Introduction: CGMPs and FDA Inspections
Current Good Manufacturing Practices (CGMPs) are mandated by regulations enforced by the U.S. Food and Drug Administration (FDA), and must be implemented and followed by manufacturers of pharmaceutical products and most medical devices to help ensure these regulated products meet consistent quality standards. In fact, most recalls of drugs and medical devices from the marketplace occur because of a failure to comply with CGMPs. The Federal Food and Cosmetics Act (FDCA) authorizes designated inspectors and officers—upon presenting appropriate credentials and a written notice to the owner, operator, or agent in charge—to enter and inspect drug and medical device manufacturing facilities at reasonable times.
The inspection extends "to all things therein" bearing on whether a regulated product is "adulterated or misbranded." Inspections, however, are not unlimited. For example, inspections do not extend to "financial and sales information (other than commercial shipment data), and pricing and personnel information (other than information related to the qualification of personnel performing regulated activities)."
Refusal to Allow Inspection
On rare occasions, an owner, operator, or agent in charge of a regulated manufacturing facility will refuse entry to the designated inspectors and officers—that is, they will refuse to allow the FDA's inspectors and officers to inspect a facility. As an example, the FDA recently released a warning letter that was issued to the Shanghai Institute of Pharmaceutical Industry (SIPI) for refusing an FDA inspection. The FDA's warning letter outlines that the SIPI site had agreed to a "planned surveillance and pre-approval inspection of your drug product testing facility" and the SIPI "refused the pre-announced inspection in a written response to the FDA China Office."
Foreign Inspections: The Larger Picture
In one sense, SIPI's refusal to allow an inspection of its facilities, and the FDA's warning letter, should be viewed in light of larger trends that we recently wrote about: attempts to control rising drug prices by encouraging drug importation and the foreign manufacture of drugs taken by U.S. consumers, and the trade war with China. For example, in a recent letter, Senator Chuck Grassley has advocated that foreign drug manufacturing plants—particularly in India and China—stop getting advanced warnings of FDA inspections. The letter references a now lapsed pilot program in India, which eliminated advanced notice of drug plant inspections, resulted in the FDA having a 60 percent increase in "Official Action Indicated" findings.
We pointed out that the senator's comments come amid a recent spate of well-publicized findings of imported blood pressure medications containing carcinogens; the Defense Health Agency scrutinizing increased Chinese production of these medications as a health threat to military personnel who use the drugs; the publication of investigative journalist Katherine Eban's book Bottle of Lies; and most recently, Valisure's citizen petition requesting, among other things, that the FDA "recall and suspend all lots of all products containing ranitidine [Zantac]" because of the "drug's propensity to form the probable carcinogen NMDA" so that the "drug is misbranded."
Consequences of Inspection Refusal
Refusing an inspection can have significant, far-reaching, and escalating consequences. Initially, the FDA can issue a warning letter. As described in the FDA's warning letter, under specific provisions of the FDCA, "drugs [and devices] are deemed adulterated if they are manufactured, processed, packed, or held in an establishment and the owner, operator, or agent delays, denies, limits, or refuses an inspection." The FDCA prohibits the "introduction or delivery for introduction into interstate commerce of any food, drug, device, or cosmetic that is adulterated or misbranded."
In line with this provision, the FDA's warning letter states: "Until FDA is permitted to inspect your facility and confirms compliance with current good manufacturing practice (CGMP), this office may recommend withholding approval of any new applications or supplements listing your firm as a drug manufacturer." Foreign firms who deny a properly noticed facility inspection request can be placed on the Red List which allows the FDA to deny any imports into the United States.
Takeaways
Startup companies will often outsource their manufacturing activities for both their clinical development programs and commercial supply, because they lack the financial resources to develop their own physical plant and hire the necessary personnel to manufacture product in compliance under CGMP conditions. Startups who are contemplating a contract manufacturer, including any manufacturer in a foreign country, must first qualify these manufacturers as being capable of complying with CGMPs, and such qualification must include evaluating any FDA enforcement action, including any warning letter history, inspectional observations (including "official action indicated") and inclusion on the Red List.
Conclusion
Delaying, denying, or limiting an inspection, or refusing to permit inspection, can have significant, escalating, and broad-ranging consequences. If the facility that refused inspection is foreign, the facility can be placed on the FDA's Red List, and any product from that facility can be denied entry into the United States. Because of this, startups considering outsourcing their manufacturing activities should carefully qualify the contract manufacturing organizations, and should continually ensure these contractors are complying with CGMPs.
For questions regarding FDA inspections, or any FDA related question, please contact David Hoffmeister, James Ravitz, Georgia Ravitz, or any member of WSGR's FDA Regulatory, Healthcare and Consumer Products Compliance practice.
Charles Andres contributed to the preparation of this WSGR alert.
