FDA Plans to Extend Compliance Date for Food Traceability Rule
On March 20, 2025, the U.S. Food and Drug Administration (FDA) announced its intention to extend the compliance date for the Food Traceability Rule by 30 months. This extension aims to provide the food industry with additional time to fully implement the rule’s requirements.
The Food Traceability Rule, established under the FDA Food Safety Modernization Act (FMSA), mandates enhanced traceability recordkeeping for entities that manufacture, process, pack, or hold foods listed on the Food Traceability List (FTL) for the purpose of promptly identifying and removing potentially contaminated food from the market.
Notably, in its announcement, FDA made clear that the substance of the rule remains intact, and the only modification is extending the compliance deadline. The agency will continue to work with stakeholders to provide additional assistance and resources to address challenges with implementation.
HHS-OIG Highlights Anti-Fraud Safeguards of Drug Manufacturer’s Free Drug Program for Patients in Financial Need
Highlights
The HHS-OIG released a favorable opinion regarding free drugs offered to patients in financial need for a drug manufactured by the pharmaceutical company offering the assistance
The assistance offered under the proposed arrangement did not satisfy a safe harbor to the Anti-Kickback Statute (AKS)
The agency said the proposed arrangement included factors that limited concerns under the AKS and the civil monetary penalty laws
The U.S. Department of Health and Human Services’ Office of Inspector General (HHS-OIG) recently released OIG Advisory Opinion 25-01, a favorable opinion regarding the federal Anti-Kickback Statute (AKS) and civil monetary penalty laws (CMP) against beneficiary inducements as applied to a financial assistance program that would provide an intravenous drug at no cost or with no cost-sharing. The program was offered by a pharmaceutical manufacturer to patients who receive an intravenous drug and meet certain objective eligibility criteria.
The HHS-OIG concluded that the financial assistance offered to patients under the proposed arrangement constitutes remuneration under the AKS and the proposed arrangement did not satisfy a safe harbor under the AKS. However, due to sufficient safeguards in place to mitigate the risk of fraud and abuse, the HHS-OIG would not impose sanctions against the pharmaceutical manufacturer.
Further, the HHS-OIG found that the proposed arrangement would not implicate the CMP because pharmaceutical manufacturers are generally not considered “providers, practitioners, or suppliers” and, therefore, the arrangement is not likely to influence an enrollee’s selection of a provider, practitioner, or supplier. Further, the product is available free of charge to a patient, regardless of the patient’s selection of a prescribing provider or infusion provider, and patients are free to change providers at any time.
Background
The pharmaceutical company manufactures the product, which treats a disease and is intended for use in patients with mild cognitive impairment and confirmed presence of amyloid pathology. Patients prescribed the product receive intravenous infusions every two weeks in an outpatient setting, which could be the treating physician’s office, an outpatient location affiliated with the treating physician, or an independent infusion center unaffiliated with the treating physician. There are currently two other drugs available to treat the disease and two additional such drugs are under development.
The Centers for Medicare & Medicaid Services reimburses for both the product and its administration, under certain circumstances, under Medicare Part B with a 20 percent coinsurance for enrollees, and all state Medicaid programs cover the product with various cost-sharing arrangements for patients.
The proposed arrangement provides the product at no cost to patients, including federal healthcare program beneficiaries, who meet the following eligibility criteria:
Reside in the United States
Be at least 18 years old
Be prescribed the product for an on-label indication
Be uninsured, be insured but with no insurance coverage for the product, or have Medicare coverage for the product but attest that they are unable to afford their out-of-pocket costs associated with the product
Have a household income equal to or below 500 percent of the federal poverty level
Patients must work with the patient’s treating physician to complete an application for assistance and submit the application to the pharmaceutical manufacturer. All eligibility determinations are made without regard to the patient’s insurer or insurance plan, prescribing provider, or infusion provider, and patients are free to change physicians or infusion providers at any time without becoming ineligible for the free product.
The provider who administers the free product is permitted to bill Medicare for the administration cost and may bill the patient for any cost sharing related to only the administration cost. If the provider is not able to administer free product to the approved patient, for any reason, the provider is required to return the free product to the manufacturer or certify its disposal pursuant to the manufacturer’s instructions.
Patients must certify that they 1) will not submit a request for payment for the product to any payor, including a federal healthcare program, and 2) understand that no part of the free product or the costs associated with the free product will count toward the patient’s out-of-pocket costs. Further, treating physicians must certify, in writing, that they prescribed the product for an on-label indication, based on the physician’s independent professional judgment of medical necessity taking into account patient safety considerations, and will not submit a request for payment for the free product to any payor and will not seek payment of the free product from the patient.
The facility where the product will be administered must provide an oral acknowledgement that it understands and agrees to follow all requirements associated with receiving the free product, and each shipment includes a letter describing such requirements.
In this request, the manufacturer certified that neither it, nor anyone acting on the manufacturer’s behalf, is permitted to promote the financial assistance program as a reason to prescribe the product to patients, and the manufacturer does not promote the program through direct-to-consumer advertising. Under the proposed arrangement, healthcare professionals may only learn about the program through 1) approved printed materials for general awareness or 2) reimbursement personnel who do not receive sales-based incentive compensation and are permitted to educate pharmacists, physicians, and physician office staff about the program.
Further, the manufacturer certified that it expects patients to learn about the program from 1) the patient’s treating physician, 2) the manufacturer’s patient support hub, or 3) the manufacturer’s patient support website.
The HHS-OIG’s Findings
The HHS-OIG found that the free product constituted remuneration to both patients and administering providers under the AKS, but relied on the following factors in determining that this posed little risk of fraud and abuse:
There are safeguards in place to avoid inappropriately increasing costs to federal healthcare programs. The only cost that could be billed to a federal healthcare program is the administration fee for the infusion, and only where Medicare could have otherwise been billed for the product. In addition, the requestor intends to offer the assistance program indefinitely to patients who continue to meet the eligibility criteria, even if Medicare were to cover the product in the future without the current limitations, so no product will be billed to Medicare for patients who attest that they cannot afford the cost-sharing amounts of the product.
There is a low risk that the program will interfere with clinical decision-making. The treating physician is not permitted to submit a request for payment of the free product to any payor, including but not limited to any federal healthcare program. Although the administering provider may charge the administration fee for patients where Medicare would otherwise reimburse for the product and there is a cost-sharing component for patients, there is a low risk that the administration fee would induct treating physicians to select the product over another product.
The program does not steer patients to a particular provider, practitioner, or insurance plan. Patients are free to change their treating physician or infusion provider at any time without impacting their eligibility for free product.
Ultimately, the HHS-OIG found that the arrangement poses low risk of fraud and abuse due to the safeguards, and the patient eligibility criteria.
Key Takeaways
This advisory opinion may be of significant interest to drug manufacturers of new pharmaceutical products. Notably, the HHS-OIG identified the risk that the arrangement could serve as a problematic “seeding” program for the product but determined it would not impose sanctions in part because there is no barrier to the patient switching to competing products and that eligibility for the free product is not contingent on past, present, or future purchases of the product.
McDermott+ Check-Up: March 21, 2025
THIS WEEK’S DOSE
Government Is Funded, Congress at Home for the Week. The continuing resolution signed by President Trump last Saturday funds the government through the rest of the fiscal year.
Senate Finance Committee Holds CMS Administrator Nomination Hearing. Centers for Medicare & Medicaid Services (CMS) administrator nominee Mehmet Oz, MD, testified.
President Trump Issues EO on Domestic Preparedness. Implementation of this executive order (EO) will likely have implications for drug supply chains and pandemic preparedness.
CONGRESS
Government Is Funded, Congress at Home for the Week. On March 15, 2025, President Trump signed a continuing resolution (CR) into law that funds the government and provides short-term extensions of certain healthcare programs and provisions, including Medicare telehealth flexibilities and community health center funding, through September 30, 2025, the end of the fiscal year. The CR did not include a Medicare physician payment fix. Instead, Republican leadership committed to include a fix in the upcoming budget reconciliation bill to secure votes from the GOP Doctors Caucus. Given the timeline of a potential reconciliation bill, it is uncertain whether Congress will consider any mitigation to the 2025 Medicare physician payment cut that is currently in effect. The House passed the CR mostly along party lines in a 217 – 213 vote. In the Senate, after much internal debate, 10 Democrats joined all but one Republican in a 62 – 38 vote to advance the CR to a final vote, ultimately allowing Republicans to pass it with a simple majority. Congress then went home for a recess week. Both the House and Senate return on March 24, 2025, for a three-week stint until they hit a two-week April recess around the Easter and Passover holidays.
Senate Finance Committee Holds CMS Administrator Nomination Hearing. In the hearing on March 14, 2025, members from both parties discussed concerns about access to care in rural areas as well as high prior authorization and upcoding usage by Medicare Advantage (MA) insurers. Mehmet Oz, MD, agreed with members and stated that he would seek to address upcoding in MA as CMS administrator – which is notable in light of his previous outspoken endorsements of the program. Republicans focused on the insights Oz can bring to CMS as a physician, while Democrats pressed to see if Oz supports reforming or cutting Medicaid, including through work requirements.
ADMINISTRATION
President Trump Issues EO on Domestic Preparedness. The “Achieving Efficiency Through State and Local Preparedness” EO seeks to expand the role of states and localities in preparedness, which will likely have impacts on drug supply chain issues and future pandemic response. The EO directs the Assistant to the President for National Security Affairs, in coordination with other relevant agencies, to:
Publish a national resilience strategy within 90 days
Review critical infrastructure policies, including the following EOs, and recommend a risk-informed approach within 180 days:
EO 14017, “America’s Supply Chains”
EO 14123, “White House Council on Supply Chain Resilience”
Review all national continuity policies, including the following, and recommend options to modernize and streamline the current approach within 180 days:
National Security Memorandum 32, National Continuity Policy
Review the findings of the Federal Emergency Management Agency Council and provide recommendations to edit policies, including the following, to reformulate the process and metrics for federal responsibility within 240 days:
Presidential Policy Directive 8, National Preparedness
Create a National Risk Register within 240 days
The EO also directs the secretary of homeland security to propose policy changes to improve federal-state communication. A fact sheet can be found here.
QUICK HITS
House Democrats Launch Congressional Doctors Caucus. The Congressional Doctors Caucus will work to advance “pragmatic healthcare policy.” This caucus joins the long-established and larger GOP Doctors Caucus in the House. The new Democratic caucus comprises:
Ami Bera, MD (CA) – internal medicine
Herb Conaway, Jr., MD (NJ) – internal medicine
Maxine Dexter, MD (OR) – pulmonary and critical care
Kelly Morrison, MD (MN) – obstetrics and gynecology
Raul Ruiz, MD (CA) – emergency medicine
Kim Schrier, MD (WA) – pediatrics
CMS Announces Manufacturer Participation in Current Round of Medicare Drug Price Negotiation. CMS stated that agreements have been signed with the manufacturers of the 15 drugs chosen for participation in the second cycle of Medicare drug negotiations.
FDA Study Shows Impact of E-Cigarette Prevention Campaign. The US Food and Drug Administration (FDA) study found that “The Real Cost” campaign successfully prevented 450,000 new youth e-cigarette users between 2023 and 2024. Read the press release here.
HHS Renews Opioid Crisis PHE Declaration. US Department of Health & Human Services (HHS) Secretary Kennedy renewed the opioid crisis public health emergency (PHE) declaration for another 90 days. The PHE was set to expire on March 21, 2025, and allows more federal coordination efforts and flexibilities.
HHS, FDA Announce Operation Stork Speed. This initiative seeks to address the safety, reliability, and nutrition of infant formula by starting the statutorily required nutrient review, increasing testing for heavy metals, and extending the personal importation policy. HHS Secretary Kennedy was outspoken in support of these steps.
OCR Takes Action Against Maine for Alleged Title IX Violation. Following an investigation, the HHS Office for Civil Rights (OCR) stated that Maine’s Department of Education and other entities in the state are in violation of President Trump’s “Keeping Men out of Women’s Sports” EO because they allegedly allowed transgender female students to play in women’s sports. OCR’s letter to the entities requires them to voluntarily commit to resolve the matter within 10 days or risk referral to the US Department of Justice. Read the press release here.
FTC Requests Stay of Noncompete Rule, Citing New Administration. The Federal Trade Commission (FTC) filed motions requesting a 120-day stay of the agency’s appeal of district court decisions blocking the Biden-era FTC proposed ban on noncompete agreements. This is a signal that FTC’s new leadership is rethinking the agency’s defense of the proposed rule. FTC Chairman Ferguson also released a memo creating the Joint Labor Task Force, which will evaluate policy options related to noncompete agreements.
NEXT WEEK’S DIAGNOSIS
Congress will return to session on Monday to continue work on budget reconciliation. While each body has passed a budget resolution, they must now agree to and pass a unified budget resolution through both bodies in order for reconciliation to proceed. The House Veterans’ Affairs Health Subcommittee will hold a hearing on healthcare access and a markup of several healthcare-related bills, and the House Energy and Commerce Subcommittee on Commerce, Manufacturing, and Trade will hold a hearing on online safety. On the regulatory side, we await the release of the inpatient prospective payment system proposed rule.
Federal Circuit Confirms Calculation of PTE for Reissue Patents Under Regulatory Review
Highlights
Calculation of patent term extension for drug products under regulatory review is based on the issue date of the original patent, not the reissue patent (if there is one), a recent court ruling said
Calculation of PTE based on the original patent’s issue date is consistent with purpose and legislative intent of Hatch Waxman Act, which is to compensate for patent exclusivity lost while patented drug products are under regulatory review
Cancellation of claims covering drug products under regulatory review in a reissue patent will result in forfeiture of any patent term extension
In Merck Sharp & Dohme B.V. et al. v. Aurobindo Pharma USA, Inc. et al, the U.S. Court of Appeals for the Federal Circuit addressed the narrow question of whether patent term extensions (PTE) for patents covering drug products that are under regulatory review pursuant to 35 U.S.C. § 156(c) is based on the issue date of the original patent or the reissue patent. The Federal Circuit sided with the district court and the patent owner, Merck, finding that the term “patent,” as used in Section § 156(c), refers to the original patent and not the reissued patent. As a result, patent term extension (PTE) is calculated based on the issue date of the original patent.
Merck’s ʼ340 patent covering sugammadex, the active ingredient in BRIDION®, was issued on Dec. 30, 2003. Merck applied for a reissue patent while sugammadex was under regulatory review, adding 12 narrower claims. The reissue patent was issued as the REʼ733 patent on Jan. 28, 2014, and sugammadex was approved by the Food and Drug Administration (FDA) on Dec. 15, 2015. The U.S. Patent and Trademark Office (PTO) granted Merck’s request for a five-year patent term extension—the maximum allowed under Section 156(c)—based on the ʼ340 patent’s original issue date.
Aurobindo, which submitted an Abbreviated New Drug Application for sugammadex, argued that the PTO should have calculated Merck’s PTE based on the issue date of Merck’s reissue patent and not the original patent (in which case Merck would only have been entitled to 686 days of PTE and not the full five years), because the original patent is “dead” upon reissue. The Federal Circuit flatly rejected this argument, relying heavily on the purpose and legislative intent underlying the Hatch Waxman Act, which was “to compensate pharmaceutical companies for the effective truncation of their patent terms while waiting for regulatory approval of new drug applications.”
Adopting Aurobindo’s argument, the court said, would eviscerate this purpose and compensate patent owners for only a small period of delay caused by FDA review. The Federal Circuit emphasized that Merck was entitled to the full PTE based on the original patent’s issue date because the reissue patent included all of the original claims of the ʼ340 patent that was subject to FDA review.
Takeaways
Because the Federal Circuit’s decision only applies to reissue patents with the same claims as the original patent, patent owners with drug products under regulatory review should think twice before canceling claims in a reissue application, as doing so will result in forfeiture of PTE if the canceled claims cover the drug product that is under review. However, the Federal Circuit did not address how PTE should be calculated when a reissue patent significantly modifies the scope of the original claims but does not cancel them, which remains an open question.
FDA’s Semaglutide Shortage Resolution: Legal Implications and Risks for Compounding Pharmacies
Last month, the U.S. Food and Drug Administration (the “FDA”) announced in a Declaratory Order the resolution of the shortage of semaglutide injection products Wegovy and Ozempic (the “February Declaratory Order”). On March 10th, the FDA issued guidance clarifying that 503A and 503B drug compounders must soon cease compounding semaglutide injection products[i] or risk enforcement action.[ii] This has a significant impact on compounding pharmacies as, under the Federal Food, Drug, and Cosmetic Act (the “FD&C”), drug compounders are permitted to compound their own copies of a patented drug if the FDA determines it is in shortage. Due to high demand for the drugs, Wegovy was added to the FDA’s drug shortage list in March 2022, and Ozempic in August 2022.[iii] Wegovy and Ozempic are the only FDA-approved semaglutide injection products.[iv]
Legal Challenges and Practical Impacts of the FDA’s Declaratory Order
After the February Declaratory Order was issued, the Outsourcing Facilities Association (the “OFA”) promptly filed a lawsuit against the FDA over its decision and a motion for a preliminary injunction to prevent the FDA from removing semaglutide from the drug shortage list.[v] U.S. District Court Judge Mark Pittman, who is hearing the case in a federal court in Texas, accepted Novo Nordisk’s renewed motion to intervene in the case to support its claim that the company can meet the high demand for its products.[vi]
In light of the OFA’s lawsuit, the FDA issued clarifying guidance on when compounders must cease compounding semaglutide. For compounders that have relied on the drug shortage to compound semaglutide, the FDA indicated that it will delay any enforcement action until the following dates, in order to avoid unnecessary disruption to patient treatment:
For state-licensed pharmacists or physicians compounding under Section 503A of the FD&C: April 22, 2025, or until the District Court issues a decision on the OFA’s preliminary injunction motion, whichever is later; and
For outsourcing facilities compounding under Section 503B of the FD&C: May 22, 2025, or until the District Court issues a decision on the OFA’s preliminary injunction motion, whichever is later.
The FDA noted that this delay in enforcement will allow patients a reasonable amount of time to transfer their prescriptions to different pharmacies to obtain the FDA-approved drug as well as to allow local pharmacies to adjust their stocking and ordering patterns to account for shifts in patient demand.
Bases for the FDA’s Decision
The FDA is required to “maintain an up-to-date list of drugs that are determined by [the FDA] to be in shortage in the United States”[vii] with a “shortage” being “a period of time when the demand or projected demand for the drug within the United Sates exceeds the supply of the drug.”[viii] To reach its decision, the FDA noted its consideration of information from numerous stakeholders, including individuals, telehealth companies, pharmacy compounders, associations representing pharmacy compounders, outsourcing facilities, and Novo Nordisk, the manufacturer of Wegovy and Ozempic. Novo Nordisk provided the FDA with information related to its production and inventory of the drugs, including quantities supplied and demanded, projected supply and demand in future months, and wholesaler inventory data. The FDA concluded that Novo Nordisk successfully demonstrated that its supply currently meets or exceeds the demand for its semaglutide injection products, and Novo Nordisk has developed sufficient reserves such that supply will meet or exceed projected future demands. The decision memorandum “Resolution of Semaglutide Injection Product Shortage and Supply Status”, dated February 21, 2025, sets forth the FDA’s full legal analysis upon which the February Declaratory Order is based.[ix]
The FDA acknowledged that it has received reports that some patients and pharmacists are not able to obtain the semaglutide injection products through the normal supply chain. However, the FDA reasoned these instances of inaccessibility are likely caused “by the practical dynamics of the part of the supply chain between Novo Nordisk and [its] customers, including wholesale distributors and pharmacies” rather than by a national shortage of supply.[x]
What’s Next for Compounders of Semaglutide?
While the OFA’s lawsuit and request for a preliminary injunction has yet to be decided, recent similar lawsuits inform the probable outcome. Specifically, the OFA previously filed a lawsuit against the FDA in October regarding the removal of tirzepatide from the shortage list. The OFA’s October suit delayed enforcement for a few months while the FDA reconsidered its decision, but on March 5th, the court upheld the FDA’s determination that the tirzepatide shortage had ended.[xi] While it is possible that the OFA’s suit challenging the February Declaratory Order could end differently, it is likely to have a similar outcome as the OFA’s challenge of tirzepatide’s removal from the shortage list. That is, enforcement may be delayed slightly, but the FDA will likely affirm its declaration that the semaglutide shortage is over.
It is expected that some compounding pharmacies, despite the February Declaratory Order, may continue to compound modified versions, such as in alternative doses or by adding additional ingredients, taking the position that it is different than the patented versions of semaglutide. However, this is a complex area of law currently being litigated with respect to tirzepatide. In addition, drug manufacturers have been actively issuing cease and desist letters and filing lawsuits against compounding pharmacies that produce tirzepatide. It is reasonable compounders of semaglutide will be met with similar action if they continue to compound modified versions of semaglutide after April 22nd or May 22nd, as applicable. As such, any compounding of drugs not on the shortage list, including semaglutide injection products, should be approached with caution given the current legal and regulatory landscape.
FOOTNOTES
[i] Rybelsus (semaglutide) tablets are FDA-approved for oral use and were not in shortage. The FDA’s February Declaratory order specifically addresses the compounding of semaglutide injection products that are “essentially a copy of a commercially available drug product” on the basis of the drug shortage exception.
[ii] U.S. Food and Drug Administration, Declaratory Order: Resolution of Shortages of Semaglutide Injection Products (Ozempic and Wegovy) (Feb. 21, 2025) [hereinafter “February Declaratory Order”].
[iii] February Declaratory Order, page 1.
[iv] February Declaratory Order, page 4.
[v] Outsourcing Facilities Ass’n v. United States Food & Drug Admin., 4:25-cv-174 (N.D. Tex. Feb. 24, 2025).
[vi] Kevin Dunleavy, In FDA obesity drug battle with compounders, Texas court allows Novo Nordisk to weigh in, Fierce Pharma (Mar. 6, 2025, 8:45 AM).e
[vii] February Declaratory Order, page 3 (citing Federal Food, Drug, and Cosmetic Act § 506E(a)).
[viii] February Declaratory Order, page 3 (citing Federal Food, Drug, and Cosmetic Act § 506C(h)(2); 21 C.F.R. 314.81(b)(3)(iii)(f)).
[ix] February Declaratory Order, page 1.
[x] February Declaratory Order, page 2.
[xi] Outsourcing Facilities Ass’n v. United States Food & Drug Admin., 4:24-cv-0953-P (N.D. Tex. Mar. 5, 2025).
Listen to this article
President Trump Revokes 2022 EO on Advancing Biotechnology and Biomanufacturing
On March 14, 2025, President Trump signed Executive Order (EO) 14236, rescinding 19 executive actions, including former President Biden’s September 2022 EO 14081, “Advancing Biotechnology and Biomanufacturing Innovation for a Sustainable, Safe, and Secure American Bioeconomy.” 90 Fed. Reg. 13037. According to the White House’s March 14, 2025, fact sheet, EO 14081 “funneled Federal resources into radical biotech and biomanufacturing initiatives under the guise of environmental policy.” As reported in our September 13, 2022, blog item, Biden’s EO created a National Biotechnology and Biomanufacturing Initiative to accelerate biotechnology innovation and grow America’s bioeconomy across multiple sectors in industries such as health, agriculture, and energy. EO 14081 called for the Secretary of Agriculture, the Administrator of the U.S. Environmental Protection Agency (EPA), and the Commissioner of Food and Drugs to identify areas of ambiguity, gaps, or uncertainties in the January 2017 Update to the Coordinated Framework for the Regulation of Biotechnology or in the policy changes made pursuant to the June 2019 EO 13874, “Modernizing the Regulatory Framework for Agricultural Biotechnology Products.” To update the Coordinated Framework, the U.S. Department of Agriculture (USDA), EPA, and the U.S. Food and Drug Administration (FDA) prepared The Coordinated Framework for the Regulation of Biotechnology: Plan for Regulatory Reform under the Coordinated Framework for the Regulation of Biotechnology, an ambitious plan to update, streamline, and clarify their regulations and oversight mechanisms for products of biotechnology. While the USDA, EPA, and FDA intended to release an updated Coordinated Framework in December 2024, the agencies did not do so. More information on the 2017 Update to the Coordinated Framework is available in our January 9, 2017, memorandum. More information on the 2024 Plan for Regulatory Reform is available in our May 16, 2024, memorandum.
Maine Considers Bill to Establish Maximum Levels of PFAS in Farm Products
If passed, Maine’s SB130, titled An Act to Establish the PFAS Response Program and to Modify the Fund To Address PFAS Contamination, would be the first state law to establish PFAS limits in food (PFAS limits have been established for other categories of goods).
The bill would formally establish a PFAS response program to “respond to and address PFAS contamination affecting agricultural producers in the State, to assist commercial farms affected by PFAS contamination and to safeguard public health.” We note that the bill would in part codify existing portions of Maine’s PFAS response program, which has already set an action level for PFOS (a type of PFAS) in milk of 210 ppt.
Specifically, under the proposed bill, the PFAS response program would, among other things:
Establish maximum levels for PFAS in farm products (defined as “plants and animals useful to humans” and includes, by way of example, products ranging from grains and food crops to Christmas trees).
Provide PFAS testing support to help agricultural producers understand the extend of PFAS contamination and provide technical support to assist in mitigation efforts.
Provide financial assistance to PFAS-impacted agricultural producers.
Establish baseline criteria that agricultural producers would have to adhere to in order to receive technical and financial assistance, including granting property access to conduct PFAS investigations and providing relevant information to program staff.
We will continue to monitor and report on PFAS regulation.
RFK Jr. Pushes to Ban Synthetic Dyes in Food
On March 10, 2025, the Secretary of the Department of Health and Human Services (HHS), Robert F. Kennedy Jr., met with executives at major companies across the food and beverage industry, including PepsiCo, General Mills, and others. He informed industry leaders that eliminating artificial dyes is going to be a top priority for the Secretary. Kennedy also expressed his desire to collaborate with industry but made it clear that he intends to act unless the industry proactively offers solutions.
The movement to ban synthetic dyes has recently gained momentum, with California and FDA banning FD&C Red No. 3 as we previously blogged, as well and several states moving to ban foods that contain artificial dyes from school lunches.
The public discussion regarding food colors has grossly misstated differences in the regulation of synthetic dyes in food, with critiques often pointing to the EU or Canadian markets as examples of regions that are more restrictive with food color regulation.
However – there are current 15 synthetic dyes approved in the European Union, 10 in Canada, and only 9 approved in the U.S.
Additionally, all food colors in the U.S. must submit a Color Additive Petition to FDA.
While the EU and Canada have premarket requirements for many food colors, naturally derived concentrates and extracts in many cases are exempt from mandatory pre-market review in Canada.
In the EU, ingredients that are derived from edible sources and are used because of their coloring properties are defined as “coloring foods,” which are not subject to a European Food Safety Authority (EFSA) evaluation prior to use and are not assigned an E number.
Keller and Heckman will continue to monitor the development of the new administration’s policy priorities and actions related to synthetic dyes and other food additives.
FDA Completes Pre-Market Consultation for Food Made With Cultured Pork Fat Cells
On March 7, 2025, FDA announced that is has no questions regarding a human food product made from cultured pork fat cells, finding that the defined production process results in a product that is as safe as comparable foods produced by other methods. The cultured cells are produced in a controlled environment using belly fat cells from domestic Yorkshire pigs to create cultured pork fat.
In addition to a pre-market consultation, FDA has inspected the facility where pork fat cells are cultured and grown and intends to conduct additional inspections after commercial production begins and on an ongoing basis. Before the product can be marketed for use in food, it must also meet USDA regulations as outlined in the joint agreement between USDA and FDA establishing the agencies’ shared oversight of food made with cultured animal cells.
FDA’s pre-market consultation process for food made with cultured animal cells allows developers to work with the Agency on a case-by-case basis to ensure they are producing food that does not violate the Federal Food, Drug, and Cosmetic Act. During the process, FDA evaluates the production process and resulting cell material, including the establishment of cell lines and cell banks, manufacturing controls, and reviews all components and inputs.
This is the third product made using cultured animal cells for which FDA has concluded it has no questions regarding the safety, following the first for a product made from cultured chicken cells in 2022. Keller and Heckman will continue to provide updates on the development of cell cultured meat products.
GT Legal Food Talk Episode 27: From Slam Dunks and Big Tech to Launching New Brands: Alan and Maxine Henderson’s Journey into Food & Beverage Entrepreneurship [Podcast]
In this episode of Greenberg Traurig Legal Food Talk, host Justin Prochnow sits down with Alan and Maxine Henderson, a dynamic husband-and-wife duo in the food and beverage industry. Alan, a former college basketball and NBA star and more recent spirits entrepreneur, and Maxine, a former electrical engineer turned beverage innovator, share their unique paths to launching their respective brands, Henderson Spirits Group and Bollygood.
Maxine brings the flavors of India to her beverage with Bollygood, the first Indian-inspired sparkling lemonade, rooted in her family’s recipe for Nimbu Pani. Alan crafts spirits that honor African American history under brands like Tom Bullock’s and Birdie Brown. They discuss the challenges of entrepreneurship, the lessons learned, and how their backgrounds in sports and engineering have shaped their approach to business.
Whether you’re a budding entrepreneur or a fan of innovative products, this episode offers valuable insights and inspiration. Tune in!
California Delays Extended Producer Responsibility Regulations for Plastic and Packaging: Three Takeaways
Earlier this month, California Governor Gavin Newsom directed the state’s recycling agency, CalRecycle, to restart the process of issuing regulations for California’s landmark plastic and packaging extended producer responsibility (EPR) law.
Over the past year, CalRecycle has been working to finalize implementing regulations by March 7. Facing a one-year deadline to finalize the regulations, Governor Newsom asked them to start again.
CalRecycle will now issue a new administrative rulemaking notice and reopen draft regulations for public comment. The agency is expected to revise its proposed rules due to Governor Newsom’s concern over the cost of the initial draft regulations, estimated at $36 billion over 10 years.
As this development with California’s EPR legislation shows, EPR programs for plastic and packaging are still evolving. Even before Governor Newsom’s decision, CalRecycle had revised its draft regulations twice in response to public feedback. We have previously covered trends in plastic regulation at state, national and global levels here and here, as well as California’s first-in-the-nation producer responsibility law for textiles here.
An overview of California’s plastic and packaging EPR law and key takeaways for impacted businesses follow below.
California’s EPR Landscape
In 2022, California enacted the Plastic Pollution Prevention and Packaging Producer Responsibility Act (SB 54), setting ambitious goals for reducing and recycling plastic. By 2032, the law requires:
A 25% reduction in single-use plastic packaging and food ware.
65% of single-use plastic packaging and food ware to be recycled.
100% of single-use packaging and plastic food ware to be recyclable.
The law also sets interim recycling targets, requiring 30% plastic packaging and food ware recycling by 2028, and 40% Fby 2030.
The law requires “producers” of “covered material” to join a producer responsibility organization (PRO), a nonprofit organization formed by producers. The PRO works with CalRecycle and producers to build and operate source reduction and recycling programs.
“Covered material” includes single-use packaging and plastic food service ware, such as plates and utensils. The “producer” is typically a California-located entity that owns or licenses the brand under which the covered product is sold. If there is no California-located entity, the distributor into California is considered the “producer.”
The PRO’s responsibilities include submitting a program plan for CalRecycle’s approval, detailing how it will meet the law’s targets. For example, the plan may involve creating recycling programs, like curbside or drop-off collection, or improving sorting processes. To fund these efforts, the PRO will assess fees on producers. It will also collect funds for California’s Plastic Pollution Mitigation Fund. From 2027-2037, the PRO must deposit $500 million annually into the fund. CalRecycle has named the Circular Action Alliance as the PRO.
Takeaways
There are three key takeaway points from the regulated community:
EPR Programs Are Evolving: Although some EPR laws have existed for decades, producer responsibility for many products is new. Recent years have seen state EPR laws for batteries, pharmaceutical drugs, tires, and household items such as mattresses, textiles, paint, and carpets. We expect more regulatory developments over the next several years, as states refine these laws and their implementing regulations.
Impacted Businesses Have Another Chance to Comment: By restarting the regulatory process, businesses have another opportunity to comment on the proposed regulations. California law requires at least 45 days for public comment on new proposals.
Potential Changes in Regulation: Over the past year, CalRecycle considered whether to include plastic-coated paper items in its source reduction and recycling rate targets. CalRecycle decided to include these items (composed mostly of paper and less than 20% plastic) because it believed that option better served the law’s goals. However, given Governor Newsom’s concern about program cost, CalRecycle may decide to exclude these items from some recycling targets.
Listen to this article
This Week in 340B: March 11 – 17, 2025
Find this week’s updates on 340B litigation to help you stay in the know on how 340B cases are developing across the country. Each week we comb through the dockets of more than 50 340B cases to provide you with a quick summary of relevant updates from the prior week in this industry-shaping body of litigation.
Issues at Stake: Rebate Model; Contract Pharmacy; Other
In three appealed cases challenging a proposed Louisiana law governing contract pharmacy arrangements, the appellee filed a motion to consolidate.
In a case challenging the US Department of Health and Human Services (HHS) and the Health Resources and Services Administration (HRSA’s) decision to prevent drug manufacturers from unilaterally implementing rebate models, defendants filed a cross motion for summary judgment and opposition to the plaintiff’s motion for summary judgment.
In a case challenging HRSA’s policy limiting the circumstances in which covered entities can use their group purchasing arrangements to purchase non-340B drugs, the plaintiff filed a motion for summary judgment.
In three cases challenging a proposed state law governing contract pharmacy arrangements in Missouri, defendants and intervenors in each case filed answers to amended complaints.
In four cases against HRSA alleging that HRSA unlawfully refused to approve drug manufacturers’ proposed rebate models:
In three cases, the defendants filed a cross motion for summary judgment and opposition to the plaintiff’s motion for summary judgment.
In one case, the plaintiffs filed a motion to strike portions of an amicus brief, and the amici filed a response.
Nadine Tejadilla contributed to this article.