(complimentary Newsletter from Target Health Inc.)

Saturday,December 13, 1997

HAPPY HOLIDAY FROM ALL OF US AT TARGET HEALTH.

We would like to welcome our colleague Woody Umanoff (Beacon Laboratories) to our e-mail list.Please forward ON TARGET to your friends and colleagues so that they may be added to our unique and proprietary e-mail list.

One of the goals of traditional Chinese medicine is not so much to treat diseases, but to put one's
body in harmony; disharmony can be one of the causative factors of disease. In Western Medicine, we
talk of homeostasis and metabolism, perhaps similar to the Eastern concept of harmony. The
interesting question then is, what are the important differences of the two approaches and how should
they be addressed?

As previously reported in ON TARGET, the National Institutes of Health has created an office of
alternative medicine, which is evaluating non-traditional therapies to treat and diagnose either disease
or perhaps even one's health's status. One study currently being funded by NIH is the effects of
magnets for pain management. A report published last month in Archives of Physical and
Rehabilitation Medicine evaluated the effects of low-intensity magnets in patients with post-polio
pain. This pain can develop years after polio. If magnet therapy is found to be safe and effective, it
could relieve pain with hopefully fewer drugs and side effects. This statement is quite similar to the
conclusions of the NIH Consensus Report on Acupuncture which is a available from TARGET
HEALTH INC. upon request. Nevertheless, the FDA has warned doctors and manufacturers about
health claims for magnets.

To properly blind the clinical trial, Magnaflex Inc., a magnet manufacturer in Corpus Christi, Texas,
prepared active and inactive magnets and blindly labeled them. After receiving IRB approval, (FDA
approval is not required for non-significant risk devices, a similar rule which should be available for
drugs), 50 volunteers were treated with magnets of 300 to 500 gauss, which are slightly stronger than
refrigerator magnets. The magnets were made in different sizes so they could fit over areas of
different sizes. Before and after treatment, the subjects graded their pain on a scale of 0 (none) to 10
(worse). The 29 who received an active magnet reported a reduction in pain to from 9.6 to 4.4 while
the placebo group declined from 9.5 to 8.4.

TARGET HEALTH is currently actively involved in several projects in "Alternative Medicine" and
looks forward to working both with the Sponsor, NIH and FDA (when appropriate) to properly design
trials to evaluate methods under controlled conditions. One of the key issues is the definition of end
points and whether "disease" endpoints are necessarily appropriate for all studies. Our CEO Joyce
Hays is looking into Chinese acupuncture and herbal remedies. The NIH report which authenticates
acupuncture, names three types; Chinese, Japanese and French.

Lyme disease, which is particularly prevalent in New York State and New England, is spread by a tick
that feeds on such animals as mice, deer, dogs and humans. Though the disease is easily treated if
antibiotics are given promptly, it can cause serious symptoms if unrecognized. A vaccine is now
undergoing clinical trials, but no accurate diagnostic test is available. TARGET HEALTH is pleased to
announce that a protocol to evaluate a new diagnostic for Borrelia burgdorferi, the bacterium that
causes Lyme disease, has just been completed and clinical trials should be underway shortly.

On the scientific front, a report on the decoding of the entire DNA of sequence of Borrelia
burgdorferi has just been published in the journal Nature. The genome of the Borrelia burgdorferi
consists of approximately 1,444,000 base pairs of DNA. Most bacteria have genomes in the form of a
single circular chromosome; Borrelia's is very unusual because it has a single linear chromosome and
numerous small strips of DNA known as plasmids. Exchange of plasmids is the usual way by which
bacteria transfer antibiotic resistance genes among each other.

Borrelia seems to have most of its basic housekeeping genes lined up on its main chromosome, while
the plasmids carry numerous genes for making lipoproteins, substances that form the bacterium's
coat. By rapidly switching between its repertoire of lipoprotein genes, Borrelia burgdorferi is able to
change its coat and develop resistance.

The FDA approved a genetically engineered drug for the prevention of acute organ rejection in
patients receiving kidney transplants. The FDA said the drug helped prevent organ rejection with fewer
side effects than other therapies. The drug, Zenapax, was developed by PROTEIN DESIGN LABS
INC., Mountain View, Calif., and will be marketed worldwide by HOFFMANN-LA ROCHE INC.
Although initially approved for kidney transplants, Zenapax will probably be used with other organs as
well, including heart, liver and lung. TARGET HEALTH is looking forward to working with one of its
clients in a very exciting program in the area of heart transplantation. An IDE is currently being
prepared.

Zenapax is of the class of drugs called monoclonal antibodies, which are genetically engineered
copies of immune system proteins, typically produced in mice. Zenapax differs from previous
monoclonals in that more than 90 percent of its amino acid sequence is human, thus avoiding the
allergic response to the mouse molecule that has limited use of previous monoclonals. The advantage
of monoclonal antibody drugs is that they can be extremely selective, binding with specific targets
while not affecting healthy cells. Zenapax works by binding with a receptor for the protein interleukin
2, which is found only on the surface of activated T cells. Traditional immunosuppressant drugs
destroy T cells indiscriminately, leaving the body vulnerable to infectious diseases and cancers.

The FDA based its approval of Zenapax on studies of 260 patients that showed that only 22 percent of
patients taking the drug showed signs of kidney rejection, compared with 35 percent of patients who
did not receive Zenapax. The patients all received other standard immunosuppressant therapies,
including cyclosporine, the most commonly used drug in transplant therapy.

1. Prescription Drug User Fees
2. FDA Initiatives and Programs
3. Information on Off-label Use and Drug Economics
4. Pharmacy Compounding
5. Risk-based Regulation of Medical Devices
6. Food Safety and Labeling
7. Standards for Medical Products

Drug and Device Regulatory Affairs is one of TARGET HEALTH's areas of expertise. As part of our
commitment to provide continuing education in this most important area, the following summarizes
the most important provisions of the FDA Moderernization Act:

The FDA Modernization Act of 1997 is a major legislation focused on reforming the regulation of
food, medical products, and cosmetics.

1. Prescription Drug User Fees

The act reauthorizes, for five more years, the Prescription Drug User Fee Act of 1992 (PDUFA). In
the past five years, the program has enabled the agency to reduce to 15 months the 30-month average
time that used to be required for a drug review before PDUFA. This accomplishment was made
possible by FDA managerial reforms and the addition of 696 employees to the agency's drugs and
biologics program, which was financed by $329 million in user fees from the pharmaceutical
industry.

2. FDA Initiatives and Programs

The law enacts many FDA initiatives undertaken in recent years under Vice President Al Gore's
Reinventing Government program. The codified initiatives include measures to modernize the
regulation of biological products by bringing them in harmony with the regulations for drugs and
eliminating the need for establishment license application; eliminate the batch certification and
monograph requirements for insulin and antibiotics; streamline the approval processes for drug and
biological manufacturing changes; and reduce the need for environmental assessment as part of a
product application. The act also codifies FDA's regulations and practice to increase patient access to
experimental drugs and medical devices and to accelerate review of important new medications. In
addition, the law provides for an expanded database on clinical trials which will be accessible by
patients. With the sponsor's consent, the results of such clinical trials will be included in the database.
Under a separate provision, patients will receive advance notice when a manufacturer plans to
discontinue a drug on which they depend for life support or sustenance, or for a treatment of a serious
or debilitating disease or condition.

3. Information on Off-label Use and Drug Economics

The law abolishes the long-standing prohibition on dissemination by manufacturers of information
about unapproved uses of drugs and medical devices. The act allows a firm to disseminate
peer-reviewed journal articles about an off-label indication of its product, provided the company
commits itself to file, within a specified time frame, a supplemental application based on appropriate
research to establish the safety and effectiveness of the unapproved use. The act also allows drug
companies to provide economic information about their products to formulary committees, managed
care organizations, and similar large-scale buyers of health-care products. The provision is intended
to provide such entities with dependable facts about the economic consequences of their procurement
decisions. The law, however, does not permit the dissemination of economic information that could
affect prescribing choices to individual medical practitioners.

4. Pharmacy Compounding

The act creates a special exemption to ensure continued availability of compounded drug products
prepared by pharmacists to provide patients with individualized therapies not available commercially.
The law, however, seeks to prevent manufacturing under the guise of compounding by establishing
parameters within which the practice is appropriate and lawful.

5. Risk-based Regulation of Medical Devices

The act complements and builds on FDA's recent measures to focus its resources on medical devices
that present the greatest risks to patients. For example, the law exempts from premarket notification
class I devices that are not intended for a use that is of substantial importance in preventing
impairment of human health, or that do not present a potential unreasonable risk of illness or injury.
The law also directs FDA to focus its postmarket surveillance on higher risk devices, and allows the
agency to implement a reporting system that concentrates on a representative sample of user facilities
-- such as hospitals and nursing homes -- that experience deaths and serious illnesses or injuries
linked with the use of devices. Finally, the law expands an ongoing pilot program under which FDA
accredits outside -- so-called "third party" -- experts to conduct the initial review of all class I and
low-to-intermediate risk class II devices. The act, however, specifies that an accredited person may
not review devices that are permanently implantable, life-supporting, life-sustaining, or for which
clinical data are required.

6. Food Safety and Labeling

The act eliminates the requirement of FDA's premarket approval for most packaging and other
substances that come in contact with food and may migrate into it. Instead, the law establishes a
process whereby the manufacturer can notify the agency about its intent to use certain food contact
substances and, unless FDA objects within 120 days, may proceed with the marketing of the new
product. Implementation of the notification process is contingent on additional appropriations to
cover its cost to the agency. The act also expands procedures under which FDA can authorize health
claims and nutrient content claims without reducing the statutory standard.

7. Standards for Medical Products

While the act reduces or simplifies many regulatory obligations of manufacturers, it does not lower
the standards by which medical products are introduced into the market place. In the area of drugs, the
law codifies the agency's current practice of allowing in certain circumstances one clinical
investigation as the basis for product approval. The act, however, does preserve the presumption that,
as a general rule, two adequate and well- controlled studies are needed to prove the product's safety
and effectiveness. In the area of medical devices, the act specifies that FDA may keep out of the
market products whose manufacturing processes are so deficient that they could present a serious
health hazard. The law also gives the agency authority to take appropriate action if the technology of a
device suggests that it is likely to be used for a potentially harmful unlabeled use.

TARGET HEALTH INC. is a full service CRO with staff dedicated to all aspects of Regulatory Affairs, Clinical Research, Biostatistics, Data Management, Strategic Planning and Drug and Device Development. TARGET HEALTH INC. also has a group of specialized advisors in the areas of Toxicology, Analytical Methods Validation, Product and Process Development, Quality Assurance, Manufacturing and Animal Health.

BACK TO TOP

TARGET HEALTH INC.
310 Madison Avenue, 22nd Floor, New York, NY 10017
Phone (212) 681-2100 - Fax (212) 682-0151

JulesMitchel@targethealth.com (Dr. Jules T. Mitchel, President)
JoyceHays@targethealth.com (Ms. Joyce Hays, CEO)