Presentation reviews analysis done by Mr. Swit of FDA warning letters in the clinical research realm, with a focus on the types of key alleged violations and how those differed by whether the recipient was a clinical investigator, a clinical site, and IRB, or a study sponsor.

1. FDA Enforcement in
the Clinical Research Setting
ACRP San Diego Chapter
September 19, 2013
Michael A. Swit, Esq.

2. Standard Disclaimers
• Views expressed here are solely mine and do not
reflect those of my firm or any of its clients.
• This presentation supports an oral briefing and
should not be relied upon solely on its own to
support any conclusion of law or fact.
• These slides are intended to provide general
educational information and are not intended to
convey legal advice.
2

3. Learning Objectives
• At the completion of this session, participants
should be able to:
– Identify FDA’s key hot buttons when inspecting organizations
involved in clinical research, whether they be clinical
investigators, IRBs, sponsors, CROs, or other key players
– Review how to prepare for and respond to an FDA inspection
or warning letter in the clinical research context
– Explain the potential liability that individuals and organizations
face if they violate FDA’s Good Clinical Practice requirements.
3

4. Why Does FDA Enforce?
• To ensure its Mission is accomplished:
– Products are safe and effective
– Honest, accurate, informative representation of products
– Correction of noncompliance or removal of unsafe or
unlawful products
– Human subject protection is a goal shared with the
Office of Human Research Protection (OHRP) in FDA’s
parent department, the Department of Health & Human
Services (HHS)
4

5. 5
How to Avoid Enforcement?
• The answer is simple – Comply!
• But, how? -- Please Teach Vigorous Risk
Avoidance Comprehensively & Corporately
– Thus, to ensure you comply, you must have:
 P = Procedures
 T = Training
 V = Validation
 R = Records
 A = Audits
 C = Communications – open channels
 C = Compliance Culture from the Top

6. What FDA Enforces – GCP
Requirements
GCP Warning Letters
Jan. 2010 to Sept. 2012
6

7. Who’s Been Targeted
7
Warning Letter
Recipient
# of
WLs
Total
Allegations
All WLs
Average #
Allegations
Per WL
Clinical Investigator 35 110 3.1
IRB 24 76 3.2
Sponsor 10 37 3.7
Sponsor/Investigator 2 14 7
Radioactive Drug Research
Committee
1 5 5
Total 72 242 3.4

8. Violations – Clinical Investigators
8
Citation
[n = 35]
Number of WL’s
Containing
Citation
Failure to Follow Investigational Plan 34
Inadequate Case History 17
Informed Consent 12
Drug or Device Disposition 9
Failure to Personally Conduct or Supervise Study 7
Failure to Protect Subjects Under P.I. Care 7
Failure to Report Changes in Study Plan to IRB 5
Record Retention 5
Failure to Get IRB Approval to Study Changes 4
Failure to Assure IRB Involvement in Study 3
Failure to Inform IRB of Risks to Human Subjects 2
Recordkeeping 1
Failure to Report IRB Approval Withdrawal 1
False Information Reported to FDA or Sponsor 1
Unacceptable Representations on Safety or Effectiveness of Investigational
Device
1
Failure to Submit Progress Reports 1
TOTAL 110

9. Violations – IRBs
9
Citation
[n = 24]
Number of WL’s
Containing
Citation
Failure to Have Adequate Documentation for IRB Functions 16
Composition of IRB Issues 14
Failure to Follow Procedures 11
Failure to Have Adequate Procedures for IRB Functions 9
Informed Consent 6
Expedited Review 5
Failure to Determine Risks to Subjects Minimized 4
Continuing Review 4
Failure to Notify Investigators of Research Decisions 2
Controverted Issues 1
Conflicts of Interest 1
Failure to Ascertain Acceptability of Proposed Research 1
Failure to Ascertain if Studies in Children met Regulation on Additional
Safeguards for Children in Studies
1
Failure to Notify FDA of Suspension/Termination of Research Approval 1
TOTAL 76

10. Violations -- Sponsors
10
Citation
[n = 6]
Number of WL’s
Containing
Citation
Started Study without an IND or IDE 6
Failure to Supply Investigators with the Investigational Plan 3
Failure to Monitor 3
Bar on Advertising an Investigational Device as Safe and Effective 3
Failed to Test Tissue Specimen for Infection 3
Product Disposition Records 3
Inadequate Informed Consent 2
Failure to Get Investigator Agreement 2
Failure To Maintain Correspondence 2
Failure to Ensure Investigational Plan Followed 1
Failure to Submit An Accurate Investigational Plan In an IDE application 1
Failure to Get FDA Approval to Charge for IND Drug 1
Started Study without a Protocol Amendment 1
Violated Clinical Hold 1
Failure to Get Investigator Compliance 1
Failure to Get Investigator Contracts with Sufficient Financial Disclosure Info 1
Tissue Donor Screening Violation 1
Failure to Notify FDA of Termination of Investigation 1
Failure to Include All Reports of Prior Device Testing 1
TOTAL 37

11. Violations – Sponsor/Investigators
11
Citation
[n = 2]
Number of WL’s
Containing
Citation
Failure to Keep Adequate Case History Files 2
Failure to Get Informed Consent 2
Failure to Get IRB Approval of Study 1
Failure to Obtain 1572 1
Failure to Give IB to Other Investigators 1
Failure to Evaluate Evidence of Safety and Effectiveness of
Drug
1
Failure to Ensure Monitoring 1
Failure to File IND Annual Report 1
Failure to File IDE-Required Progress Report 1
Failure to Keep Adequate Drug Disposition Records 1
Failure to Keep Records of Financial Interests of Investigators 1
Records Retention 1
TOTAL 14

12. Violations -- Radioactive Drug
Research Committee
Citation
[n = 1]
Number of WLs
with Citation
Failure to Assure Quality 1
Failure to Ensure AEs Reported Immediately by
Investigators
1
Committee Composition 1
Failure to Submit Special Summary Report to FDA 1
Failure to Secure IRB Approval of Research 1
1
12

13. Review of Specific Warning
Letter Allegations
13

14. • Duty – conduct at least annually
• Mother Francis Hospital – Tyler, TX
– Several reviews of device studies were more than two months
late (exact dates are purged in WL)
• Bay Regional Medical Center – Bay City, MI
– One was a month late when FDA showed up for its 2009
inspection
– Red Flag Note – FDA had inspected in March 2009 – after
that, the IRB set up a procedure regarding assignment of
studies to specific IRB members for in-depth review. When
FDA re-inspected in 2010 (leading to the WL), the IRB had not
been following its new procedure
IRB – Continuing Review Failure
14

15. • Covenant Healthcare – Saginaw, MI
– The ICD entitled “consent to receive (b)(4) to attempt to
prevent (b)(4) in my baby”
 Lack statements that the study involves research; and
 Lack a description of the procedures to be followed with respect
to the investigational drug treatment [21 CFR 50.25(a)(1)]. The
statement in the ICD that the “treatment will be discussed
with you” does not sufficiently meet the regulatory
requirement for a description of procedures.
 Lack explanation of whom to contact for answers to pertinent
questions about research subjects’ rights [21 CFR 50.25(a)(7)].
Contact information for Covenant HealthCare IRB was left
blank.
IRB – Informed Consent
15

16. • Essex IRB – Lebanon, NJ – Allegedly approved a
fictitious investigation
– Fictitious study protocol was for a drug class with well-known
CV risks. However, the IRB did not ensure that those risks
were addressed in the ICD
– Second study – a risk of graft rejection was included in draft
ICD from sponsor.
 Sponsor asked to relocate the graft discussion within ICD.
 IRB – omitted the graft rejection discussion completely in final
ICD
IRB – Informed Consent …
16

17. • Duty – no IRB member with a conflict can
participate in initial or continuing review of a study
• Covenant Healthcare – several examples where
conflicted members took action
– Approving studies where IRB member was an investigator
– Approving SAEs where IRB member was an investigator
– Continuing review of studies where Chairman of the IRB was
an investigator
IRB – Conflicts of Interest
17

18. • Duty – must have 5 or more members and at least
one “non-scientific” member and one unaffiliated
member
• Napoli LLC (dba Precision Reproduction) –
Beverly Hills
– IRB had only two members
– Both members were scientists/doctors (an M.D. and an
embryologist)
IRB – Composition Issues
18

19. • Providence Hospital IRB – Washington, D.C.
– took action without a majority of IRB being present
 June 10, 2009 – of 9 members, only 4 present and only 2
were seen as on IRB (others were IRB coordinator and
person not on roster)
 June 20, 2007 – of 9 members, 5 present, but only three seen
as on IRB (same issue as in 2009)
– 2009 roster – CVs showed all were affiliated with hospital
IRB – Composition Issues …
19

20. • Duty – investigator must personally conduct or
supervise the clinical investigation
– Note – this is a “catch-all” violation
• Martin Zaiac, M.D. – Miami Beach, FL
– W.L. does not provide specifics re allegation but is replete with
examples of serious protocol deviations including failing to
ensure sexually active women were on contraception
– W.L. makes clear that, while delegating specific duties to
qualified personnel is OK, P.I. cannot delegate his/her general
duties re conduct of study
Investigator – Failure to Personally Conduct
20

21. • Joel Picus, M.D. – St. Louis, MO (Washington
Univ.)
– Failed to ensure Liver Function Tests reviewed before dosing
to set dose or if drug should be withheld (subject later died)
• John Griffin, M.D. – Virginia Beach, VA
– Research nurse signed his name to:
 1572
 a study protocol
 a confidentiality agreement
 AEs
 Signature and delegation form
Investigator – Failure to Personally
Conduct …
21

22. • R. Judith Ratzan, M.D. – Miami, FL – failure to
supervise led to:
– chemotherapy misadministration – e.g., 6 cycles after study
closed and AE reporting errors
– Study staff told FDA that Dr. lived outside Florida 6 mos of
year and was absent for majority of study’s conduct
Investigator – Failure to Personally
Conduct …
22

23. • Another “catch-all” violation – cited in all 25
investigator warning letters
• David Scott, M.D. – Spokane, WA
– Randomization to occur after surgery – ten subjects
randomized before surgery
– Physical exam required – none done
– PK samples not collected on 11 subjects – PK measures were a
secondary endpoint of study
• Sant Chawla, M.D. – Santa Monica
– PK samples collected at wrong time (end of drug infusion
when protocol said at start)
Investigator – Fail to Follow
Investigational Plan
23

24. • Duty – no investigator can involve a subject without first
getting legally effective informed consent
• Zaiac – informed consents signed were in English when
other consents by same subjects were in Spanish.
• Robert Deitz, M.D. – San Francisco, CA
– Patient enrolled on Jan. 10, 2005 and given drug. ICD not
signed until May 2005.
– Three subjects signed ICD’s not approved by IRB
Investigator – Informed Consent
24

25. Investigator -- Informed Consent …
• John Simmons, M.D. – Geneva, AL
– Signature on ICD did not match subject diary handwriting; P.I.
said signed by someone else because subject’s hands were
shaking; but P.I. did not verify other was the L.A.R.
25

26. • Yale Cohen, M.D. – Hollywood, FL
– Re-consenting by mail and phone approved by IRB only for
subjects not actively participating in study. P.I. used
mail/phone process for active subjects.
• Samya Nasr, M.D. – Ann Arbor, MI
– Gave out tote bags, diary cards, and calendars to subjects
without IRB approval
• Timothy Summers, M.D. – Meridian, MS
– Hand-altered a consent form without IRB approval
Investigator – Changes to Study
Without IRB Approval
26

27. • TCA Cellular Therapy, LLC – Covington, LA
– The TCA letter attempts to justify a lack of monitoring by
explaining that the contracted monitor could no longer
perform monitoring as of January 2011 and negotiations
were ongoing with another company to begin monitoring in
March 2011. The TCA letter further explains that after the
inspection, Dr. Lasala, TCA Managing Member, discovered
that the last monitoring visit was August 26, 2008.
Sponsor – Failure to Monitor Study
27

28. • TCA Cellular –
– Started study without an IND in effect -- told at an End-of-
Phase 2 meeting that use of allogeneic cells would need a new
IND. Started study with allogeneic cells without IND.
– Violated clinical holds – had two studies on hold, but
administered same test product to individuals who were not
even enrolled in the study (not clear how FDA figured this out)
• Cayman Chemical Company – Ann Arbor, MI
– Administered study drug without an IND in effect
Sponsor – Illegally Starting Study
28

29. • FDA alleges all studies done from April 2005 to June
2010 at Houston bioanalytical facility were based on
fraudulent data
– Problem with trying to salvage:
 FDA -- can’t audit fraudulent data
 retained samples may not be subject to stability
– Result -- could undermine approved and pending applications
• No warning letter issued – untitled letter on July 26,
2011
• MDS – 2007 – somewhat similar, but pervasive fraud
not alleged, allowing for audits to verify study work
Special Case Study -- Cetero
29

30. Strict Liability and the “Park Doctrine” –
Criminal Liability for
Responsible Corporate Officials
30

31. U.S. v. Park – Strict Criminal Liability in
the FDA World
• 1975 – 421 U.S. 658
http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=us&vol=421&invol=658
• Facts:
– John Park – CEO of Acme Markets – based in Phila.
– Warehouse – in Baltimore –multiple FDA inspections found
rodent and insect infestation
 1970 – letter to Park re Baltimore warehouse
 1971 – FDA inspection in October and November
 1972 – January letter from FDA
 March 1972 – FDA inspection – still found rodent inspection
31

32. U.S. v. Park – Strict Liability …
• Supreme Court, quoting Dotterweich (1943):
– observed that the Act is of "a now familiar type" which
"dispenses with the conventional requirement for criminal
conduct - awareness of some wrongdoing. In the interest of
the larger good it puts the burden of acting at hazard upon a
person otherwise innocent but standing in responsible relation
to a public danger."
• “Moreover, the principle had been recognized that a
corporate agent, through whose act, default, or
omission the corporation committed a crime, was
himself guilty individually of that crime. “
32

33. U.S v. Park …
• The principle had been applied whether or not the crime required
"consciousness of wrongdoing," and it had been applied not only
to those corporate agents who themselves committed the criminal act,
but also to those who by virtue of their managerial positions or
other similar relation to the actor could be deemed responsible
for its commission.
• The liability of managerial officers did not depend on their
knowledge of, or personal participation in, the act made
criminal by the statute. Rather, where the statute under which they
were prosecuted dispensed with "consciousness of wrongdoing," an
omission or failure to act was deemed a sufficient basis for a
responsible corporate agent's liability. It was enough in such
cases that, by virtue of the relationship he bore to the
corporation, the agent had the power to prevent the act
complained of.33

34. U.S. v Park …
• Duty to seek out and fix violations -- the Act imposes not only
a positive duty to seek out and remedy violations when they
occur but also, and primarily, a duty to implement measures
that will insure that violations will not occur.
– The requirements of foresight and vigilance imposed on responsible
corporate agents are beyond question demanding, and perhaps onerous, but
they are no more stringent than the public has a right to expect of those
who voluntarily assume positions of authority in business enterprises whose
services and products affect the health and well-being of the public
• But the Act, in its criminal aspect, does not require that
which is objectively impossible -- the Act permits a claim that
a defendant was "powerless" to prevent or correct the
violation to "be raised defensively at a trial on the merits."
34

35. U.S. v. Park …
• Objective impossibility – not construed by Supreme
Court since Park.
– One federal court of appeals – would have to show that you
took extraordinary measures, but still the violation occurred
– Delegation is not a defense
• March 2010 – Commissioner Hamburg writes
Congress -- renewed commitment to use Park
– issued a revision to its Regulatory Procedures Manual (RPM)
on factors FDA will use in invoking Park
35

36. The Park Doctrine – A Recent Example –
OxyContin
• May 10, 2007 -- Purdue Frederick Company, Inc. –
as a company -- agreed to pay more than $600
million to resolve felony criminal charges and civil
liabilities in connection with a long-term illegal
scheme to promote, market and sell OxyContin
• Purdue trained its sales representatives to falsely
represent:
– to health care providers about the difficulty of extracting
oxycodone, the active ingredient, from OxyContin
– to health care providers that OxyContin did not cause euphoria and
was less addictive than IR opiates;
– to health care providers the erroneous belief that OxyContin was
less addictive than morphine.
36

37. The Park Doctrine – A Recent Example –
Oxycontin …
• As part of the plea, Purdue paid a $600 million
settlement, which included:
– a criminal fine
– restitution to government agencies
– over $276 million in forfeiture,
– civil settlement of $100.6 million to the United States.
• Purdue's then current and former executive
employees, Michael Friedman, Howard Udell and Dr.
Paul Goldenheim, pled guilty to a misdemeanor violation
of misbranding OxyContin as being the responsible
corporate officers during the long-term illegal promotion
of the drug
37

38. Why is Park Being Resurrected?
• Congress and Executive Branch – concerned that
even huge fines and Corporate Integrity Agreements
are “cost of business”
• Corporate Executives – being targeted under premise
that:
– Organizational misconduct cannot occur without individuals
– What officials could prevent a violation if they tried?
– Answer: the “Responsible Corporate Official” (RCO)
38

39. Criminal Prosecution: Misdemeanors
• Misdemeanor -- under Park Doctrine
– Fines up to $100,000 and $200,000 per misdemeanor
offense for an individual and a corporation respectively
($250,000 and $500,000 if the misdemeanor offense
resulted in death)
– Imprisonment – up to a year in jail per violation
39

40. Criminal Prosecution -- Felony
• Must prove intent
• Fines are greater
• More common than misdemeanor prosecutions
• Often will combine FDA violations with other
federal crimes (e.g., conspiracy, false statements)
40

41. Seizure
• Civil action
– Technically, is against the goods themselves
– Owner or others with interest must intervene to defend the
goods
 If do, then trial on merits of alleged violations
– Lose – goods usually destroyed, but may be reconditioned if
possible
– Win – goods go free
– Less likely in the clinical research setting
41

42. Injunction
• Action to either:
– Compel compliance
– Prevent future violations
• Personal against individuals or corporations
• Can result in an order that will involve tremendous
allocation of resources over a long period of time to
address
42

43. Consent Decree
• Order of a court
• Entered by consent of the parties
• Not technically a judicial verdict, but a
negotiated contract between the parties under
the sanction of the court
• Parties represent that it is a just determination of
their rights as if the alleged facts of the case had
been proven
43

44. Consent Decrees …
• How do they come about??
• Settlement of a court case after FDA has filed for
an injunction
– “Voluntary” negotiations with FDA after an adverse
inspection
– Most terms/conditions negotiable -- but depends on your
leverage point
– companies more often concerned about naming executives
as individually responsible: FDA finds this point important
as a deterrent and necessary to pursue contempt charges if
decree becomes ineffective
44

45. Collateral Damage – Worst Case
Scenario from FDA Enforcement
• This is a picture you do not want to see ….
– in your newspaper ….
– on your local news ….
– on the Internet ….
or
– in an FDA lawyer’s presentation for years to come
….
45

46. Purdue Pharma Executives Outside
Court in Virginia
Udell Goldenheim Friedman
46

47. HHS Disqualification – The “Death”
Sentence
• 2008 – HHS Office of Inspector General – proposed
to disqualify all three from participating in federal
health care programs (e.g., Medicare, Medicaid)
– Did not allege direct involvement, but based on RCO theory
• 2010 – Twelve year exclusion upheld by federal
district court – Friedman v. Sebelius (on appeal to
D.C. Court of Appeals)
47

48. Key Measures to Take to Protect
You and Your Company From Liability
48

49. How to Protect Yourself and Your Company
• COMPLY!!
– THE REST IS COMMENTARY …
– But …
49

50. What to Do to Protect/Mitigate Liability
• Implement an Effective Compliance Program
• Written Policies and Procedures
– Code of Conduct – on Business Ethics and Compliance
– Specific procedures for key aspects of operations – not just
those related to FDA compliance, but also:
 vendor contracts
 marketing
 pricing
 deals with doctors
 interactions with government officials, domestic and foreign
 reporting of compliance programs
50

51. What to Do to Protect/Mitigate Liability …
• Compliance Officer and Committee – institute; with
authority to:
– Direct line report to CEO (not to CFO or G.C.) – must be
able to act independently and have access to Board of
Directors (e.g., if CEO is the bad doer)
– lead responsibility for compliance
– adequate resources & budget –
 side note – Warning Letter – signal to senior management to make
resources available to correct violations
• Communication – must be avenues within company
and to outside directors, if needed
51

52. Three slides left …

53. What to Do to Protect/Mitigate Liability …
• Training and education
– Reading is not enough
– Must be renewed periodically
 at Par, we retrained on the code of conduct annually
– Must be validated
• Auditing and Monitoring
– As with FDA operational audits, all compliance processes must
be audited
– Internal and external are recommended
– But, must act on what you find
53

54. What to Do to Protect/Mitigate Liability …
• Disciplining Offenses
– Have clear guidelines on discipline – up to and including
termination
– Enforce consistently and vigorously
• Responding to Detected Problems
– Do the “right” thing, promptly and comprehensively
– Investigate and correct (need a procedure for this as with
CAPA)
• Treat Your Employees Fairly – to minimize the
potential for whistleblowers; but remember you can’t
retaliate
54

55. Final Sermon:
Please Teach Vigorous Risk Avoidance
Comprehensively and Corporately
• P = Procedures
• T = Training
• V = Validation
• R = Records
• A = Audit
• C = Communications – Open Channels
• C = Compliance Culture from the Top
55

56. No slides left …

57. Questions?
• Call, e-mail or fax:
Michael A. Swit, Esq.
Special Counsel, FDA Practice
Duane Morris LLP
San Diego, California
direct: 619-744-2215
fax: 619-923-2648
maswit@duanemorris.com
• Follow me on:
– LinkedIn: http://www.linkedin.com/in/michaelswit
– Twitter: https://twitter.com/FDACounsel
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58. About Your Speaker
Michael A. Swit, Esq., is a Special Counsel in the San Diego office of the international law firm,
Duane Morris, LLP, where he focuses his practice on solving FDA legal challenges faced by
highly-regulated pharmaceutical and medical device companies. Before joining Duane Morris in
March 2012, Swit served for seven years as a vice president at The Weinberg Group Inc., a
preeminent scientific and regulatory consulting firm in the Life Sciences. His expertise includes
product development, compliance and enforcement, recalls and crisis management, submissions
and related traditional FDA regulatory activities, labeling and advertising, and clinical research
efforts for all types of life sciences companies, with a particular emphasis on drugs, biologics and
therapeutic biotech products. Mr. Swit has been addressing vital FDA legal and regulatory issues
since 1984, both in private practice with McKenna & Cuneo and Heller Ehrman, and as vice
president, general counsel and secretary of Par Pharmaceutical, a top public generic and specialty
drug firm. He also was, from 1994 to 1998, CEO of FDANews.com, a premier publisher of
regulatory newsletters and other specialty information products for FDA-regulated firms. He has
taught and written on many topics relating to FDA regulation and associated commercial
activities and is a past member of the Food & Drug Law Journal Editorial Board. He earned his
A.B., magna cum laude, with high honors in history, at Bowdoin College, and his law degree at
Emory University.
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