US Legal Group Files Suit On IND Disclosure

The Washington Legal Foundation, a nonprofit public interest law and policy center, has filed a formal citizen petition with both the US Food and Drug Administration and the Securities and Exchange Commission, urging the FDA to exempt from regulation the public disclosure of clinical test results on Investigational New Drugs. Such information is required by FDA rules to be disclosed to the investment community.

Current FDA rules and policies prohibit drug companies from promoting or commercializing an IND until the drug gets final approval from the agency, but the SEC requires that drugmakers file reports with that agency and also inform the investment community of major product developments. The FDA has interpreted its rule against "promoting" an IND to include press releases and other communications made by companies about the results of IND testing.

In its 22-page petition, the WLF noted that publicly-traded companies often find themselves walking a tightrope to avoid FDA sanctions for disclosing too much information about their business, while facing SEC penalties and shareholder lawsuits for disclosing too little. "The unfortunate results," according to WLF chief legal director Paul Kamenar, "is that the FDA is illegally limiting the ability of drugmakers to attract needed capital, and ultimately slowing the development of important INDs to the detriment of the health of the American public."