Article | September 27, 2017

FDA Guidelines Make More Work for CMOs, But Safer Products for Consumers

By Ed Price, President, PCI Synthesis

FDA Guidelines Make More Work for CMOs

There’s been lots of talk lately about increased safety threats from new drugs hitting the market, prompting even more warning labels. This comes at a time when news outlets are reporting on an easing of FDA restrictions designed to spur increased innovation and competition, especially among generic drugs.

While we may see changes, they won’t necessarily mean FDA guidelines and restrictions will be simple or less time-consuming for drug manufacturers. In fact, the FDA approval process is one of the most time-consuming, complex processes for Contract Manufacturing Organizations (CMOs) everywhere – and rightly so. FDA scrutiny ensures the safety of drugs and those that consume them and that’s not going away anytime soon. This article provides an overview of issues regarding FDA compliance and the reasons it is a complex process.

There really are two major concerns that the FDA requires be proven during clinical trials: That the drug won’t hurt anyone, and that the efficacy of the drug is sound. While most products that go through clinical trials are deemed safe by the FDA, there are also plenty of watchdogs, such as patient advocacy groups, politicians and medical professionals who work to ensure that any issues with both brand-name drugs and generics are documented and addressed.

One area that has seen expedited FDA approvals is for drugs seeking Orphan Drug status.  For small populations with an imminent need for certain drugs, the regulatory approval process can move more quickly, with smaller clinical trials.

Yet overall, the FDA approval process is still a laborious and costly activity. Tufts University’s Tufts Center for the Study of Drug Development published a report that estimated that it takes $2.558 billion to bring a new drug to market. This is based on estimated average out-of-pocket costs of $1.395 billion and time costs of $1.163 billion. The study also reports that drug development is lengthy—often taking longer than a decade to become commercialized. A key part of these expenses and time is the FDA approval process.

Tighter FDA Restrictions Key to GDUFA
Contrary to easing restrictions, tighter restrictions for FDA approval were established as part of the Generic Drug User Fee Amendments (GDUFA) in 2012. These were designed to speed access to safe and effective generic drugs to the public and reduce costs to the industry.

As part of GDUFA, the FDA requires regulatory filing of new chemical entities be completed electronically in order to be more efficient, reduce costs to the government and eliminate manual, error-prone processes. From registering your site through self-identification, all submissions are done electronically. Yet the ability to navigate FDA electronic submission requirements alone, including using the Electronic Common Technical Document (eCTD) standard, has become increasingly time-consuming and difficult. Additionally, filing each chemical entity can cost from $41,000 to $46,000 per Drug Master File (DMF), the primary document in support of an Abbreviated New Drug Application (ANDA).  

Complex Reporting Requirements
Aside from inspections and other FDA regulations, reporting alone is a time-consuming and costly process. A critical piece of technical documentation CMOs must provide is the analytical methodology used to test the drug substance. Validation reports for the methods for assay, impurities and residual solvents are included in the open portion of the DMF, along with reports on forced degradation studies performed on the drug substance. These reports demonstrate that the methodology possesses stability-indicating properties.

The DMF also includes reports on various scientific studies essential to the applicant’s preparations. The first essential scientific document is a chemical description of the API impurity profile, which includes raw materials and intermediates that a have the potential to carry through into the final product, as well as all possible degradants and products of side-reactions that may occur during the process. The second essential document in this category is a well-articulated and scientifically sound rationale for the manufacturing process, with special attention to the selection of the API Starting Material.

A third important report is a justification for the drug substance specifications, especially those for assay, impurities and residual solvents.

Gathering this information must be handled by the CMO, yet given the time and costs involved in submitting the data in-house, many outsource the actual formatting into the FDA-required structure to a third-party. FDA approval through e-filing doesn’t end there. Under GDUFA, on the anniversary of a submission, the developer must e-file an annual report each year with updated information on their products.

While patient safety is paramount, over time, drug trials have become more complex and expensive. The bar to getting a new drug approved is much higher than it was for old drugs, long approved by the FDA. Because of its side effects, aspirin is said to be unlikely to pass FDA approval if it were in the lab today.

And that raises some issues about the regulations themselves, especially for generics.

In Jan. 2017, the FDA issued new draft guidance on what may be used as a reference standard, which may or may not be the same thing as a Reference Listed Drug (RLD), a term the industry has used for decades. Beyond sowing some confusion, comparing new generics to older, previously approved drugs demonstrates a playing field tilted heavily in favor of branded drugs – sometimes to a point that harms patients. For some, the RLD would be way outside ICH guidelines even as new generics won’t get approval if they exactly met the branded product.

The amount of work to get generics approved has increased, which has become a barrier to entry. For example, Teva and Sanofi have both had problems getting their Epi-Pen alternatives to market. The new products had to meet more stringent manufacturing standards, contain fewer impurities. While generic competitors have to spend more time and money on getting approval, because of a lack of competition, the manufacturers of branded products, like Mylan, can raise the price of its Epi-Pen, even as the manufacturing costs, including raw materials, remains flat. And that’s even as some of those branded products would not pass current FDA scrutiny if submitted today. Patients end up paying more for a drug that wouldn’t pass muster today.

The answer isn’t necessarily to roll back all standards – because patient safety is important. And it might not be to require older, approved drugs to meet updated, current standards. (One problem with that suggestion: it would lead to increase prices every few years to cover a new review process and may also necessitate taking some drugs off the market until they can meet new standards.)

So, while there may be talk of easing FDA requirements for new chemical entities, the process is by no means an easy one. Smart drug sponsors and CMOs understand that the complex process is meant to ensure safe and effective drugs that by their proven quality, safety and efficacy may not require a long list of safety warnings.

Ed Price is President of PCI Synthesis (, a pharmaceutical development CMO based in Newburyport, MA and the largest small molecule drug substance manufacturer in New England. PCI Synthesis is also a commercial manufacturer of NCEs, generic active pharmaceutical ingredients (APIs), and other specialty chemical products for the medical device industry.  As a CMO, PCI Synthesis provides emerging and mid-sized pharmaceutical companies access to the expertise needed to develop and manufacture complex small molecules.