New 2004 FDA Budget Announces Proactive" Policy on Rx-to-OTC Switches Forced Switch" Policy Shift Was Predicted by Francesco International

In a possible seismic change in the role of Rx-to-OTC importance in the US healthcare system, the US FDA so far this year has done the following: • In February announced in their 2004 Budget their intention to be more aggressive regarding switches. The 2004 Budget indicates their explicit desire to implement a major emphasis on increasing switches as a means of improving public health. • In March they began to pressure Pfizer and Aventis to force the switch of their non-sedating antihistamines well in advance of the products patent expiration. • In April, through various statements by FDA staffers, it became clear that more products beyond non-sedating antihistamines were being scrutinized for forced switch potential. • In May the FDA Commissioner confirmed that he felt the FDA had the legal authority to force Rx-to-OTC switches in the future. These changes were predicted 3 years ago by Francesco International Francesco International is a full service advisory and thought-leader, specializing in the proper and best management of the later stages of a pharmaceutical products lifecycle.

The New FDA Fiscal 2003-4 Switch Policy Initiative
In late February the first warnings of a change in policy appeared with the publishing of the FDAs new budget for the fiscal year 2003-4.

The 2004 budget boldly expresses the following thoughts: (Note: The entire US 2004 FDA budget is at www.fda.gov/oc/oms/ofm/budget/2004/BIB.htm

Program Objective
To become more proactive in recommending key potential prescription (Rx)-to-OTC" switches that could result in further consumer empowerment in self-medication as well as provide an expedient way to significantly reduce consumer health care costs for certain ailments.

FrancescoComment: The interpretation of the meaning of proactive" is now becoming clearer as are the key" switches. First to go are non-sedating antihistamines. Other products are under consideration. Francesco testified at the 2001 FDA Advisory Committee Meeting in support of switching non-sedating antihistamines but against FDA forced" switches.

However, Francesco International predicted this forced switch" shift in policy three years ago. Francesco International predicts more changes in the not too distant future. Francesco International is a thought-leader and a full service consulting specialist in this area of late stage life cycle pharmaceutical management.

(FDA Forced Switch continued)

FDAs goal is to increase RX-to-OTC switches by 50 percent on average.

Francesco Comment: This type of ambitious objective by a government is similar to that used by UK Health Minister Lord Hunt in the UK last May. At that time Lord Hunt stated: "In the last ten years some 50 substances have been removed from prescription only status and made more accessible. I now want to see the number of changes to double."

More Recent Switch Activity: A portion of letter dated March 26 by the Consumer Healthcare Products Association (CHPA) to the FDA is below. It is in response to a challenge by the US Food and Drug Administration regarding the continued prescription status of second generation (non-sedating antihistamines). Below are excerpts. (The entire text will be posted on the US FDA website.)

Re: FDA adoption of a forced switch policy

Dear Secretary Thompson and Commissioner McClellan:

   We understand that FDA is considering a switch of a second generation antihistamine, from prescription to OTC status, over the objections of the company.

   The Consumer Healthcare Products Association (CHPA) opposes a policy to force switch over the objections of the drug sponsor.

The letter then goes on to list the many reasons why a forced switch is unwise. Subsequently, there have been articles about this change in policy supported by interviews with new FDA Commissioner McClellan in the Washington Post, Wall Street Journal and USA Today

Francesco International predicted these changes three years ago. Moreover, they predict additional changes due to the rising cost of healthcare and the improved safety of drugs.

Francesco International is a full service pharmaceutical consulting firm that has specialized in late product life cycle issues, especially Rx-to-OTC switch activity for the past ten years. For more information on this specific issue or the broader subject of late stage pharmaceutical product life cycle management, please contact:
Francesco International at +1-973-761-5566 or email Stevef@franint.com

This information has been brought to you by Francesco International, a full service late stage product life cycle specialist firm

The above editorial material are copyrighted excerpts from the recent SWITCH® newsletter, a ten year old publication dedicated to the discipline of late stage product life cycle management. It is a property of Francesco International. For more information on SWITCH®, please email inquiries to: tinaq@franint.com.