: November 2017 Improve access to high-quality, person-centered services that produce positive health outcomes for individuals; Promote efficiencies that ensure Medicaid’s sustainability for beneficiaries over the long term; Support coordinated strategies to address certain health determinants that promote upward mobility, greater independence, and improved quality of life among individuals; Strengthen beneficiary engagement in their personal healthcare plan, including incentive structures that promote responsible decision-making; Enhance alignment between Medicaid policies and commercial health insurance products to facilitate smoother beneficiary transition; and Advance innovative delivery system and payment models to strengthen provider network capacity and drive greater value for Medicaid.

36. More states are seeking waivers to condition Medicaid on work requirements, but most not working face barriers to work. Main Reasons for Not Working NOTE: Totals may not add due to rounding. Includes nonelderly Medicaid adults who do not receive Supplemental Security Income (SSI), 2015. SOURCE: Kaiser Family Foundation analysis of March 2016 Current Population Survey.

37. States are also seeking waivers to impose premiums and cost sharing, but research shows negative effects of policies for low-income populations. • Decreased enrollment and renewal in coverage • Largest effects on lowest income • Many become uninsured and face increased barriers to care and financial burdens New/increased cost-sharing New/increased premiums • Even small levels ($1-$5) decrease use of services, including needed services • Increased use of more expensive services (e.g., ER) • Negative effects on health outcomes • Increased financial burdens for families Rx • States savings are limited • Offset by disenrollment, increased costs in other areas, and administrative expenses SOURCE: The Effects of Premiums and Cost Sharing on Low-Income Populations: Updated Review of Research Findings, Kaiser Family Foundation, June 2017. http://www.kff.org/medicaid/issue-brief/the-effects-of-premiums-and-cost-sharing-on-low-income-populations-updated-review-of-research-findings/

38. Key questions to ask about new waiver proposals and approvals: • What is the waiver doing? What are the stated goals and objectives? • Have similar waivers been approved in other states? What have we learned? • What provisions of the law are being waived? What populations are affected by the proposal? • What are the state estimates for PMPM costs and coverage with and without the waiver? • Does the state have an implementation plan? • What are the administrative costs and challenges? • What is the process to receive public input? If the waiver was open for public comment, did the waiver incorporate these comments? • What are the requirements for reporting and evaluation? • How often do states need to submit data?

39. Federal reform of 1332 waivers Paul Melmeyer Director of Federal Policy

41. NORD’s Rare Community Members 90+ corporate council 200+ medical students 3,000+ advocates 260+ patient groups NORD’s membership spans across more than 700 diseases, all 50 states and over 30 countries.

42. Policy & Advocacy Patient Services Research Education NORD’s Core Programs and Services • Medical Professional Education • Medical and PharmD Student Education & University Chapter Program • Patient and Caregiver Education • Advancing Basic and Translational Science • Strengthening Drug Development • Ensuring Access to Affordable Treatment • Ensuring Access to Safe, Effective Medical Care • Research Grant Program • Patient Registries & Natural History Studies • Clinical Trial Awareness & Education • Data Collection & Analysis for original research • White Papers • Insurance Navigation • Co-Pay, Premium and Medication Assistance • Emergency Relief • Ancillary Services • Clinical Trial Travel & Lodging

43. A Brief History of 1332 Reform Attempts

44. American Health Care Act (AHCA)

45. The American Health Care Act (AHCA) Technically did not substantially amend 1332s But did create a separate state waiver program to allow states to opt out of: Essential Health Benefits Community Rating

46. Better Care Reconciliation Act (BCRA)

47. Better Care Reconciliation Act (BCRA) Eliminated three of the four approval requirements: Provide coverage that is at least as comprehensive in terms of covered benefits Provide coverage that is at least as affordable (taking into account premiums and excessive cost sharing) Provide coverage to at least a comparable number of state residents; and Not increase the federal deficit

48. Better Care Reconciliation Act (BCRA) Eliminated three of the four approval requirements: Provide coverage that is at least as comprehensive in terms of covered benefits Provide coverage that is at least as affordable (taking into account premiums and excessive cost sharing) Provide coverage to at least a comparable number of state residents; and Not increase the federal deficit

49. Better Care Reconciliation Act (BCRA) Mandatory HHS approval IF: The waiver request does not increase the deficit Expedited review of waiver requests 45-day review rather than 180-day review Duration of waivers expanded from 5-years to 8-years with unlimited renewals $2 billion a year appropriated to 1332s (through 2019) HHS cannot terminate waiver after approval

50. Graham/Cassidy