Reed Smith Client Alerts

For years, the Food and Drug Administration (FDA) has relied upon draft and final guidance policies as the basis of Form 483 inspectional observations. A recent memorandum issued on January 25, 2018 by the Attorney General clearly prohibits the use of guidance documents in civil enforcement cases to effectively bind the public without undergoing notice and comment rulemaking. This alert explores FDA’s current practice of relying on draft and final guidance policies during inspections against the backdrop of this recent memorandum.

Background on Form 483

FDA inspects section 503A pharmacies under 21 U.S. Code § 374(a) and inspects outsourcing facilities under section 503B of the Federal Food, Drug, and Cosmetic Act (FDCA). The FDCA provides that FDA may “at reasonable times and within reasonable limits…[inspect] all pertinent equipment, finished and unfinished materials, containers, and labeling therein…. The inspection shall extend to all things therein (including records, files, papers, processes, controls, and facilities…” (21 U.S.C. § 374(a)). Upon completion of these inspections, FDA provides the representative of the pharmacy or outsourcing facility with a Form 483 that contains FDA’s inspectional observations.

FDA also publishes Form 483 inspectional observations on its website for public review. In certain circumstances, FDA will even communicate its findings directly to the state boards of pharmacy. State boards, in turn, have been known to use FDA’s Form 483 inspectional observations as a basis to conduct their own investigations of pharmacies and outsourcing facilities. State boards will frequently cite to FDA’s Form 483 inspectional observations as the source for their own allegations of wrongdoing under allegedly related provisions of state law. Pharmacies and outsourcing facilities, therefore, face an outsized risk of incurring penalties under state law each time FDA conducts an inspection and issues a Form 483.