Armanino Blog
Regulatory Considerations for Life Sciences During COVID-19
by Katerina Starkova
May 11, 2020

 Like other industries, life sciences and biotechnology are experiencing significant disruption in the wake of COVID-19. Regulatory compliance is challenging to navigate in the best of times, and the pandemic creates new complications and considerations. The Food and Drug Administration (FDA) has been issuing notices and updates on a near daily basis to address the various aspects of the COVID-19 situation and its effect on clinical trials.

From guidance that accelerates the availability of diagnostic testing and development of novel therapies to the postponement of foreign inspections and domestic routine facility inspections, to even changes in regulation of over-the-counter drugs and guidance of clinical trials, the FDA has been active in setting priorities during this public health emergency.

We’ve been keeping up with industry trends, what our clients are saying and doing and updates from the FDA, including guidance on the conduct of clinical trials during COVID-19. Here are some of the top takeaways we’ve discovered.

  1. There are several factors to consider if you are going to continue an ongoing study or want to initiate a new study during the pandemic.

    Per FDA guidelines, safety must be the top priority. Are you able to ensure the safety and welfare of study participants and clinical investigators/staff? Consider implementing remote follow-ups when possible. If remote study is impossible, ensure all proper precautions are taken including adequate safety and personal protective equipment.

    Make sure you contact all of your suppliers and vendors to ensure you have access to enough supplies to safely and effectively conduct the study. Even consider finding back up suppliers and vendors. Make sure all of your products and supplies have the shelf life to handle any timeline revisions, if necessary. The risk of not doing this may force the study to shut down, costing money and time, and possibly compromising the integrity of the study.

    Having continued availability of and support for all information technology systems and any other technology tools needed in support of the study is also a must. Make sure you have a reliable IT solution.

  2. The FDA can allow immediate virtual clinical trial visits.

    As mentioned, companies may immediately switch to virtual clinical trials if it can be done safely with subsequent review by the IRB and they notify the FDA. Any impacts caused by virtual visits must be documented. For example, if collecting vital signs or blood must be curtailed — companies must evaluate the potential impact on participant safety and discontinue the trial if curtailing such activities could pose a threat to patient safety.

  3. Prepare for the financial impact of inevitable delays and timeline revisions.

    With “all hands on deck” for COVID-19, it should not be unexpected that any FDA approvals or inspections will be delayed due to resource allocation and bandwidth. Any newly initiated studies should be designed in a way that is flexible and adaptable to delays — either regulatory or supply chain related.

    Financially, that means that companies need to extend their runway and potentially seek additional funding to be able to get through the FDA approval process. Make sure to adjust your forecast to reflect updated timelines and to implement any necessary cost-cutting measures.

    There are several opportunities available under the CARES Act that could help in funding operations, including payroll tax deferrals, availability of PPP loans and certain tax credits.

  4. Accounting for clinical trial accrual can be complex.

    The FDA requires detailed documentation of activities and any changes to protocols. In addition, for accounting purposes, companies must keep track of all the activities and progress made toward completion of the clinical trial. Research and development costs should be charged to expense as incurred regardless of payment arrangement, therefore, keeping close track of trial stages, number of follow-ups, and other milestones is critical to proper accounting. Changes to processes described above, including virtual visits, phone follow-ups and updated timelines, may create additional accounting hurdles and the need to update the model used for accounting purposes.

  5. Some companies are finding opportunities by re-focusing efforts toward COVID-19.

    COVID-19 testing and treatment therapies are the FDA’s current top priority. They are fast-tracking the inspection and approval process for COVID-19-related activities. If companies experience work stoppage due to delays, they can consider exploring partnerships to produce and distribute COVID-19 related products that are in high demand. We are already seeing life sciences companies securing agreements.

Finally, leaders should be in regular contact with their FDA liaison to ensure a continuous flow of information.

For the latest regulatory changes and other information on keeping your organization running through disruption, visit our COVID 19 Resource Center.

May 11, 2020

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