The FDA isn’t being shy about dragging its grievances against pharma companies into the public sphere.
As part of its push for “radical transparency,” the agency began publishing previously confidential complete response letters last year that reveal FDA decision-making when rejecting applications for drug approvals.
That effort to open the “black box culture of FDA decisions” won fans on Wall Street, where investors often only hear what companies tell them about bad news from the FDA. Regulatory bodies often bring penalties to light, but the approach is controversial, and the FDA has historically kept CRLs between the agency and the affected company. Their publication, along with the FDA’s other recent moves that shine a spotlight on companies targeted for agency enforcement, raises privacy concerns, along with legal and financial risks.
“Policy changes that make confidential information about drug development public are not new,” said Michael Abrams, managing partner at Numerof & Associates, in an email. “The FDA Amendments Act of 2007 and the 21st Century Cures Act both required disclosure of information that had previously been treated as confidential.”
In both instances, the decision to publicly reveal new details about trial designs, results and endpoints, including negative endpoints, generated industry pushback. Companies feared it would compromise intellectual property rights or lead to data misinterpretations, he said.
FDA’s ramped up pressure on pharma companies is being greeted with similar caution. Pharma giants generally support transparency but want the option to redact sensitive commercial details, Abrams said.
For emerging biotechs, the stakes are even higher as their future often hinges on a single, critical product, Abrams said.
“A CRL that exposes [these companies] to criticism could cause investors to pull their support and their valuation to plummet,” he said. “The idea that such information would be made public without their ability to influence interpretations made by investors and the media, except after the fact, offers them nothing of value.”
Here are the various ways FDA is casting more light (while throwing some shade) on pharma companies.
The ongoing CRL push
A big component of this new approach debuted in July, when the FDA released an older batch of more than 200 CRLs sent to pharma companies for drugs it later approved. These letters outline the deficiencies that prompted the FDA to delay an approval and are typically related to safety, efficacy or manufacturing problems.
More controversial and worrisome to many was the agency’s September decision to pursue the release of CRLs in real time for drugs that aren’t approved yet, a plan made without public input. Makary said on a podcast that one of the reasons behind the push to make this information public was that capital markets appreciate predictability, which raised questions about whether the decision was influenced by Wall Street.
“The strongest support for making CRLs public comes from investors and those with a regulatory perspective,” Abrams said. “From their point of view, more transparency would support more efficient capital allocation and would prevent investors and the public from being misled.”
In the past, details about CRLs were typically revealed by the companies, and presenting a spin on the denial could avoid triggering a drop in stock prices.
While the FDA hasn’t backed down on this real-time CRL release plan, officials agreed to redact confidential and sensitive information. Even so, legal and policy issues remain, according to Ropes & Gray, including questions about whether the FDA can publish CRLs for pending or withdrawn applications, and whether companies can view and comment on redactions.
A rejection letter to AstraZeneca was among the CRLs the FDA recently published. The letter, related to a subcutaneous version of its Lupus drug Saphnelo, cited “critical data quality issues that affect key analyses including the primary endpoint.” The company provided additional information and said it is “committed to working with the FDA to progress the application as quickly as possible.”
“At the end of the day, making CRLs public will demand adjustments from the industry,” Abrams said. “Most significant will be manufacturers ceding some control over the new product narrative to the FDA. In a world in which the FDA decides which information to make public, the agency itself takes on a new role as information arbiter.”
Revealing details in warning letters
The agency also recently beefed up a publicly disclosed Form 483 warning letter, which is typically triggered by a manufacturing facility inspection and can be tied to infractions ranging from poor sanitary conditions to a lack of data protection measures. Historically, the letters have not contained images — until recently.
In an unusual move, the FDA included photographs in a recent warning letter to an Indian drug company that produces over-the-counter medications. The images provided more visceral evidence of the filthy conditions described in the letter.
Although the FDA has not typically published images, the agency usually collects them during inspections to document its findings. This has become controversial though because it risks revealing proprietary information or may portray companies in an unflattering light. Some have pushed back, triggering friction with the agency.
In 2024, the FDA cited a company for not allowing inspectors to take pictures. Even so, the FDA doesn’t typically include the photos in public warning letters and it’s not clear if the recent use of images will be part of a broader trend.
Targeting industry deception
The FDA has also not shied away from cracking down on industry leaders — especially when it comes to accusations of deceptive advertising. Most recently, it leveled notably harsh criticism in a warning letter to ImmunityBio for making false and misleading claims about the company’s bladder cancer therapy, Anktiva, on a podcast and a television ad.
The letter alleges that Dr. Patrick Soon-Shiong, the executive chairman and global chief scientific and medical officer for ImmunityBio, went on a podcast and made a series of false and misleading claims, which could deceive the public into thinking the bladder cancer drug can “cure and even prevent all cancer.” The communications also omitted critical information about the drug and its potential risks, and the company never submitted the podcast for FDA review. ImmunityBio officials said they plan to conduct an internal regulatory review to address the findings.
All told, the FDA’s recent actions could increase reputational risks for companies, which may need to recalibrate their compliance efforts in response.
“In spite of those concerns, the business of drug development adapted. Data with potential competitive value has become a routine input for investors and analysts, and knowing that, manufacturers design trials to minimize such exposure,” Abrams said. “The timing of sensitive disclosures is managed to shield such data from the public eye for as long as possible. The example suggests that the business of drug development is more resilient than some thought.”
