FDA Watch: New Guidance on Charging for Investigational Drugs

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

Manufacturer(s)	Product
Thermo Fisher Scientific	Clearance for ImmunoCap Specific IgE Allergen Component Ses i 1 test quantitatively measuring specific IgE antibodies to identify patients with sesame allergies at risk for severe anaphylactic reactions
Thermo Fisher Scientific	Clearance for ImmunoCap Specific IgE Allergen Components test for wheat measures IgE antibodies to wheat allergens associated with severe allergic reactions
Thermo Fisher Scientific	Premarket clearance for Oncomine Dx Target kit to detect alterations in 23 genes associated with NSCLC
Guardant Health	Premarket clearance for Guardant360 CDx blood-based liquid biopsy assay performed by company in its own lab, covering genomic alterations in circulating tumor DNA across 55 genes
Visibly	510(k) clearance for an on-demand, self-administered visual acuity test enabling consumers to check their vision online
Roche	Clearance for Ventana MMR RxDx Panel to determine which solid tumor patients could benefit from treatment with Merck's Keytruda (pembrolizumab)
Biovica	510(k) clearance for DiviTum TKa assay to monitor disease progression in previously hormone receptor-positive, metastatic postmenopausal breast cancer patients
Qorvo Biotechnologies	EUA for Qorvo Omnia SARS-CoV-2 Antigen Test for use in Point-of-Care (POC) settings
Helix Diagnostics	EUA for Helix Diagnostics SARS nCoV-2019 Multiplexed Assay for use at firm’s Waterford, Michigan lab
Meridian Bioscience	EUA for Revogene SARS-CoV-2 molecular test run on firm’s Revogene instrument
BioMérieux	Clearance for Nephrocheck kidney stress assay

New CE Marks & Global Certifications

Notable European CE certifications announced during the period:

New CE Markings in Europe

Manufacturer(s)	Product(s)
Roche	CE label expansion for Ventana PD-L1 SP263 test to determine non-small cell lung cancer patients’ eligibility for Roche’s immune checkpoint inhibitor Tecentriq (atezolizumab)
Nanostics	ClarityDx Prostate test
CorDx	Moneypox Virus Ag Test is a lateral flow chromatographic immunoassay designed for qualitative detection of monkeypox virus antigen
CorDx	Monkeypox Virus Fluorescence PCR Kit, tests for the virus in human rash exudates and blood and plasma samples
CorDx	Monkeypox Virus IgM/IgG Ab Test lateral flow chromatographic immunoassay to detect antibodies to the virus in blood
Imspex Diagnostics	BreathSpec COVID-19, a breath-based test for detecting COVID-19
Gradientech	QuickMIC instrument and sample preparation kit to determine the best antibiotic treatment for sepsis patients based on phenotype susceptibility testing
Predicine	PredicineCare blood and urine cell-free DNA (cfDNA) assay
Genematrix	Neoflex TB/NTM-5 detection kit respiratory diagnostic product
Hyris	T-Cell Test for tracking and monitoring T-cell immunity to SARS-CoV-2
BioGX	Point-of-care, multiplex RT-PCR SARS-CoV-2 assay
Aniling	GEUS-CLL test to diagnose, monitor, and select the best therapies for patients with chronic lymphocytic leukemia
Aniling	GEUS-CRC to diagnose, monitor, and select the best therapies for patients with colon cancer
Aniling	GEUS-LB test providing information about tumor DNA for use to diagnose a patient via liquid biopsy
OptraScan	OS-Ultra line of brightfield scanners

Other international clearances announced during the period:

Manufacturer(s)	Country(ies)	Product(s)
Oncgnostics	China	DNA methylation-based cervical cancer GynTect assay
Pillar Biosciences	China	OncoReveal Dx Colon Cancer Assay
Lucira Health	Canada	Lucira COVID-19 & Flu Test