Ego Pharmaceuticals Pty Ltd and Minister for Health and Ageing

[2012] AATA 210

Division GENERAL ADMINISTRATIVE DIVISION

File Number

2008/4472

Re

Ego Pharmaceuticals Pty Ltd

APPLICANT

And

Minister for Health and Ageing

RESPONDENT

DECISION

Tribunal
Justice Downes, President
Dr Schafer, Member

Date 13 April 2012

Place Sydney
Decision set aside. Matter remitted with a direction that the goods be registered under s 25 of the Therapeutic Goods Act 1989 (Cth).
.................[sgd].......................................................
Justice Downes, President
CATCHWORDS
HEALTH AND AGEING – Therapeutic Goods - registration of pharmaceutical products – generic products – requirement of bioequivalence - Australian and European guidelines ambiguous – appropriateness of vasoconstrictor assay – validation of assay – Clinical Requirements Guidelines – different pharmaceutical forms – hydrogel similar to lotion – essential similarity
LEGISLATION
Administrative Appeals Tribunal Act 1975 (Cth) ss 2A, 42D
Therapeutic Goods Act 1989 (Cth) ss 10, 25, 31
CASES
Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409
Ego Pharmaceuticals Pty Ltd and Minister for Health and Ageing [2010] AATA 825
Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634
SECONDARY MATERIALS
Australian Regulatory Guidelines for Prescription Medicines
Clinical Requirements for Locally Applied, Locally Acting Products, Containing Known Constituents, November 1995 (CPMP/239/95)
Questions and Answers on Guideline Title: Clinical Investigation of Corticosteroids Intended for Use on the Skin 16 November 2006 (CHMP/EWP/21441/2006)
Trookman, Nathan S. and Rizer, Ronald L, ‘Randomized Controlled Trial of Desonide Hydrogel 0.05% versus Desonide Ointment 0.05% in the Treatment of Mild-to-Moderate Atopic Dermatitis Trookman and Rizer’, (2011) 4 The Journal of Clinical and Aesthetic Dermatology, 34
REASONS FOR DECISION
Justice Downes, President
Dr Schafer, Member
13 April 2012
THE OCTOBER 2010 DECISION

On 26 October 2010, we published a substantive decision in relation to Ego's application for review of a decision of the delegate of the Minister for Health and Ageing dated 12 September 2008 to reject Ego’s application for registration of Zatamil Ointment, Lotion and Hydrogel. The delegate had decided that the safety and efficacy of the Zatamil products for the purposes for which they were to be used had not been satisfactorily established. There was no issue as to the quality of the Zatamil products.
In our October 2010 decision, we considered at length the relevant guidelines which underpinned the decision under review. We had great difficulty in reconciling the requirements which Ego was obliged to meet, and noted that the guidelines were ambiguous, confusing and even contradictory. Our review of the guidelines left us with considerable uncertainty as to what standard Ego was required to meet.
We were, however, guided by Bowen CJ and Deane J in Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409, 420-421, who stated:
It is not desirable to attempt to frame any general statement of the precise part which government policy should ordinarily play in the determinations of the Tribunal. That is a matter for the Tribunal itself to determine in the context of the particular case and in the light of the need for compromise, in the interests of good government, between, on the one hand, the desirability of consistency in the treatment of citizens under the law and, on the other hand, the ideal of justice in the individual case.
Similarly, in Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634, Brennan J said at 640-641:
[D]iscretion cannot be so truncated by a policy as to preclude consideration of the merits of specified classes of cases. A fetter of that kind would be objectionable, even though it were adopted by the Minister on his own initiative….That is not to deny the lawfulness of adopting an appropriate policy which guides but does not control the making of decisions, a policy which is informative of the standards and values which the Minister usually applies. There is a distinction between a lawful policy which creates a fetter purporting to limit the range of discretion conferred by a statute, and a lawful policy which leaves the range of discretion intact while guiding the exercise of the power.
The task was left to us to interpret the relevant guidelines as best we could and to decide the case on its merits, having regard to the extensive evidence provided by a number of experts from Australia and overseas.
The key issues we considered in the October 2010 decision were:
(a)whether the vasoconstrictor assay (VCA) employed by Ego was suitable to determine the bioequivalence of the Zatamil products with the Elocon products;
(b)if so, whether the VCA had been properly validated;
(c)if so, whether the VCA was properly conducted; and
(d)if so, whether the VCA established that the Zatamil products and the Elocon products were bioequivalent.
Whilst it is not necessary for us to reconsider these issues, it is worth summarising the conclusions in our October 2010 decision.
Was the VCA a suitable assay?
As stated in our October 2010 decision (at paragraph 13), a VCA is an assay which is based on the propensity for corticosteroids to produce blanching (whitening) or vasoconstriction (narrowing of blood vessels) of the skin. This property has been shown to correlate with the amount of drug entering the skin and has been used as a basis for assessing the bioequivalence of topical steroid formulations.
We noted in our decision (at paragraph 54) that there is significant acceptance by the TGA of the VCA in bioequivalence studies for corticosteroids for use on the skin and, moreover, an acceptance of the United States FDA Guidance as an acceptable standard for conducting a VCA.
We also relied on considerable literature evidence which strongly supported the validity of the VCA as a reliable method to determine topical corticosteroid bioequivalence (at paragraph 55). In addition, we noted (at paragraph 56) that the Pharmaceutical Experts stated in their points of agreement that the VCA is “accepted as an appropriate pharmacodynamic assay to determine bioequivalence of topical corticosteroid efficacy”.
We further noted (at paragraph 63) that Dr Rowe and Professor Guy gave evidence that the VCA is sufficiently sensitive to detect any effect that the excipient formulations may have on the potency of mometasone furoate, such that it seemed to us that it was not necessary to separately consider whether Zatamil “possesses the same or a similar qualitative and quantitative composition”. We accepted that a properly conducted VCA was an appropriate means of determining bioequivalence.
Perhaps the most compelling evidence came from Professor Guy, who provided expert evidence on behalf of the Minister. During cross-examination, Professor Guy stated (at Transcript 400, [35] - Transcript 402, [5]):
(a) that the VCA “gives you an indication that the drug has become available in a part of the skin where it has its effect”;
(b)“Certainly in a number of studies the vasoconstriction response has been correlated with the potency of the steroid formulation and the steroids tested, yes.”;
(c)“When you're comparing two very similar formulations, the vasoconstriction assay is an accepted method for comparing them, no question about that. Many regulatory authorities use the technique. But not surprisingly, I think, as you make the things closer - the formulations more and more similar, the sensitivity you have to pick out the difference becomes less, as with any assay.”
Professor Guy’s statement at paragraph 12(c) above warrants further comment. The critical point which Professor Guy makes at 12(c) is that the more similar two formulations are, the less discriminating the VCA would be in detecting a difference. The corollary to that proposition is that the VCA would be particularly discriminating in formulations that are less similar, such that any difference in potency would readily be reflected in a result of bioinequivalence.
Was the VCA properly validated?
We relied on the evidence of Dr Pershing that the ED₅₀ values derived for the bioequivalence testing of Zatamil ointment, lotion and hydrogel were in the linear portion of the dose-duration response curve. We concluded on this basis that the VCA was suitable to detect any differences between the Zatamil and Elocon products.
Was the VCA properly conducted?
The VCA conducted by Ego did not comply with the FDA Guidance in respect of the ED₅₀ issue, the statistical model issue, the number of detectors issue, the outlier issue and the statistical method issue. It was our conclusion that these deviations, and Ego’s failure to strictly follow the FDA Guidance, could not be simply dismissed. In our view, the acceptability of abridged data for essentially similar medicines, whilst avoiding the need for more rigorous testing and clinical safety and efficacy trials, required a more strict adherence to the guidelines relating to those data.
In our view, the number of detectors issue and the ED₅₀ issue represented particularly significant failures by Zenith to comply with the FDA Guidance. Our conclusion on that basis was that the VCA was not conducted properly.
Did the VCA establish that the Zatamil products and the Elocon products were bioequivalent?
We decided that the failure by Zenith to comply with the FDA Guidance raised sufficient doubt as to bioequivalence to make refusal of registration the preferable decision. Because of our uncertainty as to bioequivalence, we did not accept that the safety and efficacy of the Zatamil products had been satisfactorily established.
We did, however, consider that if satisfactory VCAs were conducted, there would be no reason why the Zatamil products should not all be registered, and encouraged the parties to explore the ways in which this might be achieved.
THE NOVEMBER 2010 ORDERS
There is no question that the usefulness and reliability of the VCA to establish the bioequivalence (and therefore safety and efficacy) of the Zatamil products with the Elocon products has been central to the outcome in this case. We accepted, after hearing considerable evidence from experts called by both Ego and the Minister, including experts from overseas, that a properly conducted VCA was an appropriate test to determine the bioequivalence of the Zatamil products with the Elocon products. We were guided, in particular, by the expert evidence of Drs Rowe and Pershing, and Professor Guy. Based on their evidence, it was our view that the VCA was sufficiently discriminating to identify any differences that the excipient formulations might have on bioequivalence, that is, if the vehicle in which the active ingredient, mometasone furoate, was carried had a significant effect on the delivery of mometasone furoate at the site of action, then it would be manifested in the results of the VCA.
This was the basis upon which we decided that if satisfactory VCAs were conducted in accordance with the FDA Guidance, there would be no reason why the Zatamil products should not all be registered, and we considered that the matter should proceed on the premise that all steps ought to be taken by the parties for this matter to be finalised at the earliest opportunity.
On this basis, on 23 November 2010, following a directions hearing held on 22 November 2010, we remitted the matter to the Minister for reconsideration pursuant to s 42D of the Administrative Appeals Tribunal Act 1975 (the Act). Such reconsideration was to take place within 56 days of Ego lodging further VCA results, or within 56 days of an earlier request for reconsideration made by Ego. We directed, however, that the reconsideration was to be made, at the latest, by 31 January 2012.
Importantly, in remitting the matter, we noted that in the event that the further VCA results were satisfactory, our inclination was that registration ought to be effected for the Zatamil products, unless some exceptional circumstance not known to us at the time or not present at the time required a different result.
THE FURTHER VCA RESULTS
Pursuant to the November 2010 orders, Ego commissioned Zenith Technology to conduct further VCAs for each of the Zatamil products. This involved two new pilot studies for Zatamil Lotion and Zatamil Ointment and three pivotal studies for Zatamil Lotion, Zatamil Ointment and Zatamil Hydrogel.
The results of the further VCAs were submitted to the Minister on 12 October 2011. They were also reviewed by Professor Le Couteur, the expert engaged by the Minister, who stated in his report dated 8 February 2012:
The final results are consistent with bioequivalence with Elocon determined by the VCA as the confidence intervals are between 0.80-1.20:
Zatamil ointment t/r=0.93 90% CI 0.85-1.04 vs Elocon ointment
Zatamil lotion t/r=106 [sic] 90% CI 0.97-1.16 vs Elocon lotion
Zatamil hydrogel t/r=0.96 90% CI 0.81-1.12 vs Elocon lotion
However, despite our October 2010 decision that a properly conducted VCA was an appropriate means of determining whether the Zatamil products and Elocon products were bioequivalent, Professor Le Couteur questioned whether Zatamil Hydrogel could be considered to be a generic formulation of Elocon Lotion, noting that the two products had different physical properties related to their viscosity and water content. He referred to the Clinical Requirements for Locally Applied, Locally Acting Products, Containing Known Constituents, November 1995 (CPMP/239/95) (the Clinical Requirements Guidelines), which provide that for topical preparations of “different formulation (e.g. cream to ointment; aerosol to powder for inhalation)….clinical studies to demonstrate efficacy/safety and/or if possible pharmacodynamic studies; if necessary, studies of absorption, penetration and local tolerance” are required.
Despite the further VCA results, Professor Le Couteur's view was that the differences between Elocon Lotion and Zatamil Hydrogel indicate that they do not have similar formulations. He considered that “the differences between hydrogels and lotions are likely to be clinically important for topical skin products”.
Dr Rowe disagreed. In his affidavit dated 21 February 2012, Dr Rowe stated that the fact that Zatamil Hydrogel and Elocon Lotion were shown to be bioequivalent from the VCA testings showed that they have the same efficacy and side effect profile. He did not accept, therefore, that in the case of Zatamil Hydrogel and Elocon Lotion the differences in their formulations would lead to clinical differences.
THE 9 DECEMBER 2011 DIRECTIONS HEARING
Following lodgement of the VCA results, there was no communication between Ego’s legal representatives and the Minister’s legal representatives until 23 November 2011. In a telephone discussion on that date, the Minister’s legal representatives gave notice to Ego that there was a possibility that the TGA may be seeking further information to address the “quality” of the Zatamil products.[1]
[1] Affidavit of Peter Thompson dated 8 December 2011, at paragraph 23 and Exhibit PCT-1 at Tab 14.
On 1 December 2011, Ego's legal representatives wrote to the Minister’s legal representatives and raised concerns as to the possibility of a belated request for information relating to quality and chemistry issues to delay the decision, which the Tribunal ordered to be made within 56 days of the Minister’s receipt of the further VCA results (that is, by 7 December 2011).[2]
[2] Affidavit of Peter Thompson dated 8 December 2011, at paragraph 24 and Exhibit PCT-1 at Tab 15.
On 2 December 2011, the TGA issued a request to Ego pursuant to s 31 of the Therapeutic Goods Act 1989 (Cth) (the TG Act) to provide further information relating to the quality of the Zatamil products.[3] None of the information requested related to the further VCA results.
[3] Affidavit of Peter Thompson dated 8 December 2011, at paragraph 25 and Exhibit PCT-1 at Tab 16.
On the same day, the Minister’s legal representatives wrote to the Tribunal giving notice that at the directions hearing listed on 9 December 2011, it intended to apply, pursuant to s 42D(6) of the Act, for an extension of 3 months in which to reconsider the decision which the Tribunal remitted to it to make. In doing so, the Minister stated that “[d]espite efforts being made to complete the decision making process within that period [the 56 day period] the Respondent has been unable to do so”.
Section 42D(7) of the Act provides that if the relevant person (in this case, the Minister) has not reconsidered the decision within the required time period, the person is taken to have affirmed the decision. In addition, s 42D(8) provides that if the Minister affirms the decision, the proceedings resume before the Tribunal.
Ego opposed the Tribunal making an order extending the time for the Minister to reconsider the decision remitted to it pursuant to s 42D. Given that the Minister did not apply for an extension of time prior to the expiry of the 56 day period, we decided that s 42D(7) applied, such that the Minister was taken to have affirmed the decision and the proceedings would resume before us, pursuant to s 42D(8).
One does wonder, however, what was the focus of the Minster’s efforts to complete the decision-making process within the 56 day period. Given that the Minister’s position during the October 2010 hearing was that it did not contest that the quality of the Zatamil products had been satisfactorily established, it was somewhat surprising that much of the 56 day period appeared to have been dedicated to compiling a substantive list of questions requesting further information relating to quality. We question the basis for this, given that quality was not an issue in these proceedings. This is not to suggest that we do not understand that some quality issues, such as up-to-date GMP certification and the quality aspects of the product information and consumer medicine information, would need to be resolved before registration could be effected, but such issues were in any event ancillary to the substantive issue of whether or not the further VCA results established the bioequivalence of the Zatamil products and the Elocon products. In our view, the appropriate course would have been for the Minister to reconsider the decision in accordance with our November 2010 reasons and, if it had determined that the further VCA results satisfactorily established bioequivalence, then, in accordance with the inclination expressed in our November 2010 orders, registration should have been effected, subject to Ego addressing any new quality issues which had arisen that might be a barrier to registration.
We note that the section 31 notice issued by the TGA on 2 December 2011 requested information which would have undoubtedly delayed the prospect of registration of the Zatamil products for a significant period. Some of the requests for information did not even go to the issue of quality. Other requests contradicted the TGA's own standards which it expects sponsors to follow. For example, the “Module 3 note document” in the section 31 notice stated that “The TGA would expect that the additional tests and limits of USP monographs become the official minimum standards for the products”. However, the TG Act was amended in 2009 to provide for either the British Pharmacopoeia (BP), the United States Pharmacopeia (the USP) or the European Pharmacopoeia (EP) to be used as alternative standards. Section 10(1) of the TG Act provides:
The Minister may, by legislative instrument, make an order determining that matters specified in the order constitute a standard for therapeutic goods or a class of therapeutic goods identified in the order (whether or not those goods are the subject of a monograph in the British Pharmacopoeia, the European Pharmacopoeia, the United States Pharmacopeia-National Formulary, a homoeopathic pharmacopoeia or an anthroposophic pharmacopoeia).

In addition, s 10(2)(a)(iv) of the TG Act provides:
Without limiting the generality of subsection (1), an order establishing a standard for therapeutic goods may:
(a) be specified by reference to:
----
(iv) a monograph in the British Pharmacopoeia, the European Pharmacopoeia, the United States Pharmacopeia-National Formulary, a homoeopathic pharmacopoeia or an anthroposophic pharmacopoeia;
In this regard, it was clearly the intention of Parliament that either the BP, USP or EP could be applied as acceptable standards. In our view, it was sufficient, therefore, that the testing which Ego conducted complied with the BP, particularly given that it was the only default standard which applied when Ego submitted the original applications.
Given that the objective of the Tribunal, as provided in s 2A of the AAT Act, is that it must provide a mechanism of review that is fair, just, economical, informal and quick, we are concerned by the TGA's introduction of significant new issues relating to quality (most of which ought to have been raised before the initial decision was made), in circumstances where it had previously been determined that the quality of the Zatamil products had been satisfactorily established.
THE RESUMED PROCEEDINGS
The proceedings resumed before us on 12 March 2012. In relation to the quality issues which were raised in the section 31 notice dated 2 December 2011, we are pleased that the parties were able to reach agreement prior to the resumed proceedings, such that the Minister was satisfied that there was no remaining barrier to registration of the Zatamil products on quality grounds.
The parties also agreed that based on the further VCA results, it was appropriate that Zatamil Ointment and Zatamil Lotion ought to be registered. However, in relation to Zatamil Hydrogel, the Minister's view was that:
On the evidence, the Tribunal cannot be satisfied that the Hydrogel meets the clinical data requirements for establishing safety and efficacy as set out in the guidelines which it has determined should be applied.
We recall that in our October 2010 decision there was considerable debate as to the adequacy of the VCA to determine the bioequivalence of products which had similar, but not the same, excipients. We decided, however, based on the expert evidence, that the VCA was sufficiently sensitive to detect any effect that the excipient formulations may have on the potency of mometasone furoate.
In the submissions for the resumed proceedings, the Minister again contended that the VCA was not an appropriate test to determine the bioequivalence of Zatamil Hydrogel and Elocon Lotion, because the hydrogel and lotion were not “similar pharmaceutical forms”. Because this issue was a recurring point of contention in the resumed proceedings, we considered that it is was important to give the issue further consideration.
Professor Le Couteur's view was that hydrogels and lotions ought to be considered different pharmaceutical forms. He stated (at Transcript 12 March 2012, 73[15]):
….the hydrogel will influence skin moisturisation in a way that the lotions may not and that's based on some publications. That potentially will influence the uptake of the corticosteroid active. The other issue is that the hydrogel is used by itself therapeutically to enhance wound healing. Now these are not necessarily positive or negative effects. But they would certainly make me uncertain that you could be confident to say that long-term the clinical outcomes would be identical in a way that would allow them to be used as a generic.
He also stated (at Transcript 12 March 2012, 35[26]):
The hydrogel has additional properties of its own which may not influence the VCA, but certainly influence the formulation and its potential effect on the skin, so that's why I made the comment that I though the hydrogel and lotion was different enough in their formulation to perhaps warrant clinical testing.
Professor Le Couteur admitted that his statement that the influence of hydrogels on skin moisturisation may affect the uptake of the active component was a theoretical proposition. However, he did refer to five published papers to advance his proposition, which he claimed differentiated the effects of a hydrogel formulation with other preparations.
During cross-examination of Professor Le Couteur in relation to the content of the five clinical papers, it became clear that the only paper which Professor Le Couteur relied upon significantly to support his proposition was a paper by Trookman and Rizer, entitled “Randomized Controlled Trial of Desonide Hydrogel 0.05% versus Desonide Ointment 0.05% in the Treatment of Mild-to-Moderate Atopic Dermatitis”.
Relevantly, the key findings of the Trookman and Rizer paper were:
·Skin hydration changes were not observed for either formulation during the study;
·There were no significant differences in either the desonide hydrogel or desonide ointment cohorts at week 2 or week 4 compared with baseline; and
·The hydrogel was demonstrated to be as efficacious as the ointment in patients with mild to moderate atopic dermatitis.
The relevance of the Trookman and Rizer paper is that, contrary to Professor Le Couteur’s assertion, there was no evidence that the hydrogel formulation had any effect on corticosteroid activity and, crucially, efficacy. In addition, there was no significant difference in hydration, compared with baseline, over a 4 week period for either formulation, which is the maximum period proposed in the Zatamil product information for administration of Zatamil. There is no suggestion in this paper, therefore, that a hydrogel formulation may influence skin moisturisation in a way that will potentially influence the uptake of the corticosteroid active or may lead to long-term differences in clinical outcomes. We therefore find that Professor Le Couteur's proposition is not supported by the evidence.

The Clinical Requirements Guidelines

Despite the determination in our October 2010 decision that the VCA was an acceptable means of determining the bioequivalence of the Zatamil products with the Elocon products, the Minister again argued that the Clinical Requirements Guidelines provide that clinical studies are required for different formulations of the same active ingredient. For the purposes of our decision, it is worthwhile analysing the requirements for the clinical dossier, as set out in the guidelines, for abridged applications.
For abridged applications, the Clinical Requirements Guidelines provide, in Section 1:
In order to demonstrate therapeutic equivalence clinical trials are in principle necessary, especially for locally applied dermatological preparations, but other models may be used or developed. For this purpose, depending on the situation, human pharmacodynamic studies, local availability studies or where appropriate even animal or in vitro studies can be considered, provided that all studies used are adequately validated. Moreover, safety and local tolerance have to be addressed appropriately.
In addition, the summary table in Section 5 of the Clinical Requirements Guidelines provides details of the requirements for the clinical dossier for locally applied/locally acting products. The summary table states, at item IId, that for a “different formulation”, the clinical requirements are “clinical studies to demonstrate efficacy/safety and/or if possible pharmacodynamic studies; if necessary, studies of absorption, penetration and local tolerance” (our emphasis).
In our view, however, the reference to a “different formulation” appears to relate to a single branded product which has a different formulation, as opposed to two different brands which have different formulations. Thus, Zatamil Lotion and Zatamil Ointment are “different formulations” which could be compared in accordance with the clinical requirements set out in item IId of the summary table.
On the other hand, two different brands which have different formulations, such as Zatamil Hydrogel and Elocon Lotion, would appear to fit into the category of “generic products” in item IIe of the summary table, which provides that the clinical requirements are “if possible pharmacodynamic studies or local availability studies; possibly in vitro studies (e.g. eye drops) or argumentation in case of minor differences. Otherwise clinical studies. Any safety issue has to be addressed appropriately” (our emphasis).
The stipulation above that pharmacodynamic studies (such as the VCA) are required “if possible”, and that clinical studies may “otherwise” be used, suggests that pharmacodynamic studies are preferred over clinical studies, such that there is more than a reasonable basis to argue that the VCA is an acceptable, if not preferred, means of determining the safety and efficacy of generic products such as Zatamil Hydrogel and Elocon Lotion.
Even if we were to accept that item IId in the summary table could be applied to Zatamil Hydrogel and Elocon Lotion, we note that the use of the term “and/or” in the clinical requirements indicates that either clinical studies and pharmacodynamic studies may be submitted, or pharmacodynamic studies alone may be submitted. As in the case of the clinical requirements for generic products, the phrase “if possible” appears to suggest that pharmacodynamic studies are preferred over clinical studies, such that a pharmacodynamic study (e.g. a VCA) is also an acceptable, if not preferred, means of determining the safety and efficacy of a different formulation containing the same active ingredient.

Essential Similarity

The only other issue for us to reconsider is the Minister’s reliance on the Questions and Answers on Guideline Title: Clinical Investigation of Corticosteroids Intended for Use on the Skin 16 November 2006 (CHMP/EWP/21441/2006) (the Clinical Investigation Q&A), which provides:
“…a pharmacodynamic model, e.g. the vasoconstriction assay (VCA) is sufficient only if the generic medicinal product possesses the same or a similar qualitative and quantitative composition to that of the reference product.
Differences in excipients have to be considered case by case. In case of only minor changes, e.g. slight differences in the quantity of the same excipients in generic applications, VCAs can be accepted instead of clinical efficacy studies. However, qualitative changes in the composition imply the need for clinical efficacy data. In addition, it is not possible to present an abridged application for a topical corticosteroid preparation based on a VCA between two different steroid concentrations or two different pharmaceutical forms, e.g. cream and ointment…..”
In our view, the test for similarity is a subjective one. There is no objective test we can apply to determine whether or not two formulations are sufficiently similar to provide that a pharmacodynamic assay (such as the VCA) is an acceptable means of determining bioequivalence, and therefore safety and efficacy. We must, therefore rely on our own judgment, taking into account the evidence of the experts and guidance offered in the guidelines issued and adopted by the TGA.
Relevantly, the notion of “essential similarity”, which provides the basis for which sponsors may adopt a bioequivalence test as a surrogate marker of efficacy and safety, is defined in the Australian Regulatory Guidelines for Prescription Medicines (ARGPM), which provide that two formulations are “essentially similar” if they have:
·the same active ingredient;
·the same or similar pharmaceutical form; and
·are bioequivalent.
There is no accompanying definition of the term “pharmaceutical form”, but we take it to define the physical form in which the active ingredient is presented for administration. In this regard, a cream, ointment, lotion and hydrogel would all be considered different pharmaceutical forms.
In terms of satisfying the test for “essential similarity” in paragraph 58 above, we note that the Zatamil products and Elocon products contain the same active ingredient, mometasone furoate, in a concentration of 0.1% w/w.
There is no guidance, however, in relation to what would constitute a “similar pharmaceutical form”, and it is the word “similar” that introduces an element of subjectivity into the test. However, some guidance is provided in the ARGPM after the definition of an “essentially similar” product in the ARGPM, where reference is made to the concept of essential similarity extending to two similar types of solid oral dosage forms, viz a capsule and a tablet. This gives us a sense that the degree of similarity that can be attributed to two pharmaceutical forms is not necessarily as narrow as the Minister contends. In this regard, a capsule, which generally contains an outer gelatine case containing the active ingredient suspended in powder form or in a liquid formulation, would prima facie appear to be quite different to a tablet formulation, which typically contains ingredients such as binding agents, disintegration agents, dissolution enhancers, film coatings and colourants.
Whilst a reasonable person might consider that a capsule and tablet are different pharmaceutical forms, the ARGPM deems that these two “pharmaceutical forms” are “similar” for the purposes of essential similarity. To place this in its proper context, it is relevant to note that capsules and tablets are oral dosage forms and therefore act systemically, so the issue of establishing essential similarity such that a bioequivalence test can be used as an acceptable surrogate marker of safety and efficacy is perhaps more critical for these oral formulations from a safety point of view than establishing essential similarity for two topical formulations such as a hydrogel and lotion.
Turning to the point in issue in these proceedings and the Minister’s concern as to whether or not Zatamil Hydrogel and Elocon Lotion are sufficiently “similar pharmaceutical forms”, in our October 2010 decision, we note that Dr Pershing stated in her report:
However, given that the vehicle formulations of Elocon® lotion 0.1% and Zatamil hydrogel, 0.1% are both water-based and the active ingredient is fully dissolved in both formulations, it is reasonable to compare Zatamil Hydrogel, 0.1% to Elocon® Lotion, 0.1%.
Although the structural matrix of the vehicle of Zatamil Hydrogel, 0.1% is described as a “Hydrogel” it could also be described as a “Lotion”, since both contain higher concentrations of alcoholic solvents with or without additional permeation enhancers. Zatamil Hydrogel, 0.1% contains 60% hexylene glycol (a solvent and permeation enhancer) and 38.67% water in its inactive excipients, while Elocon® Lotion, 0.1% contains 40% isopropyl alcohol (a solvent), 30% propylene glycol (a permeation enhancer) and ~30% water. The term “Hydrogel” signifies that the product may have a slightly higher viscosity than a typical lotion, due to the addition of a higher concentration of a thickening or gelling agent, which accurately reflects the 1.2% concentration of hypromellose in Zatamil Hydrogel, 0.1% compared to the 0.15% concentration of hydroxypropyl cellulose in Elocon® Lotion, 0.1%...”
We also note the more recent evidence in Dr Rowe’s affidavit dated 21 February 2012. For the purposes of this decision, it is useful to set out his evidence in detail. Dr Rowe did not accept any suggestion that the differences in the formulations between Zatamil Hydrogel and Elocon Lotion were significantly different. He stated, in response to Professor Le Couteur’s report dated 8 February 2012, that:
14…….They cannot be described as different dosage forms. They are both lotions.
15The differences in the formulations are not in the same category of differences for example, of comparing a cream to an ointment.
16……
17In the case of Elocon® Ointment and Zatamil Ointment, both have an immiscible internal phase and as such are emulsion bases. While both a cream and an ointment can be emulsions, most commonly a cream is water soluble while an ointment is not.
18Elocon® Lotion and the Zatamil Hydrogel should not be regarded as two different pharmaceutical dosage forms. Ego’s use of the work “Hydrogel” just describes the product as having a gelling agent present.
19The term “hydrogel” simply means that the lotion contains an ingredient, for example a cellulose based thickener such as hypromellose, to increase the viscosity of the preparation to slightly higher than water.
20In terms of composition, the Elocon® Lotion and Zatamil Hydrogel both contain cellulose based thickeners. Elocon® Lotion contains hydroxypropyl cellulose and Zatamil Hydrogel contains hypromellose, which is hydroxypropylmethylcellulose and therefore closely related to hydroxypropyl cellulose. These two cellulose based thickeners have different molecular weights and accordingly have been used in different quantities, but they are both of the same chemical class and serve the same function. Both hypromellose and hydroxypropyl cellulose are long chain celluloses and they are present in the two products to provide viscosity. In the case of the Zatamil Hydrogel there is a greater concentration of the thickener to give the product greater viscosity.
21The fact that the Elocon® Lotion contains a gelling agent, albeit in a lesser quantity, could mean it too could be described as a hydrogel.
22The other difference between Zatamil Hydrogel and Elocon® Lotion is that Zatamil Hydrogel has the active ingredient dissolved in hexylene glycol whereas the Elocon® Lotion has the active ingredient dissolved in isopropyl alcohol and propylene glycol, which are different types of solvents. Hexylene glycol and propylene glycol are both different types of glycols. But in both cases the active ingredient is fully dissolved and is in its maximum bioavailable form.
23Hexylene glycol, propylene glycol and isopropyl alcohol are all aliphatic alcohols, belonging to the same chemical class, that are used as solvents. Hexylene glycol is a bigger molecule than propylene glycol and is essentially a longer version of propylene glycol.
24I do not consider the differences in the excipients used in the Zatamil Hydrogel and the Elocon® Lotion to be significant or to lead to the products being properly described as having different pharmaceutical forms.
It is clear from Dr Rowe's affidavit that he held a firm view that Zatamil Hydrogel and Elocon Lotion were similar pharmaceutical forms. Nevertheless, as stated in paragraph 19 above, we had concluded from the expert evidence that the VCA was sufficiently discriminating that any differences that the excipient formulations might have on bioequivalence would be manifested in the results of the VCA and would lead to a result of bioinequivalence.
In any case, as stated in our October 2010 decision, to eliminate the possibility of the excipient formulations having any effect on the vasoconstrictor response, Zenith conducted a “Blanks Study” which was specifically designed to determine whether the excipients in either product contributed to the vasoconstrictor effect. The Blanks Study which was conducted for Zatamil Hydrogel and Elocon Lotion demonstrated that neither the vehicle in Zatamil Hydrogel nor in Elocon Lotion had any vasoconstrictor response. This means that the vasoconstrictor response observed in the VCA conducted with respect to Zatamil Hydrogel and Elocon Lotion was solely attributable to the active ingredient, mometasone furoate.
CONSIDERATION
The parties have agreed that Zatamil Ointment and Zatamil Lotion ought to be registered. We agree with this position. Based on the further VCA results, it is our view that, pursuant to s 25(1)(d) of the TG Act, the safety and efficacy of these products has been satisfactorily established.
The only issue left for us to decide is whether or not the further VCA results for Zatamil Hydrogel and Elocon Lotion ought to be accepted as a sufficient basis for satisfactorily establishing the safety and efficacy of Zatamil Hydrogel.

We refer, again, to our October 2010 decision, in which we decided that if satisfactory VCAs were conducted by Ego which established bioequivalence of the Zatamil products with the Elocon products, then there would be no reason why all the Zatamil products ought not to be registered.
Both parties acknowledged, in this regard, that the further VCA results did indeed establish the bioequivalence of the Zatamil products with the Elocon products. In addition, both experts called by the parties gave evidence that the VCAs were conducted in accordance with the FDA Guidance; Professor Le Couteur stated that “The final results are consistent with bioequivalence with Elocon determined by the VCA as the confidence intervals are between 0.80-1.20”.[4] Dr Rowe stated “What Ego is trying to establish is bioequivalence with the marketed products, and I think that they have done that, which means that the safety and effective profile of those formulations are the same”. [5]
[4] Letter of Professor Le Couteur dated 8 February 2012, at page 2.
[5] At Transcript 12 March 2012, 36[4].
However, the Minister maintained her position that the differences in the formulations between Zatamil Hydrogel and Elocon Lotion excluded the VCA as an appropriate test to determine bioequivalence. This position was maintained despite the conclusions we reached in our October 2010 decision that the VCA was sufficiently sensitive to detect any differences that the formulation may have on bioequivalence, such that any meaningful difference would be reflected in a result of bioinequivalence.
The Minister's position was supported by the opinion of Professor Le Couteur, who also argued that the VCA was not appropriate to test the bioequivalence of Zatamil Hydrogel and Elocon Lotion. The Minister relied, in particular, on the Clinical Investigation Q&A which states that “…it is not possible to present an abridged application for a topical corticosteroid preparation based on a VCA between two different steroid concentrations or two different pharmaceutical forms, e.g. cream and ointment”.
Our decision in this case comes back to the same issues we considered at length in our October 2010 decision. It is relevant to note that the Minister did not raise any new issues in the resumed proceedings to those issues which were addressed in our October 2010 decision. Our position has not changed in light of the Minister's additional submissions.
Having reconsidered the issues we decided in the October 2010 decision, and having considered the further VCA results for Zatamil Hydrogel and Elocon Lotion and the parties' additional submissions during the resumed proceedings, it is our view that:
(a)the VCA was an appropriate test to determine the bioequivalence of Zatamil Hydrogel and Elocon Lotion; and
(b)relying on the extensive evidence of Professor Guy, Dr Pershing and Dr Rowe given during the October 2010 hearing, the VCA was sufficiently discriminating to detect any differences that the formulation might have on the bioavailability of mometasone furoate.
Based on the above, we note the following:
(a)The “Blanks Study” conducted in relation to Zatamil Hydrogel and Elocon Lotion established that the vehicles in those products did not exhibit any vasoconstrictor response, such that we are confident that any vasoconstriction observed during the VCA was attributable to the active ingredient, mometasone furoate; and
(b)The VCA conducted between Zatamil Hydrogel and Elocon Lotion established that the two products are bioequivalent.
In our view, the further VCA results for Zatamil Hydrogel and Elocon Lotion provide us with sufficient confidence that, pursuant to s 25(1)(d) of the TG Act, the safety and efficacy of the Zatamil Hydrogel for the purposes for which it is to be used has been satisfactorily established.
DECISION
We will decide that the decision to reject Ego’s application for registration of the Zatamil products should be set aside and the matter remitted to the Minister with the direction that registration as sought by Ego should be granted.

I certify that the preceding seventy-seven (77) paragraphs are a true copy of the reasons for the decision herein of the Honourable Justice Downes, President and Dr Teresa Schafer, Member.

........................................................................

Associate
Dated 13 April 2012

Date of hearing 12-13 March 2012

Date final submissions received 13 March 2012

Counsel for the Applicant J Kirk SC

Solicitors for the Applicant Thompson Eslick Solicitors

Counsel for the Respondent M Allars

Solicitors for the Respondent HWL Ebsworth Lawyers

[2012] AATA 210

13 April 2012

Key Legal Topics

Areas of Law

Regulatory Law

Legal Concepts

Regulatory Compliance

Bioequivalence

Scientific Validation

Division	GENERAL ADMINISTRATIVE DIVISION
File Number	2008/4472
Re	Ego Pharmaceuticals Pty Ltd
APPLICANT
And	Minister for Health and Ageing
RESPONDENT

Tribunal	Justice Downes, President Dr Schafer, Member
Date	13 April 2012
Place	Sydney

Date of hearing	12-13 March 2012
Date final submissions received	13 March 2012
Counsel for the Applicant	J Kirk SC
Solicitors for the Applicant	Thompson Eslick Solicitors
Counsel for the Respondent	M Allars
Solicitors for the Respondent	HWL Ebsworth Lawyers