Charging patients for new investigational drugs enables companies to defray some of the enormous costs of conducting the clinical trials necessary to bring those experimental products to market. On Aug. 21, the FDA proposed new guidelines on charging for investigational drugs.

The FDA Regulations

FDA regulations allow the agency to authorize charges by drug sponsors to recover direct (but not indirect) costs of clinical trials designed to develop new investigational drugs or expand the use of an existing one. Direct costs include costs per unit to either:

• Manufacture the drug, such as raw materials, labor, and nonreusable supplies and equipment; or
• Acquire it from another company, e.g., shipping, handling, and storage.

Expenses incurred primarily to commercially produce the drug for sale are deemed indirect costs that can’t be recovered via patient drug charges.

The New Guidance

The new guidance, which is in the form of FAQs, clarifies that to receive FDA authorization to charge for a new investigational drug, sponsors must:

• Furnish evidence showing that the drug has a potential clinical benefit that, if demonstrated in a clinical trial, would provide a significant advantage over available products in the diagnosis, treatment, mitigation, or prevention of a disease or condition;
• Demonstrate that the data to be obtained from the clinical trial would be essential to establishing that the drug is effective or safe;
• Demonstrate that it couldn’t conduct the clinical trial without charging because the cost of the drug is extraordinary to the sponsor due to manufacturing complexity, scarcity of a natural resource, the large quantity of the drug needed, or other extraordinary circumstances;
• Provide documentation supporting its calculation for cost recovery that’s reviewed and approved by an independent certified public accountant.

To get authorization to charge for investigational drugs for which expanded access is sought, the sponsor must provide the FDA reasonable assurance that charging won’t interfere with drug development, including:

• Evidence of sufficient enrollment in any ongoing clinical trials needed for marketing approval to assure that the trial will be successfully completed as planned;
• Evidence of adequate progress in the development of the drug for marketing approval; and
• Information submitted under the general investigational plan specifying the drug development milestones the sponsor plans to meet in the next year.

As with new drugs designed for introduction to the market, documentation must include the calculation for the amount to be charged that’s reviewed and approved by an independent certified public accountant.

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Here are some of the key new FDA EUAs and clearances that were announced in August 2022:

New FDA Emergency Use Authorizations (EUAs) & Approvals

New CE Marks & Global Certifications

Notable European CE certifications announced during the period:

New CE Markings in Europe

Other international clearances announced during the period: