A Convicted Felon Redefines Drug Development?

A Convicted Felon Redefines Drug Development?

August 10th, 2011 // 1:09 pm @

File this under ‘nice try, but…’ The FDA has denied a request made by convicted felon Ray Nathan for a hearing in which he hoped to prevent the agency from permanently debarring him from providing services in any capacity to a person that has an approved or pending drug product application. However, he did take a good run at parsing the language used to describe drug development.


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Some background: In 2005, Nathan was one of the founders of a start up called Argus Therapeutics that wanted to make a generic version of a drug called PhosLo, which was used to treat renal patients and was made by Nabi Pharmaceuticals. The patent was soon to expire and the Argus team wanted to get a head start. So Nathan agreed to obtain a certificate of analysis, which includes lab results and information that can be used to start development of a drug, according to court documents.

How did he go about doing this? He looked up the names of Nabi employees and created a fictitious e-mail account for a senior manager, which he then used to write an employee at Lyne Laboratories, which manufactured PhosLo as a subcontractor for Nabi. When the Lyne employee requested a physical address to which the certificate should be sent, Nathan provided the address of another principal at Argus via email. He later sent a third email from the fraudulent email account to inquire about the status of his request. But the Lyne employee grew suspicious and never sent the certificate, according to court documents.

In 2007, Nathan was convicted of a felony, although he tried in vain to convince a federal judge that was not attempting to ‘reverse engineer’ PhosLo. “It is impossible to reverse engineer a drug based on a certificate of analysis. A C of A is simply a top-level summary of product release tests and the results for a specific lot…the government’s premise that I needed a C of A to reverse engineer a drug is false. It is a very simple formulation, easy to manufacture, and the testing and acceptance criteria are published in the public domain,” he wrote at the time of sentencing.

But he was fined $5,000 for one count of wire fraud and placed on probation for one year (see this). And last year, the FDA wanted to ensure he would not be able to participate again in any drug development effort. But Nathan obviously still has some chutzpah left in him. He insisted that the “conduct underlying the conviction did not relate to the development or approval, including the process for development or approval, of any drug product or otherwise relate to the regulation of drugs under the Food Drug & Cosmetic Act.”

More specifically, Nathan took a narrow view of FDA language and argued that the “development or approval” of a drug product subject to FDA’s premarket review begins with preclinical testing in animals and ends with postmarket studies, according to an FDA notice. “He contends that his actions in attempting to obtain a certificate of analysis for PhosLo do not relate to that process but instead relate to ‘pre-development’ market research.”

Rather than acknowledge that his actions were designed to gather info on drug development, Nathan maintained that he was “attempting to evaluate production costs” for a generic version and, in any event, Argus did not have the financing needed to actually pursue drug development. No money, no foul?

But Jesse Goodman, the FDA’s chief scientist and deputy commish for science and public health, rejected his argument. “Although Nathan argues that researching manufacturing techniques and the commercial viability of those techniques is not part of the drug development process, it is clearly a necessary step in that process,” according to the FDA notice.

“At the very least, such research relates to that development process for a drug product. Indeed, the information that Nathan attempted to obtain through his illegal conduct would have enabled Argus to begin compiling the chemistry, manufacturing, and controls section for an abbreviated new drug application” .

Source: Pharmalot

We left a message for Nathan and we will update if we receive a reply.

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