Raising the yellow flag

KING OF PRUSSIA,Pa.—In early January, the FDAissued more than 1,000 notification letters to various pharmaceutical companiesrecommending that they reevaluate pharmacokinetic studies that were conductedfor them by MDS Pharma Services at its St. Laurent and Blainville, Quebec sitesin Canada from 2000 through 2004.

Some drug companies may be required to confirm or repeatcertain tests already applied to their products to win federal approval. Assuch, the approval of some drugs awaiting federal clearance may be slowed down,though the FDA has said no drugs that have already received approval will betaken off the market.

"It is important to emphasize that this action does notapply to any of our other sites or work conducted outside this time period,"notes Stephen DeFalco, president and CEO of MDS Inc., parent company of MDSPharma Services. "We are redirecting our efforts from conducting assessments inthe five-year review to supporting our customers with our independent auditactivities. We have had sponsors already complete audits and are working withothers to schedule audits. We understand from sponsors that specific clientswho have already conducted audits have received approvals based on that work."

Also, both the FDA and MDS are stressing that this federalnotification is a precautionary measure only and that no evidence has beenfound of actual problems with the quality, purity or potency of the affecteddrugs—only concerns over the testing procedures.

MDS has been working with the FDA on this concern over testsat the two facilities since 2004. MDS initially agreed to undertake acomprehensive self-review of bioequivalence studies conducted at its St. Laurent facility from 2000 through 2004 and afterthat, the FDA conducted an inspection of MDS Pharma's bioequivalence operationsin St. Laurent and Blainvilleduring March 2006. In September 2006, the FDA sent MDS Pharma a letter that wascritical of the management and the effectiveness of the retrospective review andexpressed the feeling that their concerns had not been fully addressed.

As of the fourth quarter 2006, MDS Pharma reported that itwas continuing to devote "substantial effort and resources" in the conduct ofthe retrospective review, and noted that it has incurred direct costs of $10million in that quarter as a result. Full year costs for 2006 regarding thetesting issue were $31 million, including direct labor, consulting costs, andthe cost of related customer accommodations.

DeFalco commended the FDA for developing a "practical andefficient path" for closure of the review of bioanalytical studies conducted atthe Quebec facilities, a paththat includes three options for MDS customers: redoing the studies, reanalyzingthe samples or conducting an independent audit of the data. "We remain committed to working with the agency andour customers to bring final closure to this issue," DeFalco says.